[G.R. No. 127374.

January 31, 2002] occupying their positions as elected officers in the newly-forged
PSEA-NCW.
PHILIPPINE SKYLANDERS, INC., MARILES C. ROMULO
and FRANCISCO DAKILA, petitioners, vs. NATIONAL On 17 March 1994 PSEA-NCW entered into a collective
LABOR RELATIONS COMMISSION, LABOR ARBITER bargaining agreement with PSI which was immediately registered
EMERSON TUMANON,PHILIPPINE ASSOCIATION OF with the Department of Labor and Employment.
FREE LABOR UNIONS (PAFLU) SEPTEMBER (now
UNIFIED PAFLU) and SERAFIN AYROSO, respondents. Meanwhile, apparently oblivious to PSEA's shift of allegiance,
PAFLU Secretary General Serafin Ayroso wrote Mariles C.
[G.R. No. 127431. January 31, 2002] Romulo requesting a copy of PSI's audited financial
statement. Ayroso explained that with the dismissal of PSEA-
PHILIPPINE SKYLANDERS AND WORKERS WATUs election protest the time was ripe for the parties to enter
ASSOCIATION-NCW, MACARIO CABANIAS, PEPITO into a collective bargaining agreement.
RODILLAS, SHARON CASTILLO, DANILO CARBONEL,
MANUEL EDA, ROLANDO FELIX, JOCELYN FRONDA, On 30 July 1994 PSI through its personnel manager Francisco
RICARDO LUMBA, JOSEPH MARISOL, NERISA Dakila denied the request citing as reason PSEA's disaffiliation
MORTEL, TEOFILOQUIRONG, LEONARDO REYES, from PAFLU and its subsequent affiliation with NCW.
MANUEL CADIENTE and HERMINIA RIOSA, petitioners,
vs. PHILIPPINE ASSOCIATION OF FREE LABOR Agitated by PSI's recognition of PSEA-NCW, PAFLU through
UNIONS (PAFLU) SEPTEMBER (now UNIFIED PAFLU) Serafin Ayroso filed a complaint for unfair labor practice against
and NATIONAL LABOR RELATIONS COMMISSION, PSI, its president Mariles Romulo and personnel manager
SECOND DIVISION, respondents. Francisco Dakila. PAFLU alleged that aside from PSIs refusal to
bargain collectively with its workers, the company through its
DECISION president and personnel manager, was also liable for interfering
with its employees' union activities.[6]
BELLOSILLO, J.:
Two (2) days later or on 6 October 1994 Ayroso filed another
This is a petition for certiorari[1] seeking to set aside the 31 July complaint in behalf of PAFLU for unfair labor practice against
1996 Decision[2] of the National Labor Relations Commission Francisco Dakila. Through Ayroso PAFLU claimed that Dakila
affirming the 30 June 1995 Decision of the Labor Arbiter holding was present in PSEA's organizational meeting thereby confirming
petitioners Philippine Skylanders, Inc., Mariles C. Romulo[3] and his illicit participation in union activities. Ayroso added that the
Francisco Dakila as well as the elected officers of the Philippine members of the local union had unwittingly fallen into the
Skylanders Employees and Workers Association-PAFLU[4] guilty manipulative machinations of PSI and were lured into endorsing a
of unfair labor practice and ordering them to pay private collective bargaining agreement which was detrimental to their
respondent Philippine Association of Free Labor Union (PAFLU) interests.[7] The two (2) complaints were thereafter consolidated.
September[5] P150,000.00 as damages. Petitioners likewise seek
the reversal of the 31 October 1996 Resolution of the NLRC On 1 February 1995 PAFLU amended its complaint by including
denying their Motion for Reconsideration. the elected officers of PSEA-PAFLU as additional party
respondents. PAFLU averred that the local officers of PSEA-
In November 1993 the Philippine Skylanders Employees PAFLU, namely Macario Cabanias, Pepito Rodillas, Sharon
Association (PSEA), a local labor union affiliated with the Castillo, Danilo Carbonel, Manuel Eda, Rolando Felix, Jocelyn
Philippine Association of Free Labor Unions (PAFLU) September Fronda, Ricardo Lumba, Joseph Mirasol, Nerisa Mortel, Teofilo
(PAFLU), won in the certification election conducted among the Quirong, Leonardo Reyes, Manuel Cadiente, and Herminia Riosa,
rank and file employees of Philippine Skylanders, Inc. (PSI). Its were equally guilty of unfair labor practice since they brazenly
rival union, Philippine Skylanders Employees Association-WATU allowed themselves to be manipulated and influenced by petitioner
(PSEA-WATU) immediately protested the result of the election Francisco Dakila.[8]
before the Secretary of Labor.
PSI, its president Mariles C. Romulo, and its personnel manager
Several months later, pending settlement of the controversy, PSEA Dakila moved for the dismissal of the complaint on the ground that
sent PAFLU a notice of disaffiliation citing as reason PAFLU's the issue of disaffiliation was an inter-union conflict which lay
supposed deliberate and habitual dereliction of duty toward its beyond the jurisdiction of the Labor Arbiter. On the other hand,
members. Attached to the notice was a copy of the resolution PSEA-NCW took the cudgels for its officers who were being sued
adopted and signed by the officers and members of PSEA in their capacities as former officers of PSEA-PAFLU and asserted
authorizing their local union to disaffiliate from its mother that since PSEA was no longer affiliated with PAFLU, Ayroso or
federation. PAFLU for that matter had no personality to file the instant
PSEA subsequently affiliated itself with the National Congress of complaint. In support of this assertion, PSEA-NCW submitted in
Workers (NCW), changed its name to Philippine Skylanders evidence a Katunayan signed by 111 out of 120 rank and file
Employees Association - National Congress of Workers (PSEA- employees of PSI disauthorizing Ayroso or PAFLU from
NCW), and to maintain continuity within the organization, instituting any action in their behalf.[9]
allowed the former officers of PSEA-PAFLU to continue
In a Decision rendered on 30 June 1995 the Labor Arbiter declared Arbiter could rightfully assert his jurisdiction; second, since the
PSEA's disaffiliation from PAFLU invalid and held PSI, PSEA- case involved a dispute between PAFLU as mother federation and
PAFLU and their respective officers guilty of unfair labor PSEA as local union, the controversy fell within the jurisdiction of
practice. The Decision explained that despite PSEA-PAFLU's the Bureau of Labor Relations; and lastly, the relationship of
status as the sole and exclusive bargaining agent of PSI's rank and principal-agent between PAFLU and PSEA had been severed by
file employees, the company knowingly sanctioned and the local union through the lawful exercise of its right of
confederated with Dakila in actively assisting a rival union. This, disaffiliation.[14]
according to the Labor Arbiter, was a classic case of interference
for which PSI could be held responsible. As PSEA-NCW's Stripped of non-essentials, the fundamental issue tapers down to
personality was not accorded recognition, its collective bargaining the legitimacy of PSEA's disaffiliation. To be more precise, may
agreement with PSI was struck down for being invalid. Ayroso's PSEA, which is an independent and separate local union, validly
legal personality to file the complaint was sustained on the disaffiliate from PAFLU pending the settlement of an election
ratiocination that under the Labor Code no petition questioning the protest questioning its status as the sole and exclusive bargaining
majority status of the incumbent bargaining agent shall be agent of PSI's rank and file employees?
entertained outside of the sixty (60)-day period immediately before At the outset, let it be noted that the issue of disaffiliation is an
the expiry date of such five (5)-year term of the collective inter-union conflict the jurisdiction of which properly lies with the
bargaining agreement that the parties may enter into. Accordingly, Bureau of Labor Relations (BLR) and not with the Labor
judgment was rendered ordering PSI, PSEA-PAFLU and their Arbiter.[15] Nonetheless, with due recognition of this fact, we deem
officers to pay PAFLU P150,000.00 in damages.[10] it proper to settle the controversy at this instance since to remand
PSI, PSEA and their respective officers appealed to the National the case to the BLR would only mean intolerable delay for the
Labor Relations Commission (NLRC). But the NLRC upheld the parties.
Decision of the Labor Arbiter and conjectured that since an The right of a local union to disaffiliate from its mother federation
election protest questioning PSEA-PAFLU's certification as the is not a novel thesis unillumined by case law. In the landmark case
sole and exclusive bargaining agent was pending resolution before of Liberty Cotton Mills Workers Union vs. Liberty Cotton Mills,
the Secretary of Labor, PSEA could not validly separate from Inc.[16] we upheld the right of local unions to separate from their
PAFLU, join another national federation and subsequently enter mother federation on the ground that as separate and voluntary
into a collective bargaining agreement with its employer- associations, local unions do not owe their creation and existence
company.[11] to the national federation to which they are affiliated but, instead,
Petitioners separately moved for reconsideration but both motions to the will of their members.The sole essence of affiliation is to
were denied. Hence, these petitions for certiorari filed by PSI and increase, by collective action, the common bargaining power of
PSEA-NCW together with their respective officers pleading for a local unions for the effective enhancement and protection of their
reversal of the NLRC's Decision which they claimed to have been interests. Admittedly, there are times when without succor and
rendered in excess of jurisdiction. In due time, both petitions were support local unions may find it hard, unaided by other support
consolidated. groups, to secure justice for themselves.

In these petitions, petitioner PSEA together with its officers Yet the local unions remain the basic units of association, free to
argued that by virtue of their disaffiliation PAFLU as a mere agent serve their own interests subject to the restraints imposed by the
had no authority to represent them before any proceedings. They constitution and by-laws of the national federation, and free also to
further asserted that being an independent labor union PSEA may renounce the affiliation upon the terms laid down in the agreement
freely serve the interest of all its members and readily disaffiliate which brought such affiliation into existence.
from its mother federation when circumstances so warrant. This Such dictum has been punctiliously followed since then. [17]
right, they averred, was consistent with the constitutional
guarantee of freedom of association.[12] Upon an application of the aforecited principle to the issue at hand,
the impropriety of the questioned Decisions becomes clearly
For their part, petitioners PSI, Romulo and Dakila alleged that apparent. There is nothing shown in the records nor is it claimed
their decision to bargain collectively with PSEA-NCW was by PAFLU that the local union was expressly forbidden to
actuated, to a large extent, by PAFLU's behavior. Having heard no disaffiliate from the federation nor were there any conditions
objections or protestations from PAFLU relative to PSEA's imposed for a valid breakaway. As such, the pendency of an
disaffiliation, they reckoned that PSEA's subsequent association election protest involving both the mother federation and the local
with NSW was done bona fide.[13] union did not constitute a bar to a valid disaffiliation. Neither was
The Solicitor General filed a Manifestation in Lieu of it disputed by PAFLU that 111 signatories out of the 120 members
Comment recommending that both petitions be granted. In of the local union, or an equivalent of 92.5% of the total union
his Manifestation, the Solicitor General argued against the Labor membership supported the claim of disaffiliation and had in fact
Arbiter's assumption of jurisdiction citing the following as disauthorized PAFLU from instituting any complaint in their
reasons: first, there was no employer-employee relationship behalf. Surely, this is not a case where one (1) or two (2) members
between complainant Ayroso and PSI over which the Labor of the local union decided to disaffiliate from the mother
federation, but it is a case where almost all local union members - versus - Chairper
decided to disaffiliate.
AUSTRI
It was entirely reasonable then for PSI to enter into a collective
bargaining agreement with PSEA-NCW. As PSEA had validly SAN MIGUEL PACKAGING PRODUCTS CHICO-
severed itself from PAFLU, there would be no restrictions which EMPLOYEES UNIONPAMBANSANG DIWA NG
MANGGAGAWANG PILIPINO(SMPPEUPDMP), NACHU
could validly hinder it from subsequently affiliating with NCW
and entering into a collective bargaining agreement in behalf of its Respondent.[1] REYES,
members.

There is a further consideration that likewise argues for the

Promulg
granting of the petitions. It stands unchallenged that PAFLU
instituted the complaint for unfair labor practice against the wishes
of workers whose interests it was supposedly protecting.The mere
act of disaffiliation did not divest PSEA of its own personality;
neither did it give PAFLU the license to act independently of the
Septemb
local union. Recreant to its mission, PAFLU cannot simply ignore
the demands of the local chapter and decide for its x---------------------------------------------
welfare. PAFLU might have forgotten that as an agent it could ----x
only act in representation of and in accordance with the interests of
the local union. The complaint then for unfair labor practice
lodged by PAFLU against PSI, PSEA and their respective officers,
having been filed by a party which has no legal personality to
institute the complaint, should have been dismissed at the first DECISION
instance for failure to state a cause of action.

Policy considerations dictate that in weighing the claims of a local

union as against those of a national federation, those of the former
must be preferred. Parenthetically though, the desires of the CHICO-NAZARIO, J.:
mother federation to protect its locals are not altogether to be
shunned. It will however be to err greatly against the Constitution
if the desires of the federation would be favored over those of its
members. That, at any rate, is the policy of the law. For if it were
otherwise, instead of protection, there would be disregard and In this Petition for Review on Certiorari under Rule 45 of the
neglect of the lowly workingmen. Revised Rules of Court, petitioner SAN MIGUEL
WHEREFORE, the petitions of Philippine Skylanders, Inc. and CORPORATION EMPLOYEES UNION-PHILIPPINE
of Philippine Skylanders and Workers Association-NCW, together TRANSPORT AND GENERAL WORKERS ORGANIZATION
with their respective officers, are GRANTED. The Decision of the (SMCEU-PTGWO) [2]
prays that this Court reverse and set aside the
National Labor Relations Commission of 31 July 1996 affirming (a) Decision dated 9 March 2005 of the Court of Appeals in CA-
the Decision of the Labor Arbiter of 30 June 1995 holding G.R. SP No. 66200, affirming the Decision[3] dated 19 February
petitioners Philippine Skylanders and Workers Association-NCW, 2001 of the Bureau of Labor Relations (BLR) of the Department
Philippine Skylanders, Inc. and their respective officers, guilty of of Labor and Employment (DOLE) which upheld the Certificate of
unfair labor practice and ordering them to pay damages to private Registration of respondent SAN MIGUEL PACKAGING
respondent Philippine Association of Free Labor Unions (PAFLU) PRODUCTS EMPLOYEES UNIONPAMBANSANG DIWA NG
September (now UNIFIED PAFLU) as well as the Resolution of MANGGAGAWANG [4]
PILIPINO (SMPPEUPDMP); and (b)
31 October 1996 denying reconsideration is REVERSED and SET the Resolution dated 16 January 2006 of the Court of Appeals in
ASIDE. No costs. the same case, denying petitioners Motion for Reconsideration of
the aforementioned Decision.
SO ORDERED.

SAN MIGUEL CORPORATION EMPLOYEES G.R. No. 171153

UNIONPHILIPPINE TRANSPORT AND The following are the antecedent facts:
GENERAL WORKERS ORGANIZATION Petitioner is the incumbent bargaining agent for the bargaining
(SMCEUPTGWO), Present:
unit comprised of the regular monthly-paid rank and file
Petitioner, employees of the three divisions of San Miguel Corporation
(SMC), namely, the San Miguel Corporate Staff Unit (SMCSU),
San Miguel Brewing Philippines
YNARES-SANTIAGO, J., (SMBP), and the San Miguel
Packaging Products (SMPP), in all offices and plants of SMC,
including the Metal Closure and Lithography Plant in Laguna. It privileges to act as representative of its members for purposes of
had been the certified bargaining agent for 20 years from 1987 to collective bargaining agreement. On this basis, PDMP can
1997. charter or create a local, in accordance with the provisions of
Department Order No. 9.

Respondent is registered as a chapter of Pambansang Diwa ng

Manggagawang Pilipino (PDMP). PDMP issued Charter WHEREFORE, the appeal is hereby GRANTED. Accordingly, the
Certificate No. 112 to respondent on 15 June 1999.[5] In decision of the Regional Director dated July 14, 2000, canceling
compliance with registration requirements,respondent submitted the registration of appellant San Miguel Packaging Products
the requisite documents to the BLR for the purpose of acquiring Employees Union-Pambansang Diwa ng Manggagawang Pilipino
legal personality.[6] Upon submission of its charter certificate and (SMPPEU-PDMP) is REVERSED and SET ASIDE. Appellant
other documents, respondent was issued Certificate of Creation of shall hereby remain in the roster of legitimate labor
Local or Chapter PDMP-01 by the BLR on 6 July organizations.[14]
1999.[7] Thereafter, respondent filed with the Med-Arbiter of the
DOLE Regional Officer in the National Capital Region (DOLE- While the BLR agreed with the findings of the DOLE Regional
NCR), three separate petitions for certification election to Director dismissing the allegations of fraud and
represent SMPP, SMCSU, and SMBP.[8] All three petitions were misrepresentation, and in upholding that PDMP can directly
dismissed, on the ground that the separate petitions fragmented a create a local or a chapter, it reversed the Regional Directors
single bargaining unit.[9] ruling that the 20% membership is a requirement for respondent to
attain legal personality as a labor organization. Petitioner
thereafter filed a Motion for Reconsideration with the BLR. In a
Resolution rendered on 19 June 2001 in BLR-A-C-64-05-9-00
On 17 August 1999, petitioner filed with the DOLE-NCR a (NCR-OD-9908-007-IRD), the BLR denied the Motion for
petition seeking the cancellation of respondents registration and its Reconsideration and affirmed its Decision dated 19 February
dropping from the rolls of legitimate labor organizations. In its 2001.[15]
petition, petitioner accused respondent of committing fraud and
falsification, and non-compliance with registration requirements in
obtaining its certificate of registration. It raised allegations that
respondent violated Articles 239(a), (b) and (c) [10] and 234(c)[11]of Invoking the power of the appellate court to review decisions of
the Labor Code. Moreover, petitioner claimed that PDMP is not a quasi-judicial agencies, petitioner filed with the Court of Appeals
legitimate labor organization, but a trade union center, hence, it a Petition for Certiorari under Rule 65 of the 1997 Rules of Civil
cannot directly create a local or chapter. The petition was docketed Procedure docketed as CA-G.R. SP No. 66200. The Court of
as Case No. NCR-OD-9908-007-IRD.[12] Appeals, in a Decision dated 9 March 2005, dismissed the petition
and affirmed the Decision of the BLR, ruling as follows:
On 14 July 2000, DOLE-NCR Regional Director Maximo B. Lim
issued an Order dismissing the allegations of fraud and In Department Order No. 9, a registered federation or national
misrepresentation, and irregularity in the submission of documents union may directly create a local by submitting to the BLR copies
by respondent. Regional Director Lim further ruled that of the charter certificate, the locals constitution and by-laws, the
respondent is allowed to directly create a local or principal office address of the local, and the names of its officers
chapter. However, he found that respondent did not comply with and their addresses. Upon complying with the documentary
the 20% membership requirement and, thus, ordered the requirements, the local shall be issued a certificate and included in
cancellation of its certificate of registration and removal from the the roster of legitimate labor organizations. The [herein
rolls of legitimate labor organizations.[13] Respondent appealed to respondent] is an affiliate of a registered federation PDMP, having
the BLR. In a Decision dated 19 February 2001, it declared: been issued a charter certificate. Under the rules we have
reviewed, there is no need for SMPPEU to show a membership of
20% of the employees of the bargaining unit in order to be
recognized as a legitimate labor union.
As a chartered local union, appellant is not required to submit the
number of employees and names of all its members comprising at
least 20% of the employees in the bargaining unit where it seeks to
operate. Thus, the revocation of its registration based on non- xxxx
compliance with the 20% membership requirement does not have
any basis in the rules.

In view of the foregoing, the assailed decision and resolution of

Further, although PDMP is considered as a trade union center, it the BLR are AFFIRMED, and the petition is DISMISSED.[16]
is a holder of Registration Certificate No. FED-11558-LC issued
by the BLR on 14 February 1991, which bestowed upon it the
status of a legitimate labor organization with all the rights and
Subsequently, in a Resolution dated 16 January 2006, the Court of unit. Petitioner refers to Section 1, Article 1 of the Collective
Appeals denied petitioners Motion for Reconsideration of the Bargaining Agreement (CBA),[18] quoted hereunder:
aforementioned Decision.

ARTICLE 1
Hence, this Petition for Certiorari under Rule 45 of the Revised
Rules of Court where petitioner raises the sole issue of: SCOPE

WHETHER OR NOT THE HONORABLE COURT OF
APPEALS COMMITTED REVERSIBLE ERROR IN
RULING THAT PRIVATE RESPONDENT IS NOT
REQUIRED TO SUBMIT THE NUMBER OF EMPLOYEES
AND NAMES OF ALL ITS MEMBERS COMPRISING AT
LEAST 20% OF THE EMPLOYEES IN THE BARGAINING
UNIT WHERE IT SEEKS TO OPERATE.
The present petition questions the legal personality of respondent
as a legitimate labor organization.
Petitioner posits that respondent is required to submit a list of
members comprising at least 20% of the employees in the
bargaining unit before it may acquire legitimacy, citing Article
234(c) of the Labor Code which stipulates that any applicant labor
organization, association or group of unions or workers shall
acquire legal personality and shall be entitled to the rights and
privileges granted by law to legitimate labor organizations upon
issuance of the certificate of registration based on the following
requirements:
Section 1. Appropriate Bargaining Unit. The appropriate
bargaining unit covered by this Agreement consists of all regular
rank and file employees paid on the basis of fixed salary per
month and employed by the COMPANY in its Corporate Staff
Units (CSU), San Miguel Brewing Products (SMBP) and San
Miguel Packaging Products (SMPP) and in different operations
existing in the City of Manila and suburbs, including Metal
Closure and Lithography Plant located at Canlubang, Laguna
subject to the provisions of Article XV of this Agreement provided
however, that if during the term of this Agreement, a plant within
the territory covered by this Agreement is transferred outside but
within a radius of fifty (50) kilometers from the Rizal Monument,
Rizal Park, Metro Manila, the employees in the transferred plant
shall remain in the bargaining unit covered by this
Agreement. (Emphasis supplied.)
Petitioner thus maintains that respondent, in any case, failed to
meet this 20% membership requirement since it based its
membership on the number of employees of a single division only,
namely, the SMPP.

There is merit in petitioners contentions.

a. Fifty pesos (P50.00) registration fee;

b. The names of its officers, their addresses, the principal A legitimate labor organization[19] is defined as any labor
address of the labor organization, the minutes of the organizational organization duly registered with the Department of Labor and
meetings and the list of the workers who participated in such Employment, and includes any branch or local thereof.[20] The
meetings; mandate of the Labor Code is to ensure strict compliance with the
requirements on registration because a legitimate labor
c. The names of all its members comprising at least twenty organization is entitled to specific rights under the Labor
percent (20%) of all the employees in the bargaining unit where it Code,[21] and are involved in activities directly affecting matters of
seeks to operate; public interest. Registration requirements are intended to afford a
d. If the applicant union has been in existence for one or more measure of protection to unsuspecting employees who may be
years, copies of its annual financial reports; and lured into joining unscrupulous or fly-by-night unions whose sole
purpose is to control union funds or use the labor organization for
e. Four (4) copies of the constitution and by-laws of the illegitimate ends.[22] Legitimate labor organizations have exclusive
applicant union, minutes of its adoption or ratification and the list rights under the law which cannot be exercised by non-legitimate
of the members who participated in it.[17] unions, one of which is the right to be certified as the exclusive
representative[23] of all the employees in an appropriate collective
bargaining unit for purposes of collective bargaining.[24] The
acquisition of rights by any union or labor organization,
particularly the right to file a petition for certification election, first
Petitioner also insists that the 20% requirement for registration of and foremost, depends on whether or not the labor organization
respondent must be based not on the number of employees of a has attained the status of a legitimate labor organization.[25]
single division, but in all three divisions of the company in all the
offices and plants of SMC since they are all part of one bargaining
A perusal of the records reveals that respondent is registered with local or a chapterunder Department Order No. 9. Such legal
the BLR as a local or chapter of PDMP and wasissued Charter personality is acquired from the filing of the complete
Certificate No. 112 on 15 June 1999. Hence, respondent was documentary requirements enumerated in Section 1, Rule VI.[30]
directly chartered by PDMP.

Petitioner insists that Section 3 of the Implementing Rules, as

The procedure for registration of a local or chapter of a labor
organization is provided in Book V of the Implementing Rules of
the Labor Code, as amended by Department Order No. 9 which
took effect on 21 June 1997, and again by Department Order No.
40 dated 17 February 2003. The Implementing Rules as amended
by D.O. No. 9 should govern the resolution of the petition at bar
since respondents petition for certification election was filed with
the BLR in 1999; and that of petitioner on 17 August 1999.[26]
amended by Department Order No. 9, violated Article 234 of the
Labor Code when it provided for less stringent requirements for
the creation of a chapter or local. This Court disagrees.
Article 234 of the Labor Code provides that an independent labor
organization acquires legitimacy only upon its registration with
the BLR:

The applicable Implementing Rules enunciates a two-fold Any applicant labor organization, association or group of unions
procedure for the creation of a chapter or a local. The first involves or workers shall acquire legal personality and shall be entitled to
the affiliation of an independent union with a federation or the rights and privileges granted by law to legitimate labor
national union or industry union. The second, finding application organizations upon issuance of the certificate of registration based
in the instant petition, involves the direct creation of a local or a on the following requirements:
chapter through the process of chartering.[27]

(a) Fifty pesos (P50.00) registration fee;

A duly registered federation or national union may directly create
a local or chapter by submitting to the DOLE Regional Office or
to the BLR two copies of the following:
(b) The names of its officers, their addresses, the principal address
of the labor organization, the minutes of the
organizational meetings and the list of the workers who
(a) A charter certificate issued by the federation or national participated in such meetings;
union indicating the creation or establishment of the local/chapter;

(c) The names of all its members comprising at least twenty

(b) The names of the local/chapters officers, their addresses, percent (20%) of all the employees in the bargaining unit where it
and the principal office of the local/chapter; and seeks to operate;

(c) The local/chapters constitution and by-laws; Provided, That (d) If the applicant union has been in existence for one or
where the local/chapters constitution and by-laws is the same as more years, copies of its annual financial reports; and
that of the federation or national union, this fact shall be indicated
accordingly.
(e) Four (4) copies of the constitution and by-laws of the applicant
union, minutes of its adoption or ratification, and the list of the
All the foregoing supporting requirements shall be certified under members who participated in it. (Italics supplied.)
oath by the Secretary or the Treasurer of the local/chapter and
attested to by its President.[28]
It is emphasized that the foregoing pertains to the registration of
an independent labor organization, association or group of unions
The Implementing Rules stipulate that a local or chapter may be or workers.
directly created by a federation or national union. A duly
constituted local or chapter created in accordance with the
foregoing shall acquire legal personality from the date of filing of
However, the creation of a branch, local or chapter is treated
the complete documents with the BLR.[29] The issuance of the
differently. This Court, in the landmark case of Progressive
certificate of registration by the BLR or the DOLE Regional
Development Corporation v. Secretary, Department of Labor and
Office is not the operative act that vests legal personality upon a
Employment,[31] declared that when an unregistered union becomes
a branch, local or chapter, some of the aforementioned legitimate labor organization. In the process, the legitimacy of
requirements for registration are no longer necessary or PDMP is being impugned, albeit indirectly. Secondly, the same
compulsory. Whereas an applicant for registration of an contention premises that a trade union center cannot directly create
independent union is mandated to submit, among other things, the a local or chapter through the process of chartering.
number of employees and names of all its members comprising at
least 20% of the employees in the bargaining unit where it seeks to
operate, as provided under Article 234 of the Labor Code and Anent the foregoing, as has been held in a long line of cases, the
Section 2 of Rule III, Book V of the Implementing Rules, the same legal personality of a legitimate labor organization, such as PDMP,
is no longer required of a branch, local or chapter. [32] The intent of
cannot be subject to a collateral attack. The law is very clear on
the law in imposing less requirements in the case of a branch or this matter. Article 212 (h) of the Labor Code, as amended, defines
local of a registered federation or national union is to encourage a legitimate labor organization[37] as any labor organization duly
the affiliation of a local union with a federation or national union
registered with the DOLE, and includes any branch or local
in order to increase the local unions bargaining powers respecting thereof.[38] On the other hand, a trade union center is any group of
terms and conditions of labor.[33] registered national unions or federations organized for the mutual
aid and protection of its members; for assisting such members in
collective bargaining; or for participating in the formulation of
Subsequently, in Pagpalain Haulers, Inc. v. Trajano[34] where the social and employment policies, standards, and programs, and is
validity of Department Order No. 9 was directly put in issue, this duly registered with the DOLE in accordance with Rule III,
Court was unequivocal in finding that there is no inconsistency Section 2 of the Implementing Rules.[39]
between the Labor Code and Department Order No. 9.

As to petitioners claims that respondent obtained its Certificate of

Registration through fraud and misrepresentation, this Court finds The Implementing Rules stipulate that a labor organization shall
that the imputations are not impressed with merit. In the instant be deemed registered and vested with legal personality on the date
case, proof to declare that respondent committed fraud and of issuance of its certificate of registration. Once a certificate of
misrepresentation remains wanting. This Court had, indeed, on registration is issued to a union, its legal personality cannot be
several occasions, pronounced that registration based on false and subject to collateral attack.[40] It may be questioned only in an
fraudulent statements and documents confer no legitimacy upon a independent petition for cancellation in accordance with Section 5
labor organization irregularly recognized, which, at best, holds on of Rule V, Book V of the Implementing Rules. The
to a mere scrap of paper. Under such circumstances, the labor aforementioned provision is enunciated in the following:
organization, not being a legitimate labor organization, acquires no
rights.[35]
Sec. 5. Effect of registration. The labor organization or workers
association shall be deemed registered and vested with legal
This Court emphasizes, however, that a direct challenge to the personality on the date of issuance of its certificate of
legitimacy of a labor organization based on fraud and registration. Such legal personality cannot thereafter be subject to
misrepresentation in securing its certificate of registration is a collateral attack, but may be questioned only in an independent
serious allegation which deserves careful scrutiny. Allegations petition for cancellation in accordance with these Rules.
thereof should be compounded with supporting circumstances and
evidence. The records of the case are devoid of such
evidence. Furthermore, this Court is not a trier of facts, and thisPDMP was registered as a trade union center and issued
Registration Certificate No. FED-11558-LC by the BLR on 14
doctrine applies with greater force in labor cases. Findings of fact
of administrative agencies and quasi-judicial bodies, such as the February 1991. Until the certificate of registration of PDMP is
BLR, which have acquired expertise because their jurisdiction is cancelled, its legal personality as a legitimate labor organization
confined to specific matters, are generally accorded not only greatsubsists. Once a union acquires legitimate status as a labor
respect but even finality.[36] organization, it continues to be recognized as such until its
certificate of registration is cancelled or revoked in an independent
action for cancellation.[41] It bears to emphasize that what is being
Still, petitioner postulates that respondent was not validly and directly challenged is the personality of respondent as a legitimate
legitimately created, for PDMP cannot create a local or chapter as labor organization and not that of PDMP. This being a collateral
it is not a legitimate labor organization, it being a trade union attack, this Court is without jurisdiction to entertain questions
center. indirectly impugning the legitimacy of PDMP.

Petitioners argument creates a predicament as it hinges on the Corollarily, PDMP is granted all the rights and privileges
legitimacy of PDMP as a labor organization. Firstly, this line of appurtenant to a legitimate labor organization,[42]and continues to
reasoning attempts to predicate that a trade union center is not a be recognized as such until its certificate of registration is
successfully impugned and thereafter cancelled or revoked in an
independent action for cancellation.
We now proceed to the contention that PDMP cannot directly
create a local or a chapter, it being a trade union center.
(c) The name and principal address of the
applicant, the names of its officers and their addresses, the minutes
of its organizational meeting/s, and the list of member
organizations and their representatives who attended such
meeting/s; and

This Court reverses the finding of the appellate court and BLR on (d) A copy of its constitution and by-laws and
this ground, and rules that PDMP cannot directly create a local or minutes of its ratification by a majority of the presidents of the
chapter. member organizations, provided that where the ratification was
done simultaneously with the organizational meeting, it shall be
sufficient that the fact of ratification be included in the minutes of
After an exhaustive study of the governing labor law provisions, the organizational meeting.[47]
both statutory and regulatory,[43] we find no legal justification to
support the conclusion that a trade union center is allowed to
directly create a local or chapter through chartering. Apropos, we Evidently, while a national union or federation is a labor
take this occasion to reiterate the first and fundamental duty of this organization with at least ten locals or chapters or affiliates, each
Court, which is to apply the law. The solemn power and duty of of which must be a duly certified or recognized collective
the Court to interpret and apply the law does not include the power bargaining agent;[48] a trade union center, on the other hand, is
to correct by reading into the law what is not written therein. [44] composed of a group of registered national unions or
federations.[49]

Presidential Decree No. 442, better known as the Labor Code, was
enacted in 1972. Being a legislation on social justice,[45] the
provisions of the Labor Code and the Implementing Rules have
been subject to several amendments, and they continue to evolve,
considering that labor plays a major role as a socio-economic
force. The Labor Code was first amended by Republic Act No.
6715, and recently, by Republic Act No. 9481. Incidentally, the
term trade union center was never mentioned under Presidential
Decree No. 442, even as it was amended by Republic Act No.
6715. The term trade union center was first adopted in the
Implementing Rules, under Department Order No. 9.
The Implementing Rules, as amended by Department Order No. 9,
provide that a duly registered federation or national union may
directly create a local or chapter. The provision reads:
Section 1. Chartering and creation of a local/chapter. A duly
registered federation or national union may directly create a
local/chapter by submitting to the Regional Office or to the Bureau
two (2) copies of the following:

Culling from its definition as provided by Department Order No. (a) A charter certificate issued by the federation or national union
9, a trade union center is any group of registered national unions indicating the creation or establishment of the local/chapter;
or federations organized for the mutual aid and protection of its
members; for assisting such members in collective bargaining; or
for participating in the formulation of social and employment (b) The names of the local/chapters officers, their addresses, and
policies, standards, and programs, and is duly registered with the the principal office of the local/chapter; and
DOLE in accordance with Rule III, Section 2 of the Implementing
Rules.[46] The same rule provides that the application for
registration of an industry or trade union center shall be supported (c) The local/chapters constitution and by-laws; provided that
by the following: where the local/chapters constitution and by-laws is the same as
that of the federation or national union, this fact shall be indicated
accordingly.
(a) The list of its member organizations and their
respective presidents and, in the case of an industry union, the
industry where the union seeks to operate; All the foregoing supporting requirements shall be certified under
oath by the Secretary or the Treasurer of the local/chapter and
attested to by its President.[50]
(b) The resolution of membership of each
member organization, approved by the Board of Directors of such
union;
Department Order No. 9 mentions two labor organizations either
of which is allowed to directly create a local or chapter through
chartering a duly registered federation or a national union.
Department Order No. 9 defines a "chartered local" as a labor
organization in the private sector operating at the enterprise level
that acquired legal personality through a charter certificate, issued
by a duly registered federation or national union and reported to
the Regional Office in accordance with Rule III, Section 2-E of
these Rules.[51]
Republic Act No. 9481 or An Act Strengthening the Workers
Constitutional Right to Self-Organization, Amending for the
Purpose Presidential Decree No. 442, As Amended, Otherwise
Known as the Labor Code of thePhilippines lapsed[52] into law
on 25 May 2007 and became effective on 14 June 2007.[53] This
law further amends the Labor Code provisions on Labor Relations.
Pertinent amendments read as follows:
SECTION 1. Article 234 of Presidential Decree No. 442, as
amended, otherwise known as the Labor Code of the Philippines,
is hereby further amended to read as follows:
ART. 234. Requirements of Registration. A federation, national
union or industry or trade union center or an independent union
shall acquire legal personality and shall be entitled to the rights
and privileges granted by law to legitimate labor organizations
upon issuance of the certificate of registration based on the
following requirements:
(a) Fifty pesos (P50.00) registration fee;
(b) The names of its officers, their addresses, the principal address
of the labor organization, the minutes of the organizational
meetings and the list of the workers who participated in such
meetings;
(c) In case the applicant is an independent union, the names of all
its members comprising at least twenty percent (20%) of all the
employees in the bargaining unit where it seeks to operate;
(d) If the applicant union has been in existence for one or more
years, copies of its annual financial reports; and
(e) Four copies of the constitution and by-laws of the applicant
union, minutes of its adoption or ratification, and the list of the
members who participated in it.
SECTION 2. A new provision is hereby inserted into the Labor
Code as Article 234-A to read as follows:
ART. 234-A. Chartering and Creation of a Local Chapter. A duly
registered federation or national unionmay directly create a local
chapter by issuing a charter certificate indicating the establishment
of the local chapter. The chapter shall acquire legal personality
only for purposes of filing a petition for certification election from
the date it was issued a charter certificate.
The chapter shall be entitled to all other rights and privileges of a
legitimate labor organization only upon the submission of the
following documents in addition to its charter certificate:
(a) The names of the chapter's officers, their addresses, and the
principal office of the chapter; and
(b) The chapter's constitution and by-laws: Provided, That where
the chapter's constitution and by-laws are the same as that of the
federation or the national union, this fact shall be indicated
accordingly.
The additional supporting requirements shall be certified under
oath by the secretary or treasurer of the chapter and attested by its
president. (Emphasis ours.)
Article 234 now includes the term trade union center, but
interestingly, the provision indicating the procedure for chartering
or creating a local or chapter, namely Article 234-A, still makes no
mention of a trade union center.
Also worth emphasizing is that even in the most recent
amendment of the implementing rules,[54] there was no mention of
a trade union center as being among the labor organizations
allowed to charter.
This Court deems it proper to apply the Latin maxim expressio
unius est exclusio alterius. Under this maxim of statutory
interpretation, the expression of one thing is the exclusion of
another. When certain persons or things are specified in a law,
contract, or will, an intention to exclude all others from its
operation may be inferred. If a statute specifies one exception to a
general rule or assumes to specify the effects of a certain
provision, other exceptions or effects are excluded.[55] Where the
terms are expressly limited to certain matters, it may not, by
interpretation or construction, be extended to other 66200 is REVERSED and SET ASIDE. The Certificate of
matters.[56] Such is the case here. If its intent were otherwise, the Registration of San Miguel Packaging Products Employees
law could have so easily and conveniently included trade union UnionPambansang Diwa ng Manggagawang Pilipino
centers in identifying the labor organizations allowed to charter a is ORDERED CANCELLED, and SMPPEU-
chapter or local. Anything that is not included in the enumeration PDMP DROPPED from the rolls of legitimate labor
is excluded therefrom, and a meaning that does not appear nor is organizations.
intended or reflected in the very language of the statute cannot be
placed therein.[57] The rule is restrictive in the sense that it
proceeds from the premise that the legislating body would not Costs against petitioner.
have made specific enumerations in a statute if it had the intention
not to restrict its meaning and confine its terms to those expressly
mentioned.[58] Expressium facit cessare tacitum.[59] What is
SO ORDERED.
expressed puts an end to what is implied. Casus omissus pro
omisso habendus est. A person, object or thing omitted must have G.R. No. 157117 November 20, 2006
been omitted intentionally.
COASTAL SUBIC BAY TERMINAL, INC., Petitioner,
Therefore, since under the pertinent status and applicable vs.
implementing rules, the power granted to labor organizations to DEPARTMENT OF LABOR and EMPLOYMENT – OFFICE
directly create a chapter or local through chartering is given to a OF THE SECRETARY, COASTAL SUBIC BAY
federation or national union, then a trade union center is without TERMINAL, INC. SUPERVISORY UNION-APSOTEU, and
authority to charter directly. COASTAL SUBIC BAY TERMINAL, INC. RANK-AND-
FILE UNION-ALU-TUCP, Respondents.

DECISION
The ruling of this Court in the instant case is not a departure from
the policy of the law to foster the free and voluntary organization QUISUMBING, J.:
of a strong and united labor movement,[60] and thus assure the
rights of workers to self-organization.[61] The mandate of the Labor For review on certiorari is the Court of Appeals’ Decision dated
1

Code in ensuring strict compliance with the procedural August 31, 2001, in CA-G.R. SP No. 54128 and the
requirements for registration is not without reason. It has been Resolution2 dated February 5, 2003, denying petitioner’s motion
observed that the formation of a local or chapter becomes a handy for reconsideration. The Court of Appeals had affirmed the
tool for the circumvention of union registration Decision3 dated March 15, 1999 of the Secretary of the
requirements. Absent the institution of safeguards, it becomes a Department of Labor and Employment (DOLE) reversing the
convenient device for a small group of employees to foist a not-so- Mediator Arbiter’s dismissal of private respondents’ petitions for
desirable federation or union on unsuspecting co-workers and pare certification election.
the need for wholehearted voluntariness, which is basic to free
The facts are as follows:
unionism.[62] As a legitimate labor organization is entitled to
specific rights under the Labor Code and involved in activities On July 8, 1998, private respondents Coastal Subic Bay Terminal,
directly affecting public interest, it is necessary that the law afford Inc. Rank-and-File Union (CSBTI-RFU) and Coastal Subic Bay
utmost protection to the parties affected.[63] However, as this Court Terminal, Inc. Supervisory Union (CSBTI-SU) filed separate
has enunciated in Progressive Development Corporation v. petitions for certification election before Med-Arbiter Eladio de
Secretary of Department of Labor and Employment, it is not this Jesus of the Regional Office No. III. The rank-and-file union
Court's function to augment the requirements prescribed by insists that it is a legitimate labor organization having been issued
law. Our only recourse, as previously discussed, is to exact strict a charter certificate by the Associated Labor Union (ALU), and the
compliance with what the law provides as requisites for local or supervisory union by the Associated Professional, Supervisory,
chapter formation.[64] Office and Technical Employees Union (APSOTEU). Private
respondents also alleged that the establishment in which they
sought to operate was unorganized.
In sum, although PDMP as a trade union center is a legitimate
Petitioner Coastal Subic Bay Terminal, Inc. (CSBTI) opposed both
labor organization, it has no power to directly create a local or
petitions for certification election alleging that the rank-and-file
chapter. Thus, SMPPEU-PDMP cannot be created under the more
union and supervisory union were not legitimate labor
lenient requirements for chartering, but must have complied with
organizations, and that the proposed bargaining units were not
the more stringent rules for creation and registration of an
particularly described.
independent union, including the 20% membership requirement.
Without ruling on the legitimacy of the respondent unions, the
Med-Arbiter dismissed, without prejudice to refiling, both
WHEREFORE, the instant Petition is GRANTED. The Decision petitions which had been consolidated. The Med-Arbiter held that
dated 09 March 2005 of the Court of Appeals in CA-GR SP No. the ALU and APSOTEU are one and the same federation having a
common set of officers. Thus, the supervisory and the rank-and- the part of the Secretary; its findings are supported by evidence on
file unions were in effect affiliated with only one federation.4 record; and thus should be accorded with respect and finality. 9

The Med-Arbiter ruled as follows: The motion for reconsideration was likewise denied.10 Hence, the
instant petition by the company anchored on the following
Viewed in the light of all the foregoing, this Office finds the grounds:
simultaneous filing of the instant petitions to be invalid and
unwarranted. Consequently, this Office has no recourse but to I
dismiss both petitions without prejudice to the refiling of either.
THE HONORABLE COURT OF APPEALS ERRED IN
WHEREFORE, PREMISES CONSIDERED, let the instant RELYING ON THE "1989 REVISED RULES AND
petitions be, as they are hereby DISMISSED. REGULATIONS IMPLEMENTING RA 6715" AS BASIS TO
RECOGNIZE PRIVATE RESPONDENT APSOTEU’S
SO ORDERED.5 REGISTRATION BY THE DOLE REGIONAL DIRECTOR.
Both parties appealed to the Secretary of Labor and Employment, II
who reversed the decision of the Med-Arbiter. The Secretary thru
Undersecretary R. Baldoz, ruled that CSBTI-SU and CSBTI-RFU THE HONORABLE COURT OF APPEALS ERRED WHEN IT
have separate legal personalities to file their separate petitions for AFFIRMED PUBLIC RESPONDENT’S APPLICATION OF
certification election. The Secretary held that APSOTEU is a THE PRINCIPLE OF STARE DECISIS TO HASTILY DISPOSE
legitimate labor organization because it was properly registered OF THE LEGAL PERSONALITY ISSUE OF APSOTEU.
pursuant to the 1989 Revised Rules and Regulations implementing
Republic Act No. 6715, the rule applicable at the time of its III
registration. It further ruled that ALU and APSOTEU are separate THE HONORABLE COURT OF APPEALS DID NOT DECIDE
and distinct labor unions having separate certificates of registration IN ACCORD WITH LAW AND JURISPRUDENCE WHEN IT
from the DOLE. They also have different sets of locals. The AFFIRMED PUBLIC RESPONDENT’S APPLICATION OF
Secretary declared CSBTI-RFU and CSBTI-SU as legitimate labor THE "UNION AUTONOMY" THEORY.
organizations having been chartered respectively by ALU and
APSOTEU after submitting all the requirements with the Bureau IV
of Labor Relations (BLR). Accordingly, the Secretary ordered the
IN AFFIRMING PUBLIC RESPONDENT’S FINDING THAT
holding of separate certification election, viz:
PRIVATE RESPONDENTS ARE "SEPARATE
WHEREFORE, the decision of the Med-Arbiter, Regional Office FEDERATIONS," THE HONORABLE COURT OF APPEALS:
No. III is hereby REVERSED. Let separate certification elections
(1) IGNORED JURISPRUDENCE RECOGNIZING THE
be conducted immediately among the appropriate employees of
BINDING NATURE OF A MED-ARBITER’S FACTUAL
CSBTI, after the usual pre-election conference, with the following
FINDINGS; AND
choices:
(2) DISREGARDED EVIDENCE ON RECORD OF "ILLEGAL
I. For all rank and file employees of CSBTI:
COMMINGLING."11
1. COASTAL SUBIC BAY TERMINAL, INC. RANK-AND-
Plainly, the issues are (1) Can the supervisory and the rank-and-
FILE UNION-ALU-TUCP; and
file unions file separate petitions for certification election?; (2)
2. NO UNION. Was the Secretary’s decision based on stare decisis correct?; and
(3) Were private respondents engaged in commingling?
II. For all supervisory employees of CSBTI:
The issue on the status of the supervisory union CSBTI-SU
1. COASTAL SUBIC BAY TERMINAL, INC. SUPERVISORY depends on the status of APSOTEU, its mother federation.
EMPLOYEES UNION-APSOTEU; and
Petitioner argues that APSOTEU improperly secured its
2. NO UNION. registration from the DOLE Regional Director and not from the
The latest payroll of the employer, including its payrolls for the BLR; that it is the BLR that is authorized to process applications
last three months immediately preceding the issuance of this and issue certificates of registration in accordance with our ruling
decision, shall be the basis for determining the qualified list of in Phil. Association of Free Labor Unions v. Secretary of
voters. Labor;12 that the certificates of registration issued by the DOLE
Regional Director pursuant to the rules are questionable, and
SO DECIDED.6 possibly even void ab initio for being ultra vires; and that the
Court of Appeals erred when it ruled that the law applicable at the
The motion for reconsideration was also denied.7 time of APSOTEU’s registration was the 1989 Revised
On appeal, the Court of Appeals affirmed the decision of the Implementing Rules and Regulations of Rep. Act No. 6715.
Secretary.8 It held that there was no grave abuse of discretion on
Petitioner insists that APSOTEU lacks legal personality, and its
chartered affiliate CSBTI-SU cannot attain the status of a
legitimate labor organization to file a petition for certification
election. It relies on Villar v. Inciong,13 where we held therein that
Amigo Employees Union was not a duly registered independent
union absent any record of its registration with the Bureau.
with the NCR Regional Office, the certificate of registration is
valid.
The petitioner misapplied Villar v. Inciong.18 In said case, there
was no record in the BLR that Amigo Employees Union was
registered.19

Pertinent is Article 23514 of the Labor Code which provides that
applications for registration shall be acted upon by the Bureau.
"Bureau" as defined under the Labor Code means the
BLR and/or the Labor Relations Division in the Regional Offices
of the Department of Labor.15 Further, Section 2, Rule II, Book V
of the 1989 Revised Implementing Rules of the Labor Code
(Implementing Rules) provides that:
Section 2. Where to file application; procedure – Any national
labor organization or labor federation or local union may file an
application for registration with the Bureau or the Regional Office
where the applicant’s principal offices is located. The Bureau or
the Regional Office shall immediately process and approve or
deny the application. In case of approval, the Bureau or the
Regional Office shall issue the registration certificate within thirty
(30) calendar days from receipt of the application, together with all
the requirements for registration as hereinafter provided. 16
The Implementing Rules specifically Section 1, Rule III of Book
V, as amended by Department Order No. 9, thus:
Did the Court of Appeals err in its application of stare
decisis when it upheld the Secretary’s ruling that APSOTEU is a
legitimate labor organization and its personality cannot be assailed
unless in an independent action for cancellation of registration
certificate?20
We think not.
Section 5, Rule V, Book V of the Implementing Rules states:
Section 5. Effect of registration – The labor organization or
workers’ association shall be deemed registered and vested with
legal personality on the date of issuance of its certificate of
registration. Such legal personality cannot thereafter be subject to
collateral attack, but maybe questioned only in an independent
petition for cancellation in accordance with these Rules.21
Thus, APSOTEU is a legitimate labor organization and has
authority to issue charter to its affiliates.22 It may issue a local
charter certificate to CSBTI-SU and correspondingly, CSBTI-SU
is legitimate.

SECTION 1. Where to file applications. – The application for Are ALU, a rank-and-file union and APSOTEU, a supervisory
registration of any federation, national or industry union or trade union one and the same because of the commonalities between
union center shall be filed with the Bureau. Where the application them? Are they commingled?
is filed with the Regional Office, the same shall be immediately
The petitioner contends that applying by analogy, the doctrine of
forwarded to the Bureau within forty-eight (48) hours from filing
piercing the veil of corporate fiction, APSOTEU and ALU are the
thereof, together with all the documents supporting the
same federation. Private respondents disagree.
registration.
First, as earlier discoursed, once a labor union attains the status of
The applications for registration of an independent union shall be
a legitimate labor organization, it continues as such until its
filed with and acted upon by the Regional Office where the
certificate of registration is cancelled or revoked in an independent
applicant’s principal office is located ….
action for cancellation.23 In addition, the legal personality of a
xxxx labor organization cannot be collaterally attacked.24 Thus, when
the personality of the labor organization is questioned in the same
The DOLE issued Department Order No. 40-03, which took effect manner the veil of corporate fiction is pierced, the action partakes
on March 15, 2003, further amending Book V of the above the nature of a collateral attack. Hence, in the absence of any
implementing rules. The new implementing rules explicitly independent action for cancellation of registration against either
provide that applications for registration of labor organizations APSOTEU or ALU, and unless and until their registrations are
shall be filed either with the Regional Office or with the BLR. 17 cancelled, each continues to possess a separate legal personality.
Even after the amendments, the rules did not divest the Regional The CSBTI-RFU and CSBTI-SU are therefore affiliated with
Office and the BLR of their jurisdiction over applications for distinct and separate federations, despite the commonalities of
registration by labor organizations. The amendments to the APSOTEU and ALU.
implementing rules merely specified that when the application was Under the rules implementing the Labor Code, a chartered local
filed with the Regional Office, the application would be acted union acquires legal personality through the charter certificate
upon by the BLR. issued by a duly registered federation or national union, and
The records in this case showed that APSOTEU was registered on reported to the Regional Office in accordance with the rules
March 1, 1991. Accordingly, the law applicable at that time was implementing the Labor Code.25 A local union does not owe its
Section 2, Rule II, Book V of the Implementing Rules, and not existence to the federation with which it is affiliated. It is a
Department Order No. 9 which took effect only on June 21, 1997. separate and distinct voluntary association owing its creation to the
Thus, considering further that APSOTEU’s principal office is will of its members. Mere affiliation does not divest the local
located in Diliman, Quezon City, and its registration was filed union of its own personality, neither does it give the mother
federation the license to act independently of the local union. It
only gives rise to a contract of agency, where the former acts in
representation of the latter.26 Hence, local unions are considered
principals while the federation is deemed to be merely their
agent.27 As such principals, the unions are entitled to exercise the
rights and privileges of a legitimate labor organization, including
the right to seek certification as the sole and exclusive bargaining
agent in the appropriate employer unit.1âwphi1
A word of caution though, under Article 245 of the Labor
Code,28 supervisory employees are not eligible for membership in
a labor union of rank-and-file employees. The supervisory
employees are allowed to form their own union but they are not
allowed to join the rank-and-file union because of potential
conflicts of interest.29 Further, to avoid a situation where
supervisors would merge with the rank-and-file or where the
supervisors’ labor union would represent conflicting interests, a
local supervisors’ union should not be allowed to affiliate with the
national federation of unions of rank-and-file employees where
that federation actively participates in the union activity within the
company.30 Thus, the limitation is not confined to a case of
supervisors wanting to join a rank-and-file union. The prohibition
extends to a supervisors’ local union applying for membership in a
national federation the members of which include local unions of
rank-and-file employees.31 In De La Salle University Medical
Center and College of Medicine v. Laguesma, we reiterated the
rule that for the prohibition to apply, it is not enough that the
supervisory union and the rank-and-file union are affiliated with a
single federation. In addition, the supervisors must have direct
authority over the rank-and-file employees.32
In the instant case, the national federations that exist as separate
entities to which the rank-and-file and supervisory unions are
separately affiliated with, do have a common set of officers. In
addition, APSOTEU, the supervisory federation, actively
participates in the CSBTI-SU while ALU, the rank-and-file
federation, actively participates in the CSBTI-RFU, giving
occasion to possible conflicts of interest among the common
officers of the federation of rank-and-file and the federation of
supervisory unions. For as long as they are affiliated with the
APSOTEU and ALU, the supervisory and rank-and-file unions
both do not meet the criteria to attain the status of legitimate labor
organizations, and thus could not separately petition for
certification elections.1âwphi1
The purpose of affiliation of the local unions into a common
enterprise is to increase the collective bargaining power in respect
of the terms and conditions of labor.33 When there is commingling
of officers of a rank-and-file union with a supervisory union, the
constitutional policy on labor is circumvented. Labor
organizations should ensure the freedom of employees to organize
themselves for the purpose of leveling the bargaining process but
also to ensure the freedom of workingmen and to keep open the
corridor of opportunity to enable them to do it for themselves.
WHEREFORE, the petition is GRANTED. The Court of
Appeals’ Decision dated August 31, 2001, in CA-G.R. SP No.
54128 and the Resolution dated February 5, 2003 are SET
ASIDE. The decision of the Med-Arbiter is hereby AFFIRMED.
SO ORDERED.
[G.R. No. 115180. November 16, 1999]
FILIPINO PIPE AND FOUNDRY
CORPORATION, petitioner, vs. NATIONAL LABOR
RELATIONS COMMISSION, NATIONAL LABOR UNION
TUCP, and EULOGIO LERUM, respondents.
DECISION
PURISIMA, J.:
At bar is a Petition for Certiorari under Rule 65 of the Revised
Rules of Court seeking to annul and set aside the Decision[1] of the
National Labor Relations Commission,[2] dated September 29,
1993, in NLRC NCR CA No. 003806-92, which reversed the
Decision[3]of the Labor Arbiter,[4] dated August 31, 1992, in
NLRC Case No. 4-1309-86, disposing thus:
WHEREFORE, premises considered, the appeal of complainant
corporation is hereby dismissed for lack of merit; the appeal of
Atty. Lerum and NLU is hereby granted, and the Decision dated
August 31, 1992 is hereby annulled and set side, and a new
judgment is hereby entered declaring the complaint below
dismissed for lack of merit insofar as respondent NLU and Atty.
Lerum are concerned.
SO ORDERED.[5]
The antecedent facts can be culled as follows:
On February 10, 1986, respondent National Labor Union-Trade
Union Congress of the Philippines (NLU-TUCP), a national
federation of labor unions, filed with the then Ministry of Labor
and Employment, in behalf of its local chapter, the Filipino Pipe
Workers Union-National Labor Union (FPWU-NLU, hereinafter
referred to as Union), a notice of strike signed by its national
president, Atty. Eulogio R. Lerum, against the petitioner, Filipino
Pipe and Foundry Corporation, alleging as grounds therefor union
busting and non-implementation of the Collective Bargaining
Agreement.[6]
The initial conciliation conference was set on February 24, 1986
but due to lack of notice thereof to petitioner company, as well as
the failure of FPWU-NLU to furnish the latter a copy of the notice
of strike, the initial conciliation conference was re-set to March 3,
1986.
In the early morning of March 3, 1986, however, without waiting
for the outcome of the conciliation conference scheduled on said
date, the FPWU-NLU staged the strike in question which lasted
until June 13, 1986, when a return to work agreement was reached
by the union and petitioner company.[7]
On April 8, 1986, petitioner company interposed before the
Arbitration Branch of the then Ministry of Labor and
Employment, a petition to declare the strike illegal with prayer for
damages against FPWU-NLU, NLU-TUCP and its national
president, Atty. Eulogio Lerum.
On December 23, 1988, petitioner company moved for the partial AMOUNTING TO LACK AND/OR EXCESS OF
dismissal of the Complaint against forty-three (43) officers and JURISDICTION AND ACTED CAPRICIOUSLY AND
members of FPWU-NLU, but maintained the action against the WHIMSICALLY IN TOTAL DISREGARD OF THE
NLU-TUCP and Atty. Eulogio Lerum. [8] EVIDENCE PRESENTED IN THE CASE WHEN IT HELD
THAT PRIVATE RESPONDENTS MERELY ASSISTED THE
On August 31, 1992, the Labor Arbiter came out with a decision LOCAL CHAPTER AND ITS MEMBERS IN STAGING A
for petitioner company, ruling as follows: STRIKE AGAINST PETITIONER AND THAT SUCH
WHEREFORE, judgment is hereby rendered declaring that the ASSISTANCE WAS NOT THE CAUSE NOR WAS IT AN
strike staged by respondents from March 3, 1986 to June 13, 1986 INDESPENSABLE ELEMENT OF THE STRIKE.
was ILLEGAL. Accordingly and in conformity with the Return-to- III
Work Agreement, respondent National Labor Union-TUCP is
hereby directed to pay the complainant company the following: PUBLIC RESPONDENT NATIONAL LABOR RELATIONS
COMMISSION GRAVELY ERRED IN LAW AND GRAVELY
a) Actual damages in the form of loss of revenue during the ABUSED ITS DISCRETION AMOUNTING TO LACK
duration of the strike which lasted for 100 days or in the amount of AND/OR EXCESS OF JURISDICTION WHEN IT
ONE MILLION PESOS (P1,000,000.00); CONCLUDED THAT PETITIONER LOST ITS CAUSE OF
b) Damages to the good business standing and commercial credit ACTION AGAINST PRIVATE RESPONDENTS AFTER THE
of the company in the amount of THREE HUNDRED FIFTY LOCAL UNION HIRED A NEW COUNSEL AND
THOUSAND PESOS (P350,000.00); and PETITIONER MOVED FOR PARTIAL DISMISSAL OF ITS
COMPLAINT AGAINST THE STRIKING WORKERS
c) Exemplary damages to deter others similarly inclined from INASMUCH AS PRIVATE RESPONDENTS ARE MERE
committing similar acts and to serve as an example for the public THIRD PARTIES.[10]
good, in the amount of TWO HUNDRED FIFTY THOUSAND
PESOS (P250,000.00). Rule XXII, Book V, of the Rules Implementing the Labor Code,
provides:
Further, respondent NLU is hereby directed to pay the attorneys
fees equivalent to 10% of the actual damages, or the amount of Section 1. Grounds for strike and lockout. A strike or lockout
ONE HUNDRED THOUSAND PESOS (P100, 000.00). may be declared in cases of bargaining deadlocks and unfair labor
practices. Violations of collective bargaining agreements, except
For lack of showing that respondent Lerum acted in his personal flagrant and/or malicious refusal to comply with its economic
capacity, he is hereby ABSOLVED from any liability. provisions, shall not be considered unfair labor practice and shall
not be strikeable. No strike or lockout may be declared on grounds
Pursuant to the Agreement, the complaint against all the other
involving inter-union and intra-union disputes or on issues brought
individual respondents are hereby DISMISSED.
to voluntary or compulsory arbitration.
SO ORDERED.[9]
xxx xxx xxx
Therefrom, both parties appealed to the NLRC which on
Section 3. Notice of strike or lockout.- In cases of bargaining
September 29, 1993, rendered the assailed decision. Dissatisfied
deadlocks, a notice of strike or lockout shall be filed with the
therewith, the petitioner company found its way to this
regional branch of the Board at least thirty (30) days before the
Court via the present petition; theorizing that:
intended date thereof, a copy of said notice having been served on
I the other party concerned. x x x"

PUBLIC RESPONDENT NATIONAL LABOR RELATIONS xxx xxx xxx

COMMISSION ERRED IN LAW, CAPRICIOUSLY AND
WHIMSICALLY DISREGARDED THE EVIDENCE
SUBMITTED IN THE CASE AND GRAVELY ABUSED ITS
DISCRETION AMOUNTING TO LACK AND/OR EXCESS OF
JURISDICTION WHEN IT HELD THAT PRIVATE
RESPONDENTS NATIONAL LABOR UNION (NLU)-TUCP
AND ATTY. EULOGIO LERUM ARE NOT PRIMARILY
RESPONSIBLE AND, THEREFORE, NOT LIABLE FOR
DAMAGES SUFFERED BY PETITIONER ON ACCOUNT OF
THE ILLEGAL STRIKE THEY HAD DIRECTLY AIDED,
ASSISTED, ABETTED AND PARTICIPATED IN.
II
PUBLIC RESPONDENT NATIONAL LABOR RELATIONS
COMMISSION GRAVELY ABUSED ITS DISCRETION
"Section 6. Conciliation. - Upon receipt of the notice, the regional
branch of the Board shall exert all efforts at mediation and
conciliation to enable the parties to settle the dispute
amicably. The regional branch of the Board may, upon
consultation, recommend to the parties to submit the dispute to
voluntary arbitration.
During the proceedings, the parties shall not do any act which
may disrupt or impede the early settlement of the dispute. They are
obliged as part of the duty to bargain collectively in good faith, to
participate fully and promptly in the conciliation meetings called
by the regional branch of the board. The regional branch of the
Board shall have the power to issue subpoenas requiring the
attendance of the parties to the meetings. xxx"
Applying the aforecited provision of law in point to the case under
consideration, the Court is of the finding and conclusion that the
strike staged by FPWU-NLU was illegal for want of any legal
basis. Contrary to the grounds advanced by the union in the notice
of strike, it turned out during the March 3, 1986 conciliation
conference that the purpose of the strike was to pressure the
petitioner company to:
organization.[13] In support of this stance, petitioner cited the
following letter of Atty. Lerum to the company, to wit:
NATIONAL LABOR UNION
An Affiliate of the Trade Union of the Philippines
3199 Ramon Magsaysay Blvd., Manila, Philippines

1) include in the salary of the strikers the P3.00 wage Tel. 61-42-65
increase[11] effective March 1, 1986.
March 29, 1983
2) compute their backwages covering the period from December 1,
Dear Sirs:
1980 to February 28, 1986, including vacation leave and sick
leave. Please be informed that we have formed a local union in your
company and the officers thereof are the following:
A thorough sifting of the pertinent records discloses that the
alleged union busting was not substantiated and the supposed non- President - Virgilio Bernal
implementation of the collective bargaining agreement was
groundless because the demands of FPWU-NLU, at the time the Vice-Pres. - Ramon Alborte
notice of strike was filed and at the time the union actually struck,
Secretary - Ernesto Ballesteros
were the subject of a pending application for a writ of execution
filed by the union in Case No. AB-7933-80 (NCR-CA-8-674-80), Treasurer - Arsenio Agustin
which application was granted on April 4, 1986 by the Labor
Arbiter.[12] Verily, the strike staged by FPWU-NLU was baseless Auditor - Genaro Gabule
since it was still pre-mature then for the union to insist on the
Board Members:
implementation of the adverted provision of the collective
bargaining agreement, which was the subject of a pending writ of 1. Eduardo Cenina 4. Felimon Simborio
execution.
2. Dante Canete 5. Joseph Olazo
Then too, the failure of the union to serve petitioner company a
copy of the notice of strike is a clear violation of Section 3 of the 3. Reynaldo Adelante 6. Virgilio Elnar
aforestated Rules. The constitutional precepts of due process Shop Stewards:
mandate that the other party be notified of the adverse action of the
opposing party. So also, the same Section provides for a 1. Pablito Fajardo
mandatory thirty (30) day cooling-off period which the union
ignored when it struck on March 3, 1986, before the 30th day from 2. Ruperto Manlangit
the time the notice of strike was filed on February 10, 1986. 3. Ruben Bongaos
What is more, the same strike blatantly disregarded the prohibition We have given them full authority to deal with you on all matters
on the doing of any act which may impede or disrupt the covered by our authority as sole collective bargaining
conciliation proceedings, when the union staged the strike in the representative of your rank and file workers.
early morning of March 3, 1986, the very same day the
conciliation conference was scheduled by the former Ministry of Very truly yours,
Labor.
(Sgd)
In light of the foregoing, it is beyond cavil that subject strike
staged by the union was illegal. EULOGIO R. LERUM

Anent the responsibility for the damages allegedly sustained by
petitioner company on account of the illegal strike, the latter
theorized that the liability therefor should be borne by NLU-TUCP
and its national president, Atty. Eulogio Lerum, for having directly
participated in aiding and abetting the illegal strike. It is argued
that FPWU-NLU is a mere agent of respondent NLU-TUCP,
because FPWU-NLU, which was formed by respondent NLU-
TUCP is not registered as a local unit or chapter but directly
affiliated with the latter and therefore, could not have acted on its
own. Otherwise stated, petitioner is of the view that FPWU-NLU,
a local union, cannot act as the principal of respondent NLU-
TUCP, a mother federation, because it is not a legitimate labor
National President[14]
In Progressive Development Corporation vs. Secretary,
Department of Labor and Employment,[15] the Court explained the
nature of the relationship between a mother union/federation and a
local union, thus:
At this juncture, it is important to clarify the relationship between
the mother union and the local union. In the case of Liberty Cotton
Mills Workers Union v. Liberty Cotton Mills, Inc., 66 SCRA 512
[1975], the Court held that the mother union, acting for and in
behalf of its affiliate, had the status of an agent while the local
union remained the basic unit of the association, free to serve the
common interest of all its members subject only to the restraints NLRC NCR CA No. 003806-92 AFFIRMED. No pronouncement
imposed by the constitution and by-laws of the association. x x x[16] as to costs.

The same is true even if the local union is not a legitimate labor SO ORDERED.
organization. Conformably, in the abovecited case the Court ruled
that the mother federation was a mere agent and the local G.R. No. 116194. February 2, 2000
chapter/union was the principal, notwithstanding the failure of the SUGBUANON RURAL BANK, INC., Petitioner, v. HON.
local union to comply with the procedural requirements that would UNDERSECRETARY BIENVENIDO E. LAGUESMA,
make it a legitimate labor organization. DEPARTMENT OF LABOR AND EMPLOYMENT, MED-
Evidently, in the case under scrutiny, whether or not FPWU, the ARBITER ACHILLES MANIT, DEPARTMENT OF LABOR
local chapter, complied with the procedural requirements that AND EMPLOYMENT, REGIONAL OFFICE NO. 7, CEBU
would make it a legitimate labor organization is immaterial. It CITY, AND SUGBUANON RURAL BANK, INC. -
would not affect its status as the principal and basic unit of the ASSOCIATION OF PROFESSIONAL, SUPERVISORY,
association. The requirement laid down in the Progressive OFFICE, AND TECHNICAL EMPLOYEES UNION-TRADE
Development case, that the local union must be a legitimate labor UNIONS CONGRESS OF THE PHILIPPINES, Respondents.
organization, pertains to the conditions before a union may file a D E C I S I O N
petition for certification election and to be certified as sole and
exclusive bargaining agent. In the present case, there is no dispute QUISUMBING, J.:
that FPWU-NLU is the sole and exclusive bargaining
In this special civil action for certiorari and prohibition, petitioner
representative of the rank and file employees of petitioner
seeks the annulment of the April 27, 1994 Resolution of the
company. The union's status as a legitimate labor organization is
Department of Labor and Employment, affirming the order of the
therefore of no moment in the resolution of the controversy
Med-Arbiter, dated December 9, 1993, which denied petitioner's
here. As the local union, it is considered as the principal; the entity
motion to dismiss respondent union's petition for certification
which staged the illegal strike and the one responsible for the
election.
resulting damages allegedly sustained by petitioner company.
Petitioner Sugbuanon Rural Bank, Inc., (SRBI, for brevity) is a
Furthermore, the petitioner company is now estopped from
duly-registered banking institution with principal office in Cebu
reneging on the recognition it extended to the FPUW-NLU as the
City and a branch in Mandaue City. Private respondent SRBI-
bargaining representative of its rank and file workers, by belatedly
Association of Professional, Supervisory, Office, and Technical
attacking its status which petitioner company had voluntarily
Employees Union (APSOTEU) is a legitimate labor organization
recognized. It should be noted that even as early as 1981, when the
affiliated with the Trade Unions Congress of the Philippines
collective bargaining agreement sought to be implemented by the
(TUCP).
union was entered into, the latter was already the bargaining
representative of the employees concerned. It is not, therefore, true On October 8, 1993, the DOLE Regional Office in Cebu City
that it was respondent NLU-TUCP which formed FPWU. At most, granted Certificate of Registration No. R0700-9310-UR-0064 to
the entry into the picture of the private respondent on March 23, APSOTEU- TUCP, hereafter referred to as the union.
1983, merely affirmed the status of FPWU as the recognized
bargaining representative of the rank and file employees of On October 26, 1993, the union filed a petition for certification
petitioner company. election of the supervisory employees of SRBI. It alleged, among
others, that: (1) APSOTEU-TUCP was a labor organization duly-
Evidently, direct and primary responsibility for the damages registered with the Labor Department; (2) SRBI employed 5 or
allegedly caused by the illegal strike sued upon fall on the local more supervisory employees; (3) a majority of these employees
union FPWU, being the principal, and not on respondent NLU- supported the petition; (4) there was no existing collective
TUCP, a mere agent of FPWU-NLU which assisted the latter in bargaining agreement (CBA) between any union and SRBI; and
filing the notice of strike. Being just an agent, the notice of strike (5) no certification election had been held in SRBI during the past
filed by Atty. Eulogio Lerum, the national president of NLU- 12 months prior to the petition.
TUCP, is deemed to have been filed by its principal, the FPWU-
NLU. Having thus dismissed the claim for damages against the On October 28, 1993, the Med-Arbiter gave due course to the
principal, FPWU-NLU, the action for damages against its agent, petition. The pre-certification election conference between SRBI
respondent NLU-TUCP, and Atty. Lerum, has no more leg to and APSOTEU- TUCP was set for November 15, 1993.
stand on and should also be dismissed.
On November 12, 1993, SRBI filed a motion to dismiss the union's
Premises studiedly considered, the Court is of the ineluctable petition. It sought to prevent the holding of a certification election
conclusion, and so holds, that the National Labor Relations on two grounds: First, that the members of APSOTEU-TUCP
Commission did not act with grave abuse of discretion in reversing were in fact managerial or confidential employees. Thus,
the Decision of the Labor Arbiter in NLRC CASE No. 4-1309-86. following the doctrine in Philips Industrial Development
Corporation v. National Labor Relations Commission,[1] they
WHEREFORE, for lack of merit, the Petition is DISMISSED, were disqualified from forming,ining, or assisting any labor
and the Decision of the National Labor Relations Commission in organization. Petitioner attached theb descriptions of the
employees concerned to its motion. Second, the Association of On May 25, 1994, SRBI moved for reconsideration of the
Labor Unions-Trade Unions Congress of the Philippines or ALU- Undersecretary's decision which was denied on July 7, 1994. The
TUCP was representing the union. Since ALU- TUCP also sought Med- Arbiter scheduled the holding of certification elections on
to represent the rank-and-file employees of SRBI, there was a August 12, 1994.
violation of the principle of separation of unions enunciated
in Atlas Lithographic Services, Inc. v. Laguesma.[2] Hence the instant petition grounded on the following assignments
of error:
The union filed its opposition to the motion to dismiss on
December 1, 1993. It argued that its members were not managerial I
employees but merely supervisory employees. The members RESPONDENT UNDERSECRETARY LAGUESMA ACTED
attached their affidavits describing the nature of their respective WITH GRAVE ABUSE OF DISCRETION AND PALPABLY
duties. The union pointed out that Article 245 of the Labor Code ERRED:
expressly allowed supervisory employees to form,in, or assist their
own unions. A. IN HOLDING THAT ART. 257 OF THE LABOR CODE
REQUIRES THE MED-ARBITER TO CONDUCT A
On December 9, 1993, the Med-Arbiter denied petitioner's motion CERTIFICATION ELECTION IN ANY UNORGANIZED
to dismiss. He scheduled the inclusion-exclusion proceedings in ESTABLISHMENT EVEN WHEN THE PETITIONING UNION
preparation for the certification election on December 16, 1993. DOES NOT POSSESS THE QUALIFICATION FOR AN
SRBI appealed the Med-Arbiter's decision to the Secretary of APPROPRIATE BARGAINING AGENT; AND
Labor and Employment. The appeal was denied for lack of merit. B. IN REFUSING TO ASSUME JURISDICTION OVER THE
The certification election was ordered. PETITIONER'S APPEAL AND TO DISMISS THE
On June 16, 1994, the Med-Arbiter scheduled the holding of the RESPONDENT UNION'S PETITION FOR CERTIFICATION
certification election for June 29, 1994. His order identified the ELECTION.
following SRBI personnel as the voting supervisory employees in II
the election: the Cashier of the Main office, the Cashier of the
Mandaue Branch, the Accountant of the Mandaue Branch, and the RESPONDENT UNDERSECRETARY LAGUESMA ACTED
Acting Chief of the Loans Department. WITH GRAVE ABUSE OF DISCRETION AND PALPABLY
ERRED IN DENYING THE PETITIONER'S APPEAL DESPITE
On June 17, 1994, SRBI filed with the Med-Arbiter an urgent THE FACT THAT:
motion to suspend proceedings The Med-Arbiter denied the same
on June 21, 1994. SRBI then filed a motion for reconsideration. A. THE ALLEGED MEMBERS OF RESPONDENT UNION
Two days later, the Med- Arbiter cancelled the certification ARE MANAGERIAL EMPLOYEES WHO ARE LEGALLY
election scheduled for June 29, 1994 in order to address the DISQUALIFIED FROM JOINING ANY LABOR
motion for reconsideration. ORGANIZATION.

The Med-Arbiter later denied petitioner's motion for B. AT THE VERY LEAST, THE ALLEGED MEMBERS OF
reconsideration. SRBI appealed the order of denial to the DOLE RESPONDENT UNION ARE OCCUPYING HIGHLY
Secretary on December 16, 1993. CONFIDENTIAL POSITIONS IN PETITIONER AND, THUS,
THE LEGAL DISQUALIFICATION OF MANAGERIAL
On December 22, 1993, petitioner proceeded to file a petition with EMPLOYEES EQUALLY APPLY TO THEM.
the DOLE Regional Office seeking the cancellation of the
respondent union's registration. It averred that the APSOTEU- III
TUCP members were actually managerial employees who were
IN ANY EVENT, THE CONCLUSIONS REACHED IN THE
prohibited by law fromining or organizing unions.
SUBJECT RESOLUTIONS ARE CONTRARY TO LAW AND
On April 22, 1994, respondent DOLE Undersecretary denied ARE DIAMETRICALLY OPPOSED TO RESPONDENT
SRBI's appeal for lack of merit. He ruled that APSOTEU- TUCP UNION'S RECORDED ADMISSIONS AND
was a legitimate labor organization. As such, it was fully entitled REPRESENTATIONS.
to all the rights and privileges granted by law to a legitimate labor
Considering petitioner's assigned errors, we find two core issues
organization, including the right to file a petition for certification
for immediate resolution:
election. He also held that until and unless a final order is issued
canceling APSOTEU- TUCP's registration certificate, it had the (1) Whether or not the members of the respondent union are
legal right to represent its members for collective bargaining managerial employees and/or highly-placed confidential
purposes. Furthermore, the question of whether the APSOTEU- employees, hence prohibited by law fromining labor organizations
TUCP members should be considered as managerial or and engaging in union activities?
confidential employees should not be addressed in the proceedings
involving a petition for certification election but best threshed out (2) Whether or not the Med-Arbiter may validly order the holding
in other appropriate proceedings. of a certification election upon the filing of a petition for
certification election by a registered union, despite the petitioners
appeal pending before the DOLE Secretary against the issuance of the hiring and appointment of his subordinates, as the power to
the unions registration? recommend any promotion and/or increase. 8cräläwvirtualibräry

The other issues based on the assigned errors could be resolved Here, we find that that the Cashiers, Accountant, and Acting Chief
easily after the core issues are settled. of the Loans Department of the petitioner did not possess
managerial powers and duties. We are, therefore, constrained to
Respecting the first issue, Article 212 (m) of the Labor Code conclude that they are not managerial employees.
defines the terms "managerial employee" and "supervisory
employees" as follows: Now may the said bank personnel be deemed confidential
employees? Confidential employees are those who (1) assist or act
"Art. 212. Definitions- in a confidential capacity, in regard (2) to persons who formulate,
xxx determine, and effectuate management policies [specifically in the
field of labor relations].9 The two criteria are cumulative, and both
(m) 'Managerial employee is one who is vested with powers or must be met if an employee is to be considered a confidential
prerogatives to lay down and execute management policies and/or employee-that is, the confidential relationship must exist between
hire, transfer, suspend, lay-off, recall, discharge, assign or the employee and his superior officer; and that officer must handle
discipline employees. Supervisory employees are those who, in the the prescribed responsibilities relating to labor
interest of the employer, effectively recommend such managerial relations.10cräläwvirtualibräry
actions if the exercise of such authority is not merely routinary or
11
clerical in nature but requires the use of independent judgment. All Article 245 of the Labor Code does not directly, prohibit
employees not falling within any of the above definitions are confidential employees from engaging in union activities.
considered rank-and-file employees for purposes of this Book However, under the doctrine of necessary implication, the
(Italic supplied)." disqualification of managerial employees equally applies to
confidential employees.12The confidential-employee rule justifies
Petitioner submitted detailedb descriptions to support its exclusion of confidential employees because in the normal course
contention that the union members are managerial employees of their duties they become aware of management policies relating
and/or confidential employees proscribed from engaging in labor to labor relations.13It must be stressed, however, that when the
activities.3 Petitioner vehemently argues that the functions and employee does not have access to confidential labor relations
responsibilities of the employees involved constitute the "very information, there is no legal prohibition against confidential
core of the bank's business, lending of money to clients and employees from forming, assisting, orining a
borrowers, evaluating their capacity to pay, approving the loan and union.14cräläwvirtualibräry
its amount, scheduling the terms of repayment, and endorsing
delinquent accounts to counsel for collection." 4 Hence, they must Petitioner contends that it has only 5 officers running its day-to-
be deemed managerial employees. Petitioner cites Tabacalera day affairs. They assist in confidential capacities and have
Insurance Co. v. National Labor Relations complete access to the bank's confidential data. They form the core
Commission,[5] and Panday v. National Labor Relations of the bank's management team. Petitioner explains that:
6
Commission, to sustain its submission. In Tabacalera, we "...Specifically: (1) the Head or the Loans Department initially
sustained the classification of a credit and collection supervisor by approves the loan applications before they are passed on to the
management as a managerial/supervisory personnel. But in that Board for confirmation. As such, no loan application is even
case, the credit and collection supervisor "had the power to considered by the Board and approved by petitioner without his
recommend the hiring and appointment of his subordinates, as stamp of approval based upon his interview of the applicant and
well as the power to recommend any promotion and/or determination of his (applicant's) credit standing and financial
increase."7 For this reason he was deemed to be a managerial capacity. The same holds true with respect to renewals or
employee. In the present case, however, petitioner failed to show restructuring of loan accounts. He himself determines what
that the employees in question were vested with similar powers. At account should be collected, whether extrajudicially or judicially,
best they only had recommendatory powers subject to evaluation, and settles the problem or complaints of borrowers regarding their
review, and final decision by the bank's management. Theb accounts;
description forms submitted by petitioner clearly show that the
union members in question may not transfer, suspend, lay-off, "(2) the Cashier is one of the approving officers and authorized
recall, discharge, assign, or discipline employees. Moreover, the signatories of petitioner. He approves the opening of accounts,
forms also do not show that the Cashiers, Accountants, and Acting withdrawals and encashment, and acceptance of check deposits,
Chiefs of the loans Department formulate and execute He deals with other banks and, in the absence of the regular
management policies which are normally expected of management Manager, manages the entire office or branch and approves
officers. disbursements of funds for expenses; and

Petitioner's reliance on Panday is equally misplaced. There, we "(3) the Accountant, who heads the Accounting Department, is
held that a branch accountant is a managerial employee because also one of the authorized signatories of petitioner and, in the
the said employee had managerial powers, similar to the absence of the Manager or Cashier, acts as substitute approving
supervisor in Tabacalera. Their powers included recommending officer and assumes the management of the entire office. She
handles the financial reports and reviews the debit/credit tickets found in order, for none was specifically disqualified from
submitted by the other departments." 15cräläwvirtualibräry membership.

Petitioner's explanation, however, does not state who among the WHEREFORE, the instant petition is hereby DISMISSED. No
employees has access to information specifically relating to its pronouncement as to costs.
labor relations policies. Even Cashier Patricia Maluya, who serves
as the secretary of the bank's Board of Directors may not be so SO ORDERED.
classified. True, the board of directors is responsible for corporate EN BANC
policies, the exercise of corporate powers, and the general
management of the business and affairs of the corporation. As G.R. No. 179146, July 23, 2013
secretary of the bank's governing body, Patricia Maluya serves the
HOLY CHILD CATHOLIC SCHOOL, Petitioner, v. HON.
bank's management, but could not be deemed to have access to
confidential information specifically relating to SRBI's labor PATRICIA STO. TOMAS, IN HER OFFICIAL CAPACITY
AS SECRETARY OF THE DEPARTMENT OF LABOR
relations policies, absent a clear showing on this matter. Thus,
AND EMPLOYMENT, AND PINAG-ISANG TINIG AT
while petitioner's explanation confirms the regular duties of the
concerned employees, it shows nothing about any duties LAKAS NG ANAKPAWIS – HOLY CHILD CATHOLIC
SCHOOL TEACHERS AND EMPLOYEES LABOR UNION
specifically connected to labor relations.
(HCCS-TELU-PIGLAS), Respondents.
As to the second issue. One of the rights of a legitimate labor
organization under Article 242(b) of the Labor Code is the right to DECISION
be certified as the exclusive representative of all employees in an
appropriate bargaining unit for purposes of collective bargaining. PERALTA, J.:
Having complied with the requirements of Art. 234, it is our view Assailed in this petition for review on certiorari under Rule 45 of
that respondent union is a legitimate labor union. Article 257 of the Rules of Civil Procedure are the April 18, 2007 Decision1 and
the Labor Code mandates that a certification election July 31, 2007 Resolution2 of the Court of Appeals in CA-G.R. SP
shall automatically be conducted by the Med-Arbiter upon the No. 76175, which affirmed the December 27, 2002 Decision 3 and
filing of a petition by a legitimate labor organization. 16 Nothing is February 13, 2003 Resolution4 of the Secretary of the Department
said therein that prohibits such automatic conduct of the of Labor and Employment (SOLE) that set aside the August 10,
certification election if the management appeals on the issue of the 2002 Decision5 of the Med-Arbiter denying private respondent’s
validity of the union's registration. On this score, petitioner's petition for certification election.
appeal was correctly dismissed.
The factual antecedents are as follows:cralavvonlinelawlibrary
Petitioner argues that giving due course to respondent union's
petition for certification election would violate the separation of
On May 31, 2002, a petition for certification election was filed by
unions doctrine.17 Note that the petition was filed by APSOTEU-
private respondent Pinag-Isang Tinig at Lakas ng Anakpawis –
TUCP, a legitimate labor organization. It was not, filed by ALU.
Holy Child Catholic School Teachers and Employees Labor Union
Nor was it filed by TUCP, which is a national labor federation of
(HCCS-TELU-PIGLAS), alleging that: PIGLAS is a legitimate
with which respondent union is affiliated. Petitioner says that
labor organization duly registered with the Department of Labor
respondent union is a mere alter ego of ALU. The records show
and Employment (DOLE) representing HCCS-TELU-PIGLAS;
nothing to this effect. What the records instead reveal is that
HCCS is a private educational institution duly registered and
respondent union was initially assisted by ALU during its
operating under Philippine laws; there are approximately one
preliminary stages of organization. A local union maintains its
hundred twenty (120) teachers and employees comprising the
separate personality despite affiliation with a larger national
proposed appropriate bargaining unit; and HCCS is unorganized,
federation.18 Petitioner alleges that ALU seeks to represent both
there is no collective bargaining agreement or a duly certified
respondent union and the rank-and-file union. Again, we find
bargaining agent or a labor organization certified as the sole and
nothing in the records to support this bare assertion.
exclusive bargaining agent of the proposed bargaining unit within
The law frowns on a union where the membership is composed of one year prior to the filing of the petition. 6 Among the documents
both supervisors and rank-and-file employees, for fear that attached to the petition were the certificate of affiliation
conflicts of interest may arise in the areas of discipline, collective with Pinag-Isang Tinig at Lakas ng Anakpawis Kristiyanong
bargaining, and strikes.19 However, in the present case, none of the Alyansa ng Makabayang Obrero (PIGLAS-KAMAO) issued by the
members of the respondent union came from the rank-and-file Bureau of Labor Relations (BLR), charter certificate issued by
employees of the bank. PIGLAS-KAMAO, and certificate of registration of HCCS-TELU
as a legitimate labor organization issued by the DOLE. 7
Taking into account the circumstances in this case, it is our view
that respondent Undersecretary committed no reversible error nor In its Comment8 and Position Paper,9 petitioner HCCS consistently
grave abuse of discretion when he found the order of the Med- noted that it is a parochial school with a total of 156 employees as
Arbiter scheduling a certification election in order. The list of of June 28, 2002, broken down as follows: ninety-eight (98)
employees eligible to vote in said certification election was also teaching personnel, twenty-five (25) non-teaching academic
employees, and thirty-three (33) non-teaching non-academic “bargaining unit” as a group of employees sharing mutual
workers. It averred that of the employees who signed to support interests within a given employer unit comprised of all or less than
the petition, fourteen (14) already resigned and six (6) signed all of the entire body of employees in the employer unit or any
twice. Petitioner raised that members of private respondent do not specific occupational or geographical grouping within such
belong to the same class; it is not only a mixture of managerial, employer unit. This definition has provided the “community or
supervisory, and rank-and-file employees – as three (3) are vice- mutuality of interest” test as the standard in determining the
principals, one (1) is a department head/supervisor, and eleven constituency of a collective bargaining unit. This is so because the
(11) are coordinators – but also a combination of teaching and basic test of an asserted bargaining unit’s acceptability is whether
non-teaching personnel – as twenty-seven (27) are non-teaching or not it is fundamentally the combination which will best assure
personnel. It insisted that, for not being in accord with Article to all employees the exercise of their collective bargaining rights.
24510 of the Labor Code, private respondent is an illegitimate labor The application of this test may either result in the formation of an
organization lacking in personality to file a petition for employer unit or in the fragmentation of an employer unit.
certification election, as held in Toyota Motor Philippines
Corporation v. Toyota Motor Philippines Corporation Labor In the case at bar, the employees of [petitioner], may, as already
Union;11 and an inappropriate bargaining unit for want of suggested, quite easily be categorized into (2) general
community or mutuality of interest, as ruled in Dunlop Slazenger classes[:] one, the teaching staff; and two, the non-teaching-staff.
(Phils.), Inc. v. Secretary of Labor and Employment 12 and De La Not much reflection is needed to perceive that the community or
Salle University Medical Center and College of Medicine v. mutuality of interest is wanting between the teaching and the non-
Laguesma.13 teaching staff. It would seem obvious that the teaching staff would
find very little in common with the non-teaching staff as regards
Private respondent, however, countered that petitioner failed to responsibilities and function, working conditions, compensation
substantiate its claim that some of the employees included in the rates, social life and interests, skills and intellectual pursuits, etc.
petition for certification election holds managerial and supervisory These are plain and patent realitieswhich cannot be ignored.
positions.14Assuming it to be true, it argued that Section 11 These dictate the separation of these two categories of employees
(II),15 Rule XI of DOLE Department Order (D.O.) No. 9, Series of for purposes of collective bargaining. (University of the
1997, provided for specific instances in which a petition filed by a Philippines vs. Ferrer-Calleja, 211 SCRA 451)19
legitimate organization shall be dismissed by the Med-Arbiter and
that “mixture of employees” is not one of those enumerated.
Private respondent pointed out that questions pertaining to Private respondent appealed before the SOLE, who, on December
qualifications of employees may be threshed out in the inclusion- 27, 2002, ruled against the dismissal of the petition and directed
exclusion proceedings prior to the conduct of the certification the conduct of two separate certification elections for the teaching
election, pursuant to Section 2, Rule XII of D.O. No. 9. Lastly, and the non-teaching personnel, thus:cralavvonlinelawlibrary
16

similar to the ruling in In Re: Globe Machine and Stamping We agree with the Med-Arbiter that there are differences in the
Company,17 it contended that the will of petitioner’s employees nature of work, hours and conditions of work and salary
should be respected as they had manifested their desire to be determination between the teaching and non-teaching personnel of
represented by only one bargaining unit. To back up the formation [petitioner]. These differences were pointed out by [petitioner] in
of a single employer unit, private respondent asserted that even if its position paper. We do not, however, agree with the Med-
the teachers may receive additional pay for an advisory class and Arbiter that these differences are substantial enough to warrant the
for holding additional loads, petitioner’s academic and non- dismissal of the petition. First, as pointed out by [private
academic personnel have similar working conditions. It respondent], “inappropriateness of the bargaining unit sought to be
cited Laguna College v. Court of Industrial Relations,18 as well as represented is not a ground for the dismissal of the petition[.”] In
the case of a union in West Negros College in Bacolod City, which fact, in the cited case of University of the Philippines v. Ferrer-
allegedly represented both academic and non-academic Calleja, supra, the Supreme Court did not order the dismissal of
employees. the petition but ordered the conduct of a certification election,
limiting the same among the non-academic personnel of the
On August 10, 2002, Med-Arbiter Agatha Ann L. Daquigan University of the Philippines.
denied the petition for certification election on the ground that the
unit which private respondent sought to represent is inappropriate. It will be recalled that in the U.P. case, there were two contending
She resolved:cralavvonlinelawlibrary unions, the Organization of Non-Academic Personnel of U.P.
A certification election proceeding directly involves two (2) issues (ONAPUP) and All U.P. Workers Union composed of both
namely: (a) the proper composition and constituency of the academic and non-academic personnel of U.P. ONAPUP sought
bargaining unit; and (b) the validity of majority representation the conduct of certification election among the rank-and-file non-
claims. It is therefore incumbent upon the Med-Arbiter to rule on academic personnel only while the all U.P. Workers Union sought
the appropriateness of the bargaining unit once its composition and the conduct of certification election among all of U.P.’s rank-and-
constituency is questioned. file employees covering academic and non-academic personnel.
While the Supreme Court ordered a separate bargaining unit for
Section 1 (q), Rule I, Book V of the Omnibus Rules defines a the U.P. academic personnel, the Court, however, did not order
them to organize a separate labor organization among themselves.
The All U.P. Workers Union was not directed to divest itself of its
academic personnel members and in fact, we take administrative
notice that the All U.P. Workers Union continue to exist with a
combined membership of U.P. academic and non-academic
personnel although separate bargaining agreements is sought for
the two bargaining units. Corollary, [private respondent] can
continue to exist as a legitimate labor organization with the
combined teaching and non-teaching personnel in its membership
and representing both classes of employees in separate bargaining
negotiations and agreements.
WHEREFORE, the Decision of the Med-Arbiter dated 10 August
2002 is hereby REVERSED and SET ASIDE. In lieu thereof, a
new order is hereby issued directing the conduct of two
certification elections, one among the non-teaching personnel of
Holy Child Catholic School, and the other, among the teaching
personnel of the same school, subject to the usual pre-election
conferences and inclusion-exclusion proceedings, with the
following choices:cralavvonlinelawlibrary
A. Certification Election Among [Petitioner]’s Teaching
Personnel:cralavvonlinelawlibrary
1. Holy Child Catholic School Teachers and
Employees Labor Union; and
2. No Union.
B. Certification Election Among [Petitioner]’s Non-
Teaching Personnel:cralavvonlinelawlibrary
1. Holy Child Catholic School Teachers and
Employees Labor Union; and
2. No Union.
[Petitioner] is hereby directed to submit to the Regional Office of
origin within ten (10) days from receipt of this Decision, a
certified separate list of its teaching and non-teaching personnel or
when necessary a separate copy of their payroll for the last three
(3) months prior to the issuance of this Decision.20
Petitioner filed a motion for reconsideration21 which, per
Resolution dated February 13, 2003, was denied. Consequently,
petitioner filed before the CA a Petition for Certiorari with Prayer
for Temporary Restraining Order and Preliminary
Injunction.22 The CA resolved to defer action on the prayer for
TRO pending the filing of private respondent’s Comment. 23 Later,
private respondent and petitioner filed their Comment24 and
Reply,25 respectively.
On July 23, 2003, petitioner filed a motion for immediate issuance THE HONORABLE COURT OF APPEALS ERRED IN
of a TRO, alleging that Hon. Helen F. Dacanay of the Industrial HOLDING THAT THE RULING IN THE CASE OF TOYOTA
Relations Division of the DOLE was set to implement the SOLE MOTOR PHILIPPINES CORPORATION VS. TOYOTA
Decision when it received a summons and was directed to submit a MOTOR PHILIPPINES CORPORATION LABOR UNION (268
certified list of teaching and non-teaching personnel for the last SCRA 573) DOES NOT APPLY IN THE CASE AT BAR
three months prior to the issuance of the assailed DESPITE THE [COMMINGLING] OF BOTH SUPERVISORY
Decision.26 Acting thereon, on August 5, 2003, the CA issued the
TRO and ordered private respondent to show cause why the writ
of preliminary injunction should not be granted.27 Subsequently, a
Manifestation and Motion28 was filed by private respondent,
stating that it repleads by reference the arguments raised in its
Comment and that it prays for the immediate lifting of the TRO
and the denial of the preliminary injunction. The CA, however,
denied the manifestation and motion on November 21, 2003 29 and,
upon motion of petitioner,30 granted the preliminary injunction on
April 21, 2005.31 Thereafter, both parties filed their respective
Memorandum.32
On April 18, 2007, the CA eventually dismissed the petition. As to
the purported commingling of managerial, supervisory, and rank-
and-file employees in private respondent’s membership, it held
that the Toyota ruling is inapplicable because the vice-principals,
department head, and coordinators are neither supervisory nor
managerial employees. It reasoned:cralavvonlinelawlibrary
x x x While it may be true that they wield power over other
subordinate employees of the petitioner, it must be stressed[,]
however[,] that their functions are not confined with policy-
determining such as hiring, firing, and disciplining of employees,
salaries, teaching/working hours, other monetary and non-
monetary benefits, and other terms and conditions of employment.
Further, while they may formulate policies or guidelines,
nonetheless, such is merely recommendatory in nature, and still
subject to review and evaluation by the higher executives, i.e., the
principals or executive officers of the petitioner. It cannot also be
denied that in institutions like the petitioner, company policies
have already been pre-formulated by the higher executives and all
that the mentioned employees have to do is carry out these
company policies and standards. Such being the case, it is crystal
clear that there is no improper [commingling] of members in the
private respondent union as to preclude its petition for certification
of (sic) election.33
Anent the alleged mixture of teaching and non-teaching personnel,
the CA agreed with petitioner that the nature of the former’s work
does not coincide with that of the latter. Nevertheless, it ruled that
the SOLE did not commit grave abuse of discretion in not
dismissing the petition for certification election, since it directed
the conduct of two separate certification elections based on Our
ruling in University of the Philippines v. Ferrer-Calleja.34
A motion for reconsideration35 was filed by petitioner, but the CA
denied the same;36 hence, this petition assigning the alleged errors
as follows:cralavvonlinelawlibrary
I.
OR MANAGERIAL AND RANK-AND-FILE EMPLOYEES IN provision of Section 12 of RA No. 9481, the “Bystander Rule” is
THE RESPONDENT UNION;chanroblesvirtualawlibrary already well entrenched in this jurisdiction. It has been
consistently held in a number of cases that a certification election
II is the sole concern of the workers, except when the employer itself
has to file the petition pursuant to Article 259 of the Labor Code,
THE HONORABLE COURT OF APPEALS ERRED IN ITS as amended, but even after such filing its role in the certification
CONFLICTING RULING ALLOWING THE CONDUCT OF process ceases and becomes merely a bystander.41 The employer
CERTIFICATION ELECTION BY UPHOLDING THAT THE clearly lacks the personality to dispute the election and has no
RESPONDENT UNION REPRESENTED A BARGAINING right to interfere at all therein.42 This is so since any uncalled-for
UNIT DESPITE ITS OWN FINDINGS THAT THERE IS NO concern on the part of the employer may give rise to the suspicion
43
MUTUALITY OF INTEREST BETWEEN THE MEMBERS OF that it is batting for a company union. Indeed, the demand of the
RESPONDENT UNION APPLYING THE TEST LAID DOWN law and policy for an employer to take a strict, hands-off stance in
IN THE CASE OF UNIVERSITY OF THE PHILIPPINES VS. certification elections is based on the rationale that the employees’
FERRER-CALLEJA (211 SCRA 451). 37 bargaining representative should be chosen free from any
extraneous influence of the management; that, to be effective, the
bargaining representative must owe its loyalty to the employees
We deny. alone and to no other.44

Petitioner claims that the CA contradicted the very definition of Now, going back to petitioner’s contention, the issue of whether a
managerial and supervisory employees under existing law and petition for certification election is dismissible on the ground that
jurisprudence when it did not classify the vice-principals, the labor organization’s membership allegedly consists of
department head, and coordinators as managerial or supervisory supervisory and rank-and-file employees is actually not a novel
employees merely because the policies and guidelines they one. In the 2008 case of Republic v. Kawashima Textile Mfg.,
formulate are still subject to the review and evaluation of the Philippines, Inc.,45 wherein the employer-company moved to
principal or executive officers of petitioner. It points out that the dismiss the petition for certification election on the ground inter
duties of the vice-principals, department head, and coordinators alia that the union membership is a mixture of rank-and-file and
include the evaluation and assessment of the effectiveness and supervisory employees, this Court had conscientiously discussed
capability of the teachers under them; that such evaluation and the applicability of Toyota and Dunlop in the context of R.A. No.
assessment is independently made without the participation of the 6715 and D.O. No. 9, viz.:cralavvonlinelawlibrary
higher Administration of petitioner; that the fact that their
recommendation undergoes the approval of the higher It was in R.A. No. 875, under Section 3, that such questioned
Administration does not take away the independent nature of their mingling was first prohibited, to wit:cralavvonlinelawlibrary
judgment; and that it would be difficult for the vice-principals, Sec. 3. Employees' right to self-organization. - Employees shall
department head, and coordinators to objectively assess and have the right to self-organization and to form, join or assist labor
evaluate the performances of teachers under them if they would be organizations of their own choosing for the purpose of collective
allowed to be members of the same labor union. bargaining through representatives of their own choosing and to
engage in concerted activities for the purpose of collective
On the other hand, aside from reiterating its previous submissions, bargaining and other mutual aid or protection. Individuals
private respondent cites Sections 9 and 1238 of Republic Act employed as supervisors shall not be eligible for membership
(R.A.) No. 9481 to buttress its contention that petitioner has no in a labor organization of employees under their supervision
standing to oppose the petition for certification election. On the but may form separate organizations of their own.(Emphasis
basis of the statutory provisions, it reasons that an employer is not supplied)
a party-in-interest in a certification election; thus, petitioner does
not have the requisite right to protect even by way of restraining Nothing in R.A. No. 875, however, tells of how the questioned
order or injunction. mingling can affect the legitimacy of the labor organization. Under
Section 15, the only instance when a labor organization loses its
First off, We cannot agree with private respondent’s invocation of legitimacy is when it violates its duty to bargain collectively; but
R.A. No. 9481. Said law took effect only on June 14, 2007; hence, there is no word on whether such mingling would also result in
its applicability is limited to labor representation cases filed on or loss of legitimacy. Thus, when the issue of whether the
after said date.39 Instead, the law and rules in force at the time membership of two supervisory employees impairs the legitimacy
private respondent filed its petition for certification election on of a rank-and-file labor organization came before the Court En
May 31, 2002 are R.A. No. 6715, which amended Book V of Banc in Lopez v. Chronicle Publication Employees Association,
Presidential Decree (P.D.) No. 442 (the Labor Code), as amended, the majority pronounced:cralavvonlinelawlibrary
and the Rules and Regulations Implementing R.A. No. 6715, as
amended by D.O. No. 9, which was dated May 1, 1997 but took It may be observed that nothing is said of the effect of such
effect on June 21, 1997. 40 ineligibility upon the union itself or on the status of the other
qualified members thereof should such prohibition be disregarded.
However, note must be taken that even without the express Considering that the law is specific where it intends to divest a
legitimate labor union of any of the rights and privileges granted to organization. Supervisory employees shall not be eligible for
it by law, the absence of any provision on the effect of the membership in a labor organization of the rank-and-file
disqualification of one of its organizers upon the legality of the employees but may join, assist or form separate labor
union, may be construed to confine the effect of such organizations of their own (Emphasis supplied)
ineligibility only upon the membership of the supervisor. In
other words, the invalidity of membership of one of the Unfortunately, just like R.A. No. 875, R.A. No. 6715 omitted
organizers does not make the union illegal, where the specifying the exact effect any violation of the prohibition
requirements of the law for the organization thereof are, would bring about on the legitimacy of a labor organization.
nevertheless, satisfied and met. (Emphasis supplied)
It was the Rules and Regulations Implementing R.A. No. 6715
Then the Labor Code was enacted in 1974 without reproducing (1989 Amended Omnibus Rules) which supplied the deficiency by
Sec. 3 of R.A. No. 875. The provision in the Labor Code closest to introducing the following amendment to Rule II (Registration of
Sec. 3 is Article 290, which is deafeningly silent on the prohibition Unions):cralavvonlinelawlibrary
against supervisory employees mingling with rank-and-file
employees in one labor organization. Even the Omnibus Rules Sec. 1. Who may join unions. - x x x Supervisory employees and
Implementing Book V of the Labor Code (Omnibus Rules) merely security guards shall not be eligible for membership in a labor
provides in Section 11, Rule II, thus:cralavvonlinelawlibrary organization of the rank-and-file employees but may join,
assist or form separate labor organizations of their
Sec. 11. Supervisory unions and unions of security guards to cease own; Provided, that those supervisory employees who are
operation. - All existing supervisory unions and unions of security included in an existing rank-and-file bargaining unit, upon the
guards shall, upon the effectivity of the Code, cease to operate as effectivity of Republic Act No. 6715, shall remain in that unit x x
such and their registration certificates shall be deemed x. (Emphasis supplied)
automatically cancelled. However, existing collective agreements
with such unions, the life of which extends beyond the date of and Rule V (Representation Cases and Internal-Union Conflicts)
effectivity of the Code shall be respected until their expiry date of the Omnibus Rules, viz.;chanroblesvirtualawlibrary
insofar as the economic benefits granted therein are concerned. Sec. 1. Where to file. - A petition for certification election may be
filed with the Regional Office which has jurisdiction over the
Members of supervisory unions who do not fall within the principal office of the employer. The petition shall be in writing
definition of managerial employees shall become eligible to and under oath.
join or assist the rank and file organization. The determination
of who are managerial employees and who are not shall be the Sec. 2. Who may file. - Any legitimate labor organization or the
subject of negotiation between representatives of supervisory employer, when requested to bargain collectively, may file the
union and the employer. If no agreement s reached between the petition.
parties, either or both of them may bring the issue to the nearest
Regional Office for determination. (Emphasis supplied) The petition, when filed by a legitimate labor organization, shall
The obvious repeal of the last clause of Sec. 3, R.A. No. 875 contain, among others:cralavvonlinelawlibrary
prompted the Court to declare in Bulletin v. Sanchez that
supervisory employees who do not fall under the category of xxxx
managerial employees may join or assist in the formation of a
labor organization for rank-and-file employees, but they may not (c) description of the bargaining unit which shall be the
form their own labor organization. employer unit unless circumstances otherwise require; and
provided further, that the appropriate bargaining unit of the
While amending certain provisions of Book V of the Labor Code, rank-and-file employees shall not include supervisory
E.O. No. 111 and its implementing rules continued to recognize employees and/or security guards.(Emphasis supplied)
the right of supervisory employees, who do not fall under the By that provision, any questioned mingling will prevent an
category of managerial employees, to join a rank- and-file labor otherwise legitimate and duly registered labor organization from
organization. exercising its right to file a petition for certification election.

Effective 1989, R.A. No. 6715 restored the prohibition against the Thus, when the issue of the effect of mingling was brought to the
questioned mingling in one labor fore in Toyota, the Court, citing Article 245 of the Labor Code, as
organization, viz.:cralavvonlinelawlibrary amended by R.A. No. 6715, held:cralavvonlinelawlibrary
Sec. 18. Article 245 of the same Code, as amended, is hereby Clearly, based on this provision, a labor organization composed of
further amended to read as follows:cralavvonlinelawlibrary both rank-and-file and supervisory employees is no labor
Art. 245. Ineligibility of managerial employees to join any labor organization at all. It cannot, for any guise or purpose, be a
organization; right of supervisory employees. Managerial legitimate labor organization. Not being one, an organization
employees are not eligible to join, assist or form any labor which carries a mixture of rank-and-file and supervisory
employees cannot possess any of the rights of a legitimate
labor organization, including the right to file a petition for
certification election for the purpose of collective bargaining. It
becomes necessary, therefore, anterior to the granting of an
order allowing a certification election, to inquire into the
composition of any labor organization whenever the status of
the labor organization is challenged on the basis of Article 245
of the Labor Code.
xxxx
In the case at bar, as respondent union's membership list contains
the names of at least twenty-seven (27) supervisory employees in
Level Five positions, the union could not, prior to purging itself of
its supervisory employee members, attain the status of a legitimate
labor organization. Not being one, it cannot possess the requisite
personality to file a petition for certification election. (Emphasis
supplied)
In Dunlop, in which the labor organization that filed a petition for
certification election was one for supervisory employees, but in
which the membership included rank-and-file employees, the
Court reiterated that 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.
It should be emphasized that the petitions for certification election
involved in Toyota and Dunlop were filed on November 26, 1992
and September 15, 1995, respectively; hence, the 1989 Rules was
applied in both 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 Omnibus Rules). Specifically, the requirement
under Sec. 2(c) of the 1989 Amended Omnibus Rules - that the
petition for certification election indicate that the bargaining unit
of rank-and-file employees has not been mingled with supervisory
employees - was removed. Instead, what the 1997 Amended
Omnibus Rules requires is a plain description of the bargaining
unit, thus:cralavvonlinelawlibrary
Rule XI
Certification Elections
xxxx
Sec. 4. Forms and contents of petition. - The petition shall be in
writing and under oath and shall contain, among others, the
following: x x x (c) The description of the bargaining unit.”
In Pagpalain Haulers, Inc. v. Trajano, the Court had occasion to
uphold the validity of the 1997 Amended Omnibus Rules,
although the specific provision involved therein was only Sec. 1,
Rule VI, to wit:cralavvonlinelawlibrary
Sec. 1. Chartering and creation of a local/chapter.- A duly
registered federation or national union may directly create a
local/chapter by submitting to the Regional Office or to the Bureau
two (2) copies of the following: a) a charter certificate issued by
the federation or national union indicating the creation or
establishment of the local/chapter; (b) the names of the
local/chapter's officers, their addresses, and the principal office of
the local/chapter; and (c) the local/ chapter's constitution and by-
laws; provided that where the local/chapter's constitution and by-
laws is the same as that of the federation or national union, this
fact shall be indicated accordingly.
All the foregoing supporting requirements shall be certified under
oath by the Secretary or the Treasurer of the local/chapter and
attested to by its President.
which does not require that, for its creation and registration, a local
or chapter submit a list of its members.
Then came Tagaytay Highlands Int'l. Golf Club, Inc. v. Tagaytay
Highlands Employees Union-PTGWO in which the core issue was
whether mingling affects the legitimacy of a labor organization
and its right to file a petition for certification election. This time,
given the altered legal milieu, the Court abandoned the view
in Toyota and Dunlop and reverted to its pronouncement
in Lopez that while there is a prohibition against the mingling of
supervisory and rank-and-file employees in one labor organization,
the Labor Code does not provide for the effects thereof. Thus, the
Court held that after a labor organization has been registered, it
may exercise all the rights and privileges of a legitimate labor
organization. Any mingling between supervisory and rank-and-file
employees in its membership cannot affect its legitimacy for that
is not among the grounds for cancellation of its registration, unless
such mingling was brought about by misrepresentation, false
statement or fraud under Article 239 of the Labor Code.
In San Miguel Corp. (Mandaue Packaging Products Plants) v.
Mandaue Packing Products Plants-San Miguel Packaging
Products-San Miguel Corp. Monthlies Rank-and-File Union-
FFW, the Court explained that since the 1997 Amended Omnibus
Rules does not require a local or chapter to provide a list of its
members, it would be improper for the DOLE to deny recognition
to said local or chapter on account of any question pertaining to its
individual members.
More to the point is Air Philippines Corporation v. Bureau of
Labor Relations, which involved a petition for cancellation of
union registration filed by the employer in 1999 against a rank-
and-file labor organization on the ground of mixed membership:
the Court therein reiterated its ruling in Tagaytay Highlands that
the inclusion in a union of disqualified employees is not among the
grounds for cancellation, unless such inclusion is due to
misrepresentation, false statement or fraud under the
circumstances enumerated in Sections (a) and (c) of Article 239 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 no longer hold sway in the present
altered state of the law and the rules.46
 the lower courts and administrative agencies/quasi-judicial bodies
When a similar issue confronted this Court close to three years which are better equipped for the task.52
later, the above ruling was substantially quoted in Samahang
Manggagawa sa Charter Chemical Solidarity of Unions in the Turning now to the second and last issue, petitioner argues that, in
Philippines for Empowerment and Reforms (SMCC-Super) v. view of the improper mixture of teaching and non-teaching
Charter Chemical and Coating Corporation.47 In unequivocal personnel in private respondent due to the absence of mutuality of
terms, We reiterated that the alleged inclusion of supervisory interest among its members, the petition for certification election
employees in a labor organization seeking to represent the should have been dismissed on the ground that private respondent
bargaining unit of rank-and-file employees does not divest it of its is not qualified to file such petition for its failure to qualify as a
status as a legitimate labor organization.48 legitimate labor organization, the basic qualification of which is
the representation of an appropriate bargaining unit.
Indeed, Toyota and Dunlop no longer hold true under the law and
rules governing the instant case. The petitions for certification We disagree.
election involved in Toyota and Dunlop were filed on November
26, 1992 and September 15, 1995, respectively; hence, the 1989 The concepts of a union and of a legitimate labor organization are
Rules and Regulations Implementing R.A. No. 6715 (1989 different from, but related to, the concept of a bargaining
Amended Omnibus Rules) was applied. In contrast, D.O. No. 9 is unit:cralavvonlinelawlibrary
applicable in the petition for certification election of private
respondent as it was filed on May 31, 2002. Article 212(g) of the Labor Code defines a labor organization as
"any union or association of employees which exists in whole or in
Following the doctrine laid down in Kawashima and SMCC-Super, part for the purpose of collective bargaining or of dealing with
it must be stressed that petitioner cannot collaterally attack the employers concerning terms and conditions of employment."
legitimacy of private respondent by praying for the dismissal of Upon compliance with all the documentary requirements, the
the petition for certification election:cralavvonlinelawlibrary Regional Office or Bureau shall issue in favor of the applicant
labor organization a certificate indicating that it is included in the
Except when it is requested to bargain collectively, an employer is roster of legitimate labor organizations. Any applicant labor
a mere bystander to any petition for certification election; such organization shall acquire legal personality and shall be entitled to
proceeding is non-adversarial and merely investigative, for the the rights and privileges granted by law to legitimate labor
purpose thereof is to determine which organization will represent organizations upon issuance of the certificate of registration. 53
the employees in their collective bargaining with the employer.
The choice of their representative is the exclusive concern of the
employees; the employer cannot have any partisan interest therein; In case of alleged inclusion of disqualified employees in a union,
it cannot interfere with, much less oppose, the process by filing a the proper procedure for an employer like petitioner is to directly
motion to dismiss or an appeal from it; not even a mere allegation file a petition for cancellation of the union’s certificate of
that some employees participating in a petition for certification registration due to misrepresentation, false statement or fraud
election are actually managerial employees will lend an employer under the circumstances 54
enumerated in Article 239 of the Labor
legal personality to block the certification election. The employer's Code, as amended. To reiterate, private respondent, having been
only right in the proceeding is to be notified or informed thereof. validly issued a certificate of registration, should be considered as
having acquired juridical personality which may not be attacked
The amendments to the Labor Code and its implementing rules collaterally.
have buttressed that policy even more.49
On the other hand, a bargaining unit has been defined as a "group
of employees of a given employer, comprised of all or less than all
Further, the determination of whether union membership of the entire body of employees, which the collective interests of
comprises managerial and/or supervisory employees is a factual all the employees, consistent with equity to the employer,
issue that is best left for resolution in the inclusion-exclusion indicated to be best suited to serve reciprocal rights and duties of
proceedings, which has not yet happened in this case so still the parties under the collective bargaining provisions of the
premature to pass upon. We could only emphasize the rule that law."55 In determining the proper collective bargaining unit and
factual findings of labor officials, who are deemed to have what unit would be appropriate to be the collective bargaining
acquired expertise in matters within their jurisdiction, are agency, the Court, in the seminal case of Democratic Labor
generally accorded not only with respect but even finality by the Association v. Cebu Stevedoring Company, Inc., 56 mentioned
courts when supported by substantial evidence.50 Also, the several factors that should be considered, to wit: (1) will of
jurisdiction of this Court in cases brought before it from the CA employees (Globe Doctrine); (2) affinity and unity of employees'
via Rule 45 is generally limited to reviewing errors of law or interest, such as substantial similarity of work and duties, or
jurisdiction. The findings of fact of the CA are conclusive and similarity of compensation and working conditions; (3) prior
binding. Except in certain recognized instances,51 We do not collective bargaining history; and (4) employment status, such as
entertain factual issues as it is not Our function to analyze or temporary, seasonal and probationary employees. We stressed,
weigh evidence all over again; the evaluation of facts is best left to however, that the test of the grouping is community or mutuality
of interest, because “the basic test of an asserted bargaining unit's personnel. It should be stressed that in the subject petition, [private
acceptability is whether or not it is fundamentally the combination respondent] union sought the conduct of a certification election
which will best assure to all employees the exercise of their among all the rank-and-file personnel of [petitioner] school. Since
collective bargaining rights."57 the decision of the Supreme Court in the U.P. case prohibits us
from commingling teaching and non-teaching personnel in one
As the SOLE correctly observed, petitioner failed to comprehend bargaining unit, they have to be separated into two separate
the full import of Our ruling in U.P. It suffices to quote with bargaining units with two separate certification elections to
approval the apt disposition of the SOLE when she denied determine whether the employees in the respective bargaining
petitioner’s motion for reconsideration:cralavvonlinelawlibrary units desired to be represented by [private respondent]. In the U.P.
case, only one certification election among the non-academic
[Petitioner] likewise claimed that we erred in interpreting the personnel was ordered, because ONAPUP sought to represent that
decision of the Supreme Court in U.P. v. Ferrer-Calleja, supra. bargaining unit only. No petition for certification election among
According to [petitioner], the Supreme Court stated that the non- the academic personnel was instituted by All U.P. Workers Union
academic rank-and-file employees of the University of the in the said case; thus, no certification election pertaining to its
Philippines shall constitute a bargaining unit to the exclusion of intended bargaining unit was ordered by the Court.58
the academic employees of the institution. Hence, [petitioner]
argues, it sought the creation of separate bargaining units, namely:
(1) [petitioner]’s teaching personnel to the exclusion of non- Indeed, the purpose of a certification election is precisely to
teaching personnel; and (2) [petitioner]’s non-teaching personnel ascertain the majority of the employees’ choice of an appropriate
to the exclusion of teaching personnel. bargaining unit – to be or not to be represented by a labor
organization and, if in the affirmative case, by which one. 59
[Petitioner] appears to have confused the concepts of membership
in a bargaining unit and membership in a union. In emphasizing At this point, it is not amiss to stress once more that, as a rule, only
the phrase “to the exclusion of academic employees” stated in U.P. questions of law may be raised in a Rule 45 petition. In Montoya v.
v. Ferrer-Calleja, [petitioner] believed that the petitioning union Transmed Manila Corporation,60 the Court discussed the
could not admit academic employees of the university to its particular parameters of a Rule 45 appeal from the CA’s Rule 65
membership. But such was not the intention of the Supreme Court. decision on a labor case, as follows:cralavvonlinelawlibrary

A bargaining unit is a group of employees sought to be represented x x x In a Rule 45 review, we consider the correctness of the
by a petitioning union. Such employees need not be members of a assailed CA decision, in contrast with the review for jurisdictional
union seeking the conduct of a certification election. A union error that we undertake under Rule 65. Furthermore, Rule 45
certified as an exclusive bargaining agent represents not only its limits us to the review of questions of law raised against the
members but also other employees who are not union members. assailed CA decision. In ruling for legal correctness, we have to
As pointed out in our assailed Decision, there were two contending view the CA decision in the same context that the petition for
unions in the U.P. case, namely[,] the Organization of Non- certiorari it ruled upon was presented to it; we have to examine
Academic Personnel of U.P. (ONAPUP) and the All U.P. the CA decision from the prism of whether it correctly
Worker’s Union composed of both U.P. academic and non- determined the presence or absence of grave abuse of
academic personnel. ONAPUP sought the conduct of a discretion in the NLRC decision before it, not on the basis of
certification election among the rank-and-file non-academic whether the NLRC decision on the merits of the case was
personnel only, while the All U.P. Workers Union intended to correct. In other words, we have to be keenly aware that the CA
cover all U.P. rank-and-file employees, involving both academic undertook a Rule 65 review, not a review on appeal, of the NLRC
and non-academic personnel. decision challenged before it. This is the approach that should be
basic in a Rule 45 review of a CA ruling in a labor case. In
The Supreme Court ordered the “non-academic rank-and-file question form, the question to ask is: Did the CA correctly
employees of U.P. to constitute a bargaining unit to the exclusion determine whether the NLRC committed61
grave abuse of
of the academic employees of the institution”, but did not order discretion in ruling on the case?
them to organize a separate labor organization. In the U.P. case,
the Supreme Court did not dismiss the petition and affirmed the Our review is, therefore, limited to the determination of whether
order for the conduct of a certification election among the non- the CA correctly resolved the presence or absence of grave abuse
academic personnel of U.P., without prejudice to the right of the of discretion in the decision of the SOLE, not on the basis of
academic personnel to constitute a separate bargaining unit for whether the latter’s decision on the merits of the case was strictly
themselves and for the All U.P. Workers Union to institute a correct. Whether the CA committed grave abuse of discretion is
petition for certification election. not what is ruled upon but whether it correctly determined the
existence or want of grave abuse of discretion on the part of the
In the same manner, the teaching and non-teaching personnel of SOLE.
[petitioner] school must form separate bargaining units. Thus, the
order for the conduct of two separate certification elections, one WHEREFORE, the petition is DENIED. The April 18, 2007
involving teaching personnel and the other involving non-teaching Decision and July 31, 2007, Resolution of the Court of Appeals in
CA-G.R. SP No. 76175, which affirmed the December 27, 2002 IV, issued an order granting respondent unions petition for
Decision of the Secretary of the Department of Labor and certification election. He said:
Employment that set aside the August 10, 2002 Decision of the
Med-Arbiter denying private respondent’s petition for certification . . . . [petitioner] . . . claims that based on the job descriptions
election are hereby AFFIRMED. which will be presented at the hearing, the covered employees who
are considered managers occupy the positions of purchasing
SO ORDERED. officers, personnel officers, property officers, cashiers, heads of
various sections and the like.
[G.R. No. 102084. August 12, 1998]
[Petitioner] also argues that assuming that some of the employees
DE LA SALLE UNIVERSITY MEDICAL CENTER AND concerned are not managerial but mere supervisory employees, the
COLLEGE OF MEDICINE, petitioner, vs. HON. Federation of Free Workers (FFW) cannot extend a charter
BIENVENIDO E. LAGUESMA, Undersecretary of Labor and certificate to this group of employees without violating the express
Employment; ROLANDO S. DE LA CRUZ, Med-Arbiter provision of Article 245 which provides that supervisory
Regional Office No. IV, DE LA SALLE UNIVERSITY employees shall not be eligible for membership in a labor
MEDICAL CENTER AND COLLEGE OF MEDICINE organization of the rank-and-file employees but may join, assist or
SUPERVISORY UNION-FEDERATION OF FREE form separate labor organizations of their own because the FFW
WORKERS, respondents. had similarly issued a charter certificate to its rank-and-file
employees.
DECISION
....
MENDOZA, J.:
In its position paper, [petitioner] stated that most, if not all, of the
Petitioner De La Salle University Medical Center and College of employees listed in . . . the petition are considered managerial
Medicine (DLSUMCCM) is a hospital and medical school at employees, thereby admitting that it has supervisory employees
Dasmarias, Cavite. Private respondent Federation of Free who are undoubtedly qualified to join or form a labor organization
WorkersDe La Salle University Medical Center and College of of their own. The record likewise shows that [petitioner] promised
Medicine Supervisory Union Chapter (FFW-DLSUMCCMSUC), to present the job descriptions of the concerned employees during
on the other hand, is a labor organization composed of the the hearing but failed to do so. Thus, this office has no basis in
supervisory employees of petitioner DLSUMCCM. determining at this point in time who among them are considered
On April 17, 1991, the Federation of Free Workers (FFW), a managerial or supervisory employees. At any rate, there is now no
national federation of labor unions, issued a certificate to private question that [petitioner] has in its employ supervisory employees
respondent FFW-DLSUMCCMSUC recognizing it as a local who are qualified to join or form a labor union. Consequently, this
chapter. On the same day, it filed on behalf of private respondent office is left with no alternative but to order the holding of
FFW-DLSUMCCMSUC a petition for certification election certification election pursuant to Article 257 of the Labor Code, as
among the supervisory employees of petitioner DLSUMCCM. Its amended, which mandates the holding of certification election if a
petition was opposed by petitioner DLSUMCCM on the grounds petition is filed by a legitimate labor organization involving an
that several employees who signed the petition for certification unorganized establishment, as in the case of herein respondent.
election were managerial employees and that the FFW- As to the allegation of [petitioner] that the act of the supervisory
DLSUMCCMSUC was composed of both supervisory and rank- employees in affiliating with FFW to whom the rank-and-file
and-file employees in the company.[1] employees are also affiliated is violative of Article 245 of the
In its reply dated May 22, 1991, private respondent FFW- Labor Code, suffice it to state that the two groups are considered
DLSUMCCMSUC denied petitioners allegations. It contended that separate bargaining units and local chapters of FFW. They are, for
all intents and purposes, separate with each other and their
2. Herein petition seeks for the holding of a certification election affiliation with FFW would not make them members of the same
among the supervisory employees of herein respondent.It does not labor union. This must be the case because it is settled that the
intend to include managerial employees. locals are considered the basic unit or principal with the labor
federation assuming the role of an agent.The mere fact, therefore,
....
that they are represented by or under the same agent is of no
6. It is not true that supervisory employees are joining the rank- moment. They are still considered separate with each other.[3]
and-file employees union. While it is true that both regular rank-
On July 30, 1991, petitioner DLSUMCCM appealed to the
and-file employees and supervisory employees of herein
Secretary of Labor and Employment, citing substantially the same
respondent have affiliated with FFW, yet there are two separate
arguments it had raised before the med-arbiter. However, its
unions organized by FFW. The supervisory employees have a
appeal was dismissed. In his resolution, dated August 30, 1991,
separate charter certificate issued by FFW.[2]
respondent Undersecretary of Labor and Employment Bienvenido
On July 5, 1991, respondent Rolando S. de la Cruz, med-arbiter of E. Laguesma found the evidence presented by petitioner
the Department of Labor and Employment Regional Office No. DLSUMCCM concerning the alleged managerial status of several
employees to be insufficient. He also held that, following the
ruling of this Court in Adamson & Adamson, Inc. v. CIR,[4] unions employees to self-organization which had been withdrawn from
formed independently by supervisory and rank-and-file employees them during the period of martial law.Thus:
of a company may legally affiliate with the same national
federation. Commissioner Lerum sought to amend the draft of what was later
to become Art. III, 8 of the present Constitution:
Petitioner moved for a reconsideration but its motion was
denied. In his order dated September 19, 1991, respondent ....
Laguesma stated: MR. LERUM. . . . Also, we have unions of supervisory employees
We reviewed the records once more, and find that the issues and and of security guards. But what is tragic about this is that after the
arguments adduced by movant have been squarely passed upon in 1973 Constitution was approved and in spite of an express
the Resolution sought to be reconsidered. Accordingly, we find no recognition of the right to organize in P.D. No. 442, known as the
legal justification to alter, much less set aside, the aforesaid Labor Code, the right of government workers, supervisory
resolution. Perforce, the motion for reconsideration must fail. employees and security guards to form unions was abolished.

WHEREFORE, the instant motion for reconsideration is hereby ....

denied for lack of merit and the resolution of this office dated 30 We are afraid that without any corresponding provision covering
August 1991 STANDS. the private sector, the security guards, the supervisory employees
No further motions of a similar nature shall hereinafter be ... will still be excluded and that is the purpose of this amendment.
entertained.[5] ....
Hence, this petition for certiorari. In sum, Lerums proposal to amend Art. III, 8 of the draft
Petitioner DLSUMCCM contends that respondent Laguesma Constitution by including labor unions in the guarantee of
gravely abused his discretion. While it does not anymore insist that organizational right should be taken in the context of statements
several of those who joined the petition for certification election that his aim was the removal of the statutory ban against security
are holding managerial positions in the company, petitioner guards and supervisory employees joining labor
nonetheless pursues the question whether unions formed organizations. The approval by the Constitutional Commission of
independently by supervisory and rank-and-file employees of a his proposal can only mean, therefore, that the Commission
company may validly affiliate with the same national intended the absolute right to organize of government workers,
federation. With respect to this question, it argues: supervisory employees, and security guards to be constitutionally
guaranteed.[9]
THE PUBLIC RESPONDENT, HONORABLE BIENVENIDO E.
LAGUESMA, UNDERSECRETARY OF LABOR AND Conformably with the constitutional mandate, Art. 245 of the
EMPLOYMENT, IN A CAPRICIOUS, ARBITRARY AND Labor Code now provides for the right of supervisory employees
WHIMSICAL EXERCISE OF POWER ERRED AND to self-organization, subject to the limitation that they cannot join
COMMITTED GRAVE ABUSE OF DISCRETION an organization of rank-and-file employees:
AMOUNTING TO ACTING WITHOUT OR IN EXCESS OF Supervisory employees shall not be eligible for membership in a
JURISDICTION WHEN HE DENIED THE PETITIONERS labor organization of the rank-and-file employees but may join,
APPEAL AND ORDERED THE HOLDING OF A assist or form separate labor organizations of their own.
CERTIFICATION ELECTION AMONG THE MEMBERS OF
THE SUPERVISORY UNION EMPLOYED IN PETITIONERS The reason for the segregation of supervisory and rank-and-file
COMPANY DESPITE THE FACT THAT SAID SUPERVISORY employees of a company with respect to the exercise of the right to
UNION WAS AFFILIATED WITH THE FEDERATION OF self-organization is the difference in their interests. Supervisory
FREE WORKERS TO WHICH THE RANK-AND-FILE employees are more closely identified with the employer than with
EMPLOYEES OF THE SAME COMPANY ARE LIKEWISE the rank-and-file employees. If supervisory and rank-and-file
AFFILIATED, CONTRARY TO THE EXPRESS PROVISIONS employees in a company are allowed to form a single union, the
OF ARTICLE 245 OF THE LABOR CODE, AS AMENDED.[6] conflicting interests of these groups impair their relationship and
adversely affect discipline, collective bargaining, and
The contention has no merit. strikes.[10] These consequences can obtain not only in cases where
Supervisory employees have the right to self-organization as do supervisory and rank-and-file employees in the same company
other classes of employees save only managerial ones.The belong to a single union but also where unions formed
Constitution states that the right of the people, including those independently by supervisory and rank-andfile employees of a
employed in the public and private sectors, to form unions, company are allowed to affiliate with the same national
associations or societies for purposes not contrary to law, shall not federation. Consequently, this Court has[11]held in Atlas
be abridged.[7] As we recently held in UnitedPepsi-Cola Lithographic Services Inc. v. Laguesma that -
Supervisory Union v. Laguesma,[8] the framers of the Constitution To avoid a situation where supervisors would merge with the rank-
intended, by this provision, to restore the right of supervisory and-file or where the supervisors labor organization would
represent conflicting interests, then a local supervisors union
should not be allowed to affiliate with a national federation of professional relationship must be established. To borrow the
unions of rank-and-file employees where that federation actively language of Adamson & Adamson, Inc. v. CIR:[18]
participates in union activities in the company.
We find without merit the contention of petitioner that if affiliation
As we explained in that case, however, such a situation would will be allowed, only one union will in fact represent both
obtain only where two conditions concur: First, the rank-and-file supervisors and rank-and-file employees of the petitioner; that
employees are directly under the authority of supervisory there would be an indirect affiliation of supervisors and rank-
employees.[12] Second, the national federation is actively involved andfile employees with one labor organization; that there would be
in union activities in the company.[13] Indeed, it is the presence of a merging of the two bargaining units; and that the respondent
these two conditions which distinguished Atlas Lithographic union will lose its independence because it becomes an alter ego of
Services, Inc. v. Laguesma from Adamson & Adamson, Inc. v. the federation.[19]
CIR[14] where a different conclusion was reached.
Mention has already been made of the fact that the petition for
The affiliation of two local unions in a company with the same certification election in this case was filed by the FFW on behalf
national federation is not by itself a negation of their independence of the local union. This circumstance, while showing active
since in relation to the employer, the local unions are considered as involvement by the FFW in union activities at the company, is by
the principals, while the federation is deemed to be merely their itself insufficient to justify a finding of violation of Art. 245 since
agent. This conclusion is in accord with the policy that any there is no proof that the supervisors who compose the local union
limitation on the exercise by employees of the right to self- have direct authority over the rank-and-file employees composing
organization guaranteed in the Constitution must be construed the other local union which is also affiliated with the FFW. This
strictly. Workers should be allowed the practice of this freedom to fact differentiates the case from Atlas Lithographic Services, Inc.
the extent recognized in the fundamental law. As held in Liberty v. Laguesma,[20] in which, in addition to the fact that the petition
Cotton Mills Workers Union v. Liberty Cotton Mills, Inc.:[15] for certification election had been filed by the national federation,
it was shown that the rank-and-file employees were directly under
The locals are separate and distinct units primarily designed to the supervisors organized by the same federation.
secure and maintain an equality of bargaining power between the
employer and their employee members in the economic struggle It follows that respondent labor officials did not gravely abuse
for the fruits of the joint productive effort of labor and capital; and their discretion.
the association of locals into the national unionwas in furtherance
of the same end. These associations are consensual entities capable WHEREFORE, the petition is DISMISSED.
of entering into such legal relations with their members. The SO ORDERED.
essential purpose was the affiliation of the local unions into a
common enterprise to increase by collective action the common G.R. No. L-41288 January 31, 1977
bargaining power in respect of the terms and conditions of
PHILIPPINES LABOR ALLIANCE COUNCIL
labor. Yet the locals remained the basic units of association, free to
(PLAC), petitioner,
serve their own and the common interest of all, and free also to
vs.
renounce the affiliation for mutual welfare upon the terms laid
[16] BUREAU OF LABOR RELATIONS, FEDERATION OF
down in the agreement which brought it to existence.
FREE WORKERS-ORION CHAPTER, GERARDO
The questions in this case, therefore, are whether the rank-and-file ROSANA and ORION MANILA, INC. respondents.
employees of petitioner DLSUMCCM who compose a labor union
Fortunato Gupit, Jr. for petitioner.
are directly under the supervisory employees whose own union is
affiliated with the same national federation (Federation of Free Solicitor General Estelito P Mendoza, Assistant Solicitor General
Workers) and whether such national federation is actively involved Reynato S. Puno and Solicitor Romeo C. de la Cruz for respondent
in union activities in the company so as to make the two unions in Bureau of Labor Relations.
the same company, in reality, just one union.
F. F. Bonifacio, Jr. for respondent Union and Gerardo Rosana.
Although private respondent FFW-DLSUMCCMSUC and another
union composed of rank-and-file employees of petitioner Cesar C. Cruz & Associates for respondent Orion Manila,
DLSUMCCM are indeed affiliated with the same national
federation, the FFW, petitioner DLSUMCCM has not presented
any evidence showing that the rank-and-file employees composing FERNANDO, J:
the other union are directly under the authority of the supervisory
employees. As held in Adamson & Adamson, Inc. v. CIR,[17] the It would be to frustrate the hopes that inspired the present Labor
fact that the two groups of workers are employed by the same Code 1 to minimize judicial participation in the solution of
company and the fact that they are affiliated with a common employer- employee disputes resort to the courts would remain
national federation are not sufficient to justify the conclusion that unabated. Nevertheless, in view of the certiorari jurisdiction of this
their organizations are actually just one. Their immediate Tribunal, 2 a grave abuse of discretion may be alleged as a
grievance thus calling for remedial action. So petitioner Philippine
Labor Alliance Council did hope to achieve in this certiorari and
prohibition proceeding against respondent Bureau of Labor a motion for reconsideration, then an opposition. 17 On April 8,
Relations. 3 It would indict an order 4 for a certification election by 1975, respondent Bureau of Labor Relations issued an order
respondent Bureau as tainted by a jurisdictional infirmity in view setting aside the certification of the collective bargaining
of what is contended to be an existing duly certified collective agreement and ordering a certification election within 20 days
bargaining contract between it and private respondent Orion from receipt of the order, upon the following declaration: "In the
Manila, Inc., the employer. It would thus ignore the withdrawal in instant case, it is not disputed that the collective bargaining
the same order of such certification based on a finding that there agreement certified by the National Labor Relations Commission
was a failure on the part of the majority of the employees in the was not ratified by the majority of the employees within the
bargaining unit to ratify the collective contract, renewed nine bargaining unit. This is defective. It is blatant non- observance of
months before the termination of the previous agreement. the basic requirement necessary to certification. ... With respect to
Apparently, the difficulty confronting it was due to the the complaint of the confirmation of disaffiliation of the members
disaffiliation of many of its members. The order complained of of respondent Philippine Labor Alliance Council, the same should
recognized that there was such a sentiment on the part of sizable be resolved in the most expedient and simple method of
number of employees in the collective bargaining unit, thus determining the exclusive bargaining representative—the holding
making patent the desirability of conducting a certification of a certification election"18 There was a motion for
election. That was the method to determine the exclusive reconsideration as well as a verified urgent petition filed with the
bargaining representative followed even under the previous labor Secretary of Labor by respondent Company, but the order was
legislation .5 It would thus appear rather obvious that the attempt affirmed on July 31, 1975, the motion to consider being denied. 19
to impute arbitrariness to respondent Bureau cannot be attended
with success. The petition must be dismissed. From the very petition with its annexes, it is undisputed that there
was a finding in the challenged order by respondent Bureau of
It was a detailed narration of facts set forth in the petition, starting Labor Relations of the non-ratification by the majority of the
with the allegation that there was a renewal of the collective employees of the certified collective bargaining agreement, thus
bargaining agreement with a union shop clause on March 9,1974 calling for its decertification. It is also noteworthy that in the
between petitioner union and respondent company to last for comment of respondent labor union, considered as its answer, the
another period of three (3) years incorporating therein new allegation that there was such a ratification was specifically
economic benefits to expire on December 31, 1977. 6 The claim denied. It cannot be taken as having proven. There is nothing in
was that at that time it was the only bargaining agent of the the exhaustive memorandum of petitioner either that would justify
respondent company unchallenged by any labor the imputation that respondent Bureau, in ordering decertification
organization. 7 Then came the assertion that on May 27, 1974, with of the collective bargaining agreement with petitioner to be
due notice to all the members of the petitioner union, and with followed by a certification election, committed a transgression of
more than 1,500 of them present, such collective bargaining the present Labor Code, much less one of such grievous character
agreement was ratified by a unanimous vote .8 It was then so as to taint its actuation with a jurisdictional infirmity. It is quite
certified by the former National Labor Relations Commission on apparent therefore that with due recognition of the ability and
June 4, 1974. 9 It was further alleged that at the time of such scholarship evident in the pleadings of Attorney Fortunate Gupit,
certification, there was no pending request for union recognition Jr. for the petitioner, the attempt to invoke our certiorari
by any other labor organization with management. 10 Thereafter, on jurisdiction cannot succeed..20 So it was noted at the outset.
June 20, 1974, respondent Federation of Free Workers, setting
forth that its members represent more than 60% out of 1,500 1. It is indisputable that the present controversy would not have
members, more or less, rank-and-file employees of respondent arisen if there were no mass disaffiliation from petitioning Union.
11
company, sought a certification election. Petitioner union, as Such a phenomenon is nothing new in the Philippine labor
could be expected, opposed such a move as in its view the movement.21 Nor is it open to any legal objection. It is implicit in
collective bargaining agreement entered into with the respondent the freedom of 22
association explicitly ordained by the
12
company had been certified. It was sustained, the Secretary of Constitution. There is then the incontrovertible right of any
Labor to whom an appeal was taken concurring with the former individual to join an organization of his choice. That option
National Labor Relations Commission affirming the dismissal of belongs to him. A workingman is not to be denied that
23
such petition for certification, on the ground of the existence of a liberty. He may be, as a matter of fact, more in need of it if the
certified collective bargaining agreement.13That did not end the institution of collective bargaining as an aspect of industrial
dispute, " respondent Federation on January 15, 1975, filed a democracy is to succeed. No obstacle that may possible thwart the
complaint with the respondent Bureau of Labor Relations, the desirable objective of militancy in labor's struggle for better terms
present Labor Code having become effective, alleging that some and conditions is then to be placed on his way. Once the fact of
employees, numbering 848 in all, in a resolution attached to the disaffiliation has been demonstrated beyond doubt, as in this case,
complaint disaffiliated from petitioner union and affiliated with it, a certification election is the most expeditious way of determining
characterizing the certified agreement as having been entered into which labor organization is to be the exclusive bargaining
allegedly to thwart such disaffiliation and seeking a declaration of representative. It is as simple as that. There is relevance to this
the nullity thereof. 14 After both petitioner union and respondent excerpt from a recent decision, Philippine Association of Free
24
Federation of Free Workers had filed their pleadings, 15 the Med- Labor Unions v. Bureau of Labor Relations: "Petitioner thus
Arbiter, on March 20, 1975, dismissed the complaint. 16 There was appears to be woefully lacking in awareness of the significance of
a certification election for the collective bargaining process. It is
the fairest and most effective way of determining which labor
organization can truly represent the working force. It is a
fundamental postulate that the will of the majority, if given
expression in an honest election with freedom on the part of the
voters to make their choice, is controlling. No better device can
assure the institution of industrial democracy with the two parties
to a business enterprise, managment and labor, establishing a
regime of self-rule. As was pointed out by Chief Justice Castro
in Rivera v. San Miguel Brewery Corporation, Inc., "a collective
bargaining agreement is the law of the plant." To the same effect is
this explicit pronouncement in Mactan Workers Union v.
Aboitiz: 'The terms and conditions of a collective bargaining
contract constitute the law between the parties.' What could be
aptly stressed then, as was done in Compania Maritima v.
Compania Maritima Labor Union, is "the primacy to which the
decision reached by the employees themselves is entitled."
Further, it was therein stated: 'That is in the soundest tradition of
industrial democracy. For collective bargaining implies that
instead of a unilateral imposition by management, the terms and
conditions of employment should be the subject of negotiation
between it and labor. Thus the two parties indispensable to the
economy are supposed to take care of their respective interests.
Moreover, the very notion of industrial self-rule negates the
assumption that what is good for either party should be left to the
will of the other. On the contrary, there is an awareness that labor
can be trusted to promote its welfare through the bargaining
process. To it then must be left the choice of its agent for such
purpose.' To paraphrase an observation of the recently retired
Chief Justice Makalintal in Seno v. Mendoza, it is essential that
there be an agreement to govern the relations between labor
marked by confusion, with resulting breaches of the law by either
party. There is, it would appear, a decidedly unsympathetic
approach to the institution of collective bargaining at war with
what has so often and so consistently decided by this Tribunal." 25
2. A different conclusion could have been reached had there been
no qqqdecertification The contract-bar rule could then be invoked
by petitioner. It is, as pointed out by Justice Fernandez in
Confederation of Citizens Labor Unions v. National Labor
Relations Commission, 26 "a principle in labor law that a collective
bargaining agreement of reasonable duration is, in the interest of
the stability of industrial relations, a bar to certification
elections." 27 Even then, as was pointed out in the just-cited
Philippine Association of Free Labor Unions decision, it "is not to
be applied with rigidity. ... The element of flexibility in its
operation cannot be ignored." 28 In this controversy, however, such
a principle is not applicable. The collective bargaining agreement
entered into by petitioner with management on March 9, 1974 was
decertified in the chiallenged order of April 8, 1975 . 29 The power
to decertify by respondent Bureau is not disputed. It was the
exercise thereof that is now assailed. If done arbitrarily, there is
valid ground for complaint. The due process clause is a guarantee
against any actuation of that sort. lt stands for fairness and justice,
That standard was not ignored. It suffices to read the petition to
disprove any allegation of such failing, whether in its procedural
or substantive aspect. Petitioner was heard by respondent Bureau
before the order of decertification was issued on April 8, 1975.
The denial of its motion for reconsideration came also after it had
an opportunity to present its side. Procedural due process was thus
observed. Nor was there any denial of substantive due process in
the sense of such decertification being an act of arbitrariness and
caprice.
In the order of April 8, 1975, it was specifically pointed out; "In
the instant case, it is not disputed that the collective bargaining
agreement certified by the National Labor Relations Commission
was not ratified by the majority of the employees within the
bargaining unit. This is defective. It is blatant non-observance of
the basic requirement necessary to certification. To allow it to
remain uncorrected would allow circumvention of what the law
specifically ordained. We cannot countenance irregularities of the
highest order to exist in our very own eyes to be perpetuated. With
respect to the complaint of the confirmation of disaffiliation of the
members of respondent Philippine Labor Alliance counsel the
same should be resolved in the most expedient and simple method
of determining the exclusive bargaining representative — the
holding of a certification election." 30 In the order denying the
motion for reconsideration dated July 31, 1975, it was first noted:
"On January 20, 1975, FFW and 848 Orion employees filed with
the Bureau a petition for the annulment of the 1974 collective
bargaining agreement and for the confirmation of the disaffiliation
of the 848 employees from PLAC and their affiliation with FFW.
The petition alleged among others, that the new agreement was
concluded about ten months before the expiry date of the old
purposely to defeat the right of the covered employees to choose
their bargaining representative at the proper time appointed by
law. It appears, indeed, that there qqqas no urgency. for the
premature renegotiations considering that the new agreement
provides for a 50-centavo salary increase effective yet on January
1, 1976." 31 Then, there was further clarification of the decision
reached as to the holding of a certification election being the
appropriate mode of solving the dispute: "With the decertification
of the collective agreement, the representation issue comes back to
the fore. Petitioner wants this resolved by ruling on the affiliation
and disaffiliation of the union, The Bureau holds, however, that
certification election can better reolve the issue. parenthetically, it
should be stated that a certification election can still be held even
if the collective agreement were certified, considering the peculiar
facts of the case. Good policy and equity demand that when an
agreement is renegotiated before the appointed 60-day period, its
certification must still give way to any representation issue that
may be raised within 60-day period so that the right of employees
to choose a bargaining unit agent and the right, of unions to be
chosen shall be preserved." 32
3. There is, finally, another insuperable obstacle success of this
petition. There is no need for a citation of authorities to show how
well-settled and firmly-rooted is the doctrine of the well- nigh
conclusive respect for the findings of facts of administrative
tribunals, leaving to the judiciary, in the ultimate analysis, this
Tribunal, to set forth the correct legal norm applicable to the
controversy. With specific reference to the agencies at present
dealing with labor relations, there is this excerpt from Justice
Aquino's opinion in Antipolo Highway Lines, Inc. v. Inciong: 33 "A
dispassionate scrutiny of the proceedings in the NLRC does not
sustain petitioners' view that they were denied due process and that
the NLRC committed a grave abuse of discretion. (See Maglasang
v. Ople, L-38813, April 29, 1975 per Justice Fernando). We found
no justification for setting aside the factual findings of the NLRC,
which like those of any other administrative agency, are generally
binding on the courts (Timbancaya v. Vicente. 62 O.G. 9424, 9
SCRA 852). " 34
WHEREFORE, this petition for certiorari and prohibition is
dismissed. The restraining order issued by this Court in its
resolution of September 8, 1975 is hereby lifted. No costs.
Antonio, Aquino and Concepcion, Jr., JJ., concur.
Godofredo Paceno, Sr., referred to in this Agreement as the
UNION."[1]
The CBA includes, among others, the following pertinent
provisions:
Article II-Union Security
Section 1. Coverage and Scope. All employees who are covered
by this Agreement and presently members of the UNION shall
remain members of the UNION for the duration of this Agreement
as a condition precedent to continued employment with the
COMPANY.

xxxxxx

Separate Opinions xxxxxx

Section 4. Dismissal. Any such employee mentioned in Section 2

hereof, who fails to maintain his membership in the UNION for
BARREDO, J., concurring: non-payment of UNION dues, for resignation and for violation of
UNIONs Constitution and By-Laws and any new employee as
With the observation that nothing herein modifies the general rule defined in Section 2 of this Article shall upon written notice of
that while a bargaining wish may be changed, the effectivity and such failure to join or to maintain membership in the UNION and
enforceability with a valid collective bargaining contract cannot be upon written recommendation to the COMPANY by the UNION,
affected thereby. be dismissed from the employment by the COMPANY; provided,
Malayang samahan v Ramos however, that the UNION shall hold the COMPANY free and
blameless from any and all liabilities that may arise should the
DECISION dismissed employee question, in any manner, his dismissal;
provided, further that the matter of the employees dismissal under
PURISIMA, J.:
this Article may be submitted as a grievance under Article XIII
At bar is a Petition for Certiorari under Rule 65 of the Revised and, provided, finally, that no such written recommendation shall
Rules of Court to annul the decision of the National Labor be made upon the COMPANY nor shall COMPANY be
Relations Commission in an unfair labor practice case instituted by compelled to act upon any such recommendation within the period
a local union against its employer company and the officers of its of sixty (60) days prior to the expiry date of this Agreement
national federation. conformably to law."

The petitioner, Malayang Samahan ng mga Manggagawa sa M. Article IX

Greenfield, Inc., (B) (MSMG), hereinafter referred to as the "local
Section 4. Program Fund - The Company shall provide the amount
union", is an affiliate of the private respondent, United Lumber
of P10, 000.00 a month for a continuing labor education program
and General Workers of the Philippines (ULGWP), referred to as
which shall be remitted to the Federation x x x." [2]
the "federation". The collective bargaining agreement between
MSMG and M. Greenfield, Inc. names the parties as follows: On September 12, 1986, a local union election was held under the
auspices of the ULGWP wherein the herein petitioner, Beda
"This agreement made and entered into by and between:
Magdalena Villanueva, and the other union officers were
M. GREENFIELD, INC. (B) a corporation duly organized in proclaimed as winners. Minutes of the said election were duly
accordance with the laws of the Republic of the Philippines with filed with the Bureau of Labor Relations on September 29, 1986.
office address at Km. 14, Merville Road, Paraaque, Metro Manila,
On March 21, 1987, a Petition for Impeachment was filed with the
represented in this act by its General manager, Mr. Carlos T.
national federation ULGWP by the defeated candidates in the
Javelosa, hereinafter referred to as the Company;
aforementioned election.
-and-
On June 16, 1987, the federation conducted an audit of the local
MALAYANG SAMAHAN NG MGA MANGGAGAWA SA M. union funds. The investigation did not yield any unfavorable result
GREENFIELD (B) (MSMG)/UNITED LUMBER AND and the local union officers were cleared of the charges of
GENERAL WORKERS OF THE PHILIPPINES (ULGWP), a anomaly in the custody, handling and disposition of the union
legitimate labor organization with address at Suite 404, Trinity funds.
Building, T.M. Kalaw Street, Manila, represented in this act by a
The 14 defeated candidates filed a Petition for
Negotiating Committee headed by its National President, Mr.
Impeachment/Expulsion of the local union officers with the DOLE
NCR on November 5, 1987, docketed as NCR-OD-M-11-780-87.
However, the same was dismissed on March 2, 1988, by Med- former through Resolution No. 10 passed by the local executive
Arbiter Renato Parungo for failure to substantiate the charges and board and ratified by the general membership on July 16, 1988.
to present evidence in support of the allegations.
In retaliation, the national federation asked respondent company to
On April 17, 1988, the local union held a general membership stop the remittance of the local unions share in the education funds
meeting at the Caruncho Complex in Pasig. Several union effective August 1988. This was objected to by the local union
members failed to attend the meeting, prompting the Executive which demanded that the education fund be remitted to it in full.
Board to create a committee tasked to investigate the non-
attendance of several union members in the said assembly, The company was thus constrained to file a Complaint for
pursuant to Sections 4 and 5, Article V of the Constitution and By- Interpleader with a Petition for Declaratory Relief with the Med-
Laws of the union, which read: Arbitration Branch of the Department of Labor and Employment,
docketed as Case No. OD-M-8-435-88. This was resolved on
"Seksyon 4. Ang mga kinukusang hindi pagdalo o hindi paglahok October 28, 1988, by Med-Arbiter Anastacio Bactin in an Order,
sa lahat ng hakbangin ng unyon ng sinumang kasapi o pinuno ay disposing thus:
maaaring maging sanhi ng pagtitiwalag o pagpapataw ng multa ng
hindi hihigit sa P50.00 sa bawat araw na nagkulang. "WHEREFORE, premises considered, it is hereby ordered:

Seksyon 5. Ang sinumang dadalo na aalis ng hindi pa natatapos
ang pulong ay ituturing na pagliban at maparusahan ito ng
alinsunod sa Article V, Seksyong 4 ng Saligang Batas na ito. Sino
mang kasapi o pisyales na mahuli and dating sa takdang oras ng di
lalampas sa isang oras ay magmumulta ng P25.00 at babawasin sa
sahod sa pamamagitan ng salary deduction at higit sa isang oras ng
pagdating ng huli ay ituturing na pagliban.[3]
On June 27, 1988, the local union wrote respondent company a
letter requesting it to deduct the union fines from the
wages/salaries of those union members who failed to attend the
general membership meeting. A portion of the said letter stated:
"xxx xxx xxx
In connection with Section 4 Article II of our existing Collective
Bargaining Agreement, please deduct the amount of P50.00 from
each of the union members named in said annexes on the payroll
of July 2-8, 1988 as fine for their failure to attend said general
membership meeting."[4]
In a Memorandum dated July 3, 1988, the Secretary General of the
national federation, Godofredo Paceo, Jr. disapproved the
resolution of the local union imposing the P50.00 fine. The union
officers protested such action by the Federation in a Reply dated
July 4, 1988.
On July 11, 1988, the Federation wrote respondent company a
letter advising the latter not to deduct the fifty-peso fine from the
salaries of the union members requesting that:
" x x x any and all future representations by MSMG affecting a
number of members be first cleared from the federation before
corresponding action by the Company." [5]
The following day, respondent company sent a reply to petitioner
unions request in a letter, stating that it cannot deduct fines from
the employees salary without going against certain laws. The
company suggested that the union refer the matter to the proper
government office for resolution in order to avoid placing the
company in the middle of the issue.
The imposition of P50.00 fine became the subject of bitter
disagreement between the Federation and the local union
culminating in the latters declaration of general autonomy from the company informing the latter of its designation of a certain
1. That the United Lumber and General Workers of the Philippines
(ULGWP) through its local union officers shall administer the
collective bargaining agreement (CBA).
2. That petitioner company shall remit the P10,000.00 monthly
labor education program fund to the ULGWP subject to the
condition that it shall use the said amount for its intended purpose.
3. That the Treasurer of the MSMG shall be authorized to collect
from the 356 union members the amount of P50.00 as penalty for
their failure to attend the general membership assembly on April
17, 1988.
However, if the MSMG Officers could present the individual
written authorizations of the 356 union members, then the
company is obliged to deduct from the salaries of the 356 union
members the P50.00 fine."[6]
On appeal, Director Pura-Ferrer Calleja issued a Resolution dated
February 7, 1989, which modified in part the earlier disposition, to
wit:
"WHEREFORE, premises considered, the appealed portion is
hereby modified to the extent that the company should remit the
amount of five thousand pesos (P5,000.00) of the P10,000.00
monthly labor education program fund to ULGWP and the other
P5,000.00 to MSMG, both unions to use the same for its intended
purpose."[7]
Meanwhile, on September 2, 1988, several local unions (Top
Form, M. Greenfield, Grosby, Triumph International, General
Milling, and Vander Hons chapters) filed a Petition for Audit and
Examination of the federation and education funds of ULGWP
which was granted by Med-Arbiter Rasidali Abdullah on
December 25, 1988 in an Order which directed the audit and
examination of the books of account of ULGWP.
On September 30, 1988, the officials of ULGWP called a Special
National Executive Board Meeting at Nasipit, Agusan del Norte
where a Resolution was passed placing the MSMG under
trusteeship and appointing respondent Cesar Clarete as
administrator.
On October 27, 1988, the said administrator wrote the respondent
Alfredo Kalingking as local union president and "disauthorizing" We received a demand letter dated 21 November 1988 from the
the incumbent union officers from representing the employees. United Lumber and General Workers of the Philippines (ULGWP)
This action by the national federation was protested by the demanding for your dismissal from employment pursuant to the
petitioners in a letter to respondent company dated November 11, provisions of Article II, Section 4 of the existing Collective
1988. Bargaining Agreement (CBA). In the said demand letter, ULGWP
informed us that as of November 21, 1988, you were expelled
On November 13, 1988, the petitioner union officers received from the said federation "for committing acts of disloyalty and/or
identical letters from the administrator requiring them to explain acts inimical to the interest of ULGWP and violative to its
within 72 hours why they should not be removed from their office Constitution and By-laws particularly Article V, Section 6, 9, and
and expelled from union membership. 12, Article XIII, Section 8."
On November 26, 1988, petitioners replied: In subsequent letters dated 21 February and 4 March 1989, the
(a) Questioning the validity of the alleged National Executive ULGWP reiterated its demand for your dismissal, pointing out that
Board Resolution placing their union under trusteeship; notwithstanding your expulsion from the federation, you have
continued in your employment with the company in violation of
(b) Justifying the action of their union in declaring a general Sec. 1 and 4 of Article II of our CBA, and of existing provisions of
autonomy from ULGWP due to the latters inability to give proper law.
educational, organizational and legal services to its affiliates and
the pendency of the audit of the federation funds; In view thereof, we are left with no alternative but to comply with
the provisions of the Union Security Clause of our CBA.
(c) Advising that their union did not commit any act of disloyalty Accordingly, we hereby serve notice upon you that we are
as it has remained an affiliate of ULGWP; dismissing you from your employment with M. Greenfield, Inc.,
pursuant to Sections 1 and 4, Article II of the CBA effective
(d) Giving ULGWP a period of five (5) days to cease and desist
immediately."[10]
from further committing acts of coercion, intimidation and
harrassment.[8] On that same day, the expelled union officers assigned in the first
shift were physically or bodily brought out of the company
However, as early as November 21, 1988, the officers were
premises by the companys security guards. Likewise, those
expelled from the ULGWP. The termination letter read:
assigned to the second shift were not allowed to report for work.
"Effective today, November 21, 1988, you are hereby expelled This provoked some of the members of the local union to
from UNITED LUMBER AND GENERAL WORKERS OF THE demonstrate their protest for the dismissal of the said union
PHILIPPINES (ULGWP) for committing acts of disloyalty and/or officers. Some union members left their work posts and walked
acts inimical to the interest and violative to the Constitution and out of the company premises.
by-laws of your federation.
On the other hand, the Federation, having achieved its objective,
You failed and/or refused to offer an explanation inspite of the withdrew the Notice of Strike filed with the NCMB.
time granted to you.
On March 8, 1989, the petitioners filed a Notice of Strike with the
Since you are no longer a member of good standing, ULGWP is NCMB, DOLE, Manila, docketed as Case No. NCMB-NCR-NS-
constrained to recommend for your termination from your 03-216-89, alleging the following grounds for the strike:
employment, and provided in Article II Section 4, known as
(a) Discrimination
UNION SECURITY, in the Collective Bargaining agreement." [9]
(b) Interference in union activities
On the same day, the federation advised respondent company of
the expulsion of the 30 union officers and demanded their (c) Mass dismissal of union officers and shop stewards
separation from employment pursuant to the Union Security
Clause in their collective bargaining agreement. This demand was (d) Threats, coercion and intimidation
reiterated twice, through letters dated February 21 and March 4, (e) Union busting
1989, respectively, to respondent company.
The following day, March 9, 1989, a strike vote referendum was
Thereafter, the Federation filed a Notice of Strike with the conducted and out of 2, 103 union members who cast their votes,
National Conciliation and Mediation Board to compel the 2,086 members voted to declare a strike.
company to effect the immediate termination of the expelled union
officers. On March 10, 1989, the thirty (30) dismissed union officers filed
an urgent petition, docketed as Case No. NCMB-NCR-NS-03-216-
On March 7, 1989, under the pressure of a threatened strike, 89, with the Offfice of the Secretary of the Department of Labor
respondent company terminated the 30 union officers from and Employment praying for the suspension of the effects of their
employment, serving them identical copies of the termination termination from employment. However, the petition was
letter reproduced below: dismissed by then Secretary Franklin Drilon on April 11, 1989, the
pertinent portion of which stated as follows:
"At this point in time, it is clear that the dispute at M. Greenfield is
purely an intra-union matter. No mass lay-off is evident as the
terminations have been limited to those allegedly leading the
secessionist group leaving MSMG-ULGWP to form a union under
the KMU. xxx
docketed as Case No. NCR-00-09-04199-89, charging private
respondents of unfair labor practice which consists of union
busting, illegal dismissal, illegal suspension, interference in union
activities, discrimination, threats, intimidation, coercion, violence,
and oppresion.

xxx xxx xxx After the filing of the complaint, the lease contracts on the
respondent companys office and factory at Merville Subdivision,
WHEREFORE, finding no sufficient jurisdiction to warrant the Paraaque expired and were not renewed. Upon demand of the
exercise of our extraordinary authority under Article 277 (b) of the owners of the premises, the company was compelled to vacate its
Labor Code, as amended, the instant Petition is hereby office and factory.
DISMISSED for lack of merit.
Thereafter, the company transferred its administration and
SO ORDERED."[11] account/client servicing department at AFP-RSBS Industrial Park
On March 13 and 14, 1989, a total of 78 union shop stewards were in Taguig, Metro Manila. For failure to find a suitable place in
placed under preventive suspension by respondent company. This Metro Manila for relocation of its factory and manufacturing
prompted the union members to again stage a walk-out and operations, the company was constrained to move the said
resulted in the official declaration of strike at around 3:30 in the departments to Tacloban, Leyte. Hence, on April 16, 1990,
afternoon of March 14, 1989. The strike was attended with respondent company accordingly notified its employees of a
violence, force and intimidation on both sides resulting to physical temporary shutdown. in operations. Employees who were
injuries to several employees, both striking and non-striking, and interested in relocating to Tacloban were advised to enlist on or
damage to company properties. before April 23, 1990.

The employees who participated in the strike and allegedly figured The complaint for unfair labor practice was assigned to Labor
in the violent incident were placed under preventive suspension by Arbiter Manuel Asuncion but was thereafter reassigned to Labor
respondent company. The company also sent return-to-work Arbiter Cresencio Ramos when respondents moved to inhibit him
notices to the home addresses of the striking employees thrice from acting on the case.
successively, on March 27, April 8 and April 31, 1989, On December 15, 1992, finding the termination to be valid in
respectively. However, respondent company admitted that only compliance with the union security clause of the collective
261 employees were eventually accepted back to work. Those who bargaining agreement, Labor Arbiter Cresencio Ramos dismissed
did not respond to the return-to-work notice were sent termination the complaint.
letters dated May 17, 1989, reproduced below:
Petitioners then appealed to the NLRC. During its pendency,
M. Greenfield Inc., (B) Commissioner Romeo Putong retired from the service, leaving
Km. 14, Merville Rd., Paraaque, M.M. only two commissioners, Commissioner Vicente Veloso III and
Hon. Chairman Bartolome Carale in the First Division. When
May 17, 1989 Commissioner Veloso inhibited himself from the case,
Commissioner Joaquin Tanodra of the Third Division was
xxx
temporarily designated to sit in the First Division for the proper
On March 14, 1989, without justifiable cause and without due disposition of the case.
notice, you left your work assignment at the prejudice of the
The First Division affirmed the Labor Arbiters disposition. With
Companys operations. On March 27, April 11, and April 21, 1989,
the denial of their motion for reconsideration on January 28, 1994,
we sent you notices to report to the Company. Inspite of your
petitioners elevated the case to this Court, attributing grave abuse
receipt of said notices, we have not heard from you up to this date.
of discretion to public respondent NLRC in:
Accordingly, for your failure to report, it is construed that you
I. UPHOLDING THE DISMISSAL OF THE UNION OFFICERS
have effectively abandoned your employment and the Company is,
BY RESPONDENT COMPANY AS VALID;
therefore, constrained to dismiss you for said cause.
II. HOLDING THAT THE STRIKE STAGED BYTHE
Very truly yours,
PETITIONERS AS ILLEGAL;
M. GREENFIELD, INC., (B)
III. HOLDING THAT THE PETITIONER EMPLOYEES WERE
By: DEEMED TO HAVE ABANDONED THEIR WORK AND
HENCE, VALIDLY DISMISSED BY RESPONDENT
WENZEL STEPHEN LIGOT COMPANY; AND
Asst. HRD Manager"[12] IV. NOT FINDING RESPONDENT COMPANY AND
RESPONDENT FEDERATION OFFICERS GUILTY OF ACTS
On August 7, 1989, the petitioners filed a verified complaint with
OF UNFAIR LABOR PRACTICE.
the Arbitration Branch, National Capital Region, DOLE, Manila,
Notwithstanding the several issues raised by the petitioners and demand of the labor federation pursuant to the union security
respondents in the voluminous pleadings presented before the clause embodied in their collective bargaining agreement.
NLRC and this Court, they revolve around and proceed from the
issue of whether or not respondent company was justified in Petitioners contend that their dismissal from work was effected in
dismissing petitioner employees merely upon the labor federations an arbitrary, hasty, capricious and illegal manner because it was
demand for the enforcement of the union security clause embodied undertaken by the respondent company without any prior
in their collective bargaining agreement. administrative investigation; that, had respondent company
conducted prior independent investigation it would have found
Before delving into the main issue, the procedural flaw pointed out that their expulsion from the union was unlawful similarly for lack
by the petitioners should first be resolved. of prior administrative investigation; that the federation cannot
recommend the dismissal of the union officers because it was not a
Petitioners contend that the decision rendered by the First Division principal party to the collective bargaining agreement between the
of the NLRC is not valid because Commissioner Tanodra, who is company and the union; that public respondents acted with grave
from the Third Division, did not have any lawful authority to sit, abuse of discretion when they declared petitioners dismissals as
much less write the ponencia, on a case pending before the First valid and the union strike as illegal and in not declaring that
Division. It is claimed that a commissioner from one division of respondents were guilty of unfair labor practice.
the NLRC cannot be assigned or temporarily designated to another
division because each division is assigned a particular territorial Private respondents, on the other hand, maintain that the thirty
jurisdiction. Thus, the decision rendered did not have any legal dismissed employees who were former officers of the federation
effect at all for being irregularly issued. have no cause of action against the company, the termination of
their employment having been made upon the demand of the
Petitioners argument is misplaced. Article 213 of the Labor Code federation pursuant to the union security clause of the CBA; the
in enumerating the powers of the Chairman of the National Labor expelled officers of the local union were accorded due process of
Relations Commission provides that: law prior to their expulsion from their federation; that the strike
"The concurrence of two (2) Commissioners of a division shall be conducted by the petitioners was illegal for noncompliance with
necessary for the pronouncement of a judgment or resolution. the requirements; that the employees who participated in the
Whenever the required membership in a division is not complete illegal strike and in the commission of violence thereof were
and the concurrence of two (2) commissioners to arrive at a validly terminated from work; that petitioners were deemed to
judgment or resolution cannot be obtained, the Chairman shall have abandoned their employment when they did not respond to
designate such number of additional Commissioners from the the three return to work notices sent to them; that petitioner labor
other divisions as may be necessary." union has no legal personality to file and prosecute the case for
and on behalf of the individual employees as the right to do so is
It must be remembered that during the pendency of the case in the personal to the latter; and that, the officers of respondent company
First Division of the NLRC, one of the three commissioners, cannot be liable because as mere corporate officers, they acted
Commissioner Romeo Putong, retired, leaving Chairman within the scope of their authority.
Bartolome Carale and Commissioner Vicente Veloso III.
Subsequently, Commissioner Veloso inhibited himself from the Public respondent, through the Labor Arbiter, ruled that the
case because the counsel for the petitioners was his former dismissed union officers were validly and legally terminated
classmate in law school. The First Division was thus left with only because the dismissal was effected in compliance with the union
one commissioner. Since the law requires the concurrence of two security clause of the CBA which is the law between the parties.
commisioners to arrive at a judgment or resolution, the And this was affimed by the Commission on appeal. Moreover,
Commission was constrained to temporarily designate a the Labor Arbiter declared that notwithstanding the lack of a prior
commissioner from another division to complete the First administrative investigation by respondent company, under the
Division. There is nothing irregular at all in such a temporary union security clause provision in the CBA, the company cannot
designation for the law empowers the Chairman to make look into the legality or illegality of the recommendation to
temporary assignments whenever the required concurrence is not dismiss by the union nd the obligation to dismiss is ministerial on
met. The law does not say that a commissioner from the first the part of the company.[13]
division cannot be temporarily assigned to the second or third This ruling of the NLRC is erroneous. Although this Court has
division to fill the gap or vice versa. The territorial divisions do ruled that union security clauses embodied in the collective
not confer exclusive jurisdiction to each division and are merely bargaining agreement may be validly enforced and that dismissals
designed for administrative efficiency. pursuant thereto may likewise be valid, this does not erode the
Going into the merits of the case, the court finds that the fundamental requirement of due process. The reason behind the
Complaint for unfair labor practice filed by the petitioners against enforcement of union security clauses which is the sanctity and
respondent company which charges union busting, illegal inviolability of contracts[14] cannot override ones right to due
dismissal, illegal suspension, interference in union activities, process.
discrimination, threats, intimidation, coercion, violence, and In the case of Cario vs. National Labor Relations
oppression actually proceeds from one main issue which is the Commission,[15] this Court pronounced that while the company,
termination of several employees by respondent company upon the
under a maintenance of membership provision of the collective
bargaining agreement, is bound to dismiss any employee expelled
by the union for disloyalty upon its written request, this
undertaking should not be done hastily and summarily. The
company acts in bad faith in dismissing a worker without giving
him the benefit of a hearing.
In its decision, public respondent also declared that if
complainants (herein petitioners) have any recourse in law, their
right of action is against the federation and not against the
company or its officers, relying on the findings of the Labor
Secretary that the issue of expulsion of petitioner union officers by
the federation is a purely intra-union matter.

"The power to dismiss is a normal prerogative of the employer. Again, such a contention is untenable. While it is true that the
However, this is not without limitation. The employer is bound to issue of expulsion of the local union officers is originally between
exercise caution in terminating the services of his employees the local union and the federation, hence, intra-union in character,
especially so when it is made upon the request of a labor union the issue was later on converted into a termination dispute when
pursuant to the Collective Bargaining Agreement, xxx. Dismissals the company dismissed the petitioners from work without the
must not be arbitrary and capricious. Due process must be benefit of a separate notice and hearing. As a matter of fact, the
observed in dismissing an employee because it affects not only his records reveal that the the termination was effective on the same
position but also his means of livelihood. Employers should day that the the termination notice was served on the petitioners.
respect and protect the rights of their employees, which include the
right to labor." In the case of Liberty Cotton Mills Workers Union vs. Liberty
Cotton Mills, Inc.[17], the Court held the company liable for the
In the case under scrutiny, petitioner union officers were expelled payment of backwages for having acted in bad faith in effecting
by the federation for allegedly commiting acts of disloyalty and/or the dismissal of the employees.
inimical to the interest of ULGWP and in violation of its
Constitution and By-laws. Upon demand of the federation, the "xxx Bad faith on the part of the respondent company may be
company terminated the petitioners without conducting a separate gleaned from the fact that the petitioner workers were dismissed
and independent investigation. Respondent company did not hastily and summarily. At best, it was guilty of a tortious act, for
inquire into the cause of the expulsion and whether or not the which it must assume solidary liability, since it apparently chose to
federation had sufficient grounds to effect the same. Relying summarily dismiss the workers at the unions instance secure in the
merely upon the federations allegations, respondent company unions contractual undertaking that the union would hold it free
terminated petitioners from employment when a separate inquiry from any liability arising from such dismissal."
could have revealed if the federation had acted arbitrarily and Thus, notwithstanding the fact that the dismissal was at the
capriciously in expelling the union officers. Respondent companys instance of the federation and that it undertook to hold the
allegation that petitioners were accorded due process is belied by company free from any liability resulting from such a dismissal,
the termination letters received by the petitioners which state that the company may still be held liable if it was remiss in its duty to
the dismissal shall be immediately effective. accord the would-be dismissed employees their right to be heard
As held in the aforecited case of Cario, "the right of an employee on the matter.
to be informed of the charges against him and to reasonable Anent petitioners contention that the federation was not a principal
opportunity to present his side in a controversy with either the party to the collective bargaining agreement between the company
company or his own union is not wiped away by a union security and the union, suffice it to say that the matter was already ruled
clause or a union shop clause in a collective bargaining agreement. upon in the Interpleader case filed by respondent company. Med-
An employee is entitled to be protected not only from a company Arbiter Anastacio Bactin thus ruled:
which disregards his rights but also from his own union the
leadership of which could yield to the temptation of swift and After a careful examination of the facts and evidences presented
arbitrary expulsion from membership and mere dismissal from his by the parties, this Officer hereby renders its decision as follows:
job."
1.) It appears on record that in the Collective Bargaining
While respondent company may validly dismiss the employees Agreement (CBA) which took effect on July 1, 1986, the
expelled by the union for disloyalty under the union security contracting parties are M. Greenfield, Inc. (B) and Malayang
clause of the collective bargaining agreement upon the Samahan ng Mga Manggagawa sa M. Greenfield, Inc. (B)
recommendation by the union, this dismissal should not be done (MSMG)/United Lumber and General Workers of the Philippines
hastily and summarily thereby eroding the employees right to due (ULGWP). However, MSMG was not yet a registered labor
process, self-organization and security of tenure. The enforcement organization at the time of the signing of the CBA. Hence, the
of union security clauses is authorized by law provided such union referred to in the CBA is the ULGWP." [18]
enforcement is not characterized by arbitrariness, and always with
Likewise on appeal, Director Pura Ferrer-Calleja put the issue to
due process.[16] Even on the assumption that the federation had
rest as follows:
valid grounds to expell the union officers, due process requires
that these union officers be accorded a separate hearing by It is undisputed that ULGWP is the certified sole and exclusive
respondent company. collective bargaining agent of all the regular rank-and-file workers
of the company, M. Greenfield, Inc. (pages 31-32 of the records).
It has been established also that the company and ULGWP signed The evidence on hand does not show that there is such a provision
a 3-year collective bargaining agreement effective July 1, 1986 up in ULGWPs constitution. Respondents reliance upon Article V,
to June 30, 1989.[19] Section 6, of the federations constitution is not right because said
section, in fact, bolsters the petitioner unions claim of its right to
Although the issue of whether or not the federation had reasonable declare autonomy:
grounds to expel the petitioner union officers is properly within
the original and exclusive jurisdiction of the Bureau of Labor Section 6. The autonomy of a local union affiliated with ULGWP
Relations, being an intra-union conflict, this Court deems it shall be respected insofar as it pertains to its internal affairs, except
justifiable that such issue be nonetheless ruled upon, as the Labor as provided elsewhere in this Constitution.
Arbiter did, for to remand the same to the Bureau of Labor
Relations would be to intolerably delay the case. There is no disloyalty to speak of, neither is there any violation of
the federations constitution because there is nothing in the said
The Labor Arbiter found that petitioner union officers were constitution which specifically prohibits disaffiliation or
justifiably expelled from the federation for committing acts of declaration of autonomy. Hence, there cannot be any valid
disloyalty when it "undertook to disaffiliate from the federation by dismissal because Article II, Section 4 of the union security clause
charging ULGWP with failure to provide any legal, educational or in the CBA limits the dismissal to only three (3) grounds, to wit:
organizational support to the local. x x x and declared autonomy, failure to maintain membership in the union (1) for non-payment
wherein they prohibit the federation from interfering in any of union dues, (2) for resignation; and (3) for violation of the
internal and external affairs of the local union."[20] unions Constitution and By-Laws.

It is well-settled that findings of facts of the NLRC are entitled to To support the finding of disloyalty, the Labor Arbiter gave weight
great respect and are generally binding on this Court, but it is to the fact that on February 26, 1989, the petitioners declared as
equally well-settled that the Court will not uphold erroneous vacant all the responsible positions of ULGWP, filled these
conclusions of the NLRC as when the Court finds insufficient or vacancies through an election and filed a petition for the
insubstantial evidence on record to support those factual findings. registration of UWP as a national federation. It should be pointed
The same holds true when it is perceived that far too much is out, however, that these occurred after the federation had already
concluded, inferred or deduced from the bare or incomplete facts expelled the union officers. The expulsion was effective
appearing of record.[21] November 21, 1988. Therefore, the act of establishing a different
federation, entirely separate from the federation which expelled
In its decision, the Labor Arbiter declared that the act of them, is but a normal retaliatory reaction to their expulsion.
disaffiliation and declaration of autonomy by the local union was
part of its "plan to take over the respondent federation." This is With regard to the issue of the legality or illegality of the strike,
purely conjecture and speculation on the part of public respondent, the Labor Arbiter held that the strike was illegal for the following
totally unsupported by the evidence. reasons: (1) it was based on an intra-union dispute which cannot
properly be the subject of a strike, the right to strike being limited
A local union has the right to disaffiliate from its mother union or to cases of bargaining deadlocks and unfair labor practice (2) it
declare its autonomy. A local union, being a separate and was made in violation of the "no strike, no lock-out" clause in the
voluntary association, is free to serve the interests of all its CBA, and (3) it was attended with violence, force and intimidation
members including the freedom to disaffiliate or declare its upon the persons of the company officials, other employees
autonomy from the federation to which it belongs when reporting for work and third persons having legitimate business
circumstances warrant, in accordance with the constitutional with the company, resulting to serious physical injuries to several
guarantee of freedom of association.[22] employees and damage to company property.
The purpose of affiliation by a local union with a mother union or On the submission that the strike was illegal for being grounded on
a federation a non-strikeable issue, that is, the intra-union conflict between the
"xxx is to increase by collective action the bargaining power in federation and the local union, it bears reiterating that when
respect of the terms and conditions of labor. Yet the locals respondent company dismissed the union officers, the issue was
remained the basic units of association, free to serve their own and transformed into a termination dispute and brought respondent
the common interest of all, subject to the restraints imposed by the company into the picture. Petitioners believed in good faith that in
Constitution and By-Laws of the Association, and free also to dismissing them upon request by the federation, respondent
renounce the affiliation for mutual welfare upon the terms laid company was guilty of unfair labor pratice in that it violated the
down in the agreement which brought it into existence." [23] petitioners right to self-organization. The strike was staged to
protest respondent companys act of dismissing the union officers.
Thus, a local union which has affiliated itself with a federation is Even if the allegations of unfair labor practice are subsequently
free to sever such affiliation anytime and such disaffiliation cannot found out to be untrue, the presumption of legality of the strike
be considered disloyalty. In the absence of specific provisions in prevails.[25]
the federations constitution prohibiting disaffiliation or the
declaration of autonomy of a local union, a local may dissociate Another reason why the Labor Arbiter declared the strike illegal is
with its parent union. [24] due to the existence of a no strike no lockout provision in the
CBA. Again, such a ruling is erroneous. A no strike, no lock out
provision can only be invoked when the strike is economic in consideration, the petitioners did, in fact, file a complaint when
nature, i.e. to force wage or other concessions from the employer they were refused reinstatement by respondent company.
which he is not required by law to grant.[26]Such a provision
cannot be used to assail the legality of a strike which is grounded Anent public respondents finding that there was no unfair labor
on unfair labor practice, as was the honest belief of herein practice on the part of respondent company and federation officers,
petitioners. Again, whether or not there was indeed unfair labor the Court sustains the same. As earlier discussed, union security
practice does not affect the strike. clauses in collective bargaining agreements, if freely and
voluntarily entered into, are valid and binding. Corrolarily,
On the allegation of violence committed in the course of the strike, dismissals pursuant to union security clauses are valid and legal
it must be remembered that the Labor Arbiter and the Commission subject only to the requirement of due process, that is, notice and
found that "the parties are agreed that there were violent incidents hearing prior to dismissal. Thus, the dismissal of an employee by
x x x resulting to injuries to both sides, the union and the company pursuant to a labor unions demand in accordance
management."[27] The evidence on record show that the violence with a union security agreement does not constitute unfair labor
cannot be attributed to the striking employees alone for the practice.[31]
company itself employed hired men to pacify the strikers. With
violence committed on both sides, the management and the However, the dismissal was invalidated in this case because of
employees, such violence cannot be a ground for declaring the respondent companys failure to accord petitioners with due
strike as illegal. process, that is, notice and hearing prior to their termination. Also,
said dismissal was invalidated because the reason relied upon by
With respect to the dismissal of individual petitioners, the Labor respondent Federation was not valid. Nonetheless, the dismissal
Arbiter declared that their refusal to heed respondents recall to still does not constitute unfair labor practice.
work notice is a clear indication that they were no longer
interested in continuing their employment and is deemed Lastly, the Court is of the opinion, and so holds, that respondent
abandonment. It is admitted that three return to work notices were company officials cannot be held personally liable for damages on
sent by respondent company to the striking employees on March account of the employees dismissal because the employer
27, April 11, and April 21, 1989 and that 261 employees who corporation has a personality separate and distinct from its officers
responded to the notice were admittted back to work. who merely acted as its agents.

However, jurisprudence holds that for abandonment of work to It has come to the attention of this Court that the 30-day prior
exist, it is essential (1) that the employee must have failed to report notice requirement for the dismissal of employees has been
for work or must have been absent without valid or justifiable repeatedly violated and the sanction imposed for such violation
[32]
reason; and (2) that there must have been a clear intention to sever enunciated in Wenphil Corporation vs. NLRC has become an
the employer-employee relationship manifested by some overt ineffective deterrent. Thus, the Court recently promulgated a
[28]
acts. Deliberate and unjustified refusal on the part of the decision to reinforce and make more effective the requirement of
employee to go back to his work post amd resume his employment notice and hearing, a procedure that must be observed before
must be established. Absence must be accompanied by overt acts termination of employment can be legally effected.
unerringly pointing to the fact that the employee simply does not In Ruben Serrano vs. NLRC and Isetann Department Store (G.R.
want to work anymore.[29] And the burden of proof to show that No. 117040, January 27, 2000), the Court ruled that an employee
there was unjustified refusal to go back to work rests on the who is dismissed, whether or not for just or authorized cause but
employer. without prior notice of his termination, is entitled to full
In the present case, respondents failed to prove that there was a backwages from the time he was terminated until the decision in
clear intention on the part of the striking employees to sever their his case becomes final, when the dismissal was for cause; and in
employer-employee relationship. Although admittedly the case the dismissal was without just or valid cause, the backwages
company sent three return to work notices to them, it has not been shall be computed from the time of his dismissal until his actual
substantially proven that these notices were actually sent and reinstatement. In the case at bar, where the requirement of notice
received by the employees. As a matter of fact, some employees and hearing was not complied with, the aforecited doctrine laid
deny that they ever received such notices. Others alleged that they down in the Serrano case applies.
were refused entry to the company premises by the security guards WHEREFORE, the Petition is GRANTED; the decision of the
and were advised to secure a clearance from ULGWP and to sign a National Labor Relations Commission in case No. NCR-00-09-
waiver. Some employees who responded to the notice were 04199-89 is REVERSED and SET ASIDE; and the respondent
allegedly told to wait for further notice from respondent company company is hereby ordered to immediately reinstate the petitioners
as there was lack of work. to their respective positions. Should reinstatement be not feasible,
Furthermore, this Court has ruled that an employee who took steps respondent company shall pay separation pay of one month salary
to protest his lay-off cannot be said to have abandoned his for every year of service. Since petitioners were terminated
[30]
work. The filing of a complaint for illegal dismissal is without the requisite written notice at least 30 days prior to their
inconsistent with the allegation of abandonment. In the case under termination, following the recent ruling in the case of Ruben
Serrano vs. National Labor Relations Commission and Isetann
Department Store, the respondent company is hereby ordered to
pay full backwages to petitioner-employees while the Federation is
also ordered to pay full backwages to petitioner-union officers
who were dismissed upon its instigation. Since the dismissal of
petitioners was without cause, backwages shall be computed from
the time the herein petitioner employees and union officers were
dismissed until their actual reinstatement. Should reinstatement be
not feasible, their backwages shall be computed from the time
petitioners were terminated until the finality of this decision. Costs
against the respondent company.
SO ORDERED.
G.R. No.174287, August 12, 2013
NATIONAL UNION OF BANK EMPLOYEES
(NUBE), Petitioner, v. PHILNABANK EMPLOYEES
ASSOCIATION (PEMA) AND PHILIPPINE NATIONAL
BANK, Respondents.
DECISION
PERALTA, J.:
Assailed in this petition for review on certiorari under Rule 45 of
the 1997 Rules of Civil Procedure are the May 22, 2006
Decision1 and August 17, 2006 Resolution2 of the Court of
Appeals (CA) in CA-G.R. SP No. 84606, which reversed the May
27, 2004 Decision3 of the Secretary of Labor and Employment
acting as voluntary arbitrator, the dispositive portion of which
states:
WHEREFORE, in light of the foregoing findings, the Bank is
hereby ORDERED to release all union dues withheld and to
continue remitting to NUBE-PNB chapter the members'
obligations under the CBA, LESS the amount corresponding to
the number of non-union members including those who
participated in the unsuccessful withdrawal of membership from significant events transpired – the independent union registration
their mother union.
The parties are enjoined to faithfully comply with the above-
mentioned resolution.
With respect to the URGENT MOTION FOR
INTERVENTION filed by PEMA, the same is hereby denied
without prejudice to the rights of its members to bring an action to Certificate No. NCR-UR-3-3790-2002.
protect such rights if deemed necessary at the opportune time.
4
SO ORDERED. cralaw virtualaw library
We state the facts.
Respondent Philippine National Bank (PNB) used to be a
government-owned and controlled banking institution established WHEREAS, in the long period of time that the Union has been
under Public Act 2612, as amended by Executive Order No. 80
dated December 3, 1986 (otherwise known as The 1986 Revised provide satisfactory services and support to the former in the form
Charter of the Philippine National Bank). Its rank-and-file
employees, being government personnel, were represented for
collective negotiation by the Philnabank Employees Association
(PEMA), a public sector union.
In 1996, the Securities and Exchange Commission approved
PNB’s new Articles of Incorporation and By-laws and its changed
status as a private corporation. PEMA affiliated with petitioner
National Union of Bank Employees (NUBE), which is a labor
federation composed of unions in the banking industry, adopting
the name NUBE-PNB Employees Chapter (NUBE-PEC).
Later, NUBE-PEC was certified as the sole and exclusive
bargaining agent of the PNB rank-and-file employees. A collective
bargaining agreement (CBA) was subsequently signed between
NUBE-PEC and PNB covering the period of January 1, 1997 to
December 31, 2001.
Pursuant to Article V on Check-off and Agency Fees of the CBA,
PNB shall deduct the monthly membership fee and other
assessments imposed by the union from the salary of each union
member, and agency fee (equivalent to the monthly membership
dues) from the salary of the rank- and-file employees within the
bargaining unit who are not union members. Moreover, during the
effectivity of the CBA, NUBE, being the Federation union, agreed
that PNB shall remit P15.00 of the P65.00 union dues per month
collected by PNB from every employee, and that PNB shall
directly credit the amount to NUBE’s current account with
PNB.5cralaw virtualaw library
Following the expiration of the CBA, the Philnabank Employees
Association-FFW (PEMA-FFW) filed on January 2, 2002 a
petition for certification election among the rank-and-file
employees of PNB. The petition sought the conduct of a
certification election to be participated in by PEMA-FFW and
NUBE-PEC.
While the petition for certification election was still pending, two
of NUBE- PEC and its disaffiliation with NUBE.
With a legal personality derived only from a charter issued by
NUBE, NUBE-PEC, under the leadership of Mariano Soria,
decided to apply for a separate registration with the Department of
Labor and Employment (DOLE). On March 25, 2002, it was
registered as an independent labor organization under Registration
Thereafter, on June 20, 2003, the Board of Directors of NUBE-
PEC adopted a Resolution6 disaffiliating itself from NUBE. Cited
as reasons were as follows:
xxxx
affiliated with NUBE, the latter has miserably failed to extend and
of legal services, training assistance, educational seminars, and the
like;chanr0blesvirtualawlibrary
WHEREAS, this failure by NUBE to provide adequate essential
services and support to union members have caused the latter to be dealing with Serrana, Roma, Latorre, Garcia, Medrano, and
resentful to NUBE and to demand for the Union’s disaffiliation Magtibay, who are expelled from NUBE-PEC.11 With regard to
from the former[;] the issue of non-remittance of the union dues, NUBE enjoined
PNB to comply with the union check-off provision of the CBA;
WHEREAS, just recently, NUBE displayed its lack of regard for otherwise, it would elevate the matter to the grievance machinery
the interests and aspirations of the union members by blocking the in accordance with the CBA.
latter’s desire for the early commencement of CBA negotiations
with the PNB management[;] Despite NUBE’s response, PNB stood firm on its decision.
Alleging unfair labor practice (ULP) for non-implementation of
WHEREAS, this strained relationship between NUBE and the the grievance machinery and procedure, NUBE brought the matter
Union is no longer conducive to a fruitful partnership between to the National Conciliation and Mediation Board (NCMB) for
them and could even threaten industrial peace between the Union preventive mediation.12 In time, PNB and NUBE agreed to refer
and the management of PNB. the case to the Office of the DOLE Secretary for voluntary
arbitration. They executed a Submission Agreement on October
WHEREAS, under the circumstances, the current officers of the 28, 2003.13cralaw virtualaw library
Union have no choice but to listen to the clamor of the
overwhelming majority of union members for the Union to Meantime, the DOLE denied PEMA’s motion to change its name
7
disaffiliate from NUBE. cralaw virtualaw library in the official ballots. The certification election was finally held on
October 17, 2003. The election yielded the following results:
The duly notarized Resolution was signed by Edgardo B. Serrana
(President), Rico B. Roma (Vice-President), Rachel C. Latorre Number of eligible voters 3,742
(Secretary), Valeriana S. Garcia (Director/Acting Treasurer),
Ruben C. Medrano (Director), and Verlo C. Magtibay (Director). Number of valid votes cast 2,993
It is claimed that said Resolution was overwhelmingly ratified by Number of spoiled ballots 72
about eighty-one percent (81%) of the total union membership.
Total 3,065
On June 25, 2003, NUBE-PEC filed a Manifestation and
Motion8 before the Med-Arbitration Unit of DOLE, praying that,
in view of its independent registration as a labor union and Philnabank Employees Association-FFW 289
disaffiliation from NUBE, its name as appearing in the official
ballots of the certification election be changed to “Philnabank National Union of Bank Employees (NUBE)-
2,683
Employees Association (PEMA)” or, in the alternative, both Philippine National Bank (PNB) Chapter
parties be allowed to use the name “PEMA” but with PEMA-FFW
No Union 21
and NUBE-PEC be denominated as “PEMA-Bustria Group” and
“PEMA-Serrana Group,” respectively. Total 2,99314

On the same date, PEMA sent a letter to the PNB management On April 28, 2004, PEMA filed before the voluntary arbitrator an
informing its disaffiliation from NUBE and requesting to stop, Urgent Motion for Intervention,15alleging that it stands to be
effective immediately, the check-off of the P15.00 due for substantially affected by whatever judgment that may be issued,
NUBE.9cralaw virtualaw library because one of the issues for resolution is the validity of its
disaffiliation from NUBE. It further claimed that its presence is
Acting thereon, on July 4, 2003, PNB informed NUBE of PEMA’s necessary so that a complete relief may be accorded to the parties.
letter and its decision to continue the deduction of the P15.00 fees, Only NUBE opposed the motion, arguing that PEMA has no legal
but stop its remittance to NUBE effective July 2003. PNB also personality to intervene, as it is not a party to the existing CBA;
notified NUBE that the amounts collected would be held in a trust and that NUBE is the exclusive bargaining representative of the
account pending the resolution of the issue on PEMA’s PNB rank-and-file employees and, in dealing with a union other
disaffiliation.10cralaw virtualaw library than NUBE, PNB is violating the duty to bargain collectively,
which is another form of ULP.16cralaw virtualaw library
On July 11, 2003, NUBE replied that: it remains as the exclusive
bargaining representative of the PNB rank-and-file employees; by Barely a month after, DOLE Acting Secretary Manuel G. Imson
signing the Resolution (on disaffiliation), the chapter officers have denied PEMA’s motion for intervention and ordered PNB to
abandoned NUBE-PEC and joined another union; in abandoning release all union dues withheld and to continue remitting the same
NUBE-PEC, the chapter officers have abdicated their respective to NUBE. The May 27, 2004 Decision opined:
positions and resigned as such; in joining another union, the
Before we delve into the merits of the present dispute, it behooves
chapter officers committed an act of disloyalty to NUBE-PEC and
[Us] to discuss in passing the propriety of the MOTION FOR
the general membership; the circumstances clearly show that there
INTERVENTION filed by the Philnabank Employees Association
is an emergency in NUBE-PEC necessitating its placement under
(PEMA) on April 28, 2004, the alleged [break-away] group of
temporary trusteeship; and that PNB should cease and desist from
NUBE- PNB Chapter.

A cursory reading of the motion reveals a denial thereof is not
prejudicial to the individual rights of its members. They are
protected by law.
Coming now to the main issues of the case, suffice it to say that
after an evaluative review of the record of the case, taking into
consideration the arguments and evidence adduced by both parties, management discretion apparently in order to protect the Bank’s
We find that indeed no effective disaffiliation took place.
It is well settled that [l]abor unions may disaffiliate from their
mother federations to form a local or independent union only
during the 60-day freedom period immediately preceding the
expiration of the CBA. [Tanduay Distillery Labor Union v.
National Labor Relations Commission, et al.] However, such
disaffiliation must be effected by a majority of the members in the
bargaining unit. (Volkschel Labor Union v. Bureau of Labor
Relations).
Applying the foregoing jurisprudence to the case at bar, it is
difficult to believe that a justified disaffiliation took place. While application for WPI. PEMA’s motion for reconsideration was
members of the latter, is beyond reproach.
However, the Bank cannot be faulted for not releasing union dues
to NUBE at the time when representation status issue was still
being threshed out by proper governmental authority. Prudence
dictates the discontinuance of remittance of union dues to NUBE
under such circumstances was a legitimate exercise of
business interest. The suspension of the check-off provision of the
CBA, at the instance of the latter made in good faith, under the
present circumstances cannot give rise to a right of action. For
having been exercised without malice much less evil motive and
for not causing actual loss to the National Union of Bank
Employees (NUBE), the same act of management [cannot] be
penalized.17cralaw virtualaw library
Aggrieved, PEMA filed before the CA a petition under Rule 43 of
the Rules on Civil Procedure with prayer for the issuance of a
temporary restraining order (TRO) or writ of preliminary
injunction (WPI). On November 2, 2004, the CA denied the
18

the record apparently shows that attempts at disaffiliation occurred also denied on February 24, 2005, noting PNB’s manifestation that
sometime in June of 2003 x x x the latest result of a certification it would submit to the judgment of the CA as to which 19
party it
election dated 17 October 2003 mooted such disaffiliation. should remit the funds collected from the employees. cralaw
virtualaw library
Further, even if for the sake of argument an attempt at
disaffiliation occurred, the record is bereft of substantial evidence On June 21, 2005, however, petitioner again filed an Urgent
to support a finding of effective disaffiliation. There might have Motion for the Issuance of a TRO against the June 10, 2005
been a mass withdrawal of the union members from the NUBE- Resolution of DOLE Acting Secretary Imson, which ordered PNB
PNB Chapter. The record shows, however, that only 289 out of to properly issue a check directly payable to the order of NUBE
3,742 members shifted their allegiance from the mother union. covering the withheld funds from the trust account.20 Considering
Hence, they constituted a small minority for which reason they the different factual milieu, the CA resolved to grant the
could not have successfully severed the local union’s affiliation motion.21cralaw virtualaw library
with NUBE.
Subsequent to the parties’ submission of memoranda, the CA
Thus, since only a minority of the members wanted disaffiliation promulgated its May 22, 2006 Decision, declaring the validity of
as shown by the certification election, it can be inferred that the PEMA’s disaffiliation from NUBE and directing PNB to return to
majority of the members wanted the union to remain an affiliate of the employees concerned the amounts deducted and held in trust
the NUBE. [Villar, et al. v. Inciong, et al.]. There being no for NUBE starting July 2003 and to stop further deductions in
22
justified disaffiliation that took place, the bargaining agent’s right favor of NUBE. cralaw virtualaw library
under the provision of the CBA on Check-Off is unaffected and
still remained with the old NUBE-PNB Chapter. x x x As to the impropriety of denying PEMA’s motion for intervention,
the CA noted:
While it is true that the obligation of an employee to pay union x x x Among the rights of the [PEMA] as an affiliate of a
dues is co-terminus with his affiliation [Philippine Federation of federation is to disaffiliate from it. Any case in which this is an
Petroleum Workers v. CIR], it is equally tenable that when it is issue is then one in which the union has a significant legal interest
shown, as in this case, that the withdrawal from the mother union and as to which it must be heard, irrespective of any residual rights
is not supported by majority of the members, the disaffiliation is of the members after a decision that might deny a disaffiliation. It
unjustified and the disaffiliated minority group has no authority to is a non-sequitur to make the intervention of the union in this case
represent the employees of the bargaining unit. This is the import dependent on the question of whether its members can pursue their
of the principle laid down in [Volkschel Labor Union v. Bureau of own agenda under the same constraints.23cralaw virtualaw library
Labor Relations supra] and the inverse application of the Supreme
Court decision in [Philippine Federation of Petroleum Workers v. On the validity of PEMA’s disaffiliation, the CA ratiocinated:
CIR] regarding entitlement to the check-off provision of the CBA.
The power and freedom of a local union to disaffiliate from its
mother union or federation is axiomatic. As Volkschel vs. Bureau
As a necessary consequence to our finding that no valid
of Labor Relations [137 SCRA 42] recognizes, a local union is,
disaffiliation took place, the right of NUBE to represent its local
after all, a separate and voluntary association that under the
chapter at the PNB, less those employees who are no longer
constitutional guarantee of freedom of expression is free to serve
the interests of its members. Such right and freedom invariably
include the right to disaffiliate or declare its autonomy from the
federation or mother union to which it belongs, subject to
reasonable restrictions in the law or the federation’s constitution.
[Malayang Samahan ng mga Manggagawa sa M. Greenfield vs.
Ramos, 326 SCRA 428]
Without any restrictive covenant between the parties, [Volkschel
Labor Union vs. Bureau of Labor Relations, supra, at 48,] it is
instructive to look into the state of the law on a union’s right to
disaffiliate. The voluntary arbitrator alludes to a provision in PD
1391 allowing disaffiliation only within a 60-day period preceding
the expiration of the CBA. In Alliance of Nationalist and Genuine
Labor Organization vs. Samahan ng mga Manggagawang
Nagkakaisa sa Manila Bay Spinning Mills, etc. [258 SCRA 371],
however, the rule was not held to be iron-clad. Volkschel was cited
to support a more flexible view that the right may be allowed as
the circumstances warrant. In Associated Workers Union-
PTGWO vs. National Labor Relations Commission [188 SCRA
123], the right to disaffiliate was upheld before the onset of the
freedom period when it became apparent that there was a shift of
allegiance on the part of the majority of the union members.
xxxx
As the records show, a majority, indeed a vast majority, of the
members of the local union ratified the action of the board to
disaffiliate. Our count of the members who approved the board
action is, 2,638. If we divide this by the number of eligible voters
as per the certification election which is 3,742, the quotient is
70.5%, representing the proportion of the members in favor of
disaffiliation. The [PEMA] says that the action was ratified by
81%. Either way, the groundswell of support for the measure was
overwhelming.
The respondent NUBE has developed the ingenious theory that if
the disaffiliation was approved by a majority of the members, it
was neutered by the subsequent certification election in which
NUBE-PNB Chapter was voted the sole and exclusive bargaining
agent. It is argued that the effects of this change must be upheld as
the latest expression of the will of the employees in the bargaining
unit. The truth of the matter is that the names of PEMAand NUBE-
PNB Chapter are names of only one entity, the two sides of the
same coin. We have seen how NUBE-PNB Employees Chapter
evolved into PEMA and competed with Philnabank Employees
Association-FFW for supremacy in the certification election. To
realize that it was PEMA which entered into the contest, we need
only to remind ourselves that PEMA was the one which filed a
motion in the certification election case to have its name PEMA
put in the official ballot. DOLE insisted, however, in putting the
name NUBE-PNB Chapter in the ballots unaware of the
implications of this seemingly innocuous act.24cralaw virtualaw
library
NUBE filed a motion for reconsideration, but it was
denied;25 hence, this petition raising the following issues for
resolution:
I. The Secretary of Labor acted without error and without grave abuse of d
giving due course to the urgent motion for intervention filed by PEMA.
II. The Secretary of Labor acted without grave abuse of discretion and with
in ruling that PEMA’s alleged disaffiliation was invalid.
III. The Secretary of Labor did not commit serious error in ordering the rele
disputed union fees/dues to NUBE-PNB Chapter.
IV. There is no substantial basis for the issuance of a preli minary injunctio
restraining order.
V. Under the Rules of Court, the appeal/petition of PEMA should have bee
VI. PEMA and NUBE are not one and the same, and the denial by the Secre
the motion for intervention was proper.
VII. NUBE-PNB Chapter, not PEMA, has been fighting for PNB rank-and-f
rights since PNB’s privatization, which is further pro of that NUBE-PN
PEMA are not one and the same.
VIII.The alleged disaffiliation was not valid as proper procedure was not foll
IX. NUBE is entitled to check-off.26
Stripped of the non-essential, the issue ultimately boils down on
whether PEMA validly disaffiliated itself from NUBE, the
resolution of which, in turn, inevitably affects the latter’s right to
collect the union dues held in trust by PNB.
We deny the petition.
Whether there was a valid disaffiliation is a factual issue.27 It is
elementary that a question of fact is not appropriate for a petition
for review on certiorari under Rule 45 of the Rules of Court. The
parties may raise only questions of law because the Supreme Court
is not a trier of facts. As a general rule, We are not duty-bound to
analyze again and weigh the evidence introduced in and
considered by the tribunals below. When supported by substantial
evidence, the findings of fact of the CA are conclusive and binding
on the parties and are not reviewable by this Court, except: (1)
When the conclusion is a finding grounded entirely on speculation,
surmises and conjectures; (2) When the inference made is
manifestly mistaken, absurd or impossible; (3) Where there is a
grave abuse of discretion; (4) When the judgment is based on a
misapprehension of facts; (5) When the findings of fact are
conflicting; (6) When the CA, in making its findings, went beyond
the issues of the case and the same is contrary to the admissions of support local unions may find it hard, unaided by other support
both parties; (7) When the findings are contrary to those of the groups, to secure justice for themselves.
trial court; (8) When the findings of fact are conclusions without
citation of specific evidence on which they are based; (9) When Yet the local unions remain the basic units of association, free to
the facts set forth in the petition as well as in the petitioner’s main serve their own interests subject to the restraints imposed by the
and reply briefs are not disputed by the respondents; and (10) constitution and by-laws of the national federation, and free also to
When the findings of fact of the CA are premised on the supposed renounce the affiliation upon the terms laid down in the agreement
absence of evidence and contradicted by the evidence on which brought such affiliation into existence.
record.28 The Court finds no cogent reason to apply these
recognized exceptions. Such dictum has been punctiliously followed since then. 32cralaw
virtualaw library
Even a second look at the records reveals that the arguments raised
in the petition are bereft of merit. And again, in Coastal Subic Bay Terminal, Inc. v. Department of
Labor and Employment – Office of the Secretary,33 this Court
The right of the local union to exercise the right to disaffiliate opined:
from its mother union is well settled in this jurisdiction. In MSMG- Under the rules implementing the Labor Code, a chartered local
UWP v. Hon. Ramos,29 We held: union acquires legal personality through the charter certificate
A local union has the right to disaffiliate from its mother union or issued by a duly registered federation or national union, and
declare its autonomy. A local union, being a separate and reported to the Regional Office in accordance with the rules
voluntary association, is free to serve the interests of all its implementing the Labor Code. A local union does not owe its
members including the freedom to disaffiliate or declare its existence to the federation with which it is affiliated. It is a
autonomy from the federation which it belongs when separate and distinct voluntary association owing its creation to the
circumstances warrant, in accordance with the constitutional will of its members. Mere affiliation does not divest the local
guarantee of freedom of association. union of its own personality, neither does it give the mother
federation the license to act independently of the local union. It
The purpose of affiliation by a local union with a mother union only gives rise to a contract of agency, where the former acts in
[or] representation of the latter. Hence, local unions are considered
a federation principals while the federation is deemed to be merely their agent.
As such principals, the unions are entitled to exercise the rights
"x x x is to increase by collective action the bargaining power in and privileges of a legitimate labor organization, including the
respect of the terms and conditions of labor. Yet the locals right to seek certification as the sole and exclusive bargaining
34
remained the basic units of association, free to serve their own and agent in the appropriate employer unit. cralaw virtualaw library
the common interest of all, subject to the restraints imposed by the Finally, the recent case of Cirtek Employees Labor Union-
Constitution and By-Laws of the Association, and free also to Federation of Free Workers v. Cirtek Electronics, Inc35 ruled:
renounce the affiliation for mutual welfare upon the terms laid
down in the agreement which brought it into existence." x x x [A] local union may disaffiliate at any time from its
mother federation, absent any showing that the same is
Thus, a local union which has affiliated itself with a federation is prohibited under its constitution or rule. Such, however, does
free to sever such affiliation anytime and such disaffiliation cannot not result in it losing its legal personality
be considered disloyalty. In the absence of specific provisions in altogether. Verily, Anglo-KMU v. Samahan Ng Mga
the federation's constitution prohibiting disaffiliation or the Manggagawang Nagkakaisa Sa Manila Bar Spinning Mills At J.P.
declaration of autonomy of a local union, a local may dissociate Coats enlightens:
with its parent union.30cralaw virtualaw library
A local labor union is a separate and distinct unit primarily
Likewise, Philippine Skylanders, Inc. v. National Labor Relations designed to secure and maintain an equality of bargaining power
Commission31 restated: between the employer and their employee-members. A local
union does not owe its existence to the federation with which it
The right of a local union to disaffiliate from its mother federation is affiliated. It is a separate and distinct voluntary association
is not a novel thesis unillumined by case law. In the landmark case owing its creation to the will of its members. The mere act of
of Liberty Cotton Mills Workers Union vs. Liberty Cotton Mills, affiliation does not divest the local union of its own personality,
Inc., we upheld the right of local unions to separate from their neither does it give the mother federation the license to act
mother federation on the ground that as separate and voluntary independently of the local union. It only gives rise to a contract
associations, local unions do not owe their creation and existence of agency where the former acts in representation of the
to the national federation to which they are affiliated but, instead, latter.36cralaw virtualaw library
to the will of their members. The sole essence of affiliation is to
increase, by collective action, the common bargaining power of These and many more have consistently reiterated the earlier view
local unions for the effective enhancement and protection of their that the right of the local members to withdraw from the federation
interests. Admittedly, there are times when without succor and and to form a new local union depends upon the provisions of the
union's constitution, by-laws and charter and, in the absence of representation of PEMA, any act performed by the former that
enforceable provisions in the federation's constitution preventing affects the interests and affairs of the latter, including the supposed
disaffiliation of a local union, a local may sever its relationship expulsion of Serrana et al., is rendered without force and effect.
with its parent.37In the case at bar, there is nothing shown in the
records nor is it claimed by NUBE that PEMA was expressly Also, in effect, NUBE loses it right to collect all union dues held
forbidden to disaffiliate from the federation nor were there any in its trust by PNB. The moment that PEMA separated from and
conditions imposed for a valid breakaway. This being so, PEMA is left NUBE and exists as an independent labor organization with a
not precluded to disaffiliate from NUBE after acquiring the status certificate of registration, the former is no longer obliged to pay
of an independent labor organization duly registered before the dues and assessments to the latter; naturally, there would be no
DOLE. longer any reason or occasion for PNB to continue making
deductions.42 As we said in Volkschel Labor Union v. Bureau of
Also, there is no merit on NUBE’s contention that PEMA’s Labor Relations:43cralaw virtualaw library
disaffiliation is invalid for non-observance of the procedure that
union members should make such determination through secret x x x In other words, ALUMETAL [NUBE in this case] is entitled
ballot and after due deliberation, conformably with Article 241 (d)to receive the dues from respondent companies as long as
of the Labor Code, as amended.38 Conspicuously, other than citing petitioner union is affiliated with it and respondent companies are
the opinion of a “recognized labor law authority,” NUBE failed to authorized by their employees (members of petitioner union) to
deduct union dues. Without said affiliation, the employer has no
quote a specific provision of the law or rule mandating that a local
union’s disaffiliation from a federation must comply with Article link to the mother union. The obligation of an employee to pay
241 (d) in order to be valid and effective. union dues is coterminous with his affiliation or membership. "The
employees' check-off authorization, even if declared irrevocable, is
Granting, for argument’s sake, that Article 241 (d) is applicable, good only as long as they remain members of the union
still, We uphold PEMA’s disaffiliation from NUBE. First, non- concerned." A contract between an employer and the parent
compliance with the procedure on disaffiliation, being premised on organization as bargaining agent for the employees is terminated
purely technical grounds cannot rise above the employees’ bv the disaffiliation ofthe local of which the employees are
44
fundamental right to self-organization and to form and join labor members. x x x cralaw virtualaw library
organizations of their own choosing for the purpose of collective On the other hand, it was entirely reasonable for PNB to enter into
bargaining.39Second, the Article nonetheless provides that when a CBA with PEMA as represented by Serrana et al. Since PEMA
the nature of the organization renders such secret ballot had validly separated itself from NUBE, there would be no
impractical, the union officers may make the decision in behalf of restrictions which could validly hinder it from collectively
the general membership. In this case, NUBE did not even dare to bargaining with PNB.
contest PEMA’s representation that “PNB employees, from where
[PEMA] [derives] its membership, are scattered from Aparri to WHEREFORE, the foregoing considered, the instant Petition
Jolo, manning more than 300 branches in various towns and cities is DENIED. The May 22, 2006 Decision and August 17, 2006
of the country,” hence, “[to] gather the general membership of the Resolution of the Court of Appeals in CA-G.R. SP No. 84606,
union in a general membership to vote through secret balloting is which reversed the May 27, 2004 Decision ofthe Secretary of
virtually impossible.”40 It is understandable, therefore, why Labor and Employment, are AFFIRMED.
PEMA’s board of directors merely opted to submit for ratification
of the majority their resolution to disaffiliate from NUBE. Third, SO ORDERED.
and most importantly, NUBE did not dispute the existence of the
persons or their due execution of the document showing their ALLIANCE OF NATIONALIST AND GENUINE LABOR
unequivocal support for the disaffiliation of PEMA from NUBE. ORGANIZATION (ANGLO-KMU), petitioner, vs. SAMAHAN
Note must be taken of the fact that the list of PEMA members NG MGA MANGAGAWANG NAGKAKAISA SA MANILA
(identifying themselves as “PEMA-Serrana Group”41) who agreed BAY SPINNING MILLS AT J.P. COATS (SAMANA BAY),
with the board resolution was attached as Annex “H” of PEMA’s GILBERT SUNGAYANN, FERNANDO MELARPIS, ET.
petition before the CA and covered pages 115 to 440 of the AL, respondents.
CA rollo. While fully displaying the employees’ printed name,
identification number, branch, position, and signature, the list was RESOLUTION
left unchallenged by NUBE. No evidence was presented that the FRANCISCO, J.:
union members’ ratification was obtained by mistake or through
fraud, force or intimidation. Surely, this is not a case where one or Petitioner Alliance of Nationalist and Genuine Labor Organization
two members of the local union decided to disaffiliate from the (ANGLO for brevity) is a duly registered labor organization while
mother federation, but one where more than a majority of the local respondent union Samahan Ng Mga Mangagawang Nagkakaisa sa
union members decided to disaffiliate. Manila Bay Spinning Mills and J.P. Coats (SAMANA BAY for
brevity) is its affiliate. In representation of SAMANA BAY,
Consequently, by PEMA's valid disaffiliation from NUBE, the ANGLO entered and concluded a Collective Bargaining
vinculum that previously bound the two entities was completely Agreement (CBA) with Manila Bay Spinning Mills and J.P. Coats
severed. As NUBE was divested of any and all power to act in Manila Bay, Inc. (hereinafter referred to as the corporations) on
November 1, 1991. On December 4, 1993, the Executive
Committee of SAMANA BAY decided to disaffiliate from
ANGLO in view of the latter's dereliction of its duty to promote
and advance the welfare of SAMANA BAY and the alleged cases
of corruption involving the federation officers. Said disaffiliation
was unanimously confirmed by the members of SAMANA BAY.
On April 4, 1994, a petition to stop remittance of federation dues
to ANGLO was filed by SAMANA BAY with the Bureau of
Labor Relations on the ground that the corporations, despite
having been furnished copies of the union resolution relating to
said disaffiliation, refused to honor the same. ANGLO
counteracted by unseating all officers and board members of
SAMANA BAY and appointing, in their stead, a new set of
officers who were duly recognized by the corporations.
Anent the first ground, we reiterate the rule that all employees
enjoy the right to self-organization and to form and join labor
organizations of their own choosing for the purpose of collective
bargaining. This is a fundamental right of labor and derives its
existence from the Constitution. In interpreting the protection to
labor and social justice provisions of the Constitution and the labor
laws, rules or regulations, we have always adopted the liberal
approach which favors the exercise of labor rights. [2]
This Court is not ready to bend this principle to yield to a mere
procedural defect, to wit: failure to observe certain procedural
requirements for a valid disaffiliation. Non-compliance with the
procedure on disaffiliation, being premised on purely technical
grounds cannot rise above the fundamental right of self-
organization.[3]

In its position paper, ANGLO contended that the disaffiliation was We quote, with approval, the findings of herein public respondent,
void considering that a collective bargaining agreement is still that:
existing and the freedom period has not yet set in. The Med-
Arbiter resolved that the disaffiliation was void but upheld the "x x x the resolution of the general membership ratifying the
illegality of the ouster officers of SAMANA BAY. Both parties disaffiliation action initiated by the Board, substantially satisfies
filed their respective appeals with the Department of Labor and the procedural requirements for disaffiliation. No doubt was raised
Employment. In a resolution dated September 23, 1994, herein on the support of the majority of the union members on the
public respondent modified the order and ruled in favor of decision to disaffiliate."[4]
respondent union, disposing as follows: This, to our mind, is clearly supported by the evidence. ANGLO's
"WHEREFORE, the appeal of respondent ANGLO is hereby alleged acts inimical to the interests of respondent union have not
denied for lack of merit while the appeal of petitioners is hereby been sufficiently rebutted. It is clear under the facts that
granted.Accordingly, the order of the Med-Arbiter is modified by: respondent union's members have unanimously decided to
disaffiliate from the mother federation and ANGLO has nothing to
1) declaring the disaffiliation of petitioner union from respondent offer in dispute other than the law prohibiting the disaffiliation
ANGLO as valid; outside the freedom period.

2) directing respondent Manila Bay Spinning Mills, Inc. and J.P. In the same wise, We find no ground for ruling against the validity
Coats to stop remitting to ANGLO federation dues and instead to of the disaffiliation in the light of recent jurisprudential rules.
remit the whole amount of union dues to the treasurer of petitioner
union; and Although P.D. 1391 provides:

3) enjoining ANGLO-KMU from interfering in the affairs of "Item No. 6. No petition for certification election, for intervention
petitioner union. and disaffiliation shall be entertained or given due course except
within the 60-day freedom period immediately preceding the
SO ORDERED."[1] expiration of a collective bargaining agreement,"

ANGLO filed a motion for reconsideration but the same was
denied for lack of merit. Hence, this petition for certiorariunder
Rule 65.
The petition calls upon us to resolve two issues, to wit:
1) whether the disaffiliation was valid; and
2) whether petitioner can validly oust individual private
respondents from their positions.
We rule for the respondents.
For clarity, we shall first consider the issue respecting the validity
of the disaffiliation.
Petitioner ANGLO wants to impress on us that the disaffiliation
was invalid for two reasons, namely: that the procedural
requirements for a valid disaffiliation were not followed; and that the general membership and within the company.
it was made in violation of P.D. 1391.
said law is definitely not without exceptions. Settled is the rule
that a local union has the right to disaffiliate from its mother union
when circumstances warrant.[5] Generally, a labor union may
disaffiliate from the mother union to form a local or independent
union only during the 60-day freedom period immediately
preceding the expiration of the CBA. However, even before the
onset of the freedom period, disaffiliation may be carried out when
there is a shift of allegiance on the part of the majority of the
members of the union.[6]
Coming now to the second issue, ANGLO contends that individual
private respondents were validly ousted as they have ceased to be
officers of the incumbent union (ANGLO-KMU) at the time of
disaffiliation. In order to fill the vacuum, it was deemed proper to
appoint the individual replacements so as not to put in disarray the
organizational structure and to prevent chaos and confusion among
The contention is bereft of merit. A local labor union is a separate Car, Inc., under or by virtue of the questioned writ of execution
and distinct unit primarily designed to secure and maintain an issued by respondent Bureau, dated April 4, 1977.
equality of bargaining power between the employer and their
employee-members. A local union does not owe its existence to Petitioner was once affiliated with the Associated Labor Union for
the federation with which it is affiliated. It is a separate and Metal Workers (ALUMETAL for short). On August 1, 1975, both
distinct voluntary association owing its creation to the will of its unions, using the name Volkschel Labor Union Associated Labor
members.[7] The mere act of affiliation does not divest the local Union for Metal Workers, jointly entered into a collective
union of its own personality, neither does it give the mother bargaining agreement with respondent companies. One of the
federation the license to act independently of the local union. It subjects dealt with is the payment of union dues which is provided
only gives rise to a contract of agency[8] where the former acts in for in Section 3, Article 1, of the CBA, which reads:
representation of the latter. Section 3. CHECK-OFF. — The COMPANY agrees to make
By SAMANA BAY's disaffiliation from ANGLO, the vinculum payroll deductions not softener than twice a month of UNION
that previously bound the two entities was completely membership dues and such special assessments fees or fines as
severed. ANGLO was divested of any and all power to act in may be duly authorized by the UNION, provided that the same is
representation of SAMANA BAY. Thus, any act performed by covered by the individual check-off authorization of the UNION
ANGLO affecting the interests and affairs of SAMANA BAY, members. All said deductions shall be promptly transmitted within
including the ouster of herein individual private respondents, is five (5) days by the COMPANY to the UNION Treasurer. The
rendered without force and effect. COMPANY shall prepare two (2) checks. One (1) check will be
under the name of the local union as their local fund including
WHEREFORE, premises considered, the petition is hereby local special assessment funds and the other check will be for the
DISMISSED. ALU Regional Office regarding the remittance of the UNION dues
deduction.
SO ORDERED.
On March 10, 1976, a majority of petitioner's members decided to
G.R. No. L-45824 June 19, 1985 disaffiliate from respondent federation in order to operate on its
VOLKSCHEL LABOR UNION, petitioner, own as an independent labor group pursuant to Article 241
vs. (formerly Article 240) of the Labor Code of the Philippines, the
BUREAU OF LABOR RELATIONS, ASSOCIATED LABOR pertinent portion of which reads:
UNION FOR METAL, WORKERS, DMG, INC., PEOPLE'S Incumbent affiliates of existing federations or national unions may
CAR, INC., KARBAYAN INC., and RTC TRADING, disaffiliate only for the purpose of joining a federation or national
INC., respondents. union in the industry or region in which it properly belongs or for
Ignacio P. Lacsina for petitioner. the purpose of operating as an independent labor group.

William D. Dichoso for respondent DMG, Inc. Accordingly, a resolution was adopted and signed by petitioner's
members revoking their check-off authorization in favor of
Abraham B. Drapiza for private respondent. ALUMETAL and notices thereof were served on ALUMETAL
and respondent companies.

Confronted with the predicament of whether or not to continue

CUEVAS, J.:
Petition for certiorari to review the Resolutions dated January 25, respondent, ALUMETAL which wrote respondent companies
1977 and March 14, 1977 of the Bureau of Labor Relations.
On April 25. 1977, however, a Supplemental Petition was filed
seeking the issuance of —
(1) A preliminary mandatory injunction commanding respondents
to return to petitioner the union dues amounting to about
P55,000.00 lawfully pertaining to it but illegally levied upon,
collected and handed over by respondent Bureau, acting through
the NLRC sheriff, to respondent Associated Labor Union for
Metal workers, with the collusion of respondents DMG, Inc.,
Karbayan, Inc. and RTC Machineries, Inc.;
(2) A preliminary restraining order prohibiting respondents from
making further delivery to respondent Associated Labor Union for
Metal workers of Union dues collected or to be collected through
check-off from the wages of petitioner's members by respondents,
DMG, Inc., Karbayan, Inc., RTC Machineries, Inc., and People's
deducting from employees' wages and remitting union dues to
advising them to continue deducting union dues and remitting
them to said federation, respondent companies sought the legal
opinion of the respondent Bureau as regards the controversy
between the two unions. On November 11, 1976, Med-Arbiter
George A. Eduvalla of respondent Bureau rendered a Resolution
which in effect found the disaffiliation legal but at the same time
gave the opinion that, petitioner's members should continue paying
their dues to ALUMETAL in the concept of agency fees. 1
From the said Resolution, of the Med-Arbiter both petitioner and
respondent ALUMETAL appealed to the Director of respondent
Bureau. Petitioner' contended that the Med-Arbiter's opinion to the
effect that petitioner's members remained obligated to pay dues to
respondent ALUMETAL was inconsistent with the dispositive
finding that petitioner's disaffiliation from ALUMETAL was
valid. ALUMETAL, on the other hand, assailed the Resolution in
question asserting that the disaffiliation should have been declared allegedly left unattended to by respondent federation to the
contrary to law.
On January 25, 1977, respondent Bureau, through its Acting
Director, Francisco L. Estrella, REVERSED the Med-Arbiter's
Resolution., and declared that the Bureau recognized "the
continued affiliation of Volkschel Labor Union with the
Associated Labor Union for Metal Workers." 2
Petitioner appealed the Acting Director's Resolution to the
Secretary of Labor know Minister of Labor and Employment)
who, treating the appeal as a Motion for Reconsideration referred
the same back to respondent Bureau On March 14, 1977, the
Bureau denied the appeal for lack of merit.
Hence, the instant petition.
Meanwhile, on April 4, 1977, on motion of ALUMETAL, the then
Acting Secretary of Labor, Amado Gat Inciong, issued a of
execution commanding the Sheriff of the National Labor Relations
Commission to enforce and execute the order of January 25, 1977,
which has become final and executory. 3 Pursuant thereto, the
NLRC Sheriff enforced and implemented the Order of January 25,
1977, as a result of which respondent companies turned over and
handed to respondent federation the union dues and other
assessments in accordance with the check-off provision of the
CBA,
From the pleadings filed and arguments of counsel, the following of the CBA, the obligation of the respondent companies to deduct
issues present themselves for this Court's resolution.
I
Is petitioner union's disaffiliation from respondent federation
valid?
II
Do respondent companies have the right to effect union dues
collections despite revocation by the employees of the check-off
authorization? and
III
Is respondent federation entitled to union dues payments from
petitioner union's members notwithstanding their disaffiliation
from said federation?
We resolve the first issue in the affirmative.
The right of a local union to disaffiliate from its mother union is
well-settled. In previous cases, it has been repeatedly held that a
local union, being a separate and voluntary association, is free to
serve the interest of all its members including the freedom to
disaffiliate when circumstances warrant. 4 This right is consistent
with the Constitutional guarantee of freedom of association
(Article IV, Section 7, Philippine Constitution).
Petitioner contends that the disaffiliation was not due to any
opportunists motives on its part. Rather it was prompted by the
federation's deliberate and habitual dereliction of duties as mother
federation towards petitioner union. Employees' grievances were
detriment of the employees' rights and interests.
In reversing the Med-Arbiter's resolution, respondent Bureau
declared: the Department of Labor is set on a task to restructure
the labor movement to the end that the workers will unite
themselves along industry lines. Carried to its complete fruition,
only one union for every industry will remain to bargain
collectively for the workers. The clear policy therefore even now
is to conjoin workers and worker groups, not to dismember
them. 5 This policy is commendable. However, we must not lose
sight of the constitutional mandate of protecting labor and the
workers' right to self-organization. In the implementation and
interpretation of the provisions of the Labor Code and its
implementing regulations, the workingman's welfare should be the
primordial and paramount consideration. In the case at bar, it
would go against the spirit of the labor law to restrict petitioner's
right to self-organization due to the existence of the CBA. We
agree with the Med-Arbiter's opinion that "A disaffiliation does
not disturb the enforceability and administration of a collective
agreement; it does not occasion a change of administrators of the
contract nor even an amendment of the provisions thereof." 6 But
nowhere in the record does it appear that the contract entered into
by the petitioner and ALUMETAL prohibits the withdrawal of the
former from the latter.
This now brings us to the second issue. Under Section 3, Article I,
and remit dues to ALUMETAL is conditioned on the individual
check-off authorization of petitioner's members, In other words,
ALUMETAL is entitled to receive the dues from respondent
companies as long as petitioner union is affiliated with it and
respondent companies are authorized by their employees
(members of petitioner union) to deduct union dues. Without said
affiliation, the employer has no link to the mother union. The
obligation of an employee to pay union dues is coterminous with
his affiliation or membership. "The employees' check-off
authorization, even if declared irrevocable, is good only as long as
they remain members of the union concerned." 7 A contract
between an employer and the parent organization as bargaining
agent for the employees is terminated by the disaffiliation of the
local of which the employees are members. 8 Respondent
companies therefore were wrong in continuing the check-off in
favor of respondent federation since they were duly notified of the
disaffiliation and of petitioner's members having already rescinded
their check-off authorization.
With the view we take on those two issues, we find no necessity in
dwelling further on the last issue. Suffice it to state that respondent
federation is not entitled to union dues payments from petitioner's
members. "A local union which has validly withdrawn from its
affiliation with the parent association and which continues to
represent the employees of an employer is entitled to the check-off
dues under a collective bargaining contract." 9
WHEREFORE, the Resolutions of the Bureau of Labor Relations
of January 25, 1977 and March 14, 1977 are REVERSED and SET
ASIDE. Respondent ALUMETAL is ordered to return to
petitioner union all the union dues enforced and collected through
the NLRC Sheriff by virtue of the writ of execution dated April 4,
1977 issued by respondent Bureau.

No costs.

SO ORDERED