Labor 2 Compilation #9
Insular Hotel Employees Union-NFL v. Waterfront
Insular Hotel Davao
G.R. Nos. 174040-41; September 22, 2010; Peralta, J.
Digest prepared by John Cruz *gulo ng kaso kaya sorry ang
haba
Facts:
Employer (respondent): Waterfront Insular Hotel Davao
Registered Union: Davao Insular Hotel Free Employees
Union (DIHFEUNFL)
Unregistered Union and actually the Federation NFL
(petitioner): Insular Hotel Employees Union-NFL (IHEU-
NFL)
1. Nov. 6, 2000: Respondent Waterfront Insular Hotel
Davao sent the DOLE a Notice of Suspension of
Operations for a period of 6 months due to severe and
serious business losses.
2. Domy Rojas, the President of DIHFEUNFL or the Union
sent respondent a number of letters asking
management to reconsider its decision.
3. Rojas intimated that the members of the Union were
determined to keep their jobs and were willing to help
respondent by suspending re-negotiations of the CBA,
and reducing employee benefits such as:
a. Suspension of the CBA for 10 years, No strike
no lock-out shall be enforced.
b. Pay all the employees their benefits due, and
put the length of service to zero with a
minimum hiring rate. Payment of benefits may
be on a staggered basis or as available.
c. Night premium and holiday pays shall be
according to law. Overtime hours rendered
shall be offsetted as practiced.
d. Reduce the sick leaves and vacation leaves to
15 days/15days.
e. Emergency leave and birthday off are hereby
waived.
f. Duty meal allowance is fixed at P30.00 only.
No more midnight snacks and double meal
allowance. The cook drinks be stopped as
practiced.
g. We will shoulder 50% of the group health
insurance and family medical allowance be
reduced to 1,500.00 instead of 3,000.00.
h. The practice of bringing home our uniforms for
laundry be continued.
i. Fixed manning shall be implemented, the rest
of manpower requirements maybe sourced
thru WAP and casual hiring. Manpower for
fixed manning shall be 145 rank-and-file union
members.
j. Union will cooperate fully on strict
implementation of house rules in order to
attain desired productivity and discipline. The
union will not tolerate problem members.
k. The union in its desire to be of utmost service
would adopt multi-tasking for the hotel to be
more competitive.
4. Jan. 2001: the Union, through Rojas, submitted to
respondent a Manifesto concretizing their earlier
proposals.
5. After series of negotiations, the respondent and
Union signed a MOA for the re-opening of the hotel
subject to the concessions made by the Union.
6. Respondent downsized its manpower structure to 100
(from 145) rank-and-file employees in accordance with
the MOA and a new pay scale was made.
7. Retained employees individually signed a
"Reconfirmation of Employment which embodied the
new terms and conditions of their continued
employment. Each employee was assisted by Rojas
who co-signed the document.
8. June 15, 2001: Hotel resumed its business operations.
9. Aug. 22, 2002: Darius Joves and Debbie Planas,
local officers of the National Federation of Labor
(NFL) filed a Notice of Mediation before the National
Conciliation and Mediation Board (NCMB). The
issue raised was the "Diminution of wages and other
benefits through unlawful MOA.
10. Aug. 29, 2002: NCMB called Joves and respondent to
a preliminary conference. In said conference, the
Submission Agreement signed by respondent and
Joves, assisted by Atty. Cullo, wherein they chose the
accredited voluntary arbitrator (AVA Olvida), Joves
indicated that he represented IHEU-NFL instead of
NFL.
11. Sept. 2, 2002 or 4 days after, respondent filed a
"Manifestation with Motion for a Second Preliminary
Conference" that the persons who filed the instant
complaint in the name of IHEU-NFL had no authority to
represent the Union.
12. During the 2nd conference, Cullo confirmed that the
case was filed not by the IHEU-NFL but by the NFL.
When asked to present his authority from NFL, Cullo
admitted that the case was filed by 79 individual
employees and members of the Union named in
SPAs.
13. Respondent filed a motion to withdraw from the
proceedings arguing that the persons who signed
the complaint were not the authorized
representatives of the Union indicated in the
Submission Agreement nor were they parties to the
MOA.
14. AVA Olvida denied the motion to withdraw since the
NFL is the mother federation of the local union, and
signatory to the existing CBA, it can represent the
union, the officers, the members or union and officers
or members.
15. Respondent demanded inhibition of Olvida for his bias
and prejudice. Olvida complied and voluntarily inhibited
himself out of delicadeza.
16. AVA Montejo (Olvidas replacement) decided in favor of
Cullo,
a. Declaring the MOA in question as invalid as it
is contrary to law and public policy;
b. Declaring that there is a diminution of the
wages and other benefits of the Union
members and officers under the said invalid
MOA.
c. Ordering respondent management to
immediately reinstate the workers wage rates
and other benefits that they were receiving and
enjoying before the signing of the invalid MOA;
d. Ordering the management respondent to pay
attorneys fees.
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17. Upon appeal, CA reversed. MR denied.
Issue/Held/Ratio
W/N the accredited voluntary arbitrator has jurisdiction
because the Notice of Mediation does not mention the
name of the local union but only of the affiliate
federation (NFL). NO, complaint for mediation was not
filed by the Union.
A review of the development of the case shows that
there has been much confusion as to the identity of the
party which filed the case against respondent.
o In the Notice of Mediation filed before the
NCMB, it stated that the union involved was
"DARIUS JOVES/DEBBIE PLANAS ET. AL.,
National Federation of Labor."
o In the Submission Agreement, however, it
stated that the union involved was IHEU-NFL
While it is undisputed that a submission agreement was
signed by respondent and IHEU-NFL, then represented
by Joves and Cullo, this Court finds that there are two
circumstances which affect its validity:
1. the Notice of Mediation was filed by a party
who had no authority to do so;
2. that respondent had persistently voiced out its
objection questioning the authority of Joves,
Cullo and the individual members of the Union
to file the complaint before the NCMB.
Under Section 3, Rule IV of the NCMB Manual of
Procedure, only a certified or duly recognized
bargaining agent may file a notice or request for
preventive mediation.
Cullo himself admitted, in a number of pleadings,
that the case was filed not by the Union but by the
NFL and individual members of the Union.
Therefore, the NCMB had no jurisdiction to entertain
the notice filed before it.
Even though respondent signed a Submission
Agreement, it had immediately manifested after 4 days
its desire to withdraw from the proceedings after it
became apparent that the Union had no part in the
complaint.
Respondent cannot be estopped in raising the
jurisdictional issue, because it is basic that the issue of
jurisdiction may be raised at any stage of the
proceedings, even on appeal, and is not lost by waiver
or by estoppel.
W/N the individual employees and members of the
UNION had standing to file the complaint before the
NCMB. NO
Tabigue v. International Copra Export Corporation citing
Atlas Farms, Inc. v. NLRC is instructive:
Pursuant to Article 260 of the Labor Code, the
parties to a CBA shall name or designate their
respective representatives to the grievance
machinery and if the grievance is unsettled in that
level, it shall automatically be referred to the
voluntary arbitrators designated in advance by
parties to a CBA. Consequently, only disputes
involving the union and the company shall be
Labor 2 Compilation #9
referred to the grievance machinery or
voluntary arbitrators.
W/N the federation NFL had standing to file the
complaint before the NCMB. NO
In Coastal Subic Bay Terminal, Inc. v. DOLE, SC
pronounced that
o A local union does not owe its existence to the
federation with which it is affiliated. It is a
separate and distinct voluntary association
owing its creation to the will of its members.
Mere affiliation does not divest the local
union of its own personality, neither does it
give the mother federation the license to
act independently of the local union.
Even granting that petitioner Union was affiliated with
NFL, still the relationship between that of the local
union and the affiliated labor federation or national
union with is that of an agency, where the local is the
principal and the federation the agency. Being merely
an agent of the local union, NFL should have
presented its authority to file the Notice of
Mediation.
As provided under the NCMB Manual of Procedures,
only a certified or duly recognized bargaining
representative and an employer may file a notice of
mediation, declare a strike or lockout or request
preventive mediation. The CBA recognizes that
DIHFEU-NFL is the exclusive bargaining representative
of all permanent employees.
o The inclusion of the word "NFL" after the name
of the local union merely stresses that the local
union is NFL's affiliate. It does notmean that
the local union cannot stand on its own. The
local union owes its creation and continued
existence to the will of its members and not to
the federation to which it belongs. The spring
cannot rise higher than its source, so to speak.
W/N respondent was really suffering from serious
losses. YES
Respondent submitted its audited financial statements
which show that for the years 1998, 1999, until
September 30, 2000, its total operating losses
amounted to P48,409,385.00. Based on the foregoing,
the CA was not without basis when it declared that
respondent was suffering from impending financial
distress.
W/N the MOA was an invalid dimunition of benefits
prohibited under Art. 100. NO
The prohibition against elimination or diminution of
benefits set out in Article 100 of the Labor Code is
specifically concerned with benefits already enjoyed at
the time of the promulgation of the Labor Code. Article
100 does not, in other words, purport to apply to
situations arising after the promulgation date of the
Labor Code.
Even assuming arguendo that Article 100 applies to the
case at bar, this Court agrees with respondent that the
same does not prohibit a union from offering and
agreeing to reduce wages and benefits of the
employees.
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Lastly, this Court is not unmindful of the fact that
DIHFEU-NFL's Constitution and By-Laws specifically
provides that "the results of the collective bargaining
negotiations shall be subject to ratification and approval
by majority vote of the Union members at a meeting
convened, or by plebiscite held for such special
purpose."
Accordingly, the MOA was ratified by the members of
the Union when they individually signed contracts
denominated as "Reconfirmation of Employment with
the assistance by their president, Rojas.
Petition DENIED
=============================================
COASTAL SUBIC BAY TERMINAL INC. vs. DOLE-Office
of the Sec.
G.R. No. 157117; Nov. 20, 2006; Quisumbing.
Digest by Ian
Facts: There are 2 unions (1 for rank-and-file union (RFU)
and 1 for supervisory employees (SU)) in petitioner-
company.
1. July 8, 1998- RFU and SU filed separate petitions
for certification election before the Med-Arbiter.
They insist that they are legitimate labor
organizations because petitioner-company is
unorganized. More importantly their charter
certificates were issued by the federations
Associated Labor Union (ALU) for RFU and
Associated Professional Supervisory, Office and
Technical Employees Union (APSOTEU) for SU.
2. Petitioner opposed the petitions for certification
election alleging that RFU and SU are not
legitimate labor orgs and that the proposed
bargaining units were not particularly described.
Also, particularly as regards SU, petitioner
insists that APSOTEU lacks legal personality
hence its chartered affiliate SU cannot attain the
status of a legitimate labor organization to file a
petition for certification election.
3. Med.Arbiter- dismissed petitions because it held
that ALU and and APSOTEU are one and the same
federation having a common set of officers. In
effect, they are affiliated with only one federation.
4. SOLE reversed MedArbiter and held that ALU and
APSOTEU are legitimate and that they are
separate and distinct labor unions having separate
certificates of registration from DOLE. Further, they
have separate set of officers.
5. CA affirmed SOLE .
Issues: 1. WON the APSOTEU is duly-registered and can
therefor issue charter to its affiliates such as herein SU.
YES!
2. WON the RFU and SU be allowed to conduct
certification election. NO!
Held: No. Petition granted. For as long as they are affiliated
with ALU and APSOTEU, the unions do not meet the
criteria to attain the status of legitimate labor organizations,
Labor 2 Compilation #9
and this could not separately petition for certification
elections.
Ratio:
1. The records in this case showed that APSOTEU was
registered on March 1, 1991. Accordingly, the laws
applicable at that time were Art. 235 and Sec. 2, Rule II,
Book V which provides that application for registration may
be filed before the BLR or the Regional Offices (in the
Labor Relations Division). Considering that APSOTEU's
principal office is located in Diliman, Quezon City, and its
registration was filed with the NCR Regional Office, the
certificate of registration is valid.
Given this, APSOTEU is a legitimate labor
organization and has authority to issue charter
to its affiliates. It may issue a local charter certificate to SU
and correspondingly, SU is legitimate.
2. Book V, Rule I, Sec. 1 (i) provides that a chartered local
union acquires legal personality through the charter
certificate issued by a duly registered federation or national
union, and reported to the Regional Office in accordance
with the rules implementing the Labor Code.
A local union does not owe its existence to the
federation with which it is affiliated. It is a
separate and distinct voluntary association owing
its creation to the will of its members. Mere
affiliation does not divest the local 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. Hence, local unions are considered
principals while the federation is deemed to be
merely their agent. 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.
However, Art. 245 states that supervisory employees are
not eligible for membership in a labor union of rank-and-file
employees. 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
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.
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. When there is commingling of officers
3

of a rank-and-file union with a supervisory union, the
constitutional policy on labor is circumvented.
=============================================
San Miguel Corp. Employees Union v. SM Packaging
G.R. No. 171153; 12 September 2007; Chico-Nazario, J.
Digest prepared by Maggy Gan
Petitioner: San Miguel Corporation Employees Union
Philippine Transport and General Workers Organization
(SMCEU-PTGWO)
Respondent: San Miguel Packaging Products Employees
Union Pambansang Diwa ng Manggagawang Pilipino
(SMPPEU-PDMP)
I. aFacts
Petitioner is the incumbent bargaining agent for the
bargaining unit comprised of the regular monthly-paid
R&F employees of the 3 divisions of San Miguel
Corporation (SMC) [enumerated below], in all offices and
plants of SMC, including the Metal Closure and
Lithography Plant in Laguna. It had been the certified
bargaining agent for 20 years from 1987 to 1997 [?]
[1]San Miguel Corporate Staff Unit (SMCSU), [2] San
Miguel Brewing Philippines (SMBP), [3] San Miguel
Packaging Products (SMPP)
- RRespondent is registered as a chapter of Pambansang
Diwa ng Manggagawang Pilipino (PDMP). PDMP issued
Charter Certificate No. 112 to respondent on June 15,
1999. Upon submission of its charter certificate and other
documents, respondent was issued Certificate of
Creation of Local or Chapter PDMP-01 by the BLR on
July 6, 1999. Thereafter, respondent filed with the Med-
Arbiter of the DOLE-NCR, 3 separate petitions for
certification election to represent SMCSU, SMBP, and
SMPP. All 3 petitions were dismissed on the ground that
the separate petitions fragmented a single bargaining
unit.
- OOn Aug 17, 1999, petitioner filed with the DOLE-NCR a
petition seeking the cancellation of respondents
registration and its dropping from the rolls of legitimate
labor organizations. Petitioner accused respondent of
committing fraud and falsification, not complying with
registration requirements in obtaining its certificate of
registration and violating Art. 239 (a), (b), (c) and 234(c)
of the LC. It also claimed that PDMP is not a legitimate
organization, but a trade union center, hence, it cannot
directly create a local or chapter.
- RRegional Director Lim issued an Order which dismissed
the allegations of fraud and misrepresentation, ruled that
respondent is allowed to directly create a local or chapter.
However, he found that respondent did not comply with
the 20% membership requirement and, thus, ordered the
cancellation of its certificate of registration and removal
from the rolls of legitimate labor organizations.
- BBLR agreed with the findings of the RegDir dismissing
the allegations of fraud and misrepresentation, and in
upholding that PDMP can directly create a local or
Labor 2 Compilation #9
chapter, it reversed the ruling that the 20% membership is
a requirement for respondent to attain legal personality as
a labor organization.
- CCA dismissed the petition and affirmed the decision of
the BLR.
II. IIssue/Held/Ratio
W/N respondent is not required to submit the number
employees and names of all its members comprising at
least 20% of the employees in the bargaining unit
where it seeks to operate Yes, it is required. Although
PDMP as a trade union center is a legitimate labor
organization, it has no power to directly create a local or
chapter. Thus, respondent cannot be created under the
more lenient requirements for chartering, but must have
complied with the more stringent rules for creation and
registration of an independent union, including the 20%
membership requirement.
Held: Petition granted.
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
Art. 234(c) of the LC. It also insists that this requirement
must be based not on the number of the employees in a
single division, but in all 3 divisions of the company in all
the offices and plants of SMC since they are all part of on
bargaining unit. Respondent failed to meet this 20%
requirement since it based its membership on the number
of a single division only, namely, SMPP.
SC:
- TThe mandate of the LC is to ensure strict compliance
with the requirement on registration because a legitimate
labor organization is entitled to specific rights under the
Code, and are involved in activities directly affecting
matters of public interest. Registration requirements are
intended to afford a measure of protection to
unsuspecting employees who may be lured into joining
unscrupulous or fly-by-night unions whose sole purpose
is to control union funds or use the labor organization for
illegitimate ends.
- RRespondent is registered with the BLR as a local or
chapter of PDMP and was issued a Charter Certificate
No. 112 on June 15, 1999. Hence, respondent was
directly chartered by PDMP.
The procedure for registration of a local or chapter of a
labor organization is provided in Book V of the
Implementing Rules of the LC, as amended by DO No. 9
which took effect on June 21, 1997, and again by DO No.
40 dated Feb 17, 2003. The Implementing Rules as
amended by DO 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 Aug 17, 1999.
- TThe applicable Implementing Rules enunciates a two-
fold procedure for the creation of a chapter or local.
4

The first involves the affiliation of an independent
union with a federation or a national union or an
industry union.
The second involves the direct creation of a local
or a chapter through the process of chartering
applicable to this case.
o 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:
(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/chapters officers, their
addresses, and the principal
office of the local/chapter;
and
(c) The local/chapters
constitution and by-laws;
Provided, That 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.
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.
o A duly constituted local or chapter created
in accordance with the foregoing shall
acquire legal personality from the date of
filing of the complete documents with the
BLR. The issuance of the certificate of
registration by the BLR or the DOLE
Regional Office is not the operative act
that vests legal personality upon a local or
a chapter under DO No. 9. Such legal
personality is acquired from the filing of
the complete documentary requirements
enumerated in Section 1, Rule VI.
Petitioner insists that Sec. 3 of the Implementing Rules, as
amended by DO No. 9, violated Art. 234 when it provided
for less stringent requirements for the creation of a chapter
or local.
- AArt. 234 provides that an independent labor
organization acquires legitimacy only upon its
registration with the BLR. However, the creation of a
branch, local or chapter is treated differently.
- AAs held in Progressive Development Corporation v.
Secretary, DOLE, when an unregistered union becomes
Labor 2 Compilation #9
a branch, local or chapter, some of the aforementioned
requirements for registration are no longer necessary or
compulsory. The intent of the law in imposing less
requirements in the case of a branch or local of a
registered federation or national union is to encourage
the affiliation of a local union with a federation or national
union in order to increase the local unions bargaining
powers respecting terms and conditions of labor.
- IIn Pagpalain Haulers, Inc. v. Trajano, where the validity
of DO No. 9 was directly put in issue, this Court was
unequivocal in finding that there is no inconsistency
between the LC and DO No. 9
On petitioners claim that respondent obtained its
Certificate of Registration through fraud and falsification
- PProof remains wanting. A direct challenge to the
legitimacy of a labor organization based on fraud and
misrepresentation in securing its certificate of registration
is a serious allegation which deserves careful scrutiny.
Allegations thereof should be compounded with
supporting circumstances and evidence.
- FFurthermore, this Court is not a trier of facts, and this
doctrine applies with greater force in labor cases.
On petitioners claim that respondent was not validly and
legitimately created, for PDMP cannot create a local or
chapter as it is not a legitimate labor organization, it being a
trade union center.
According to the Court, this contention is predicated on two
premises:
Premise 1: A trade union center is not a legitimate
labor organization. In the process, the legitimacy of
PDMP is impugned indirectly.
- TThe legal personality of a legitimate labor organization,
such as PDMP, cannot be subject to a collateral attack.
This being a collateral attack, the Court is without
jurisdiction to entertain questions indirectly impugning the
legitimacy of PDMP.
- UUntil the certificate of registration of PDMP is cancelled,
its legal personality as a legitimate labor organization
subsists.
Premise 2: A trade union center cannot directly create
a local or chapter through the process of chartering.
- TThe Court reverses the findings of the CA and BLR on
this ground, and rules that PDMP cannot directly create a
local or chapter.
- TThere is no legal justification to support the conclusion
that a trade union center is allowed to directly create a
local or chapter through chartering.
- PPD 442, enacted in 1972, was first amended by RA
6715, and recently by RA 9481. Incidentally, the term
trade union center was never mentioned under PD 442,
even as it was amended by RA 6715. The term trade
union center was first adopted by the Implementing
Rules, under DO No. 9.
5

- DDO No. 9 defines a trade union center as any group of
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 social and employment
policies, standards, and programs, and is duly registered
with the DOLE in accordance with Rule III, Section 2 of
the Implementing Rules.
- DDO No. 9 mentioned 2 labor organizations either of
which is allowed to directly create local or chapter
through charteringa duly registered federation or a
national union. DO 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.
- rRA 9481 lapsed into law on May 25, 1997 and became
effective on June 14, 1997. This law further amends the
Labor Code provisions on Labor Relations. Art. 234 now
includes the term trade union center, but interestingly,
the provision indicating the procedure for chartering or
creating a local or chapter,, namely Art. 234-A, still makes
no mention of a :trade union center Even in the most
recent amendment of the implementing rules [i.e., DO
Nos. 40-B-03, 40-C-05, and 40-D-05], there was no
mention of a trade union center as being among the labor
organization allowed to charter.
- TThe Court applied the Latin maxim expressio unius est
exclusion alterius [the expression of one thing is the
exclusion of another]. If its intent were otherwise, the law
could have so easily and conveniently included trade
union centers in identifying the labor organizations
allowed to charter a chapter or local. Expressium facit
cessare tacitum. What is expressed puts an end to what
is implied. Casus omissus pro omisso habendus est. A
person, object or thing omitted must have been omitted
intentionally.
Therefore, the power granted to labor organizations
to directly create a chapter or local through
chartering is given to a federation or national union;
a trade union center is without authority to charter
directly.
- TThe mandate of the LC in ensuring strict compliance
with the procedural requirements for registration is not
without reason. It has been observed that the formation
of a local or chapter becomes a handy tool for the
circumvention of union registration requirements. Absent
the institution of safeguards, it becomes a convenient
device for a small group of employees to foist a not-so-
desirable federation or union on unsuspecting co-workers
and pare the need for wholehearted voluntariness, which
is basic to free unionism.
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Sugbuanon Rural Bank Inc. v. Laguesma
G.R. No. 116194; February 2, 2000; Quisumbing, J.
Digest by Rose Ann Gonzales
Labor 2 Compilation #9
Facts
Petitioner Sugbuanon Rural Bank, Inc., (SRBI) is a
duly-registered banking institution with principal
office in Cebu City and a branch in Mandaue City.
Private respondent SRBI Association of
Professional, Supervisory, Office, and Technical
Employees Union (APSOTEU) is a legitimate labor
organization affiliated with the Trade Unions
Congress of the Philippines (TUCP).
On October 26, 1993, the union (APSOTEU-
TUCP) filed a petition for certification election of
the supervisory employees of SRBI.
o It alleged that: (1) APSOTEU-TUCP was a
labor organization duly-registered with the
Labor Department; (2) SRBI employed 5
or more supervisory employees; (3) a
majority of these employees supported the
petition: (4) there was no existing
collective bargaining agreement (CBA)
between any union and SRBI; and (5) no
certification election had been held in
SRBI during the past 12 months prior to
the petition.
On November 12, 1993, SRBI filed a motion to
dismiss the union's petition on two grounds. (Case
1)
o First, that the members of APSOTEU-
TUCP were in fact managerial or
confidential employees and so they were
disqualified from forming, joining, or
assisting any labor organization.
o Second, the Association of Labor Unions-
Trade Unions Congress of the Philippines
or ALU-TUCP was representing the union
and at the same time also sought to
represent the rank-and-file employees of
SRBI. Following this, there was a violation
of the principle of separation of unions as
per ruling in Atlas Lithographic
Services, Inc. v. Laguesma.
On December 9, 1993, the Med-Arbiter denied
petitioner's motion to dismiss. SRBI appealed
the Med-Arbiter's decision to the SOLE. The
appeal was denied for lack of merit. The
certification election was ordered.
o Med-Arbiters order identified the following
SRBI personnel as the voting supervisory
employees in the election: the Cashier of
the Main Office, the Cashier of the
Mandaue Branch, the Accountant of the
Mandaue Branch, and the Acting Chief of
the Loans Department.
On June 17, 1994, SRBI filed with the Med-Arbiter
an urgent motion to suspend proceedings. The
Med-Arbiter denied the same on June 21, 1994.
SRBI then filed a motion for reconsideration.
Med-Arbiter cancelled the certification election
scheduled for June 29, 1994 in order to address
the motion for reconsideration. The Med-Arbiter
later denied petitioner's motion for
reconsideration, SRBI appealed the order of denial
to the DOLE Secretary on December 16, 1993.
6

On December 22, 1993, SRBI proceeded to file a
petition with the DOLE Regional Office seeking
the cancellation of the union's registration
(Case 2). It alleged that the APSOTEU-TUCP
members were actually managerial employees who
were prohibited by law from joining or organizing
unions. (Note that appeal wrt the order of denial of
its MR in the 1st case is still pending)
On April 22, 1994, respondent DOLE
Undersecretary Laguesma denied SRBI's appeal
(case 1) for lack of merit. Laguesma held that
o APSOTEU-TUCP was a legitimate labor
organization. As such, it was fully entitled
to all the rights and privileges granted by
law to a legitimate labor organization
o Until and unless a final order is issued
cancelling APSOTEU-TUCP's registration
certificate, it had the legal right to
represent its members for collective
bargaining purposes.
o Also, the question of whether the
APSOTEU-TUCP members should be
considered as managerial or confidential
employees is best threshed out in other
appropriate proceedings.
Issue/s
1. WoN the members of the respondent union are
managerial employees and/or highly-placed
confidential employees?--NO
2. WoN the Med-Arbiter may validly order the
holding of a certification election upon the
filing of a petition for certification election by a
registered union, despite the petitioner's
appeal pending before the DOLE Secretary
against the issuance of the union's
registration?--YES
Held
Decision of Undersecretary affirmed.
Ratio
1. They are neither managerial nor confidential
employees.
On WoN they are Managerial employees
SRBI argues: that the functions and responsibilities of the
employees involved constitute the "very core of the bank's
business, lending of money to clients and borrowers,
evaluating their capacity to pay, approving the loan and its
amount, scheduling the terms of repayment, and endorsing
delinquent accounts to counsel for collection." Hence, they
must be deemed managerial employees (citing Tabacalera
Insurance Co. v. National Labor Relations
Commission, and Panday v. National Labor Relations
Commission)
SC held:
Article 212 (m) of the Labor Code defines the
terms "managerial employee" and "supervisory
employees".1
1 Art. 212. Definitions
Labor 2 Compilation #9
Reliance on Tabacalera is misplaced. In said case,
the credit and collection supervisor "had the power
to recommend the hiring and appointment of his
subordinates, as well as the power to recommend
any promotion and/or increase." Petitioner's
reliance on Panday is equally misplaced. In said
case, the branch accountant is a managerial
employee because the said employee had
managerial powers which included recommending
the hiring and appointment of his subordinates, as
well as the power to recommend any promotion
and/or increase.
In this case, the Cashiers, Accountant, and Acting
Chief of the Loans Department did not possess
managerial powers and duties.
The job description forms submitted by SRBI
clearly show that the union members in question
may not transfer, suspend, lay-off, recall,
discharge, assign, or discipline employees.
Moreover, the forms also do not show that the
Cashiers, Accountants, and Acting Chiefs of the
Loans Department formulate and execute
management policies which are normally expected
of management officers. At best they only had
recommendatory powers subject to evaluation,
review, and final decision by the bank's
management.
On WoN they are confidential employees
SRBI argues: It has only 5 officers running its day-to-day
affairs. They assist in confidential capacities and have
complete access to the bank's confidential data. They form
the core of the bank's management team. Petitioner
explains that:
. . . Specifically: (1) the Head of the Loans
Department initially approves the loan applications
before they are passed on to the Board for
confirmation. As such, no loan application is even
considered by the Board and approved by
petitioner without his stamp of approval based
upon his interview of the applicant and
determination of his (applicant's) credit standing
and financial capacity. The same holds true with
respect to renewals or restructuring of loan
accounts. He himself determines what account
should be collected, whether extrajudicially or
judicially, and settles the problems or complaints of
borrowers regarding their accounts;
(2) the Cashier is one of the approving officers and
authorized signatories of petitioner. He approves
the opening of accounts, withdrawals and
encashment, and acceptance of check deposits.
He deals with other banks and, in the absence of
the regular Manager, manages the entire office or
(m) "Managerial employee" is one who is vested with powers or
prerogatives to lay down and execute management policies and/or
hire, transfer, suspend, lay-off, recall, discharge, assign or discipline
employees. Supervisory employees are those who, in the interest of
the employer, effectively recommend such managerial actions if the
exercise of such authority is not merely routinary or clerical in nature
but requires the use of independent judgment. All employees not falling
within any of the above definitions are considered rank-and-file
employees for purposes of this Book.
7

branch and approves disbursements of funds for
expenses; and
(3) the Accountant, who heads the Accounting
Department, is also one of the authorized
signatories of petitioner and, in the absence of the
Manager or Cashier, acts as substitute approving
officer and assumes the management of the entire
office. She handles the financial reports and
reviews the debit/credit tickets submitted by the
other departments.
SC held: they are not confidential employees
Confidential employees are those who (1) assist or
act in a confidential capacity, in regard (2) to
persons who formulate, determine, and effectuate
management policies [specifically in the field of
labor relations].
o The two criteria are cumulative, and both
must be met if an employee is to be
considered a confidential employee that
is, the confidential relationship must exist
between the employee and his superior
officer; and that officer must handle the
prescribed responsibilities relating to labor
relations.
Art. 245 of the Labor Code does not directly
prohibit confidential employees from engaging in
union activities. However, under the doctrine of
necessary implication, the disqualification of
managerial employees equally applies to
confidential employees. However, note that when
the employee does not have access to confidential
labor relations information, there is no legal
prohibition against confidential employees from
forming, assisting, or joining a union.
SRBIs explanation, however, does not state who
among the employees has access to information
specifically relating to its labor to relations policies.
While petitioner's explanation confirms the regular
duties of the concerned employees, it shows
nothing about any duties specifically connected to
labor relations.
o Even Cashier Patricia Maluya, who
serves as the secretary of the bank's
Board of Directors may not be so
classified. As secretary of the bank's
governing body, Patricia Maluya serves
the bank's management, but could not be
deemed to have access to confidential
information specifically relating to SRBI's
labor relations policies, absent a clear
showing on this matter.
2. A certification election may be validly held
despite pendency of the petition for the
cancellation of the issuance of the unions
registration.
One of the rights of a legitimate labor organization
under Article 242(b) of the Labor Code is the right
to be certified as the exclusive representative of all
employees in an appropriate bargaining unit for
purposes of collective bargaining. Having complied
Labor 2 Compilation #9
with the requirements of Art. 234, respondent union
is a legitimate labor union.
Article 257 of the Labor Code mandates that a
certification election shall automatically be
conducted by the Med-Arbiter upon the filing of a
petition by a legitimate labor organization. Nothing
is said therein that prohibits such automatic
conduct of the certification election if the
management appeals on the issue of the validity of
the union's registration.
Also, giving due course to respondent union's
petition for certification election would not violate
the separation of unions doctrine.
o Note that the petition was filed by
APSOTEU-TUCP, a legitimate labor
organization. It was not filed by ALU. Nor
was it filed by TUCP, which is a national
labor federation of with which respondent
union is affiliated.
o SRBI argues that respondent union is a
mere alter ego of ALU. The records show
nothing to this effect. What the records
instead reveal is that respondent union
was initially assisted by ALU during its
preliminary stages of organization. A local
union maintains its separate
personality despite affiliation with a
larger national federation.
o SRBI alleges that ALU seeks to represent
both respondent union and the rank-and-
file union. However, nothing in the records
to support this bare assertion.
The law frowns on a union where the membership
is composed of both supervisors and rank-and-file
employees, for fear that conflicts of interest may
arise in the areas of discipline, collective
bargaining, and strikes. However, in the present
case, none of the members of the respondent
union came from the rank-and-file employees of
the bank.
=============================================
Filipino Pipe and Foundry Corporation v. NLRC
G.R. No. 115180; 16 November 1999; Purisima, J.
Digest prepared by Ruth B. Guinto
I. Facts
February 10, 1986: National Labor Union Trade
Union Congress of the Philippines (NLU-TUCP)
filed a notice of strike in behalf of its local chapter,
Filipino Pipe Workers Union-National Labor Union
(FPWU-NLU), alleging as grounds therefore union
busting and non-implementation of the Collective
Bargaining Agreement.
Initial conciliation conference was set on February
24, 1986 but due to lack of notice to the company it
was reset to March 3, 1986.
March 3, 1986: FWPU-NLU staged a strike without
waiting for the outcome of the conciliation
conference. Strike lasted until June 13, 1986.
April 8, 1986: Company interposed a petition
before the Labor Arbiter to declare the strike illegal
8

with prayer for damages against FPWU-NLU, NLU-
TUCP and its national president, Atty. Eulogio
Lerum.
December 23, 1988: Company moved for the
partial dismissal of the Complaint against
officers and members of FPWU-NLU, but
maintained the action against the NLU-TUCP and
Atty. Lerum.
LA: declared the strike ILLEGAL. Lerum was
absolved from any liability. NLU was directed to
pay damages.
NLRC: reversed LA with respect to liability of NLU.
II. Issues
1. WON the strike was illegal. [YES]
2. WON NLU-TUCP is liable for damages. [NO]
III. Held
Petition dismissed for lack of merit. NLRC decision
AFFIRMED.
IV. Ratio
1. Rule XXII, Book V
Section 1. Grounds for strike a
nd lockout A strike or lockout
may be declared in cases of
bargaining deadlocks and unfair
labor practices. Violations of
collective bargaining agreements,
except flagrant and/or malicious
refusal to comply with its
economic provisions, shall not be
considered unfair labor practice
and shall not be strikeable. No
strike or lockout may be declared
on grounds involving interunion
and intraunion disputes or on
issues brought to voluntary or
compulsory arbitration."
xxx xxx xxx
Section 3. Notice of strike or
lockout - In cases of bargaining
deadlocks, a notice of strike or
lockout shall be filed with the
regional branch of the Board at
least thirty (30) days before the
intended date thereof, a copy of
said notice having been served
on the other party concerned.
xxx
xxx xxx xxx
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.
Labor 2 Compilation #9
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
The strike staged by FPWU-NLU was illegal for
want of legal basis. The alleged union busting was
not substantiated and the supposed non-
implementation of the collective bargaining
agreement was groundless because the demands
FPWU-NLU were the subject of a pending
application for a writ of execution filed by the union.
The Union also failed to serve the company with a
copy of the notice of strike. Further, the Union also
failed to observe the mandatory 30-day cooling off
period, as it struck before the 30th day from the
time the notice of strike was filed.
The same strike blatantly disregarded the
prohibition on the doing of any act which may
impede or disrupt the conciliation proceedings.
(note: it staged the strike on the same day as the
conference)
2. NLU-TUCP was the agent of its local chapter
FPWU-NLU. It was argued that FPWU-NLU was
not a registered local unit or chapter, but this is of
no moment.
There is no dispute that FPWU-NLU is the sole and
exclusive bargaining representative of the rank and
file employees of the company. The legitimacy of
the union is of no issue here. Furthermore, the
company is estopped to belatedly attack the status
of the organization which it had voluntarily
recognized. (note: FPWU-NLU has been the
exclusive bargaining agent since 1981)
Direct and primary responsibility for the damages
allegedly caused by the illegal strike sued upon fall
on the local union, being the principal, and not on
NLU-TUCP, a mere agent of FWPU-NLU.
Since the claim for damages against FWPU was
dismissed, the action for damages against its
agent must be dismissed as well.
=============================================
Holy Child Catholic School (HCCS) v. Hon. Patrcica Sto.
Tomas (SOLE) and Pinag-Isang Tinig at Lakas ng
Anakpawis HCCS Teachers and Employees Labor
Union (HCCS-TELU-PIGLAS)
GR. No 179146; July 23, 2013; Peralta, J.
9

Digest by Donna S. Talledo
DOCTRINE: 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
FACTS
May 31, 2002 A petition for certification election
was filed by HCSS-TELU-PIGLAS (Union) alleging
that:
a. PIGLAS a legitimate labor organization duly
registered with the DOLE representing the Union;
b. HCCS is a private educational institution with
approximately 120 teachers and employees
comprising the proposed bargaining unit; and
c. HCCS is unorganized and there is no CBA or a
duly certified agent or labor organization certified
as the SEBA of the proposed bargaining unit
within one year prior to the filing of the petitioner.
Attached to the petition were the certificate of
affiliation with PIGLAS-KAMAO, charter certificate,
and certificate of registration as a legitimate labor
organization issued by the DOLE.
HCCS, on the other hand, alleged that the Union is
not only a mixture of managerial, supervisory, and
rank-and-file employees but also a combination of
teaching and non-teaching personnel. It insisted that
the Union is an illegitimate labor organization lacking
in personality to file a petition for certification election
for not being in accord with Article 245 and an
inappropriate bargaining unit for want of community or
mutuality of interest.
The Union countered the HCCS failed to substantiate
its claim that some of the employees included in the
petition holds managerial and supervisory positions.
And even assuming that it is true, mixture of
employees is not one of the enumerated instances in
which a petition shall be dismissed (DO No.9) and
questions pertaining to qualifications of employees
may be threshed out in the inclusion-exclusion
proceedings.
The Med-Arbiter denied the petition for certification
election on the ground that the unit which the Union
sought to represent is inappropriate. The Union
appealed to the SOLE.
The SOLE ruled against the dismissal and directed
the conduct of two separate certification elections
for the teaching and the non-teaching personnel. It
held that although there are differences in the nature
of work, hours and conditions of work and salary
determination, these differences are not substantial
enough to warrant the dismissal of the petition.
HCSS filed before the CA a petition for certiorari with a
Prayer for TRO and Preliminary Injunction. The CA
dismissed the petition.
The CA agreed with the HCCS that the nature
of the teaching personnels work does not
coincide with that of the non-teaching
personnels
Labor 2 Compilation #9
It nevertheless ruled that the SOLE did not
commit GAD in not dismissing the petitioner for
certification election since it directed the
conduct of two separate certification elections.
The CA denied the MR hence, this petition.
ISSUE: Whether or not a petition for certification election is
dismissible on the ground that the labor organizations
membership allegedly consists of supervisory and rank-
and-file employees.
HELD: NO. The petition is denied. The Decision of the CA
affirming the Decision of the SOLE that set aside the
Decision of the Med-Arbiter denying the petition for
certification election is affirmed.
RATIO
It was in RA 875 that the questioned mingling of
employees was first prohibited, to wit:
Sec. 3. Employees' right to self-organization. -
Employees shall have the right to self-
organization and to form, join or assist labor
organizations of their own choosing for the
purpose of collective bargaining through
representatives of their own choosing and to
engage in concerted activities for the purpose of
collective bargaining and other mutual aid or
protection. Individuals employed as
supervisors shall not be eligible for
membership in a labor organization of
employees under their supervision but may
form separate organizations of their own.
However, nothing in RA 875 provides for the effect of
mingling on the legitimacy of the labor organization.
In Lopez v. Chronicle Publication Employees
Association, it was pronounced that the absence of
any provision on the effect of the disqualification of
one of its organizers upon the legality of the union,
may be construed to confine the effect of such
ineligibility only upon the membership of the
supervisor. In other words, the invalidity of
membership of one of the organizers does not
make the union illegal, where the requirements of
the law for the organization thereof are,
nevertheless, satisfied and met.
The Labor Code was enacted, however, without
reproducing Sec. 3 of RA 875. Article 290 which is the
closest to Sec. 3 is silent on the prohibition against
supervisory employees mingling with rank-and-file
employees in one labor organization.
Thus, it was declared in Bulletin v. Sanchez that
supervisory employees who do not fall under the
category of managerial employees may join or assist
in the formation of a labor organization for rank-
and-file employees, but they may not form their
own labor organization.
E.O. No.111, which amended certain provisions of
Book V continued to recognize the right of supervisory
employees to join a rank-and-file labor organization.
10

Effective 1989, RA 6715 restored the prohibition
against the questioned mingling in one labor
organization.
Art. 245. Ineligibility of managerial employees to
join any labor organization; right of supervisory
employees. Managerial employees are not
eligible to join, assist or form any labor
organization. Supervisory employees shall
not be eligible for membership in a labor
organization of the rank-and-file employees
but may join, assist or form separate labor
organizations of their own.
Unfortunately, RA 6715 also omitted specifying the
exact effect any violation of the prohibition would bring
about on the legitimacy of a labor organization.
It was the IRR which supplied the deficiency with the
amendment to Rule II:
Sec. 1. Who may join unions. - x x
x Supervisory employees and security
guards shall not be eligible for membership
in a labor organization of the rank-and-file
employees but may join, assist or form
separate labor organizations of their
own; Provided, that those supervisory
employees who are included in an existing rank-
and-file bargaining unit, upon the effectivity of
Republic Act No. 6715, shall remain in that unit x
x x.
and Rule V, Sec 2(c):
The petition, when filed by a legitimate labor
organization, shall contain, among others:
x x x x
(c) description of the bargaining unit which
shall be the employer unit unless
circumstances otherwise require; and
provided further, that the appropriate
bargaining unit of the rank-and-file
employees shall not include supervisory
employees and/or security guards.
But on June 21, 1997, the 1989 Amended Omnibus
Rules was further amended by DO No. 9. The
requirement under Sec. 2(c) - 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.
In Tagaytay Highlands Int'l. Golf Club, Inc. v. Tagaytay
Highlands Employees Union-PTGWO, it was held that
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.
Labor 2 Compilation #9
DO No. 9 is applicable in this case as the petition for
certification election was filed on May 31, 2002. It must
aksi be stressed that HCCS cannot collaterally attack
the legitimacy of private respondent by praying for the
dismissal of the petition for certification election.
Moreover, the determination of whether union
membership comprises managerial and/or supervisory
employees is a factual issue that is best left for
resolution in the inclusion-exclusion proceedings,
which has not yet happened in this case so still
premature to pass upon. Factual findings of labor
officials, who are deemed to have acquired expertise
in matters within their jurisdiction, are generally
accorded not only with respect but even finality by the
courts when supported by substantial evidence.
Whether or not, in view of the improper mixture of teaching
and non-teaching personnel in the Union, the petition for
certification election should have been dismissed on the
ground that private respondent is not qualified to file such
petition for its failure to qualify as a legitimate labor
organization.
NO. The concepts of a union and a legitimate labor
organization are different from, but relate to, the
concept of a bargaining unit.
A labor organization as "any union or association
of employees which exists in whole or in part for
the purpose of collective bargaining or of dealing
with employers concerning terms and conditions of
employment.
A bargaining unit has been defined as a "group
of employees of a given employer, comprised of all
or less than all of the entire body of employees,
which the collective interests of all the employees,
consistent with equity to the employer, indicated to
be best suited to serve reciprocal rights and duties
of the parties under the collective bargaining
provisions of the law.
A bargaining unit is a group of employees sought
to be represented by a petitioning union. Such
employees need not be members of a union
seeking the conduct of a certification election
In case of alleged inclusion of disqualified employees
in a union, the proper procedure for an employer like
petitioner is to directly file a petition for cancellation of
the unions certificate of registration due to
misrepresentation, false statement or fraud under the
circumstances enumerated in Article 239 of the Labor
Code, as amended.
=============================================
DE LA SALLE UNIVERSITY MEDICAL CENTER v.
LAGUESMA [G.R. 102084; Aug. 12, 1998; Mendoza, J.]
Digest by Reinerr Nuestro
Facts:
1. Petitioner DLSU Medical Center and College of
Medicine (DLSUMCCM) is a hospital and med
11

school in Dasmarinas, Cavite. Private respondent
Federation of Free Workers (FFW-DLSUMCCM) is
a labor organization composed of the supervisory
employees of DLSUMCCM.
2. A1991 The Federation of Free Workers (FFW), a
national federation of labor unions, issued a
certificate to private respondent FFW-DLSUMCCM
recognizing it as a local chapter.
a. It also filed on behalf of the union a
petition for certification election among
supervisory employees of petitioner
DLSUMCCM, which was opposed by the
latter on grounds that several employees
who signed the said petition were
managerial employees and that the union
was composed of both supervisory and
rank-and-file employees in the company.
3. Respondent Union denied the allegation that
supervisory employees are joining the rank-and-file
employees union. That while it is true that both
regular rank-and-file and supervisory employees of
the union have affiliated with the FFW, yet, there
are two separate unions and the supervisory
employees have a separate charter certificate
issued by FFW.
4. Med-Arbiter Rolando S. Dela Cruz of the DOLE-
Reg. IV Office granted the petition for certification
election saying that:
a. In its position paper, petitioner stated that
most, if not all, of the employees listed in
the petition are considered managerial
employees, thereby admitting that it has
supervisory employees who are
undoubtedly qualified to join or form a
labor organization of their own;
b. The record likewise showed that petitioner
promised to present the job descriptions of
the concerned employees during the
hearing but failed to do so.
c. Thus, he had no basis in determining who
among them are managerial or
supervisory. At any rate, there was no
question that petition has in its employ
supervisory employees qualified to form
and join a union and that theres no other
alternative but to order the holding of the
certification election pursuant to Art. 257
of the Labor Code.
d. Moreover, the two groups (supervisory v.
rank-and-file) are considered separate
bargaining units and local chapters of
FFW. They are separate from each other
and their affiliation with FFW would not
make them members of the same union.
5. Petitioner appealed to the Secretary of Labor and
Employment but its appeal was dismissed.
Undersecretary Bienvenido Laguesma found that:
a. The evidence submitted by petitioner
concerning the alleged managerial status
of several employees to be insufficient,
and
b. Under Court in Adamson & Adamson v.
CIR, unions formed independently by
supervisory and r&f employees of a
Labor 2 Compilation #9
company may legally affiliate with the
same national federation.
6. Petitioner brought the case before the SC saying
that Laguesma erred in granting the petition for
certification election despite the fact the said
supervisory union was affiliated with the FFW to
which the r&f employees of the company are
likewise affiliated, contrary to Art. 245 of the
Labor Code.
Issue: Whether the granting of the petition for certification
election for the supervisory union violated Art. 245 of the
LC
Held: NO. Petition Dismissed.
Ratio:
Supervisory employees have the right to self-
organization like other classes of supervisory
employees save only managerial ones. Art. III,
Sec. 8 of the 1987 Constitution provides that the
right of the people, including those employed in the
public and private sectors, to form unions,
associations or societies for purposes not contrary
to law, shall not be abridged.
o United Pepsi-Cola Supervisory Union v.
Laguesma: the framers of the Constitution
intended to restore the right of supervisory
employees to self-organization which had
been withdrawn from them during the
martial law.
Commissioner Lerums proposal
to amend Art. III, Sec. 8 of the
Const. by including labor unions
in the guarantee of organizational
right should be taken in the
context of statements that his aim
was the removal of the statutory
ban against security guards and
supervisory employees joining
labor organizations.
Conformably with the constitutional mandate, Art.
245 of the Labor Code (now Art. 251) now
provides for the right of supervisory employees to
self-organization, subject to the limitation that they
cannot join an organization of rank-and-file
employees.
o The reason for this segregation is due to
the difference in interests. Supervisory
employees are more identified with the
employer and should they be allowed to
form a single union, the conflicting
interests impair their relationship and
affect discipline, collective bargaining, and
strikes.
o These consequences may be obtained not
only when the two groups join in a single
union but also where unions formed
independently are allowed to affiliate with
the same national federation.
Atlas Lithographic Services, Inc. v. Laguesma
that to avoid a conflict of interests, a local
supervisors union should not be allowed to affiliate
12

with a national federation of unions of r&f
employees where that federation actively
participates in union activities in the company.
However, as explained in the case, such a situation
would obtain only when two conditions concur:
o First, the r&f employees are directly under
the authority of supervisory employees.
o Second, the national federation is actively
involved in union activities in the company.
The affiliation of two local unions in a company with
the same national federation is not by itself a
negation of their independence since in relation to
the employer, the local unions are considered as
the principals, while the federation is deemed to be
merely their agent.
o This conclusion is in line with the policy
that any limitation on the exercise of the
right to self-organization must be
construed strictly.
Although respondent union and another union
composed of r&f employees of petitioner are
indeed affiliated with the same national federation
(FFW), petitioner has not presented any evidence
showing that the r&f employees composing the
other union are directly under the authority of the
supervisory employees. As held in Adamson &
Adamson, Inc. v. CIR:
o The fact that the two groups of workers
are employed by the same company and
the fact that they are affiliated with a
common national federation are not
sufficient to justify the conclusion that their
organizations are actually just one. Their
immediate professional relationship must
be established.
And the circumstance that the petition for
certification election was filed by FFW on behalf of
the local union, while showing involvement by the
FFW in union activities at the company, is by itself
insufficient to justify a finding of violation of Art.
245 since there is no proof that the supervisors
who compose the local union have direct authority
over the r&f employees composing the other local
union which is also affiliated with FFW.
=============================================
ATLAS LITHOGRAPHIC SERVICES INC v LAGUESMA
G.R. No. 96566; January 6, 1992; Gutierrez, JR, J,
Digest prepared by Efren II Resurreccion
Facts:
1. July 16 1990 the supervisory, admin persoel,
production, acoutig and confiedential employees of
Atlas Lithographic affiliated with Kaisahan ng
Manggagawang Pilipino [KAMPIL-KATIPUNAN] (a
national labor organization).The local union adopted
the name ALSI-SAPPACEA-KAMPIL (supervisors
union).
2. Kampil-Katipunan filed on behalf of the supervisors
union, a petition for certification election.
Labor 2 Compilation #9
3. The company opposed the petition claiming that
because Kaisahan represented both the supervisors
and the r&f union, in violation of Art 245.
4. Med Arbiter ruled in favor of Kampil-Katipunan ordering
a pre-election conference.
5. Atlas appealed to the Secretary of Labor, however the
decision was affirmed. MR denied.
Issues/Ratio:
W/N under Art 245 a local union of supervisory
employees may be allowed to affiliate with a national
federation of rak ad file employees when the
federation actively represents it s affiliates in collective
bargaining negotiations with the SAME EMPLOYER
NO.
ATLAS argues: The intent of the law is to prevent a
single labor organization from representing different
classes of employees with conflicting interests.
KAMPIL-KATIPUNAN argues: despite affiliation, the
local union does not lose its personality which is
separate and distinct from the national federation
(Citing Adamson & Adamson v CIR)
SC: Under the Industrial Peace act of 1953, workers
were classified into 1) managerial;2) supervisors; 3)
rank and file. Supervisors, who are considered
employees in relation to their employer could join a
union but not that of the R&F.
Under PD442, employees were classified into
managerial and R&F. Neither the category of
supervisors nor their right to organize were recognize
such that in Bulletin Publishing v Sanchez, the court
held that supervisors have lost the right to unionize.
A revision of the labor code was undertaken
through the enactment of RA6715 I March 1989 in
which employees were restored to the old classification
of 3 groups. Hence Art 212 (m) [Refer to LC]
o The ratio for such amendment was that the
government recognized the right of supervisors to
organize with the qualification that they cannot join
or assist in forming R&F unions, their interests
being separate and distinct. Supervisors tasks
being recommendatory in nature.
o Under the deliberations, it was held that
managerial employees were limited to those with
authority to hire & fire while those who only
recommend such acts (supervisors) are closer
to R&F.
The peculiar role of supervisors is such that while they
are not managers, when they recommend action
implementing policy or asking for dismissal of
subordinates, they identify with the interests of the
employer which may be contrary to R&F interests.
The court agrees with Atlas contentions.
o Members of the supervisory union might refuse to
carry out disciplinary measures against their co-
member R&F employees.
o In the area of bargaining, their interests canot be
considered identical. During a strike, the national
federation might cause the supervisors union to
conduct a sympathy strike. Moreover, the Adamso
13

case is not in point as in Adamson, the R&F co-
members were not directly under the supervision of
the supervisor co-members. The contemplation
of law in Sec 3 of the industrial peace act is to
prohibit supervisors from joinin g a labor
organization of employees under their
supervision.
Construing Art. 245 of the Labor code, the court holds
that the supervisors shall not be given an occasion to
bargain together with R&F against the interests of the
employer. Affiliation between the two unions should not
be allowed under a federation that actively participates
in union activity in the company.
The court further emphasizes that the limitation under
the labor code is not limited to a case of supervisors
wanting to join an R&F union. It also applies to
supervisors unions joining membership in a national
federation whose members include local R&F
employees. This is to prevent the co-mingling of the
employees in light of collective bargaining.
Neither has the court found Atlas to have prevented the
supervisory employees from exercising their right to
organize.
o However, in a motion dated November 15, 1991, it
appears that the employer has knuckled down
under the pressure of the federation and allowed
the federation to represent its supervisors I a CBA.
The petitioner is free to grant concessions it wishes
to give unilaterally. However the court cannot allow
such result to validate the erroneous rulings of the
DOLE which are contrary to law and must be held
as such.
Held: Petition is Granted.
=============================================
Phil. Skylanders, Inc. v. NLRC
G.R. No. 115949; Mar. 16, 2000; Quisumbing, J.
Digest prepared by Paolo Tamase
A. Facts
1. These are two petitions for certiorari, filed by the
following parties who question the same decision
of the NLRC:
a. Phil. SKYLANDERS (PSI), its president
(Mariles ROMULO), and personnel
manager (Francisco DAKILA), versus the
Phil. Association of Free Labor Unions
(PAFLU) and its secretary-general
(Serafin AYROSO)
b. Phil. Skylanders Employees
Association-NCW (UNION), and its
officers, versus PAFLU
2. Nov. 1993: The UNION, which was affiliated with
the PAFLU, won in the certification election.
Consequently, its rival union (PSEA-WATU)
protested the result before the SOLE.
3. Months later, the UNION passed a resolution,
signed by 111/120 members (92.5%), disaffiliating
from PAFLU, citing the latters deliberate and
habitual dereliction of duty towards its members.
Labor 2 Compilation #9
a. The UNION then affiliated with the Natl.
Congress of Workers (NCW)
b. The officers of the UNION continued in
their positions.
c. 1994: The UNION entered into a CBA
with PSI.
4. Oblivious to the UNIONs shift of allegiance,
PAFLUs sec. gen. wrote PSIs president,
requesting a copy of PSIs financial statements
in preparation for a CBA negotiation. PSI, through
its personnel manager, denied the request, citing
the UNIONs disaffiliation with PAFLU.
5. Oct. 1994: PAFLU filed complaints before the
Labor Arbiter for unfair labor practice:
a. Against PSI and its president, alleging it
was interfering with the UNIONs activities.
b. Against PSIs personnel manager,
alleging he was present in the UNIONs
organizational meeting, thereby confirming
his interference.
c. In Feb. 1995, PAFLU amended its
complaint to include the elected officers
of the UNION, as they allegedly allowed
themselves to be manipulated by PSI.
6. PSI and the UNION officers questioned the (1)
jurisdiction of the LA over the case, this being an
inter-union dispute; and (2) the legal personality of
PAFLU, as the UNION was no longer affiliated with
it.
7. The LA (1) held the petitioners guilty of unfair labor
practice; and (2) declared the disaffiliation invalid.
The NLRC upheld the LA, ruling that since there
was a pending election protest (see A.1.), the
UNION could not validly separate from PAFLU
and subsequently enter a CBA.
8. Before the SC, the UNION argued (1) that PAFLU
was a mere agent and, due to the affiliation, it had
lost its authority to represent them in any
proceeding; and (2) being an independent labor
union, the UNION may readily disaffiliate from the
mother federation.
a. The Solicitor General agreed with the
UNION, and questioned the LAs
jurisdiction.
B. Issues
1. WON the LA has jurisdiction. - NO
2. WON an independent local union may validly
disaffiliate pending an election protest. - YES
3. WON PAFLU has personality to file the complaint. -
NO
C. Held: Petition granted. The NLRC decision is set aside.
D. Ratio
1. The issue of disaffiliation is an inter-union conflict;
the BLR has jurisdiction.
a. But the Court will settle the main case to avoid
delay.
2. A local union has the right to disaffiliate from the
mother federation.
14

a. This has been settled by Liberty Workers Union v.
Liberty Cotton Mills.
b. As separate and voluntary associations, local
unions do not owe their existence to the
federation, but instead, to the will of their
members.
c. The essence of affiliation is to increase common
bargaining power, but local unions remain the
basic union of association. While it is limited by
the constitution and by-laws of the natl. federation,
it is also free to renounce affiliation upon the
terms of the affiliation. Here, there were no
conditions imposed for a valid breakaway.
d. The pendency of an election protest is not a
bar to the disaffiliation.
3. PAFLU had no personality to file the complaint.
a. Disaffiliating from PAFLU did not divest the UNION
of personality.
b. Instead, it removed PAFLUs personality, as a
mere agent, to file the complaint.
=============================================
Malayang Samahan ng mga Manggagawa sa M
Greenfield (MSMG-UWP) et al. v Ramos, NLRC
GR No. 113907; Feb 28, 2000; Purisima, J;
Paola Vargas
FACTS:
- MSMG-UWP (local union) is an affiliate of
respondent United Lumber and General Workers of
the Philippines (ULGWP) (Federation)
- There was a CBA entered into with MSMG/ULGWP
and the employer M Greenfield Inc (B) as parties,
which contains a union security clause providing
that employees covered by the CBA who are
currently members of the Union shall remain
members of the Union as condition precedent to
continued employment in the Company and that if
an employee fails to maintain his membership in
the Union (non-payment of dues, resignation,
violation of CBL) shall, upon written
recommendation to the Company be dismissed
from work; also there is a provision for Program
Fund that the Company will provide for P10,000
pesos, to be remitted to ULGWP for continuing
education program.
- Sept 1986: Petitioner Beda Magdalena Villanueva
and other officers were declared as the winners in
a local union election.
- April 1988: The Union held a general membership
meeting, where several union members failed to
attend the meeting. The unions CBL provides for a
fined of P50.00 for non-attendance. A committee
was created by the Executive Board to investigate
said non-attendance. The Union thereafter
requested from the company to deduct the union
fines (50 pesos) from the wages and salaries of
union members who failed to attend the meeting.
- In a Memorandum, the Secretary General of
ULGWP Godofredo Paceo Jr, disapproved of said
imposition of P50 fine. It then wrote to the
company not the deduct the fine and said that all
Labor 2 Compilation #9
future representations by MSMG affecting
members be first cleared from ULGWP before
corresponding action from the company. The
Company did not deduct the fines.
- This issue regarding the fine became the subject of
bitter disagreement between ULGWP and MSMG
causing the latter to declare general autonomy
from the former through Resolution No. 10
passed by the executive board and ratified by
general membership.
- In retaliation, ULGWP asked the company to stop
remitting MSMGs share in the education funds
(also provided in the company and MSMGs CBA
P10,000/month for continuing labor education
program which shall be remitted to the Federation
(ULGWP))
- The company was thus constrained to file a
Complaint for Interpleader with petition for
Declaratory relief with DOLE.
Med Arbiter Bactin ruled that the ULGWP through
its local union officer shall administer the CBA; for
the company to remit P10,000 for the education
fund; for treasurer of MSMG to collect from 365
members P50.00 as penalty for failure to attend
the general assembly if MSMG can present
individual written authorities of the 365, then
company is obliged to deduct from the salaries of
the 365 said fine.
On Appeal DOLE Director Pura-Ferrer Calleja
ssued a resolution splitting the P10,000 between
ULGWP and MSMG (P5000 each)
In a Special National Executive Board Meeting, the
ULGWP passed a resolution placing MSMG under
trusteeship and appointed Cesar Clarete as
administrator. Said administrator wrote to the
company appointing a certain Kalingking as local
union president and disauthorizing the incumbent
officers. MSMG officers also received letters
requiring them to explain why they should not be
removed from office and expelled from union.
Petitioners questioned the validity of the National
Board Resolution placing the union under
trusteeship. They justified their declaration of
autonomy from ULGWP due to the latters inability
to give proper educational, organizational and legal
services. They also maintained that they did not
commit any act of disloyalty as it remained an
affiliate of ULGWP.
They were still expelled from ULGWP for acts of
disloyalty and/or acts inimical to the interest and
violative of CBL of Federation. Using the Union
Security clause, it wrote to the Company to
demand for the dismissal of said officers from
work.
Under pressure of a threatened strike, the
company sent the officers a termination letter
(notice of termination). On the same day,
officers in the first shift were bodily brought out of
the company premises while those who were about
to report for the next shift were not permitted to
report. This provoked some members of the union
to protest and some left their work and walked out
of company premises.
15

Petitioners filed a Notice of Strike with the DOLE
for discrimination, interference in union activities,
union busting, etc. Said strike was voted upon in a
referendum and 2,086 members out of 2,103 voted
to declare a strike.
The 30 dismissed officers also filed a petition with
the SOLE for suspension of their termination from
employment. However, the SOLE dismissed said
petition saying it was a purely intra-union matter
(no mass lay-off)
Another strike was declared by the union
members, this time because 78 shop stewards
were placed under preventive suspension. Some
strikers figured in violence resulting in physical
injuries to employees and damage to company
properties. Said strikers were placed in preventive
suspension. A return to work notice was sent but
only 261 were eventually accepted back to work.
Petitioners filed a complaint for unfair labor practice
(union busting, illegal dismissal/suspension,
interference in union activities, discrimination,
threats, intimidation, coercion, violence and
oppression)
*not important to issues: Company relocated its factory and
manufacturing ops to Tacloban Leyte because their lease
contract in a subdivision in Paranaque expired and they did
not renew.
LA: dismissed complaint termination of the officers valid in
compliance with union security clause
NLRC: affirmed LA.
ISSUE: WoN the company was justified in dismissing
petitioner employees merely upon demand by ULGWP
(Federation) for enforcement of the union security clause in
the CBA NO
WON Unions act of declaring general autonomy
from the Federation is an act of disloyalty NO
RATIO:
1. Union security clauses embodied in a CBA may be
validly enforced and dismissals pursuant thereto
may be likewise valid. However, said undertaking
should not be done hastily and summarily. The
company acts in bad faith if he dismisses an
employee without giving him the benefit of a
hearing.
o The Federation demanded for the
dismissal of said employees for alleged
acts of disloyalty and/or acts inimical to
the interest of ULGWP and in violation of
the CBL. Company dismissed said
employees based on said demand without
conducting a separate and independent
investigation (relying merely on ULGWPs
allegations)
o Even assuming ULGWP had valid grounds
to expel the officers, due process requires
that the union officers be accorded a
separate hearing.
o Expulsion of local officers was originally a
intra-union matter (between the union and
Labor 2 Compilation #9
federation) but when petitioners were
dismissed from work without the hearing
(in fact the termination was effective the
same day the notice was served to said
employee) it became a termination
dispute.
2. Federation was a principal party to the CBA
o As found out by the Med-Arbiter in the
interpleader case, when the CBA was
entered into MSMG was not yet a
registered labor union at that time. So the
union referred to in the CBA is ULGWP.
o ULGWP is also the CEBA of all Rank and
file workers of the Company.
3. Act of disaffiliating with the Federation not an
act of disloyalty.
o A local union, being a separate and
voluntary association is free to serve the
interests of all its members including the
freedom to disaffiliate or declare its
autonomy from the federation to which it
belongs when the circumstances warrant,
in accordance with constitutional
guarantee of freedom of association.
o The purpose of affiliation by a union with a
federation is to increase collective
bargaining power. Yet unions are free to
serve their own and common interest of
all, free to renounce affiliation for mutual
welfare upon terms laid down in the
agreement which brought it to existence.
Such disaffiliation cannot be considered
disloyalty.
o In the absence of specific provisions in the
Federations constitution prohibiting
disaffiliation or declaration of local
autonomy, a local may disassociate with a
parent union.
o NOTHING in ULGWPs Constitution
prohibits disaffiliation. Even Section 6 of
said CBL of ULGWP bolsters petitioners
right because it says autonomy of local
affiliate shall be respected insofar as it
pertains to internal affairs.
o Since there is no disloyalty, there is no
valid dismissal (no violation of unions
CBL)
4. Other issues: Strike legal because in good faith,
and since this a termination dispute, workers
staged a strike. As to violence both sides
(company and workers) committed violence, so
cannot be a ground to declare strike as illegal.
Striking workers did not abandon work despite not
heeding return to work orders it was not clearly
proven that there was abandonment (burden of
proof on employer to show elements of clear
intention to abandon and absence without valid
reason)
=============================================
16

NATIONAL UNION OF BANK EMPLOYEES (NUBE)
v. PHILNABANK EMPLOYEES ASSOCIATION (PEMA)
AND PHILIPPINE NATIONAL BANK
August 12, 2013| Peralta, J.| by Ron San Juan
Facts: Respondent PNB used to be a government-owned
and controlled banking institution. 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 SEC approved PNBs new Articles of
Incorporation and By-laws and its changed status as a
private corporation. PEMA affiliated with petitioner 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, and
a CBA was subsequently signed which allows check-off and
agency fees, i.e. PNB to deduct from salary of the
employees and remit the same to NUBE.
Following the expiration of the CBA, the Philnabank
Employees Association-FFW (PEMA-FFW) filed 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 significant events transpired the independent union
registration of NUBE- PEC and its disaffiliation with NUBE.
Cited as reasons in the Resolution were as follows: (1)
NUBE's failure to extend and provide satisfactory services
and support in the form of legal services, training
assistance, educational seminars, and the like; (2) lack of
regard for the interests of the union members by blocking
their desire for the early commencement of CBA
negotiations. It is claimed that said Resolution was
overwhelmingly ratified by about 81% of the total union
membership.
PEMA sent a letter to the PNB management informing its
disaffiliation from NUBE and requesting to stop, effective
immediately, the check-off due for NUBE. library
Acting thereon, PNB informed NUBE that it would stop its
remittance to NUBE. Despite protest from NUBE alleging
that the disaffiliation was an act of disloyalty which led to
the expulsion of those involved, PNB stood firm on its
decision.
Alleging unfair labor practice (ULP) for non-implementation
of the grievance machinery and procedure, NUBE brought
the matter to the NCMB for preventive mediation. In time,
PNB and NUBE agreed to refer the case to the Office of the
DOLE Secretary for voluntary arbitration.
Meantime, the certification election was finally held where
NUBE-PEC overwhelmingly won.
Labor 2 Compilation #9
PEMA filed before the voluntary arbitrator an Urgent Motion
for Intervention, alleging that it stands to be substantially
affected by whatever judgment that may be issued,
because one of the issues for resolution is the validity of its
disaffiliation from NUBE.
DOLE denied PEMAs motion for intervention and ordered
PNB to release all union dues withheld and to continue
remitting the same to NUBE.
CA reversed. Hence this appeal by NUBE.
Issue: Whether PEMA validly disaffiliated itself from
NUBE. (YES)
Held: Petition denied.
A local union may disaffiliate at any time from its mother
federation, absent any showing that the same is prohibited
under its constitution or rule. Such, however, does not result
in it losing its legal personality altogether.
A local labor union is a separate and distinct unit primarily
designed to secure and maintain an equality of bargaining
power between the employer and their employee-
members. A local union does not owe its existence to the
federation with which it is affiliated. It is a separate and
distinct voluntary association owing its creation to the will of
its members. The mere act of affiliation does not divest the
local 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.
In the case at bar, there is nothing shown in the records nor
is it claimed by NUBE that PEMA was expressly forbidden
to disaffiliate from the federation nor were there any
conditions imposed for a valid breakaway. This being so,
PEMA is not precluded to disaffiliate from NUBE after
acquiring the status of an independent labor organization
duly registered before the DOLE.
Also, there is no merit on NUBEs contention that PEMAs
disaffiliation is invalid for non-observance of the procedure
that union members should make such determination
through secret ballot and after due deliberation,
conformably with Article 241 (d) of the Labor Code, as
amended. NUBE failed to quote a specific provision of the
law or rule mandating that a local unions disaffiliation from
a federation must comply with Article 241 (d) in order to be
valid and effective.
Granting, for arguments sake, that Article 241 (d) is
applicable, still, PEMAs disaffiliation from NUBE was valid.
First, non-compliance with the procedure on
disaffiliation, being premised on purely technical
grounds cannot rise above the employees
fundamental right to self-organization and to form
and join labor organizations of their own choosing
for the purpose of collective bargaining.
17

Second, the Article nonetheless provides that when
the nature of the organization renders such secret
ballot impractical, the union officers may make the
decision in behalf of the general membership. In
this case, PNB employees are scattered from
Aparri to Jolo, manning more than 300 branches,
hence, to gather the general membership of the
union in a general membership to vote through
secret balloting is virtually impossible. It is
understandable, therefore, why PEMAs board of
directors merely opted to submit for ratification of
the majority their resolution to disaffiliate from
NUBE.
Third, and most importantly, NUBE did not dispute
the existence of the persons or their due execution
of the document showing their unequivocal support
for the disaffiliation of PEMA from NUBE. The list of
PEMA members who agreed with the board
resolution was left unchallenged by NUBE.
Consequently, by PEMA's valid disaffiliation from NUBE,
the vinculum that previously bound the two entities was
completely severed. As NUBE was divested of any and all
power to act in representation of PEMA, any act performed
by the former that affects the interests and affairs of the
latter, including the supposed expulsion of Serrana et al., is
rendered without force and effect. Also, in effect, NUBE
loses it right to collect all union dues held in its trust by
PNB. And since PEMA had validly separated itself from
NUBE, it can now collectively bargain with PNB.
=============================================
Philippine Labor Alliance Council v. Bureau of Labor
Relations [Fernando, J.]
Facts:
1. March 1974: There was a renewal of the CBA with
a union shop clause between PLAC and Orion
Manila, Inc. (Orion).
a. To last for another 3 years
b. Incorporating new economic benefits that
would expire in 1977
2. PLAC claimed it was the SEBA of the 1,500 rank-
and-file employees.
3. May 1974: The CBA was ratified by a unanimous
vote of the members of the Union (1,500 of them
were present at the time).
4. June 1974: The NLRC certified it.
5. June 20, 1974: FFW butted in, saying that its
members represent more than 60% of the 1,500
members. It then sought a certification election.
6. PLAC opposed the (above), saying that it was the
SEBA, as evidenced by the CBA (which was
certified) it entered into already with Orion.
7. The SOLE decided in favor of PLAC, dismissing
the petition for certification election of FFW (on the
ground of the existence of a certified CBA).
8. FFW filed a complaint with the BLR, saying that
some employees (848 of them) had disaffiliated
from PLAC and affiliated with FFW.
Labor 2 Compilation #9
a. Alleged also that the certified CBA was
entered into to thwart such disaffiliation
and seeking its nullification (the new CBA
was concluded about 10 months before
the expiry date of the old on purposely to
defeat the rights of the covered employees
to choose their bargaining representative
at the proper time appointed by law- there
was no need to take so long since the new
one only provided for a 50-centavo salary
increase)
9. The Med-Arbiter dismissed FFWs complaint.
10. 1975: The BLR decided in favor of FFW, issuing an
order setting aside the certification of the CBA
entered into by PLAC with Orion (on the ground
that the CBA was actually not ratified by majority of
the employees, and so was defective)
a. It also allowed a certification election to
determine who really was the SEBA
Issue/s - Holding:
1. WON the disaffiliation of 848 members from PLAC
served to render the CBA (between PLAC and Orion)
void. YES
Ratio: Basically, PLAC wants the BLR to resolve the issue
of who the SEBA is by just ruling on the affiliation and
disaffiliation that happened (in other words, ANYHTING
BUT a certification election because it knew that it would
lose for sure). The SC said no. Certification election is the
best way of determining who the SEBA is, especially once
there is mass disaffiliation from the old union.
1. There was mass disaffiliation (848 members) from
PLACs membership. These employees transferred
to FFW.
a. There is the incontrovertible right of any
individual to join an organization (and
leave).
2. Once there is mass disaffiliation from a union,
a certification election is the most expeditious
way of determining which labor organization is
to be the exclusive bargaining representative.
It is as simple as that, according to the Court.
a. In Phil. Assoc. of Free Labor Unions vs.
BLR: Certification elections if the fairest
and most effective way of determining
which labor organization can truly
represent the working force.
b. 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.
c. Good policy and equity demand that
when an agreement is renegotiated (here,
that CBA of PLAC with Orion) before the
appointed 60-day period, its certification
must still give way to any representation
issue (like that raised by FFW) that may
be raised within the 60-day period so that
the right of employees to choose a
bargaining unit agent and the right of
unions to be chose shall be preserved.
3. Court agreed with FFW when it said that the CBA
of PLAC was a delaying tactic (SEE Fact 8.a.)
18

4. The terms and conditions of the CBA constitute the
law between the parties.
a. Workers must be left with the choice of
their agent for purposes of collective
bargaining.
5. The BLR has the power to decertify CBAs.
a. If done arbitrarily, however, there is a valid
ground for complaint.
b. Here, PLAC was heard by the BLR before
the order of decertification of the CBA was
issued.
c. The denial of PLACs MR came also after
it had an opportunity to present its side.
d. Procedural and substantive due process
was thus observed.
Dispositive: PETITION DENIED.
=============================================
ANGLO-KMU v SAMANA BAY, GILBERT SUNGAYANN,
FERNANDO MELARPIS, ET AL. [G.R. No. 115682; 05 July
1996; Francisco J.] Digest by Dudday
FACTS
Petitioner ALLIANCE OF NATIONALIST AND
GENUINE LABOR ORGANIZATION (Anglo-KMU)
is a duly registered labor organization (federation).
Respondent SAMAHAN NG MGA
MANGGAGAWANG NAGKAKAISA SA MANILA
BAY SPINNING MILLS AT J.P. COATS (Samana
Bay) is its affiliate union (union) consisted
employees of Manila Bay Spinning Mills and J.P.
Coats Manila Bay, Inc. (the corporations). Private
respondents Gilbert Sungayann, Fernando
Melarpis, et al. are the former set of officers and
board members of Samana Bay removed by Anglo-
KMU.
Nov. 1, 1991: Anglo-KMU entered and concluded a
CBA with the corporations in behalf of Samana
Bay.
Dec. 4, 1993: Samana Bays Executive Committee
decided to disaffiliate from Anglo-KMU because of
the latters dereliction of duty to promote and
advance the welfare of Samana Bay and the
alleged cases of corruption involving the
federations officers. This was unanimously
confirmed by the members of the union and a
resolution to that effect was made.
Apr. 4, 1994: Since the corporations refused to
honor the union resolution and continued remitting
federation dues to Anglo-KMU, Samana Bay filed a
petition before the Bureau of Labor Relations to
stop the remittance. Anglo counteracted by
unseating all officers and board members of
Samana Bay (the private respondents) and
appointing a new set of officers who were duly
recognized by the corporations.
Anglo-KMU contended that the disaffiliation is void
because it was done outside the 60-day freedom
period considering that there was an existing CBA
and that it was in violation of P.D. 1391. It also
averred that the removal of private respondents
Labor 2 Compilation #9
was valid because they have ceased to be officers
of the Anglo-KMU at the time of disaffiliation.
Med-Arbiter declared the disaffiliation void but
upheld the illegality of the ouster of Samana Bays
officers. DOLE, upon appeal of both parties,
modified the Med-Arbiters ruling by declaring the
disaffiliation as valid, directing the corporations to
stop remitting dues to the federation and instead
give the amount to the Samana Bay treasurer, and
enjoinoing Anglo-KMU from interfering in the affairs
of the union. Hence, the present appeal by Anglo-
KMU.
ISSUES, RESOLUTION, RATIO
1. WON the disaffiliation is valid - Yes, the
disaffiliation is valid.
Anent the contention of Anglo-KMU that the
disaffiliation should be voided for not
complying with the procedural requirements for
a valid disaffiliation, Supreme Court found the
resolution of the general membership ratifying
the disaffiliation initiated by the Executive
Committee substantially satisfies the
requirements for disaffiliation.
Such mere procedural defect should not
defeat the employees constitutional right
to self-organization and to form and join
labor organizations of their own choosing
for collective bargaining. In interpreting the
labor laws, the Court had always adopted
a liberal approach in favor of the exercise
of the aforementioned laborers rights.
Anglo failed to rebut the allegations that its
acts were inimical to the unions interests,
and all it offered in dispute is the law
prohibiting disaffiliation during the freedom
period.
On the contention that the disaffiliation was
made in violation of PD 1391 (Item No. 6, PD
1391: No petition for certification election, for
intervention and disaffiliation shall be
entertained or given due course except within
the 60-day freedom period immediately
preceding the expiration of a CBA.), SC said
that the said provision embodies only a
general rule which has an exception.
The general rule is that a labor union may
disaffiliate from its mother union to form a
local or independent union only during the
60-day freedom period immediately
preceding the expiration of the CBA. The
exception to this rule is that disaffiliation
may be carried out, even before the onset
of the freedom period, when there is a
shift of allegiance on the part of the
majority of the members of the union.
Such exception is present in the case at
hand.
2. WON Anglo-KMU can validly oust the officers of
Samana Bay (private respondents) No, the
ouster is illegal.
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A local labor union is a separate and distinct
unit designed to secure equality of bargaining
power between the employer and the
employees. It does not owe its existence to its
mother federation which acts only as an agent
of the local union. Samana Bays disaffiliation
divested Anglo of the power to act in
representation of Samana Bay. Hence, all acts
made by Anglo-KMU affecting the interests
and affairs of Samana Bay, including the
removal from position of private respondents,
are rendered without force and effect.

PETITION DISMISSED.

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