SECOND DIVISION
de la Cruz, med-arbiter of the Department of Labor
[G.R. No. 102084. August 12, 1998]
DE LA SALLE UNIVERSITY MEDICAL CENTER AND COLLEGE OF
MEDICINE, petitioner, vs. HON. BIENVENIDO E. LAGUESMA, Undersecretary of Labor and
Employment; ROLANDO S. DE LA CRUZ, Med-Arbiter Regional Office No. IV, DE LA SALLE
UNIVERSITY MEDICAL CENTER AND COLLEGE OF MEDICINE SUPERVISORY UNION-
FEDERATION OF FREE WORKERS, respondents.
DECISION
MENDOZA, J.:
Petitioner De La Salle University Medical Center and College of Medicine (DLSUMCCM) is a
hospital and medical school at Dasmarias, Cavite. Private respondent Federation of Free
WorkersDe La Salle University Medical Center and College of Medicine Supervisory Union
Chapter (FFW-DLSUMCCMSUC), on the other hand, is a labor organization composed of the
supervisory employees of petitioner DLSUMCCM.
On April 17, 1991, the Federation of Free Workers (FFW), a national federation of labor
unions, issued a certificate to private respondent FFW-DLSUMCCMSUC recognizing it as a
local chapter. On the same day, it filed on behalf of private respondent FFW-DLSUMCCMSUC
a petition for certification election among the supervisory employees of petitioner
DLSUMCCM. Its petition was opposed by petitioner DLSUMCCM on the grounds that several
employees who signed the petition for certification election were managerial employees and
that the FFW-DLSUMCCMSUC was composed of both supervisory and rank-and-file
employees in the company.[1]
In its reply dated May 22, 1991, private respondent FFW-DLSUMCCMSUC denied petitioners
allegations. It contended that
2. Herein petition seeks for the holding of a certification election among the supervisory
employees of herein respondent. It does not intend to include managerial employees.
....
6. It is not true that supervisory employees are joining the rank-and-file employees
union. While it is true that both regular rank-and-file employees and supervisory employees
of herein respondent have affiliated with FFW, yet there are two separate unions organized
by FFW. The supervisory employees have a separate charter certificate issued by FFW.[2]
On July 5, 1991, respondent Rolando S.
and Employment Regional Office No. IV, issued an order granting respondent unions petition
for certification election. He said:
. . . . [petitioner] . . . claims that based on the job descriptions which will be presented at the
hearing, the covered employees who are considered managers occupy the positions of
purchasing officers, personnel officers, property officers, cashiers, heads of various sections
and the like.
[Petitioner] also argues that assuming that some of the employees concerned are not
managerial but mere supervisory employees, the Federation of Free Workers (FFW) cannot
extend a charter certificate to this group of employees without violating the express provision
of Article 245 which provides that 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 because the FFW had similarly issued a charter certificate to
its rank-and-file employees.
....
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. The record likewise shows that [petitioner] promised to present the job descriptions of
the concerned employees during the hearing but failed to do so. Thus, this office has no basis
in determining at this point in time who among them are considered managerial or
supervisory employees. At any rate, there is now no question that [petitioner] has in its
employ supervisory employees who are qualified to join or form a labor union. Consequently,
this office is left with no alternative but to order the holding of certification election pursuant
to Article 257 of the Labor Code, as amended, which mandates the holding of certification
election if a petition is filed by a legitimate labor organization involving an unorganized
establishment, as in the case of herein respondent.
As to the allegation of [petitioner] that the act of the supervisory employees in affiliating with
FFW to whom the rank-and-file employees are also affiliated is violative of Article 245 of the
Labor Code, suffice it to state that the two groups are considered separate bargaining units
and local chapters of FFW. They are, for all intents and purposes, separate with each other
and their affiliation with FFW would not make them members of the same labor union. This
must be the case because it is settled that the locals are considered the basic unit or principal
with the labor federation assuming the role of an agent. The mere fact, therefore, that they
are represented by or under the same agent is of no moment. They are still considered
separate with each other.[3]
On July 30, 1991, petitioner DLSUMCCM appealed to the Secretary of Labor and Employment,
citing substantially the same arguments it had raised before the med-arbiter. However, its
appeal was dismissed. In his resolution, dated August 30, 1991, respondent Undersecretary
of Labor and Employment Bienvenido E. Laguesma found the evidence presented by
petitioner DLSUMCCM concerning the alleged managerial status of several employees to be
insufficient. He also held that, following the ruling of this Court in Adamson & Adamson, Inc.
v. CIR,[4] unions formed independently by supervisory and rank-and-file employees of a
company may legally affiliate with the same national federation.
Petitioner moved for a reconsideration but its motion was denied. In his order dated
September 19, 1991, respondent Laguesma stated:
We reviewed the records once more, and find that the issues and arguments adduced by
movant have been squarely passed upon in the Resolution sought to be
reconsidered. Accordingly, we find no legal justification to alter, much less set aside, the
aforesaid resolution. Perforce, the motion for reconsideration must fail.
WHEREFORE, the instant motion for reconsideration is hereby denied for lack of merit and
the resolution of this office dated 30 August 1991 STANDS.
No further motions of a similar nature shall hereinafter be entertained.[5]
Hence, this petition for certiorari.
Petitioner DLSUMCCM contends that respondent Laguesma gravely abused his discretion.
While it does not anymore insist that several of those who joined the petition for certification
election are holding managerial positions in the company, petitioner nonetheless pursues the
question whether unions formed independently by supervisory and rank-and-file employees
of a company may validly affiliate with the same national federation.With respect to this
question, it argues:
THE PUBLIC RESPONDENT, HONORABLE BIENVENIDO E. LAGUESMA, UNDERSECRETARY OF
LABOR AND EMPLOYMENT, IN A CAPRICIOUS, ARBITRARY AND WHIMSICAL EXERCISE OF
POWER ERRED AND COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO ACTING
WITHOUT OR IN EXCESS OF JURISDICTION WHEN HE DENIED THE PETITIONERS APPEAL AND
ORDERED THE HOLDING OF A CERTIFICATION ELECTION AMONG THE MEMBERS OF THE
SUPERVISORY UNION EMPLOYED IN PETITIONERS COMPANY DESPITE THE FACT THAT SAID
SUPERVISORY UNION WAS AFFILIATED WITH THE FEDERATION OF FREE WORKERS TO WHICH
THE RANK-AND-FILE EMPLOYEES OF THE SAME COMPANY ARE LIKEWISE AFFILIATED,
CONTRARY TO THE EXPRESS PROVISIONS OF ARTICLE 245 OF THE LABOR CODE, AS
AMENDED.[6]
The contention has no merit.
Supervisory employees have the right to self-organization as do other classes of employees
save only managerial ones. The Constitution states 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.[7] As we recently held in UnitedPepsi-Cola
Supervisory Union v. Laguesma,[8] the framers of the Constitution intended, by this provision,
to restore the right of supervisory employees to self-organization which had been withdrawn
from them during the period of martial law. Thus:
Commissioner Lerum sought to amend the draft of what was later to become Art. III, 8 of the
present Constitution:
....
MR. LERUM. . . . Also, we have unions of supervisory employees and of security guards. But
what is tragic about this is that after the 1973 Constitution was approved and in spite of an
express recognition of the right to organize in P.D. No. 442, known as the Labor Code, the
right of government workers, supervisory employees and security guards to form unions was
abolished.
....
We are afraid that without any corresponding provision covering the private sector, the
security guards, the supervisory employees ... will still be excluded and that is the purpose of
this amendment.
....
In sum, Lerums proposal to amend Art. III, 8 of the draft Constitution 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. The approval by the Constitutional Commission of his proposal
can only mean, therefore, that the Commission intended the absolute right to organize of
government workers, supervisory employees, and security guards to be constitutionally
guaranteed.[9]
Conformably with the constitutional mandate, Art. 245 of the Labor Code 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:
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.
The reason for the segregation of supervisory and rank-and-file employees of a company with
respect to the exercise of the right to self-organization is the difference in their
interests. Supervisory employees are more closely identified with the employer than with the
rank-and-file employees. If supervisory and rank-and-file employees in a company are
allowed to form a single union, the conflicting interests of these groups impair their
relationship and adversely affect discipline, collective bargaining, and strikes.[10] These
consequences can obtain not only in cases where supervisory and rank-and-file employees in
the same company belong to a single union but also where unions formed independently by
supervisory and rank-andfile employees of a company are allowed to affiliate with the same
national federation. Consequently, this Court has held in Atlas Lithographic Services Inc. v.
Laguesma[11] that -
To avoid a situation where supervisors would merge with the rank-and-file or where the
supervisors labor organization would represent conflicting interests, then a local supervisors
union should not be allowed to affiliate with a national federation of unions of rank-and-file
employees where that federation actively participates in union activities in the company.
As we explained in that case, however, such a situation would obtain only where two
conditions concur: First, the rank-and-file employees are directly under the authority of
supervisory employees.[12] Second, the national federation is actively involved in union
activities in the company.[13] Indeed, it is the presence of these two conditions which
distinguished Atlas Lithographic Services, Inc. v. Laguesma from Adamson & Adamson, Inc. v.
CIR[14] where a different conclusion was reached.
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. This
conclusion is in accord with the policy that any limitation on the exercise by employees of the
right to self-organization guaranteed in the Constitution must be construed strictly. Workers
should be allowed the practice of this freedom to the extent recognized in the fundamental
law. As held in Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc.:[15]
The locals are separate and distinct units primarily designed to secure and maintain an
equality of bargaining power between the employer and their employee members in the
economic struggle for the fruits of the joint productive effort of labor and capital; and the
association of locals into the national unionwas in furtherance of the same end. These
associations are consensual entities capable of entering into such legal relations with their
members. The essential purpose was the affiliation of the local unions into a common
enterprise to increase by collective action the common bargaining power in respect of the
terms and conditions of labor. Yet the locals remained the basic units of association, free to
serve their own and the common interest of all, and free also to renounce the affiliation for
mutual welfare upon the terms laid down in the agreement which brought it to existence.[16]
The questions in this case, therefore, are whether the rank-and-file employees of petitioner
DLSUMCCM who compose a labor union are directly under the supervisory employees whose
own union is affiliated with the same national federation (Federation of Free Workers) and
whether such national federation is actively involved in union activities in the company so as
to make the two unions in the same company, in reality, just one union.
Although private respondent FFW-DLSUMCCMSUC and another union composed of rank-and-
file employees of petitioner DLSUMCCM are indeed affiliated with the same national
federation, the FFW, petitioner DLSUMCCM has not presented any evidence showing that the
rank-and-file employees composing the other union are directly under the authority of the
supervisory employees. As held in Adamson & Adamson, Inc. v. CIR,[17] 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. To borrow the language of Adamson & Adamson, Inc. v. CIR:[18]
We find without merit the contention of petitioner that if affiliation will be allowed, only one
union will in fact represent both supervisors and rank-and-file employees of the petitioner;
that there would be an indirect affiliation of supervisors and rank-andfile employees with one
labor organization; that there would be a merging of the two bargaining units; and that the
respondent union will lose its independence because it becomes an alter ego of the
federation.[19]
Mention has already been made of the fact that the petition for certification election in this
case was filed by the FFW on behalf of the local union. This circumstance, while showing active
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 rank-and-file employees composing the other local
union which is also affiliated with the FFW. This fact differentiates the case from Atlas
Lithographic Services, Inc. v. Laguesma,[20] in which, in addition to the fact that the petition
for certification election had been filed by the national federation, it was shown that the rank-
and-file employees were directly under the supervisors organized by the same federation.

It follows that respondent labor officials did not gravely abuse their discretion.

WHEREFORE, the petition is DISMISSED.

SO ORDERED.
FIRST DIVISION
G.R. No. 157086 February 18, 2013
LEPANTO CONSOLIDATED MINING COMPANY, Petitioner,
vs.
THE LEPANTO CAPATAZ UNION, Respondent.
DECISION
BERSAMIN, J.:
Capatazes are not rank-and-file employees because they perform supervisory functions for
the management; hence, they may form their own union that is separate and distinct from
the labor organization of rank-and-file employees.
The Case-
Lepanto Consolidated Mining Company (Lepanto) assails the Resolution promulgated on
December 18, 2002,1whereby the Court of Appeals (CA) dismissed its petition for certiorari on
the ground of its failure to first file a motion for reconsideration against the decision rendered
by the Secretary of the Department of Labor and Employment (DOLE); and the resolution
promulgated on January 31, 2003,2 whereby the CA denied Lepanto's motion for
reconsideration.
Antecedents
As a domestic corporation authorized to engage in large-scale mining, Lepanto operated
several mining claims in Mankayan, Benguet. On May 27, 1998, respondent Lepanto Capataz
Union (Union), a labor organization duly registered with DOLE, filed a petition for consent
election with the Industrial Relations Division of the Cordillera Regional Office (CAR) of DOLE,
thereby proposing to represent 139 capatazes of Lepanto.3
In due course, Lepanto opposed the petition,4 contending that the Union was in reality
seeking a certification election, not a consent election, and would be thereby competing with
the Lepanto Employees Union (LEU), the current collective bargaining agent. Lepanto pointed
out that the capatazes were already members of LEU, the exclusive representative of all rank-
and-file employees of its Mine Division.
On May 2, 2000, Med-Arbiter Michaela A. Lontoc of DOLE-CAR issued a ruling to the effect
that the capatazes could form a separate bargaining unit due to their not being rank-and-file
employees,5 viz:
xxxx
We agree with petitioner that its members perform a function totally different from the rank-
and-file employees. The word capataz is defined in Webster’s Third International Dictionary,
1986 as "a boss", "foreman" and "an overseer". The employer did not dispute during the
hearing that the capatazes indeed take charge of the implementation of the job orders by
supervising and instructing the miners, mackers and other rank-and-file workers under
them, assess and evaluate their performance, make regular reports and recommends (sic)
new systems and procedure of work, as well as guidelines for the discipline of employees.
As testified to by petitioner’s president, the capatazes are neither rank-and-file nor
supervisory and, more or less, fall in the middle of their rank. In this respect, we can see
that indeed the capatazes differ from the rank-and-file and can by themselves constitute a
separate bargaining unit.
While it is claimed by the employer that historically, the capatazes have been considered
among the rank-and-file and that it is only now that they seek a separate bargaining unit such
history of affiliation with the rank-and-file association of LEU cannot totally prevent the
capatazes from disaffiliating and organizing themselves separately. The constitutional right of
every worker to self-organization essentially gives him the freedom to join or not to join an
organization of his own choosing.
The fact that petitioner seeks to represent a separate bargaining unit from the rank-and-file
employees represented by the LEU renders the contract bar rule inapplicable. While the
collective bargaining agreement existing between the LEU and the employer covering the
latter’s rank-andfile employee covers likewise the capatazes, it was testified to and
undisputed by the employer that the capatazes did not anymore participate in the
renegotiation and ratification of the new CBA upon expiration of their old one on 16
November 1998. Their nonparticipation was apparently due to their formation of the new
bargaining unit. Thus, while the instant petition was filed on 27 May 1998, prior to the
freedom period, in the interest of justice and in consonance with the constitutional right of
workers to self-organization, the petition can be deemed to have been filed at the time the
60-day freedom period set in. After all, the petition was still pending and unresolved during
this period.
WHEREFORE, the petition is hereby granted and a certification election among the capataz
employees of the Lepanto Consolidated Mining Company is hereby ordered conducted,
subject to the usual preelection and inclusion/exclusion proceedings, with the following
choices:
1.Lepanto Capataz Union; and
2.No Union.
The employer is directed to submit to this office within ten (10) days from receipt hereof a
copy of the certified list of its capataz employees and the payroll covering the said bargaining
unit for the last three (3) months prior to the issuance hereof.
6
SO DECIDED.
Lepanto appealed to the DOLE Secretary. 7 the 111 total valid votes cast.10
On July 12, 2000, then DOLE Undersecretary Rosalinda Dimapilis- Baldoz (Baldoz), acting by
authority of the DOLE Secretary, affirmed the ruling of Med-Arbiter Lontoc,8 pertinently
stating as follows:
xxxx
The bargaining unit sought to be represented by the appellee are the capataz employees of
the appellant. There is no other labor organization of capatazes within the employer unit
except herein appellant. Thus, appellant is an unorganized establishment in so far as the
bargaining unit of capatazes is concerned. In accordance with the last paragraph of Section
11, Rule XI, Department Order No. 9 which provides that "in a petition filed by a legitimate
labor organization involving an unorganized establishment, the Med-Arbiter shall, pursuant
to Article 257 of the Code, automatically order the conduct of certification election after
determining that the petition has complied with all requirements under Section 1, 2 and 4 of
the same rules and that none of the grounds for dismissal thereof exists", the order for the
conduct of a certification election is proper.
Finally, as to the issue of whether the Med-Arbiter exhibited ignorance of the law when she
directed the conduct of a certification election when appellee prays for the conduct of a
consent election, let it be stressed that appellee seeks to be recognized as the sole and
exclusive bargaining representative of all capataz employees of appellant. There are two
modes by which this can be achieved, one is by voluntary recognition and two, by consent or
certification election. Voluntary recognition under Rule X, Department Order No. 9 is a mode
whereby the employer voluntarily recognizes the union as the bargaining representative of
all the members in the bargaining unit sought to be represented. Consent and certification
election under Rules XI and XII of Department Order No. 9 is a mode whereby the members
of the bargaining unit decide whether they want a bargaining representative and if so, who
they want it to be. The difference between a consent election and a certification election is
that the conduct of a consent election is agreed upon by the parties to the petition while the
conduct of a certification election is ordered by the Med-Arbiter. In this case, the appellant
withdrew its consent and opposed the conduct of the election. Therefore, the petition
necessarily becomes one of a petition for certification election and the Med-Arbiter was
correct in granting the same.9
xxxx
In the ensuing certification election held on November 28, 2000, the Union garnered 109 of
On the day of the certification election, however, Lepanto presented an
opposition/protest.11 Hence, on February 8, 2001, a hearing was held on Lepanto’s
opposition/protest. Although the parties were required in that hearing to submit their
respective position papers, Lepanto later opted not to submit its position paper,12 and
contended that the issues identified during the hearing did not pose any legal issue to be
addressed in a position paper.13
On April 26, 2001, Med-Arbiter Florence Marie A. Gacad-Ulep of DOLE-CAR rendered a
decision certifying the Union as the sole and exclusive bargaining agent of all capatazes of
Lepanto.14
On May 18, 2001, Lepanto appealed the decision of Med-Arbiter Gacad-Ulep to the DOLE
Secretary.
By her Resolution dated September 17, 2002,15 DOLE Secretary Patricia A. Sto. Tomas
affirmed the decision dated April 26, 2001, holding and disposing thus:
Appellant accused Med-Arbiter Ulep of grave abuse of discretion amounting to lack of
jurisdiction based on her failure to resolve appellant’s motion to modify order to submit
position papers and on rendering judgment on the basis only of appellee’s position paper.
We deny.
Section 5, Rule XXV of Department Order No. 9, otherwise known as the New Rules
Implementing Book V of the Labor Code, states that "in all proceedings at all levels, incidental
motions shall not be given due course, but shall remain as part of the records for whatever
they may be worth when the case is decided on the merits".
Further, the motion to modify order to submit position papers filed by appellant is without
merit. Appellant claimed that the issues over which Med-Arbiter Ulep directed the submission
of position papers were: (1) failure to challenge properly; (2) failure (especially of LEU) to
participate actively in the proceedings before the decision calling for the conduct of
certification election; and (3) validity of earlier arguments. According to appellant, the first
issue was for appellee LCU to reply to in its position paper, the second issue was for the LEU
and the third issue for appellant company to explain in their respective position paper. It was
the position of appellant company that unless the parties filed their position paper on each
of their respective issues, the other parties cannot discuss the issues they did not raise in the
same position papers and have to await receipt of the others’ position paper for their
appropriate reply.
Section 9, Rule XI of Department Order No. 9, which is applied with equal force in the
disposition of protests on the conduct of election, states that "the Med-Arbiter shall in the
same hearing direct all concerned parties, including the employer, to simultaneously submit
their respective position papers within a non-extendible period of ten days". The issues as
recorded in the minutes of 28 February 2001 hearing before the Med- Arbiter are clear. The
parties, including appellant company were required to submit their respective positions on
whether there was proper challenge of the voters, whether LEU failed to participate in the
proceedings, if so, whether it should be allowed to participate at this belated stage and
whether the arguments raised during the pre-election conferences and in the protests are
valid. The parties, including appellant company were apprised of these issues and they agreed
thereto. The minutes of the hearing even contained the statement that "no order will issue"
and that "the parties are informed accordingly". If there is any matter that had to be clarified,
appellant should have clarified the same during the said hearing and refused to file its position
paper simultaneously with LCU and LEU. It appears that appellant did not do so and
acquiesced to the filing of its position paper within fifteen days from the date of said hearing.
Neither is there merit in appellant’s contention that the Med- Arbiter resolved the protest
based solely on appellee LCU’s position paper. Not only did the Med-Arbiter discuss the
demerits of appellant’s motion to modify order to submit position papers but likewise the
demerits of its protest. We do not, however, agree with the Med-Arbiter that the protest
should be dismissed due to appellant’s failure to challenge the individual voters during the
election. We take note of the minutes of the pre-election conference on 10 November 2000,
thus:
"It was also agreed upon (by union and management’s legal officer) that all those listed will
be allowed to vote during the certification election subject to challenge by management on
ground that none of them belongs to the bargaining unit". (Underscoring supplied)
It is therefore, not correct to say that there was no proper challenge made by appellant
company. The challenge was already manifested during the pre-election conference,
specifying that all listed voters were being challenged because they do not belong to the
bargaining unit of capatazes. Likewise, the formal protest filed by appellant company on the
day of the election showed its protest to the conduct of the election on the grounds that (1)
none of the names submitted and included (with pay bracket 8 and 9) to vote qualifies as
capataz under the five-point characterization made in 02 May 2000 decision calling for the
conduct of certification election; (2) the characterization made in the 02 May 2000 decision
pertains to shift bosses who constitutes another union, the Lepanto Local Staff Union; and (3)
the names listed in the voters’ list are members of another union, the Lepanto Employees
Union. This constitutes proper challenge to the eligibility of all the voters named in the list
which includes all those who cast their votes. The election officer should have not canvassed
the ballots and allowed the Med-Arbiter to first determine their eligibility.
Notwithstanding the premature canvass of the votes, we note that appellant company failed
to support its grounds for challenge with sufficient evidence for us to determine the validity
of its claim. No job description of the challenged voters was submitted by appellant from
which we can verify whether the said voters are indeed disqualified from the alleged five-
point characterization made in the 02 May 2000 decision, either before the Med-Arbiter or
on appeal. Neither was the job description of the shift bosses whom appellant company
claims pertain to the alleged five-point characterization submitted for our perusal. The
challenge must perforce fail for lack of evidence.
As to the alleged membership of appellee LCU’s member with another union LEU, the issue
has been resolved in the 02 May 200[0] decision of Med-Arbiter Lontoc which we affirmed on
12 July 2000.
WHEREFORE, the appeal is hereby DENIED for lack of merit and the decision of the Med-
Arbiter dated 26 April 2001, certifying Lepanto Capataz Union as the sole and exclusive
bargaining agent of all capataz workers of Lepanto Consolidated Mining Company,
is AFFIRMED.
SO RESOLVED.16
Ruling of the CA
Still dissatisfied with the result, but without first filing a motion for reconsideration, Lepanto
challenged in the CA the foregoing decision of the DOLE Secretary through a petition
for certiorari.
On December 18, 2002, the CA dismissed Lepanto’s petition for certiorari, stating in its first
assailed resolution:
Considering that the petitioner failed to file a prior motion for reconsideration of the Decision
of the public respondent before instituting the present petition as mandated by Section 1 of
Rule 65 of the 1997 Rules of Civil Procedure, as amended, the instant "Petition for Certiorari
Under Rule 65 with Prayer for Temporary Restraining Order and Injunction" is
hereby DISMISSED.
Well-settled is the rule that the "filing of a petition for certiorari under Rule 65 without first
moving for reconsideration of the assailed resolution generally warrants the petition’s
outright dismissal. As we consistently held in numerous cases, a motion for reconsideration by
a concerned party is indispensable for it affords the NLRC an opportunity to rectify errors or
mistakes it might have committed before resort to the courts can be had.
It is settled that certiorari will lie only if there is no appeal or any other plain, speedy and
adequate remedy in the ordinary course of law against acts of public respondents. Here, the
plain and adequate remedy expressly provided by law was a motion for reconsideration of the
impugned resolution, based on palpable or patent errors, to be made under oath and filed
within ten (10) days from receipt of the questioned resolution of the NLRC, a procedure which
is jurisdictional. Further, it should be stressed that without a motion for reconsideration
seasonably filed within the ten-day reglementary period, the questioned order, resolution or
decision of NLRC, becomes final and executory after ten (10) calendar days from receipt
thereof." (Association of Trade Unions (ATU), Rodolfo Monteclaro and Edgar Juesan vs. Hon.
Commissioners Oscar N. Abella, Musib N. Buat, Leon Gonzaga, Jr., Algon Engineering
Construction Corp., Alex Gonzales and Editha Yap. 323 SCRA 50).
17
SO ORDERED.
Lepanto moved to reconsider the dismissal, but the CA denied its motion for reconsideration
through the second assailed resolution.18
Issues
Hence, this appeal by Lepanto based on the following errors, namely:
I
THE COURT OF APPEALS ERRED IN SUMMARILY DISMISSING THE PETITION FOR CERTIORARI
ON THE GROUND THAT NO PRIOR MOTION FOR RECONSIDERATION WAS FILED. THE
DECISION OF THE SECRETARY BEING FINAL AND EXECUTORY, A MOTION FOR
RECONSIDERATION WAS NOT AN AVAILABLE REMEDY FOR PETITIONER.
II
ON THE MERITS, THE SECRETARY OF LABOR ACTED WITHOUT OR IN EXCESS OF JURISDICTION,
[O]R WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION
IN ISSUNG THE DECISION DATED SEPTEMBER 17, 2002, WHEN SHE DELIBERATELY IGNORED
THE FACTS AND RULED IN FAVOR OF THE RESPONDENT UNION, DESPITE HER OWN FINDING
THAT THERE HAD BEEN A PREMATURE CANVASS OF VOTES. 19
Lepanto argues that a motion for reconsideration was not an available remedy due to the
decision of the DOLE Secretary being already classified as final and executory under Section
15, Rule XI, Book V of Omnibus Rules Implementing the Labor Code, as amended by
Department Order No. 9, series of 1997;20 that the Union’s petition for consent election was
really a certification election; that the Union failed to give a definite description of the
bargaining unit sought to be represented; and that the capatazes should be considered as
rank-and-file employees.
The issues to be resolved are, firstly, whether a motion for reconsideration was a pre-requisite
in the filing of its petition for certiorari; and, secondly, whether the capatazes could form their
own union independently of the rank-and-file employees.
Ruling
The petition for review has no merit.
I.
The filing of the motion for reconsideration is a pre-requisite to the filing of a petition
for certiorari to assail the decision of the DOLE Secretary
We hold to be untenable and not well taken Lepanto’s submissions that: (1) a motion for
reconsideration was not an available remedy from the decision of the DOLE Secretary because
of Section 15, Rule XI, Book V of the Omnibus Rules Implementing the Labor Code, as
amended; and (2) the ruling in National Federation of Labor v. Laguesma21(recognizing the
remedy of certiorari against the decision of the DOLE Secretary to be filed initially in the CA)
actually affirms its position that an immediate recourse to the CA on certiorari is proper even
without the prior filing of a motion for reconsideration.
To start with, the requirement of the timely filing of a motion for reconsideration as a
precondition to the filing of a petition for certiorari accords with the principle of exhausting
administrative remedies as a means to afford every opportunity to the respondent agency to
resolve the matter and correct itself if need be.22
And, secondly, the ruling in National Federation of Labor v. Laguesma reiterates St. Martin’s
Funeral Home v. National Labor Relations Commission,23 where the Court has pronounced
that the special civil action of certiorari is the appropriate remedy from the decision of the
National Labor Relations Commission (NLRC) in view of the lack of any appellate remedy
provided by the Labor Code to a party aggrieved by the decision of the NLRC. Accordingly, any
decision, resolution or ruling of the DOLE Secretary from which the Labor Code affords no
remedy to the aggrieved party may be reviewed through a petition for certiorari initiated only
in the CA in deference to the principle of the hierarchy of courts.
Yet, it is also significant to note that National Federation of Labor v. Laguesma also reaffirmed
the dictum issued in St. Martin’s Funeral Homes v. National Labor Relations Commission to
the effect that "the remedy of the aggrieved party is to timely file a motion for reconsideration
as a precondition for any further or subsequent remedy, and then seasonably avail of the
special civil action of certiorari under Rule 65 x x x."24
Indeed, the Court has consistently stressed the importance of the seasonable filing of a
motion for reconsideration prior to filing the certiorari petition. In SMC Quarry 2 Workers
Union-February Six Movement (FSM) Local Chapter No. 1564 v. Titan Megabags Industrial
Corporation25 and Manila Pearl Corporation v. Manila Pearl Independent Workers
Union,26 the Court has even warned that a failure to file the motion for reconsideration would
be fatal to the cause of the petitioner.27 Due to its extraordinary nature as a
remedy, certiorari is to be availed of only when there is no appeal, or any plain, speedy or
adequate remedy in the ordinary course of law.28 There is no question that a motion for
reconsideration timely filed by Lepanto was an adequate remedy in the ordinary course of
law in view of the possibility of the Secretary of Justice reconsidering her disposition of the
matter, thereby according the relief Lepanto was seeking.1âwphi1
Under the circumstances, Lepanto’s failure to timely file a motion for reconsideration prior to
filing its petition for certiorari in the CA rendered the September 17, 2002 resolution of the
DOLE Secretary beyond challenge.
II.
Capatazes are not rank-and-file employees; hence, they could form their own union
Anent the second issue, we note that Med-Arbiter Lontoc found in her Decision issued on May
2, 2000 that the capatazes were performing functions totally different from those performed
by the rank-and-file employees, and that the capatazes were "supervising and instructing the
miners, mackers and other rank-and-file workers under them, assess[ing] and evaluat[ing]
their performance, mak[ing] regular reports and recommend[ing] new systems and
procedure of work, as well as guidelines for the discipline of employees."29 Hence, Med-
Arbiter Lontoc concluded, the capatazes "differ[ed] from the rank-and-file and [could] by
themselves constitute a separate bargaining unit."30
Agreeing with Med-Arbiter Lontoc’s findings, then DOLE Undersecretary Baldoz, acting by
authority of the DOLE Secretary, observed in the resolution dated July 12, 2000, thus:31
The bargaining unit sought to be represented by the appellee are the capataz employees of
the appellant. There is no other labor organization of capatazes within the employer unit
except herein appellant. Thus, appellant is an unorganized establishment in so far as the
bargaining unit of capatazes is concerned. In accordance with the last paragraph of Section
11, Rule XI, Department Order No. 9 which provides that "in a petition filed by a legitimate
labor organization involving an unorganized establishment, the Med-Arbiter shall, pursuant
to Article 257 of the Code, automatically order the conduct of certification election after
determining that the petition has complied with all requirements under Section 1, 2 and 4 of
the same rules and that none of the grounds for dismissal thereof exists", the order for the
conduct of a certification election is proper.32
We cannot undo the affirmance by the DOLE Secretary of the correct findings of her
subordinates in the DOLE, an office that was undeniably possessed of the requisite expertise
on the matter in issue. In dealing with the matter, her subordinates in the DOLE fairly and
objectively resolved whether the Union could lawfully seek to be the exclusive representative
of the bargaining unit of capatazes in the company. Their factual findings, being supported by
substantial evidence, are hereby accorded great respect and finality. Such findings cannot be
made the subject of our judicial review by petition under Rule 45 of the Rules of Court,
because:
x x x [T]he office of a petition for review on certiorari under Rule 45 of the Rules of Court
requires that it shall raise only questions of law. The factual findings by quasi-judicial agencies,
such as the Department of Labor and Employment, when supported by substantial evidence,
are entitled to great respect in view of their expertise in their respective field. Judicial review
of labor cases does not go far as to evaluate the sufficiency of evidence on which the labor
official’s findings rest. It is not our function to assess and evaluate all over again the evidence,
testimonial and documentary, adduced by the parties to an appeal, particularly where the
findings of both the trial court (here, the DOLE Secretary) and the appellate court on the
matter coincide, as in this case at bar. The Rule limits that function of the Court to review or
revision of errors of law and not to a second analysis of the evidence. Here, petitioners would
have us re-calibrate all over again the factual basis and the probative value of the pieces of
evidence submitted by the Company to the DOLE, contrary to the provisions of Rule 45. Thus,
absent any showing of whimsical or capricious exercise of judgment, and unless lack of any
basis for the conclusions made by the appellate court may be amply demonstrated, we may
not disturb such factual findings.33

In any event, we affirm that capatazes or foremen are not rank-andfile employees because
they are an extension of the management, and as such they may influence the rank-and-file
workers under them to engage in slowdowns or similar activities detrimental to the policies,
interests or business objectives of the employers.34

WHEREFORE, the Court DENIES the petition for review for lack of merit, and AFFIRMS the
resolutions the Court of Appeals promulgated on December 18, 2002 and January 31, 2003.

Petitioner to pay the costs of suit.

SO ORDERED.
THIRD DIVISION
G.R. No. 160352 July 23, 2008
REPUBLIC OF THE PHILIPPINES, represented by Department of Labor and Employment
(DOLE), Petitioner,
vs.
KAWASHIMA TEXTILE MFG., PHILIPPINES, INC., Respondent.
DECISION
AUSTRIA-MARTINEZ, J.:
The Republic of the Philippines assails by way of Petition for Review on Certiorari under Rule
45 of the Rules of Court, the December 13, 2002 Decision1 of the Court of Appeals (CA), which
reversed the August 18, 2000 Decision2 of the Department of Labor and Employment (DOLE),
and reinstated the May 17, 2000 Order3 of Med-Arbiter Anastacio L. Bactin, dismissing the
petition of Kawashima Free Workers Union-PTGWO Local Chapter No. 803 (KFWU) for the
conduct of a certification election in Kawashima Textile Mfg. Phils., Inc. (respondent); and the
October 7, 2003 CA Resolution4 which denied the motion for reconsideration.
The relevant facts are of record.
On January 24, 2000, KFWU filed with DOLE Regional Office No. IV, a Petition for Certification
Election to be conducted in the bargaining unit composed of 145 rank-and-file employees of
respondent.5 Attached to its petition are a Certificate of Creation of Local/Chapter6 issued on
January 19, 2000 by DOLE Regional Office No. IV, stating that it [KFWU] submitted to said
office a Charter Certificate issued to it by the national federation Phil. Transport & General
Workers Organization (PTGWO), and a Report of Creation of Local/Chapter.7
Respondent filed a Motion to Dismiss8 the petition on the ground that KFWU did not acquire
any legal personality because its membership of mixed rank-and-file and supervisory
employees violated Article 245 of the Labor Code, and its failure to submit its books of account
contravened the ruling of the Court in Progressive Development Corporation v. Secretary,
Department of Labor and Employment.9
In an Order dated May 17, 2000, Med-Arbiter Bactin found KFWU’s legal personality defective
and dismissed its petition for certification election, thus:
We scrutinize the facts and evidences presented by the parties and arrived at a decision that
at least two (2) members of [KFWU], namely: Dany I. Fernandez and Jesus R. Quinto, Jr. are
supervisory employees, having a number of personnel under them. Being supervisory
employees, they are prohibited under Article 245 of the Labor Code, as amended, to join the
union of the rank and file employees. Dany I. Fernandez and Jesus R. Quinto, Jr., Chief
Engineers of the Maintenance and Manufacturing Department, respectively, act as foremen
to the line engineers, mechanics and other non-skilled workers and responsible [for] the
preparation and organization of maintenance shop fabrication and schedules, inventory and
control of materials and supplies and tasked to implement training plans on line engineers
and evaluate the performance of their subordinates. The above-stated actual functions of
Dany I. Fernandez and Jesus R. Quinto, Jr. are clear manifestation that they are supervisory
employees.
xxxx
Since petitioner’s members are mixture of rank and file and supervisory employees,
petitioner union, at this point [in] time, has not attained the status of a legitimate labor
organization. Petitioner should first exclude the supervisory employees from it membership
before it can attain the status of a legitimate labor organization. The above judgment is
supported by the decision of the Supreme Court in the Toyota Case10 wherein the High
Tribunal ruled:
"As respondent union’s membership list contains the names of at least twenty seven (27)
supervisory employees in Level Five Positions, the union could not prior to purging itself of its
supervisory employee members, attain the status of a legitimate labor organization. Not
being one, it cannot possess the requisite personality to file a petition for certification
election." (Underscoring omitted.)
xxxx
Furthermore, the commingling of rank and file and supervisory employees in one (1)
bargaining unit cannot be cured in the exclusion-inclusion proceedings [at] the pre-election
conference. The above ruling is supported by the Decision of the Supreme Court in Dunlop
Slazenger (Phils.), Inc. vs. Honorable Secretary of Labor and Employment, et al., G.R. No.
131248 dated December 11, 199811 x x x.
xxxx
WHEREFORE, premises considered, the petition for certification election is hereby dismissed
for lack of requisite legal status of petitioner to file this instant petition.
SO ORDERED.12 (Emphasis supplied)
On the basis of the aforecited decision, respondent filed with DOLE Regional Office No. IV a
Petition for Cancellation of Charter/Union Registration of KFWU,13 the final outcome of which,
unfortunately, cannot be ascertained from the records.
Meanwhile, KFWU appealed14 to the DOLE which issued a Decision on August 18, 2000, the
dispositive portion of which reads:
WHEREFORE, the appeal is GRANTED. The Order dated 17 May 2000 of the Med-Arbiter is
REVERSED and SET ASIDE. Accordingly, let the entire records of the case be remanded to the
office of origin for the immediate conduct of certification election, subject to the usual pre-
election conference, among the rank-and-file employees of Kawashima Textile Manufacturing
Philippines, Inc. with the following choices:
1. Kawashima Free Workers Union-PTGWO Local Chapter No. 803; and
2. No union.
Pursuant to Rule XI, Section 11.1 of the New Implementing Rules, the employer is hereby
directed to submit to the office of origin the certified list of current employees in the
bargaining unit for the last three months prior to the issuance of this decision.
SO DECIDED.15
The DOLE held that Med-Arbiter Bactin's reliance on the decisions of the Court in Toyota
Motor Philippines Corporation v. Toyota Motor Philippines Corporation Labor
Union16 and Dunlop Slazenger, Inc. v. Secretary of Labor and Employment17 was misplaced, for
while Article 245 declares supervisory employees ineligible for membership in a labor
organization for rank-and-file employees, the provision did not state the effect of such
prohibited membership on the legitimacy of the labor organization and its right to file for
certification election. Neither was such mixed membership a ground for cancellation of its
registration. Section 11, Paragraph II, Rule XI of Department Order No. 9 "provides for the
dismissal of a petition for certification election based on lack of legal personality of a labor
organization only on the following grounds: (1) [KFWU] is not listed by the Regional Office or
the Bureau of Labor Relations in its registry of legitimate labor organizations; or (2) [KFWU's]
legal personality has been revoked or canceled with finality."18 The DOLE noted that neither
ground existed; on the contrary, KFWU's legal personality was well-established, for it held a
certificate of creation and had been listed in the registry of legitimate labor organizations.
As to the failure of KFWU to file its books of account, the DOLE held that such omission was
not a ground for revocation of union registration or dismissal of petition for certification
election, for under Section 1, Rule VI of Department Order No. 9, a local or chapter like KFWU
was no longer required to file its books of account.19
Respondent filed a Motion for Reconsideration20 but the DOLE denied the same in its
September 28, 2000 Resolution.21
However, on appeal by respondent, the CA rendered the December 13, 2002 Decision assailed
herein, reversing the August 18, 2000 DOLE Decision, thus:
Since respondent union clearly consists of both rank and file and supervisory employees, it
cannot qualify as a legitimate labor organization imbued with the requisite personality to
file a petition for certification election. This infirmity in union membership cannot be
corrected in the inclusion-exclusion proceedings during the pre-election conference.
Finally, contrary to the pronouncement of public respondent, the application of the doctrine
enunciated in Toyota Motor Philippines Corporation vs. Toyota Motor Philippines Corporation
Labor Union was not construed in a way that effectively denies the fundamental right of
respondent union to organize and seek bargaining representation x x x.
For ignoring jurisprudential precepts on the matter, the Court finds that the Undersecretary
of Labor, acting under the authority of the Secretary of Labor, acted with grave abuse of
discretion amounting to lack or excess of jurisdiction.
WHEREFORE, premises considered, the Petition is hereby GRANTED. The Decision dated 18
August 2000 of the Undersecretary of Labor, acting under the authority of the Secretary, is
hereby REVERSED and SET ASIDE. The Order dated 17 May 2000 of the Med-Arbiter dismissing
the petition for certification election filed by Kawashima Free Workers Union-PTGWO Local
Chapter No. 803 is REINSTATED.
SO ORDERED.22 (Emphasis supplied)
KFWU filed a Motion for Reconsideration23 but the CA denied it.
The Republic of the Philippines (petitioner) filed the present petition to seek closure on two
issues:
First, whether a mixed membership of rank-and-file and supervisory employees in a union is
a ground for the dismissal of a petition for certification election in view of the amendment
brought about by D.O. 9, series of 1997, which deleted the phraseology in the old rule that
"[t]he appropriate bargaining unit of the rank-and-file employee shall not include the
supervisory employees and/or security guards;" and
Second, whether the legitimacy of a duly registered labor organization can be collaterally
attacked in a petition for a certification election through a motion to dismiss filed by an
employer such as Kawashima Textile Manufacturing Phils., Inc.24
The petition is imbued with merit.
The key to the closure that petitioner seeks could have been Republic Act (R.A.) No.
9481.25 Sections 8 and 9 thereof provide:
Section 8. Article 245 of the Labor Code is hereby amended to read as follows:
"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 the
collective bargaining unit of the rank-and-file employees but may join, assist or form separate
collective bargaining units and/or legitimate labor organizations of their own. The rank and
file union and the supervisors' union operating within the same establishment may join the
same federation or national union."
Section 9. A new provision, Article 245-A is inserted into the Labor Code to read as follows:
"Art. 245-A. Effect of Inclusion as Members of Employees Outside the Bargaining Unit. - The
inclusion as union members of employees outside the bargaining unit shall not be a ground
for the cancellation of the registration of the union. Said employees are automatically
deemed removed from the list of membership of said union." (Emphasis supplied)
Moreover, under Section 4, a pending petition for cancellation of registration
will not hinder a legitimate labor organization from initiating a certification election, viz:
Sec. 4. A new provision is hereby inserted into the Labor Code as Article 238-A to read as
follows:
"Art. 238-A. Effect of a Petition for Cancellation of Registration. - A petition for cancellation
of union registration shall not suspend the proceedings for certification election nor shall it
prevent the filing of a petition for certification election.
In case of cancellation, nothing herein shall restrict the right of the union to seek just and
equitable remedies in the appropriate courts." (Emphasis supplied)
Furthermore, under Section 12 of R.A. No. 9481, employers have no personality to interfere
with or thwart a petition for certification election filed by a legitimate labor organization, to
wit:
Sec. 12. A new provision, Article 258-A is hereby inserted into the Labor Code to read as
follows:
"Art. 258-A. Employer as Bystander. - In all cases, whether the petition for certification
election is filed by an employer or a legitimate labor organization, the employer shall not be
considered a party thereto with a concomitant right to oppose a petition for certification
election. The employer's participation in such proceedings shall be limited to: (1) being
notified or informed of petitions of such nature; and (2) submitting the list of employees
during the pre-election conference should the Med-Arbiter act favorably on the petition."
(Emphasis supplied)
However, R.A. No. 9481 took effect only on June 14, 2007;26 hence, it applies only to labor
representation cases filed on or after said date.27 As the petition for certification election
subject matter of the present petition was filed by KFWU on January 24, 2000,28 R.A. No. 9481
cannot apply to it. There may have been curative labor legislations29that were given
retrospective effect,30 but not the aforecited provisions of R.A. No. 9481, for otherwise,
substantive rights and interests already vested would be impaired in the process.31
Instead, the law and rules in force at the time of the filing by KFWU of the petition for
certification election on January 24, 2000 are R.A. No. 6715,32 amending Book V of
Presidential Decree (P.D.) No. 442 (Labor Code),33 as amended, and the Rules and Regulations
Implementing R.A. No. 6715,34 as amended by Department Order No. 9, series of 1997.35
It is within the parameters of R.A. No. 6715 and the Implementing Rules that the Court will
now resolve the two issues raised by petitioner.
If there is one constant precept in our labor laws – be it Commonwealth Act No. 213
(1936),36 R.A. No. 875 (1953),37 P.D. No. 442 (1974), Executive Order (E.O.) No. 111 (1986)38 or
R.A. No. 6715 (1989) - it is that only a legitimate labor organization may exercise the right to
be certified as the exclusive representative of all the employees in an appropriate collective
bargaining unit for purposes of collective bargaining.39 What has varied over the years has
been the degree of enforcement of this precept, as reflected in the shifting scope of
administrative and judicial scrutiny of the composition of a labor organization before it is
allowed to exercise the right of representation.
One area of contention has been the composition of the membership of a labor organization,
specifically whether there is a mingling of supervisory and rank-and-file employees and how
such questioned mingling affects its legitimacy.
It was in R.A. No. 875, under Section 3, that such questioned mingling was first prohibited,40 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. (Emphasis supplied)
Nothing in R.A. No. 875, however, tells of how the questioned mingling can affect the
legitimacy of the labor organization. Under Section 15, the only instance when a labor
organization loses its legitimacy is when it violates its duty to bargain collectively; but there is
no word on whether such mingling would also result in loss of legitimacy. Thus, when the
issue of whether the membership of two supervisory employees impairs the legitimacy of a
rank-and-file labor organization came before the Court En Banc in Lopez v. Chronicle
Publication Employees Association,41 the majority pronounced:
It may be observed that nothing is said of the effect of such ineligibility upon the union itself
or on the status of the other qualified members thereof should such prohibition be
disregarded. Considering that the law is specific where it intends to divest a legitimate labor
union of any of the rights and privileges granted to it by law, 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.42 (Emphasis supplied)
Then the Labor Code was enacted in 1974 without reproducing Sec. 3 of R.A. No. 875. The
provision in the Labor Code closest to Sec. 3 is Article 290,43 which is deafeningly silent on the
prohibition against supervisory employees mingling with rank-and-file employees in one labor
organization. Even the Omnibus Rules Implementing Book V of the Labor Code44 (Omnibus
Rules) merely provides in Section 11, Rule II, thus:
Sec. 11. Supervisory unions and unions of security guards to cease operation. – All existing
supervisory unions and unions of security guards shall, upon the effectivity of the Code, cease
to operate as such and their registration certificates shall be deemed automatically cancelled.
However, existing collective agreements with such unions, the life of which extends beyond
the date of effectivity of the Code shall be respected until their expiry date insofar as the
economic benefits granted therein are concerned.
Members of supervisory unions who do not fall within the definition of managerial employees
shall become eligible to join or assist the rank and file organization. The determination of who
are managerial employees and who are not shall be the subject of negotiation between
representatives of supervisory union and the employer. If no agreement s reached between
the parties, either or both of them ma bring the issue to the nearest Regional Office for
determination. (Emphasis supplied)
The obvious repeal of the last clause of Sec. 3, R.A. No. 875 prompted the Court to declare in
Bulletin v. Sanchez45that 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.
While amending certain provisions of Book V of the Labor Code, E.O. No. 111 and its
implementing rules46continued to recognize the right of supervisory employees, who do not
fall under the category of managerial employees, to join a rank-and-file labor organization.47
Effective 1989, R.A. No. 6715 restored the prohibition against the questioned mingling in one
labor organization, viz:
Sec. 18. Article 245 of the same Code, as amended, is hereby further amended to read as
follows
"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." (Emphasis supplied)
Unfortunately, just like R.A. No. 875, R.A. No. 6715 omitted specifying the exact effect any
violation of the prohibition would bring about on the legitimacy of a labor organization.
It was the Rules and Regulations Implementing R.A. No. 6715 (1989 Amended Omnibus Rules)
which supplied the deficiency by introducing the following amendment to Rule II (Registration
of Unions):
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. (Emphasis supplied)
and Rule V (Representation Cases and Internal-Union Conflicts) of the Omnibus Rules, viz:
Sec. 1. Where to file. – A petition for certification election may be filed with the Regional Office
which has jurisdiction over the principal office of the employer. The petition shall be in writing
and under oath.
Sec. 2. Who may file. – Any legitimate labor organization or the employer, when requested to
bargain collectively, may file the petition.
The petition, when filed by a legitimate labor organization, shall contain, among others:
xxxx
(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. (Emphasis
supplied)
By that provision, any questioned mingling will prevent an otherwise legitimate and duly
registered labor organization from exercising its right to file a petition for certification
election.
Thus, when the issue of the effect of mingling was brought to the fore in Toyota,48 the Court,
citing Article 245 of the Labor Code, as amended by R.A. No. 6715, held:
Clearly, based on this provision, a labor organization composed of both rank-and-file and
supervisory employees is no labor organization at all. It cannot, for any guise or purpose, be
a legitimate labor organization. Not being one, an organization which carries a mixture of
rank-and-file and supervisory employees cannot possess any of the rights of a legitimate
labor organization, including the right to file a petition for certification election for the
purpose of collective bargaining. It becomes necessary, therefore, anterior to the granting of
an order allowing a certification election, to inquire into the composition of any labor
organization whenever the status of the labor organization is challenged on the basis of Article
245 of the Labor Code.
xxxx
In the case at bar, as respondent union's membership list contains the names of at least
twenty-seven (27) supervisory employees in Level Five positions, the union could not, prior to
purging itself of its supervisory employee members, attain the status of a legitimate labor
organization. Not being one, it cannot possess the requisite personality to file a petition for
certification election.49 (Emphasis supplied)
In Dunlop,50 in which the labor organization that filed a petition for certification election was
one for supervisory employees, but in which the membership included rank-and-file
employees, the Court reiterated that such labor organization had no legal right to file a
certification election to represent a bargaining unit composed of supervisors for as long as it
counted rank-and-file employees among its members.51
It should be emphasized that the petitions for certification election involved in Toyota and
Dunlop were filed on November 26, 1992 and September 15, 1995, respectively; hence, the
1989 Rules was applied in both cases.
But then, on June 21, 1997, the 1989 Amended Omnibus Rules was further amended by
Department Order No. 9, series of 1997 (1997 Amended Omnibus Rules). Specifically, the
requirement under Sec. 2(c) of the 1989 Amended Omnibus Rules - that the petition for
certification election indicate that the bargaining unit of rank-and-file employees has not
been mingled with supervisory employees - was removed. Instead, what the 1997 Amended
Omnibus Rules requires is a plain description of the bargaining unit, thus:
Rule XI
Certification Elections
xxxx
Sec. 4. Forms and contents of petition. - The petition shall be in writing and under oath and
shall contain, among others, the following: x x x (c) The description of the bargaining unit.52
In Pagpalain Haulers, Inc. v. Trajano,53 the Court had occasion to uphold the validity of the
1997 Amended Omnibus Rules, although the specific provision involved therein was only Sec.
1, Rule VI, to wit:
Sec. 1. Chartering and creation of a local/chapter.- A duly registered federation or national employees is not among the grounds for cancellation, unless such inclusion is due to
union may directly create a local/chapter by submitting to the Regional Office or to the Bureau misrepresentation, false statement or fraud under the circumstances enumerated in Sections
two (2) copies of the following: a) a charter certificate issued by the federation or national (a) and (c) of Article 239 of the Labor Code.61lavvphil
union indicating the creation or establishment of the local/chapter; (b) the names of the
All said, while the latest issuance is R.A. No. 9481, the 1997 Amended Omnibus Rules, as
local/chapter’s officers, their addresses, and the principal office of the local/chapter; and (c)
interpreted by the Court in Tagaytay Highlands, San Miguel and Air Philippines, had already
the local/ chapter’s constitution and by-laws; provided that where the local/chapter’s
set the tone for it. Toyota and Dunlop no longer hold sway in the present altered state of the
constitution and by-laws is the same as that of the federation or national union, this fact shall
law and the rules.
be indicated accordingly.
Consequently, the Court reverses the ruling of the CA and reinstates that of the DOLE granting
All the foregoing supporting requirements shall be certified under oath by the Secretary or
the petition for certification election of KFWU.
the Treasurer of the local/chapter and attested to by its President.
Now to the second issue of whether an employer like respondent may collaterally attack the
which does not require that, for its creation and registration, a local or chapter submit a list
legitimacy of a labor organization by filing a motion to dismiss the latter’s petition for
of its members.
certification election.
Then came Tagaytay Highlands Int’l. Golf Club, Inc. v. Tagaytay Highlands Employees Union-
Except when it is requested to bargain collectively,62 an employer is a mere bystander to any
PGTWO54 in which the core issue was whether mingling affects the legitimacy of a labor
petition for certification election; such proceeding is non-adversarial and merely investigative,
organization and its right to file a petition for certification election. This time, given the altered
for the purpose thereof is to determine which organization will represent the employees in
legal milieu, the Court abandoned the view in Toyota and Dunlop and reverted to its
their collective bargaining with the employer.63 The choice of their representative is the
pronouncement in Lopez that while there is a prohibition against the mingling of supervisory
exclusive concern of the employees; the employer cannot have any partisan interest therein;
and rank-and-file employees in one labor organization, the Labor Code does not provide for
it cannot interfere with, much less oppose, the process by filing a motion to dismiss or an
the effects thereof.55 Thus, the Court held that after a labor organization has been registered,
appeal from it;64 not even a mere allegation that some employees participating in a petition
it may exercise all the rights and privileges of a legitimate labor organization. Any mingling
for certification election are actually managerial employees will lend an employer legal
between supervisory and rank-and-file employees in its membership cannot affect its
personality to block the certification election.65 The employer's only
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 right in the proceeding is to be notified or informed thereof.66
of the Labor Code.56
The amendments to the Labor Code and its implementing rules have buttressed that policy
In San Miguel Corp. (Mandaue Packaging Products Plants) v. Mandaue Packing Products even more.
Plants-San Miguel Packaging Products-San Miguel Corp. Monthlies Rank-and-File Union-
FFW,57 the Court explained that since the 1997 Amended Omnibus Rules does not require a WHEREFORE, the petition is GRANTED. The December 13, 2002 Decision and October 7, 2003
local or chapter to provide a list of its members, it would be improper for the DOLE to deny Resolution of the Court of Appeals and the May 17, 2000 Order of Med-Arbiter Anastacio L.
recognition to said local or chapter on account of any question pertaining to its individual Bactin are REVERSED and SET ASIDE,while the August 18, 2000 Decision and September 28,
members.58 2000 Resolution of the Department of Labor and Employment are REINSTATED.

More to the point is Air Philippines Corporation v. Bureau of Labor Relations,59 which involved No costs.
a petition for cancellation of union registration filed by the employer in 1999 against a rank- SO ORDERED.
and-file labor organization on the ground of mixed membership:60 the Court therein
reiterated its ruling in Tagaytay Highlands that the inclusion in a union of disqualified
FIRST DIVISION
G.R. No. L-35120 January 31, 1984
ADAMSON & ADAMSON, INC., petitioner,
vs.
THE COURT OF INDUSTRIAL RELATIONS and ADAMSON & ADAMSON SUPERVISORY UNION
(FFW), respondents.
Sycip, Salazar, Luna & Feliciano for petitioner.
Jaime D. Lauron for respondents.
GUTIERREZ, JR., J.:
Adamson and Adamson, Inc., filed this petition to set aside orders of the respondent Court of
Industrial Relations (CIR) holding that the Adamson and Adamson, Inc. supervisory Union
(FFW) can legally represent supervisors of the petitioner corporation notwithstanding the
affiliation of the lank and file union of the same company with the same labor federation, the
Federation of Free Workers.
The Adamson and Adamson, Inc. Supervisory Union (FFW) informed the petitioner about its
having organized on the same date that the Adamson and Adamson, Inc. Salesmen
Association (FFW) advised the petitioner that the rank and file salesmen had formed their
own union.
The CIR dismissed the petition in CIR Case No. 3267-MC entitled "In the Matter of
Representation of the Supervisory Employees of Adamson and Adamson, Inc., Petitioner "
thus prompting the filing of this petition for review on certiorari.
Subsequently and during the pendency of the present petition, the rank and file employees
formed their own union, naming it Adamson and Adamson Independent Workers (FFW).
The petitioner made a lone assignment of error, to wit:
THE RESPONDENT COURT OF INDUSTRIAL RELATIONS ERRED IN SUSTAINING THE ELIGIBILITY
OF THE RESPONDENT UNION TO REPRESENT THE PETITIONER'S SUPERVISORY EMPLOYEES
NOT-WITHSTANDING THE AFFILIATION OF THE SAID UNION WITH THE SAME NATIONAL
FEDERATION WITH WHICH THE UNIONS OF NON-SUPERVISORS IN THE PETITIONER COMPANY
ARE ALSO AFFILIATED.
The petitioner argues that the affiliation of the respondent union of supervisors, the
salesmen's association, and the Adamson and Adamson independent Workers Union of rank
and file personnel with the same national federation (FFW) violates Section 3 of the Industrial
Peace Act, as amended, because — (1) it results in the indirect affiliation Of supervisors and
rank-and-file employees with one labor organization; (2) since respondent union and the
unions of non-supervisors in the same company are governed by the same constitution and
by-laws of the national federation, in practical effect, there is but one union; and (3) it would
result in the respondent union's losing its independence because it becomes the alter ego of
the federation.
The petitioner also submits that should affiliation be allowed, this would violate the
requirement of separateness of bar units under Section 12 of the Act because only one union
will in fact represent both supervisors and rank-and-file employees of the petitioner.
The respondents on the other hand argue that the supervisory employees of an employer
may validly join an organization of the rank-and-file employees so long as the said rank and
file employees are not under their supervision. They submit that Adamson and Adamson
Supervisory Union (FFW) is not composed of sales supervisors and, therefore, the salesmen
of the company are not under the supervision of the supervisory employees forming the
union. Respondents also argue that even if the salesmen of the petitioner company are under
the supervision of the members of the supervisory union, the prohibition would not apply
because the salesmen and the supervisory employees of the company have their separate
and distinct labor organizations, and, as a matter of fact, their respective unions sent separate
proposal for collective bargaining agreements. They contend that their respective labor
organizations, not the FFW, will represent their members in the negotiations as well as in the
signing of their respective contracts. Respondents further argue that the Federation of Free
Workers has, as its affiliates, supervisory as well as rank-and-file employees, and should both
the supervisory and the rank-and-file employees of a certain employer who have separate
certificates of registration affiliate with the same federation, the prohibition does not apply
as the federation is not the organization of the supervisory employees contemplated in the
law.
The issue presented involves the correct interpretation of Section 3 of Republic Act No. 875,
the Industrial Peace Act, as amended, which states:
Employees shall have the right to self-organization and to form join or assist labor
organizations of their own choosing for the purpose 6f collective bargaining through
representatives of their own 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.
The right of employees to self-organization and to form, join or assist labor organizations of
their own choosing for the purpose of collective bargaining and to engage in concerted
activities for mutual aid or protection is a fundamental right of labor that derives its existence
from the Constitution. It is recognized and implemented through the abovecited Section 3 of
the Industrial Peace Act as amended.
In interpreting the protection to labor and social justice provisions of the Constitution and the
labor laws or rules and regulations implementing the constitutional mandates, we have
always adopted the liberal approach which favors the exercise of labor rights.
In deciding this case, we start with the recognized rule that the right of supervisory employees
to organize under the Industrial Peace Act carries certain restrictions but the right itself may
not be denied or unduly abridged. The supervisory employees of an employer cannot join any
labor organization of employees under their supervision but may validly form a separate
organization of their own. As stated in Caltex Filipino Managers and Supervisors Association
v. Court of Industrial Relations (47 SCRA 112), it would be to attach unorthodoxy to, not to say
an emasculation of, the concept of law if managers as such were precluded from organization.
Thus, if Republic Act 875, in its Section 3, recognizes the right of supervisors to form a separate
organization of their own, albeit they cannot be members of a labor organization of
employees under their supervision, that authority of supervisors to form a separate labor
union carries with it the right to bargain collectively with the employer. (Government Service
Insurance System v. Government Service Insurance System Supervisors' Union, 68 SCRA 418).
The specific issue before us is whether or not a supervisor's union may affiliate with a
federation with which unions of rank and-file employees of the same employer are also
affiliated. We find without merit the contentions of petitioner that if affilation will be allowed,
only one union will in fact represent both supervisors and rank-and-file employees of the
petitioner; that there would be an indirect affiliation of supervisors and rank-and-file
employees with one labor organization; that there would be emerging of two bargaining units
; and that the respondent union will loose its independence because it becomes an alter ego
of the federation.
In Elisco-Elirol Labor Union (NAFLU) v. Noriel (80 SCRA 681) and Liberty Cotton Mills Workers
Union v. Liberty Cotton Mills, Inc. (66 SCRA 512), we held :
xxx xxx xxx
... the court expressly cited and affirmed the basic principle that '(T)he locals are separate and
distinct units primarily designed to secure and maintain the equality of bargaining power
between the employer and their employee-member in the economic struggle for the fruits of
the joint productive effort of labor and capital; and the association of the locals into the
national union (as PAFLU) was in the furtherance of the same end. These association are
concensual entities capable of entering into such legal relations with their members. The
essential purpose was the affiliation of the local unions into a common enterprise to increase
by collective action the common bargaining power in respect of the terms and conditions of
labor. Yet the locals remained the basic units of association; free to serve their own and the
common-interest of all, subject to the restraints imposed by the Constitution and By-laws of
the Association; and free also to renounce the affiliation for mutual welfare upon the terms
laid down in the agreement which brought it into existence.
We agree with the Court of Industrial Relations when it ruled that:
xxx xxx xxx
The confusion seems to have stemmed from the prefix of FFW after the name of the local
unions in the registration of both. Nonetheless, the inclusion of FWW in the registration is
merely to stress that they are its affiliates at the time of registrations. It does not mean that
said local unions cannot stand on their own Neither can it be construed that their personalities
are so merged with the mother federation that for one difference or another they cannot
pursue their own ways, independently of the federation. This is borne by the fact that FFW,
like other federation is a legitimate labor organization separate and distinct from its locals
and affiliates and to construe the registration certificates of the aforecited unions, along the
line of the Company's argument. would tie up any affiliates to the shoe string of the
federation. ...
The Adamson and Adamson Supervisory Union and the Adamson and Adamson, Inc.,
Salesmen Association (FFW), have their own respective constitutions and by-laws. They are
separately and independently registered of each other. Both sent their separate proposals for
collective bar agreements with their employer. There could be no employer influence on rank-
and-file organizational activities nor their could be any rank and file influence on the
supervisory function of the supervisors because of the representation sought to be
proscribed.
WHEREFORE, the instant petition is DISMISSED for lack of merit. The questioned order and
the resolution en bancof the respondent Court of Industrial Relations are AFFIRMED.
SO ORDERED.
THIRD DIVISION 55578, granting the petition of respondent company and reversing the Voluntary Arbitrators
Decision[3] dated October 14, 1999.

The facts are:

TUNAY NA PAGKAKAISA NG G.R. No. 162025
MANGGAGAWA SA ASIABREWERY, Respondent Asia Brewery, Inc. (ABI) is engaged in the manufacture, sale and distribution of
beer, shandy, bottled water and glass products. ABI entered into a Collective Bargaining
Petitioner,
Present: Agreement (CBA),[4]effective for five (5) years from August 1, 1997 to July 31, 2002, with Bisig
at Lakas ng mga Manggagawa sa Asia-Independent (BLMA-INDEPENDENT), the exclusive
bargaining representative of ABIs rank-and-file employees. On October 3, 2000, ABI and
CARPIO MORALES, J., BLMA-INDEPENDENT signed a renegotiated CBA effective from August 1, 2000 to 31 July
- versus - 2003.[5]
Chairperson,
Article I of the CBA defined the scope of the bargaining unit, as follows:
BRION,
Section 1. Recognition. The COMPANY recognizes the UNION as the sole and exclusive
BERSAMIN, bargaining representative of all the regular rank-and-file daily paid employees within the
ABAD,* and scope of the appropriate bargaining unit with respect to rates of pay, hours of work and other
terms and conditions of employment. The UNION shall not represent or accept for
VILLARAMA, JR., JJ. membership employees outside the scope of the bargaining unit herein defined.

Section 2. Bargaining Unit. The bargaining unit shall be comprised of all regular rank-and-file
daily-paid employees of the COMPANY. However, the following jobs/positions as herein
ASIA BREWERY, INC., Promulgated:
defined shall be excluded from the bargaining unit, to wit:
Respondent.
1. Managers
August 3, 2010
2. Assistant Managers
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
3. Section Heads

4. Supervisors
DECISION
5. Superintendents

6. Confidential and Executive Secretaries

VILLARAMA, JR., J.:
7. Personnel, Accounting and Marketing Staff
For resolution is an appeal by certiorari filed by petitioner under Rule 45 of the 1997 Rules of
8. Communications Personnel
Civil Procedure, as amended, assailing the Decision[1] dated November 22, 2002 and
Resolution[2] dated January 28, 2004 rendered by the Court of Appeals (CA) in CA-G.R. SP No. 9. Probationary Employees

10. Security and Fire Brigade Personnel

11. Monthly Employees
12. Purchasing and Quality Control Staff[6] [EMPHASIS SUPPLIED.]
Subsequently, a dispute arose when ABIs management stopped deducting union dues from
eighty-one (81) employees, believing that their membership in BLMA-INDEPENDENT violated
the CBA. Eighteen (18) of these affected employees are QA Sampling Inspectors/Inspectresses
and Machine Gauge Technician who formed part of the Quality Control Staff. Twenty (20)
checkers are assigned at the Materials Department of the Administration Division, Full Goods
Department of the Brewery Division and Packaging Division. The rest are secretaries/clerks
directly under their respective division managers.[7]
BLMA-INDEPENDENT claimed that ABIs actions restrained the employees right to self-
organization and brought the matter to the grievance machinery. As the parties failed to
amicably settle the controversy, BLMA-INDEPENDENT lodged a complaint before the National
Conciliation and Mediation Board (NCMB). The parties eventually agreed to submit the case
for arbitration to resolve the issue of [w]hether or not there is restraint to employees in the
exercise of their right to self-organization.[8]
In his Decision, Voluntary Arbitrator Bienvenido Devera sustained the BLMA-INDEPENDENT
after finding that the records submitted by ABI showed that the positions of the subject
employees qualify under the rank-and-file category because their functions are merely
routinary and clerical. He noted that the positions occupied by the checkers and
secretaries/clerks in the different divisions are not managerial or supervisory, as evident from
the duties and responsibilities assigned to them. With respect to QA Sampling
Inspectors/Inspectresses and Machine Gauge Technician, he ruled that ABI failed to establish
with sufficient clarity their basic functions as to consider them Quality Control Staff who were
excluded from the coverage of the CBA. Accordingly, the subject employees were declared
eligible for inclusion within the bargaining unit represented by BLMA-INDEPENDENT.[9]
On appeal, the CA reversed the Voluntary Arbitrator, ruling that:
WHEREFORE, foregoing premises considered, the questioned decision of the Honorable
Voluntary Arbitrator Bienvenido De Vera is hereby REVERSED and SET ASIDE, and A NEW ONE
ENTERED DECLARING THAT:
a) the 81 employees are excluded from and are not eligible for inclusion in the bargaining unit
as defined in Section 2, Article I of the CBA;
b) the 81 employees cannot validly become members of respondent and/or if already
members, that their membership is violative of the CBA and that they should disaffiliate from
respondent; and
c) petitioner has not committed any act that restrained or tended to restrain its employees in
the exercise of their right to self-organization.
NO COSTS.
SO ORDERED.[10]
BLMA-INDEPENDENT filed a motion for reconsideration. In the meantime, a certification
election was held on August 10, 2002 wherein petitioner Tunay na Pagkakaisa ng
Manggagawa sa Asia (TPMA) won. As the incumbent bargaining representative of ABIs rank-
and-file employees claiming interest in the outcome of the case, petitioner filed with the CA
an omnibus motion for reconsideration of the decision and intervention, with attached
petition signed by the union officers.[11] Both motions were denied by the CA.[12]
The petition is anchored on the following grounds:
(1)
THE COURT OF APPEALS ERRED IN RULING THAT THE 81 EMPLOYEES ARE EXCLUDED FROM
AND ARE NOT ELIGIBLE FOR INCLUSION IN THE BARGAINING UNIT AS DEFINED IN SECTION 2,
ARTICLE 1 OF THE CBA[;]
(2)
THE COURT OF APPEALS ERRED IN HOLDING THAT THE 81 EMPLOYEES CANNOT VALIDLY
BECOME UNION MEMBERS, THAT THEIR MEMBERSHIP IS VIOLATIVE OF THE CBA AND THAT
THEY SHOULD DISAFFILIATE FROM RESPONDENT;
(3)
THE COURT OF APPEALS SERIOUSLY ERRED IN HOLDING THAT PETITIONER (NOW PRIVATE
RESPONDENT) HAS NOT COMMITTED ANY ACT THAT RESTRAINED OR TENDED TO RESTRAIN
ITS EMPLOYEES IN THE EXERCISE OF THEIR RIGHT TO SELF-ORGANIZATION.[13]
Although Article 245 of the Labor Code limits the ineligibility to join, form and assist any labor
organization to managerial employees, jurisprudence has extended this prohibition to
confidential employees or those who by reason of their positions or nature of work are
required to assist or act in a fiduciary manner to managerial employees and hence, are
likewise privy to sensitive and highly confidential records.[14]Confidential employees are thus 1. Angeles, Cristina C. Transportation Mr. Melito K. Tan
excluded from the rank-and-file bargaining unit. The rationale for their separate category and
2. Barraquio, Carina P. Transportation Mr. Melito K. Tan
disqualification to join any labor organization is similar to the inhibition for managerial
employees because if allowed to be affiliated with a Union, the latter might not be assured of 3. Cabalo, Marivic B. Transportation Mr. Melito K. Tan
their loyalty in view of evident conflict of interests and the Union can also become company-
denominated with the presence of managerial employees in the Union 4. Fameronag, Leodigario C. Transportation Mr. Melito K. Tan
membership.[15] Having access to confidential information, confidential employees may also
become the source of undue advantage. Said employees may act as a spy or spies of either
party to a collective bargaining agreement.[16] 1. Abalos, Andrea A. Materials Mr. Andres G. Co

In Philips Industrial Development, Inc. v. NLRC,[17] this Court held that petitioners division 2. Algire, Juvy L. Materials Mr. Andres G. Co
secretaries, all Staff of General Management, Personnel and Industrial Relations Department, 3. Anouevo, Shirley P. Materials Mr. Andres G. Co
Secretaries of Audit, EDP and Financial Systems are confidential employees not included
within the rank-and-file bargaining unit.[18] Earlier, in Pier 8 Arrastre & Stevedoring Services, 4. Aviso, Rosita S. Materials Mr. Andres G. Co
Inc. v. Roldan-Confesor,[19] we declared that legal secretaries who are tasked with, among
5. Barachina, Pauline C. Materials Mr. Andres G. Co
others, the typing of legal documents, memoranda and correspondence, the keeping of
records and files, the giving of and receiving notices, and such other duties as required by the 6. Briones, Catalina P. Materials Mr. Andres G. Co
legal personnel of the corporation, fall under the category of confidential employees and
7. Caralipio, Juanita P. Materials Mr. Andres G. Co
hence excluded from the bargaining unit composed of rank-and-file employees.[20]
8. Elmido, Ma. Rebecca S. Materials Mr. Andres G. Co
Also considered having access to vital labor information are the executive secretaries of the
General Manager and the executive secretaries of the Quality Assurance Manager, Product 9. Giron, Laura P. Materials Mr. Andres G. Co
Development Manager, Finance Director, Management System Manager, Human Resources
Manager, Marketing Director, Engineering Manager, Materials Manager and Production 10. Mane, Edna A. Materials Mr. Andres G. Co
Manager.[21]

In the present case, the CBA expressly excluded Confidential and Executive Secretaries from xxxx
the rank-and-file bargaining unit, for which reason ABI seeks their disaffiliation from
petitioner. Petitioner, however, maintains that except for Daisy Laloon, Evelyn Mabilangan
and Lennie Saguan who had been promoted to monthly paid positions, the following C2 BREWERY DIVISION
secretaries/clerks are deemed included among the rank-and-file employees of ABI:[22]

NAME DEPARTMENT IMMEDIATE SUPERIOR

1. Laloon, Daisy S. Brewhouse Mr. William Tan

C1 ADMIN DIVISION
1. Arabit, Myrna F. Bottling Production Mr. Julius Palmares

2. Burgos, Adelaida D. Bottling Production Mr. Julius Palmares

3. Menil, Emmanuel S.
4. Nevalga, Marcelo G.
1. Mapola, Ma. Esraliza T.
2. Velez, Carmelito A.
1. Bordamonte, Rhumela D.
2. Deauna, Edna R.
3. Punongbayan, Marylou F.
4. Saguan, Lennie Y.
1. Alcoran, Simeon A.
2. Cervantes, Ma. Sherley Y.
3. Diongco, Ma. Teresa M.
4. Mabilangan, Evelyn M.
5. Rivera, Aurora M.
6. Salandanan, Nancy G.
1. Magbag, Ma. Corazon C.
1. Capiroso, Francisca A.
Bottling Production Mr. Julius Palmares
Bottling Production Mr. Julius Palmares 1. Alconaba, Elvira C. Engineering Mr. Clemente Wong
2. Bustillo, Bernardita E. Electrical Mr. Jorge Villarosa
Bottling Mr. Ernesto Ang 3. Catindig, Ruel A. Civil Works Mr. Roger Giron
Maintenance
4. Sison, Claudia B. Utilities Mr. Venancio Alconaba
Bottling Mr. Ernesto Ang
Maintenance
xxxx
Bottled Water Mr. Faustino Tetonche
C3 PACKAGING DIVISION
Bottled Water Mr. Faustino Tetonche
Bottled Water Mr. Faustino Tetonche
1. Alvarez, Ma. Luningning L. GP Administration Ms. Susan Bella
Bottled Water Mr. Faustino Tetonche
2. Caiza, Alma A. GP Technical Mr. Chen Tsai Tyan
3. Cantalejo, Aida S. GP Engineering Mr. Noel Fernandez
Full Goods Mr. Tsoi Wah Tung
4. Castillo, Ma. Riza R. GP Production Mr. Tsai Chen Chih
Full Goods Mr. Tsoi Wah Tung
5. Lamadrid, Susana C. GP Production Mr. Robert Bautista
Full Goods Mr. Tsoi Wah Tung
6. Mendoza, Jennifer L. GP Technical Mr. Mel Oa
Full Goods Mr. Tsoi Wah Tung
As can be gleaned from the above listing, it is rather curious that there would be several
Full Goods Mr. Tsoi Wah Tung
secretaries/clerks for just one (1) department/division performing tasks which are mostly
Full Goods Mr. Tsoi Wah Tung routine and clerical.Respondent insisted they fall under the Confidential and Executive
Secretaries expressly excluded by the CBA from the rank-and-file bargaining unit. However,
perusal of the job descriptions of these secretaries/clerks reveals that their assigned duties
Tank Farm/ Mr. Manuel Yu Liat and responsibilities involve routine activities of recording and monitoring, and other paper
works for their respective departments while secretarial tasks such as receiving telephone
Cella Services calls and filing of office correspondence appear to have been commonly imposed as additional
duties.[23] Respondent failed to indicate who among these numerous secretaries/clerks have
access to confidential data relating to management policies that could give rise to potential
Quality Assurance Ms. Regina Mirasol conflict of interest with their Union membership. Clearly, the rationale under our previous
rulings for the exclusion of executive secretaries or division secretaries would have little or no
significance considering the lack of or very limited access to confidential information of these
secretaries/clerks. It is not even farfetched that the job category may exist only on paper since
they are all daily-paid workers. Quite understandably, petitioner had earlier expressed the
view that the positions were just being reclassified as these employees actually discharged
routine functions.
assisted or acted in a confidential capacity to managerial employees and obtained
confidential information relating to labor relations policies. And even assuming that they had
exposure to internal business operations of the company, respondent claimed, this is not per
se ground for their exclusion in the bargaining unit of the daily-paid rank-and-file
employees.[27]

We thus hold that the secretaries/clerks, numbering about forty (40), are rank-and-file Not being confidential employees, the secretaries/clerks and checkers are not disqualified
employees and not confidential employees. from membership in the Union of respondents rank-and-file employees. Petitioner argues
that respondents act of unilaterally stopping the deduction of union dues from these
With respect to the Sampling Inspectors/Inspectresses and the Gauge Machine Technician,
employees constitutes unfair labor practice as it restrained the workers exercise of their right
there seems no dispute that they form part of the Quality Control Staff who, under the express
to self-organization, as provided in Article 248 (a) of the Labor Code.
terms of the CBA, fall under a distinct category. But we disagree with respondents contention
that the twenty (20) checkers are similarly confidential employees being quality control staff Unfair labor practice refers to acts that violate the workers right to organize. The prohibited
entrusted with the handling and custody of company properties and sensitive information. acts are related to the workers right to self organization and to the observance of a CBA. For
a charge of unfair labor practice to prosper, it must be shown that ABI was motivated by ill
Again, the job descriptions of these checkers assigned in the storeroom section of the
will, bad faith, or fraud, or was oppressive to labor, or done in a manner contrary to morals,
Materials Department, finishing section of the Packaging Department, and the decorating and
good customs, or public policy, and, of course, that social humiliation, wounded feelings or
glass sections of the Production Department plainly showed that they perform routine and
grave anxiety resulted x x x[28] from ABIs act in discontinuing the union dues deduction from
mechanical tasks preparatory to the delivery of the finished products.[24] While it may be
those employees it believed were excluded by the CBA. Considering that the herein dispute
argued that quality control extends to post-production phase -- proper packaging of the
arose from a simple disagreement in the interpretation of the CBA provision on excluded
finished products -- no evidence was presented by the respondent to prove that these daily-
employees from the bargaining unit, respondent cannot be said to have committed unfair
paid checkers actually form part of the companys Quality Control Staff who as such were
labor practice that restrained its employees in the exercise of their right to self-organization,
exposed to sensitive, vital and confidential information about [companys] products or have
nor have thereby demonstrated an anti-union stance.
knowledge of mixtures of the products, their defects, and even their formulas which are
considered trade secrets. Such allegations of respondent must be supported by evidence.[25] WHEREFORE, the petition is GRANTED. The Decision dated November 22, 2002 and
Resolution dated January 28, 2004 of the Court of Appeals in CA-G.R. SP No. 55578 are
Consequently, we hold that the twenty (20) checkers may not be considered confidential
hereby REVERSED and SET ASIDE. The checkers and secretaries/clerks of respondent
employees under the category of Quality Control Staff who were expressly excluded from the
company are hereby declared rank-and-file employees who are eligible to join the Union of
CBA of the rank-and-file bargaining unit.
the rank-and-file employees.
Confidential employees are defined as those who (1) assist or act in a confidential capacity,
No costs.
(2) to persons who formulate, determine, and effectuate management policies in the field of
labor relations. The two (2) criteria are cumulative, and both must be met if an employee is SO ORDERED.
to be considered a confidential employee that is, the confidential relationship must exist
between the employee and his supervisor, and the supervisor must handle the prescribed
responsibilities relating to labor relations. The exclusion from bargaining units of employees
who, in the normal course of their duties, become aware of management policies relating to
labor relations is a principal objective sought to be accomplished by the confidential
employee rule.[26] There is no showing in this case that the secretaries/clerks and checkers
THIRD DIVISION AUSTRIA-MARTINEZ, J.:

STANDARD CHARTERED G.R. No. 161933 For resolution is an appeal by certiorari filed by petitioner under Rule 45 of the Rules of Court,
assailing the Decision[1] dated October 9, 2002 and Resolution[2] dated January 26, 2004 issued
BANK EMPLOYEES UNION
by the Court of Appeals (CA), dismissing their petition and affirming the Secretary of Labor
(SCBEU-NUBE), Present: and Employment's Orders dated May 31, 2001 and August 30, 2001.

Petitioner,

YNARES-SANTIAGO, J., Petitioner and the Standard Chartered Bank (Bank) began negotiating for a new Collective
Bargaining Agreement (CBA) in May 2000 as their 1998-2000 CBA already expired. Due to a
- versus - Chairperson, deadlock in the negotiations, petitioner filed a Notice of Strike prompting the Secretary of
AUSTRIA-MARTINEZ, Labor and Employment to assume jurisdiction over the labor dispute.

STANDARD CHARTERED CHICO-NAZARIO,

BANK and ANNEMARIE NACHURA, and On May 31, 2001, Secretary Patricia A. Sto. Tomas of the Department of Labor and
Employment (DOLE) issued an Order with the following dispositive portion:
DURBIN, in her capacity as REYES, JJ.

Chief Executive Officer,

WHEREFORE, PREMISES CONSIDERED, the Standard Chartered Bank and the Standard
Philippines, Standard Chartered Promulgated: Chartered Bank Employees Union are directed to execute their collective bargaining
Bank, agreement effective 01 April 2001 until 30 March 2003 incorporating therein the foregoing
dispositions and the agreements they reached in the course of negotiations and
Respondents. April 22, 2008 conciliation. All other submitted issues that were not passed upon are dismissed.
x---------------------------------------------x The charge of unfair labor practice for bargaining in bad faith and the claim for damages
relating thereto are hereby dismissed for lack of merit.

Finally, the charge of unfair labor practice for gross violation of the economic provisions of
the CBA is hereby dismissed for want of jurisdiction.
DECISION
SO ORDERED.[3]

Both petitioner and the Bank filed their respective motions for reconsideration, which were
denied by the Secretary per Order dated August 30, 2001.[4]
Petitioner sought recourse with the CA via a petition for certiorari, and in the assailed
Decision dated October 9, 2002[5] and Resolution dated January 26, 2004,[6] the CA dismissed
their petition and affirmed the Secretary's Orders.
Hence, herein petition based on the following grounds:
I.
THE COURT A QUO ERRED IN DECIDING THAT THERE WAS NO BASIS FOR REVISING THE SCOPE
OF EXCLUSIONS FROM THE APPROPRIATE BARGAINING UNIT UNDER THE CBA.
II.
THE COURT A QUO ERRED IN DECIDING THAT A ONE-MONTH OR LESS TEMPORARY
OCCUPATION OF A POSITION (ACTING CAPACITY) DOES NOT MERIT ADJUSTMENT IN
REMUNERATION.[7]
The resolution of this case has been overtaken by the execution of the parties' 2003-2005
CBA. While this would render the case moot and academic, nevertheless, the likelihood that
the same issues will come up in the parties' future CBA negotiations is not far-fetched, thus
compelling its resolution. Courts will decide a question otherwise moot if it
is capable of repetition yet evading review.[8]
The CBA provisions in dispute are the exclusion of certain employees from the appropriate
bargaining unit and the adjustment of remuneration for employees serving in an acting
capacity for one month.
In their proposal, petitioner sought the exclusion of only the following employees from the
appropriate bargaining unit all managers who are vested with the right to hire and fire
employees, confidential employees, those with access to labor relations materials, Chief
Cashiers, Assistant Cashiers, personnel of the Telex Department and one Human Resources
(HR) staff.[9]
In the previous 1998-2000 CBA,[10] the excluded employees are as follows:
A. All covenanted and assistant officers (now called National Officers)
B. One confidential secretary of each of the:
1. Chief Executive, Philippine Branches
2. Deputy Chief Executive/Head, Corporate Banking Group
3. Head, Finance
4. Head, Human Resources
5. Manager, Cebu
6. Manager, Iloilo
7. Covenanted Officers provided said positions shall be filled by new recruits.
C. The Chief Cashiers and Assistant Cashiers in Manila, Cebu and Iloilo, and in any other
branch that the BANK may establish in the country.
D. Personnel of the Telex Department
E. All Security Guards
F. Probationary employees, without prejudice to Article 277 (c) of the Labor Code, as
amended by R.A. 6715, casuals or emergency employees; and
G. One (1) HR Staff[11]
The Secretary, however, maintained the previous exclusions because petitioner failed to show
that the employees sought to be removed from the list qualify for exclusion.[12]
With regard to the remuneration of employees working in an acting capacity, it was
petitioner's position that additional pay should be given to an employee who has been serving
in a temporary/acting capacity for one week. The Secretary likewise rejected petitioner's
proposal and instead, allowed additional pay for those who had been working in such capacity information, may become the source of undue advantage. Said employee(s) may act as spy
for one month. The Secretary agreed with the Bank's position that a restrictive provision or spies of either party to a collective bargaining agreement.[19]
would curtail management's prerogative, and at the same time, recognized that employees
Finally, in Philips Industrial Development, Inc. v. National Labor Relations Commission,[20] the
should not be made to work in an acting capacity for long periods of time without adequate
Court designated personnel staff, in which human resources staff may be qualified, as
compensation.
confidential employees because by the very nature of their functions, they assist and act in a
confidential capacity to, or have access to confidential matters of, persons who exercise
managerial functions in the field of labor relations.
The Secretary's disposition of the issues raised by petitioner were affirmed by the CA.[13] The
Court sustains the CA. Petitioner insists that the foregoing employees are not confidential employees; however, it
failed to buttress its claim. Aside from its generalized arguments, and despite the Secretary's
Whether or not the employees sought to be excluded from the appropriate bargaining unit
finding that there was no evidence to support it, petitioner still failed to substantiate its claim.
are confidential employees is a question of fact, which is not a proper issue in a petition for
Petitioner did not even bother to state the nature of the duties and functions of these
review under Rule 45 of the Rules of Court.[14]This holds more true in the present case in which
employees, depriving the Court of any basis on which it may be concluded that they are
petitioner failed to controvert with evidence the findings of the Secretary and the CA.
indeed confidential employees. As aptly stated by the CA:
The disqualification of managerial and confidential employees from joining a bargaining unit
While We agree that petitioner's proposed revision is in accordance with the law, this does
for rank and file employees is already well-entrenched in jurisprudence. While Article 245 of
not necessarily mean that the list of exclusions enumerated in the 1998-2000 CBA is contrary
the Labor Code limits the ineligibility to join, form and assist any labor organization to
to law. As found by public respondent, petitioner failed to show that the employees sought
managerial employees, jurisprudence has extended this prohibition to confidential
to be removed from the list of exclusions are actually rank and file employees who are not
employees or those who by reason of their positions or nature of work are required to assist
managerial or confidential in status and should, accordingly, be included in the appropriate
or act in a fiduciary manner to managerial employees and hence, are likewise privy to sensitive
bargaining unit.
and highly confidential records.[15]
Absent any proof that Chief Cashiers and Assistant Cashiers, personnel of the Telex
In this case, the question that needs to be answered is whether the Bank's Chief Cashiers and
department and one (1) HR Staff have mutuality of interest with the other rank and file
Assistant Cashiers, personnel of the Telex Department and HR staff are confidential
employees, then they are rightfully excluded from the appropriate bargaining unit.
employees, such that they should be excluded.
x x x[21] (Emphasis supplied)
As regards the qualification of bank cashiers as confidential employees, National Association
of Trade Unions (NATU) Republic Planters Bank Supervisors Chapter v. Torres[16] declared that
they are confidential employees having control, custody and/or access to confidential Petitioner cannot simply rely on jurisprudence without explaining how and why it should
matters, e.g., the branch's cash position, statements of financial condition, vault combination, apply to this case. Allegations must be supported by evidence. In this case, there is barely any
cash codes for telegraphic transfers, demand drafts and other negotiable instruments, at all.
pursuant to Sec. 1166.4 of the Central Bank Manual regarding joint custody, and therefore,
There is likewise no reason for the Court to disturb the conclusion of the Secretary and the
disqualified from joining or assisting a union; or joining, assisting or forming any other labor
CA that the additional remuneration should be given to employees placed in an acting
organization.[17]
capacity for one month. The CA correctly stated:
Golden Farms, Inc. v. Ferrer-Calleja[18] meanwhile stated that confidential employees such as
Likewise, We uphold the public respondent's Order that no employee should be temporarily
accounting personnel, radio and telegraph operators who, having access to confidential
placed in a position (acting capacity) for more than one month without the corresponding
adjustment in the salary. Such order of the public respondent is not in violation of the equal
pay for equal work principle, considering that after one (1) month, the employee performing
the job in an acting capacity will be entitled to salary corresponding to such position.

xxxx

In arriving at its Order, the public respondent took all the relevant evidence into account and
weighed both parties arguments extensively. Thus, public respondent concluded that a
restrictive provision with respect to employees being placed in an acting capacity may curtail
management's valid exercise of its prerogative. At the same time, it recognized that
employees should not be made to perform work in an acting capacity for extended periods of
time without being adequately compensated. x x x[22]

Thus, the Court reiterates the doctrine that:

[T]he office of a petition for review on certiorari under Rule 45 of the Rules of Court requires
that it shall raise only questions of law. The factual findings by quasi-judicial agencies, such as
the Department of Labor and Employment, when supported by substantial evidence, are
entitled to great respect in view of their expertise in their respective fields. Judicial review
of labor cases does not go so far as to evaluate the sufficiency of evidence on which the labor
officials findings rest. It is not our function to assess and evaluate all over again the evidence,
testimonial and documentary, adduced by the parties to an appeal, particularly where the
findings of both the trial court (here, the DOLE Secretary) and the appellate court on the
matter coincide, as in this case at bar. The Rule limits that function of the Court to the review
or revision of errors of law and not to a second analysis of the evidence. x x x Thus, absent
any showing of whimsical or capricious exercise of judgment, and unless lack of any basis for
the conclusions made by the appellate court be amply demonstrated, we may not disturb
such factual findings.[23]

WHEREFORE, the petition is DENIED.

SO ORDERED.
THE HERITAGE HOTEL MANILA, ACTING THROUGH ITS OWNER, requirements to the DOLE justify the suspension of the proceedings for the certification
elections or even the denial of the petition for the certification election?
GRAND PLAZA HOTEL CORPORATION vs. LABOR SEC, et. al.
Ruling:
G.R. NO. 172132 July 23, 2014
No.
For: Petition for the cancellation of union registration / Certification Election
Under the long established rule, too, the filing of the petition for the cancellation of
Facts:
NUWHRAIN-HHMSC’s registration should not bar the conduct of the certification election. In
Respondent National Union of Workers in Hotel Restaurant and Allied Industries-Heritage that respect, only a final order for the cancellation of the registration would have prevented
Hotel Manila Supervisors Chapter (NUWHRAIN-HHMSC) filed a petition for certification NUWHRAINHHMSC from continuing to enjoy all the rights conferred on it as a legitimate labor
election, seeking to represent all the supervisory employees of Heritage Hotel Manila. The union, including the right to the petition for the certification election. This rule is now
petitioner filed its opposition, but the opposition was deemed denied when Med-Arbiter enshrined in Article 238-A of the Labor Code, as amended by Republic Act No. 9481.
Napoleon V. Fernando issued his order for the conduct of the certification election. The
Labor authorities should, indeed, act with circumspection in treating petitions for cancellation
petitioner appealed the order of Med-Arbiter Fernando, but the appeal was also denied. A
of union registration, lest they be accused of interfering with union activities. In resolving the
pre-election conference was then scheduled. However, the pre-election conference was
petition, consideration must be taken of the fundamental rights guaranteed by Article XIII,
suspended until further notice because of the repeated non-appearance of NUWHRAIN-
Section 3 of the Constitution, i.e., the rights of all workers to self-organization, collective
HHMSC. Later, NUWHRAIN-HHMSC moved for the conduct of the pre-election conference.
bargaining and negotiations, and peaceful concerted activities. Labor authorities should bear
The petitioner primarily filed its comment on the list of employees submitted by NUWHRAIN-
in mind that registration confers upon a union the status of legitimacy and the concomitant
HHMSC, and simultaneously sought the exclusion of some from the list of employees for
right and privileges granted by law to a legitimate labor organization, particularly the right to
occupying either confidential or managerial positions. The petitioner filed a motion to dismiss
participate in or ask for certification election in a bargaining unit. Thus, the cancellation of a
raising the prolonged lack of interest of NUWHRAIN-HHMSC to pursue its petition for
certificate of registration is the equivalent of snuffing out the life of a labor organization. For
certification election. The petitioner filed a petition for the cancellation of NUWHRAIN-
without such registration, it loses - as a rule - its rights under the Labor Code.
HHMSC’s registration as a labor union for failing to submit its annual financial reports and an
updated list of members as required by Article 238 and Article 239 of the Labor Code. It filed R.A. No. 9481 also inserted in the Labor Code Article 242-A, which provides for reportorial
another motion to seek either the dismissal or the suspension of the proceedings on the basis requirements that failure to comply with the requirements shall not be a ground for
of its pending petition for the cancellation of union registration. However, the DOLE issued a cancellation of union registration but shall subject the erring officers or members to
notice scheduling the certification elections. Dissatisfied, the petitioner commenced in the CA suspension, expulsion from membership, or any appropriate penalty.
a special civil action for certiorari, alleging that the DOLE gravely abused its discretion in not
Presently, then, the mixed membership does not result in the illegitimacy of the registered
suspending the certification election proceedings. The CA dismissed the petition for certiorari
labor union unless the same was done through misrepresentation, false statement or fraud
for non-exhaustion of administrative remedies. The certification election proceeded as
according to Article 239 of the Labor Code.
scheduled, and NUWHRAINHHMSC obtained the majority vote of the bargaining unit. The
petitioner filed a protest (with motion to defer the certification of the election results and the
winner), insisting on the illegitimacy of NUWHRAIN-HHMSC.

Issue:

Should the petition for the cancellation of union registration based on mixed membership of
supervisors and managers in a labor union, and the non-submission of reportorial