BENGUET ELECTRIC COOPERATIVE, INC., petitioner, vs. HON.

PURA FERRER-CALLEJA, Director of the Bureau of

Labor Relations, and BENECO EMPLOYEES LABOR UNION, respondents.

Facts:

Beneco Worker's Labor Union-Association of Democratic Labor Organizations (BWLU- ADLO) filed a petition for direct certification as
the sole and exclusive bargaining representative of all the rank and file employees of Benguet Electric Cooperative, Inc. (BENECO)
alleging that BENECO has in its employ 214 rank and file employees; that 198 or 92.5% of these employees have supported the filing of
the petition; that no certification election has been conducted for the last 12 months; that there is no existing collective bargaining
representative of the rank and file employees sought to represented by BWLU- ADLO; and, that there is no collective bargaining
agreement in the cooperative.

An opposition to the petition was filed by the Beneco Employees Labor Union (BELU) contending that it was certified as the sole and
exclusive bargaining representative of the subject workers pursuant to an order issued by the med-arbiter; that pending resolution by the
NLRC are two cases it filed against BENECO involving bargaining deadlock and unfair labor practice; and, that the pendency of these
cases bars any representation question.

BENECO, on the other hand, filed a motion to dismiss the petition claiming that it is a non-profit electric cooperative engaged in
providing electric services to its members and patron-consumers; and, that the employees sought to be represented by BWLU-ADLO are
not eligible to form, join or assist labor organizations of their own choosing because they are members and joint owners of the
cooperative.

The med-arbiter issued an order giving due course to the petition for certification election. However, the med-arbiter limited the election
among the rank and file employees of BENECO who are non-members thereof and without any involvement in the actual ownership of
the cooperative. The med-arbiter found that there are 37 employees who are not members and without any involvement in the actual
ownership of the cooperative.

BELU and BENECO appealed but the same was dismissed for lack of merit. So BENECO filed with the SC a petition for certiorari which
the SC dismissed for lack of merit in a minute resolution dated April 1986.

The ordered certification election was held in October 1986. Prior to the conduct thereof BENECO's counsel verbally manifested that "the
cooperative is protesting that employees who are members-consumers are being allowed to vote when they are not eligible to be members
of any labor union for purposes of collective bargaining; much less, to vote in this certification election." BENECO submitted a
certification showing that only 4 employees are not members of BENECO and insisted that only these employees are eligible to vote in
the certification election. Canvass of the votes showed that BELU garnered 49 of the 83 "valid" votes cast.

Thereafter BENECO formalized its verbal manifestation by filing a Protest. The med-arbiter dismissed the protest. BLR director Calleja
affirmed the med-arbiter's order and certified BELU as the sole and exclusive bargaining agent of all the rank and file employees of
BENECO.

Issue: W/N employees of a cooperative are qualified to form or join a labor organization for purposes of collective bargaining. NO

Ratio:

Under Article 256 LC, to have a valid certification election, "at least a majority of all eligible voters in the unit must have cast their votes.
The labor union receiving the majority of the valid votes cast shall be certified as the exclusive bargaining agent of all workers in the
unit." BENECO asserts that the certification election held was null and void since members-employees who are not eligible to form and
join a labor union for purposes of collective bargaining were allowed to vote therein.

The issue has already been resolved and clarified in the case of Cooperative Rural Bank of Davao City, Inc. vs. Ferrer Calleja, et al. and
reiterated in the cases of Batangas-Electric Cooperative Labor Union v. Young, et al. and San Jose City Electric Service Cooperative, Inc.
v. Ministry of Labor and Employment, et al. wherein the Court had stated that the right to collective bargaining is not available to an
employee of a cooperative who at the same time is a member and co-owner thereof. With respect, however, to employees who are neither
members nor co-owners of the cooperative they are entitled to exercise the rights to self-organization, collective bargaining and
negotiation as mandated by the Constitution and applicable statutes.
Calleja argues that to deny the members of petitioner cooperative the right to form, assist or join a labor union of their own choice for
purposes of collective bargaining would amount to a patent violation of their right to self-organization.

The above contention is untenable. Contrary to respondents' claim, the fact that the members-employees of BENECO do not participate in
the actual management of the cooperative does not make them eligible to form, assist or join a labor organization for the purpose of
collective bargaining with petitioner. The Court's ruling in the Davao City case that members of cooperative cannot join a labor union for
purposes of collective bargaining was based on the fact that as members of the cooperative they are co-owners thereof. As such, they
cannot invoke the right to collective bargaining for "certainly an owner cannot bargain with himself or his co-owners." It is the fact of
ownership of the cooperative, and not involvement in the management thereof, which disqualifies a member from joining any labor
organization within the cooperative. Thus, irrespective of the degree of their participation in the actual management of the cooperative, all
members thereof cannot form, assist or join a labor organization for the purpose of collective bargaining.

Respondent union further claims that if nominal ownership in a cooperative is "enough to take away the constitutional protections
afforded to labor, then there would be no hindrance for employers to grant, on a scheme of generous profit sharing, stock bonuses to their
employees and thereafter claim that since their employees are stockholders, albeit in a minimal and involuntary manner, they are now also
co-owners and thus disqualified to form unions."

The above contention is based on the erroneous presumption that membership in a cooperative is the same as ownership of stocks in
ordinary corporations. While cooperatives may exercise some of the rights and privileges given to ordinary corporations provided under
existing laws, such cooperatives enjoy other privileges not granted to the latter. Similarly, members of cooperatives have rights and
obligations different from those of stockholders of ordinary corporations. It was precisely because of the special nature of cooperatives,
that the Court held in the Davao City case that members-employees thereof cannot form or join a labor union for purposes of collective
bargaining. The Court held that:

A cooperative is by its nature different from an ordinary business concern being run either by persons, partnerships, or corporations. Its
owners and/or members are the ones who run and operate the business while the others are its employees. As above stated, irrespective of
the number of shares owned by each member they are entitled to cast one vote each in deciding upon the affairs of the cooperative. An
employee therefore of such a cooperative who is a member and co-owner thereof cannot invoke the right to collective bargaining for
certainly an owner cannot bargain with himself or his co-owners.

Article 256 of the Labor Code provides, among others, that:

To have a valid, election, at least a majority of all eligible voters in the unit must have cast their votes. The labor union receiving the
majority of the valid votes cast shall be certified as the exclusive bargaining agent of all workers in the unit.

In this case it cannot be determined whether or not respondent union was duly elected by the eligible voters of the bargaining unit since
even employees who are ineligible to join a labor union within the cooperative because of their membership therein were allowed to vote
in the certification election. Considering the foregoing, the Court finds that respondent director committed grave abuse of discretion in
certifying respondent union as the sole and exclusive bargaining representative of the rank and file employees of petitioner cooperative.

REPUBLIC OF THE PHILIPPINES/SSC/SSS VS. ASIAPRO COOPERATIVE

Facts:

Asiapro, as a cooperative, is composed of owners-members. Under its by-laws, owners-members are of two categories, (1)regular
member, who is entitled to all the rights and privileges of membership ; and (2) associate member, who has no right to vote and be voted
upon and shall be entitled only to such rights and privileges provided in its by-laws. Its primary objectives are to provide savings and
credit facilities and to develop other livelihood services for its owners-members. In the discharge of the aforesaid primary objectives,
respondent cooperative entered into several Service Contracts with Stanfilco - a division of DOLE Philippines, Inc. and a company based
in Bukidnon. The owners-members do not receive compensation or wages from the respondent cooperative. Instead, they receive a share
in the service surplus which Asiapro earns from different areas of trade it engages in, such as the income derived from the said Service
Contracts with Stanfilco. In order to enjoy the benefits under the Social Security Law of 1997, the owners-members of Asiapro assigned
to Stanfilco requested the services of the latter to register them with SSS as self-employed and to remit their contributions as such. On
September 26, 2002, petitioner SSS sent a letter to respondent cooperative informing the latter that based on the Service Contracts it
executed with Stanfilco, Asiapro is actually manpower contractor supplying employees to Stanfilco and so, it is an employer of its
owners-members working with Stanfilco. Thus, Asiapro should register itself with petitioner SSS as an employer and make the
corresponding report and remittance of premium contributions. Despite letters received, respondent cooperative continuously ignored the
demand of petitioner SSS. Accordingly, SSS filed a petition on June 12, 2003 before SSC against Asiapro and Stanfilco praying that
either of them be directed to register as an employer and to report Asiapro‘s owners-members as covered employees under the compulsory
coverage of SSS and to remit the necessary contributions. Respondent cooperative filed its answer with Motion to Dismiss alleging that no
employer-employee relationship exists between it and its owners-members, thus, petitioner SSC has no jurisdiction over the respondent
cooperative.

Issues:

1. Whether or not there exists an employer-employee relationship between Asiapro Cooperative and its owners-members.

2. Whether or not petitioner has jurisdiction over the petition-complaint filed before it by SSS against the respondent cooperative.

SC Ruling:

1. In determining the existence of an employer-employee relationship, the following elements are considered: (1) the selection and
engagement of the workers; (2) the payment of wages by whatever means; (3) the power of dismissal; and (4) the power to control the
worker‘s conduct, with the latter assuming primacy in the overall consideration. The most important element is the employer‘s control.
All the aforesaid elements are present in this case. The existence of an employer-employee relationship cannot be negated by expressly
repudiating it in a contract, when the terms and surrounding circumstances show otherwise. The employment status of a person is defined
and prescribed by law and not by what the parties say it should be. A cooperative acquires juridical personality upon its registration with
the Cooperative Development Authority. It has its Board of Directors, which directs and supervises its business; meaning its Board of
Directors is the one in charge in the conduct and management of its affairs. With that, a cooperative can be likened to a corporation with a
personality separate and distinct from its owners-members. Consequently, an owner-member of a cooperative can be an employee of the
latter and the employer-employee relationship can exist between them.

2. Petitioner SSC‘s jurisdiction is clearly stated in Section 5 of R.A. No. 8282 as well as in Section 1, Rule III of the 1997 SSS Revised
Rules of Procedure. Sec. 5 of R.A. 8282 provides:

―Sec. 5 Settlement of Disputes

–(a) Any dispute arising under this Act with respect to coverage, benefits, contributions and penalties thereon or any other matter related
thereto, shall be cognizable by the Commission

, xxx‖ (Emphasis Supplied)

Similarly, Section 1, Rule III of the 1997 SSS Revised Rules of Procedure states:

―Section 1. Jurisdiction –

Any dispute arising under the Social Security Act with respect to coverage, entitlement of benefits, collection and settlement of
contributions and penalties thereon, or any other matter related thereto, shall be cognizable by the Commission after the SSS through its
President, Manager or Officer-in-charge of the Department/Branch/Representative Office concerned had first taken action thereon in
writing.‖ (Emphasis supplied)

It is clear then from the aforesaid provisions that any issue regarding the compulsory coverage of the SSS is well within the exclusive
domain of the petitioner SSC. It is important to note that the mandatory coverage under the SSS Law is premised on the existence of an
employer-employee relationship. Consequently, the respondent cooperative being the employer of its owners-members must register as
employer and report its owners-members as covered members of the SSS and remit the necessary premium contributions in accordance
with the Social Security Law of 1997.Accordingly, based on the allegations in the petition-complaint filed before the petitioner SSC, the
case clearly falls within its jurisdiction.

SIM VS NLRC

FACTS:

1. Corazon Sim filed a case for illegal dismissal with the Labor Arbiter, alleging that she was initially employed by Equitable PCI-
Bank in 1990 as Italian Remittance Marketing Consultant to the Frankfurt Representative Office.

2. Eventually, she was promoted to Manager position, until September 1999, when she received a letter from Remegio David -- the
Senior Officer, European Head of PCIBank, and Managing Director of PCIB- Europe -- informing her that she was being dismissed due to
loss of trust and confidence based on alleged mismanagement and misappropriation of funds.

3. Equitable PCI Bank denied any employer-employee relationship between them, and sought the dismissal of the complaint.

4. The Labor Arbiter rendered its Decision dismissing the case for want of jurisdiction and/or lack of merit. According to the Labor
Arbiter: It should be stressed at this juncture that the labor relations system in the Philippines has no extra-territorial jurisdiction. It is
limited to the relationship between labor and capital within the Philippines.

5. Sim was accused of withdrawing P3,000,000.00 lire from the bank's account.

6. Sim does not deny withdrawing the said amount. What she submits is that she used said amount for the Radio Pilipinas sa Roma
radio program of the company.

7. Equitable PCI-Bank countered that at the time Sim withdrew said amount, the radio program was already off the air. She is a
managerial employee. Thus, loss of trust and confidence is a valid ground for her dismissal.

ISSUE/S:

1. Whether or not the Labor Relations System of the Philippines has extraterritorial jurisdiction

2. Whether or not the National Labor Relations Commission has jurisdiction over overseas Filipino workers

RULING/RATIO:

Yes to both issues. The Labor relations system in the Philippines has extra-territorial jurisdiction and the Labor Arbiters of the National
Labor Relations Commission (NLRC) have jurisdiction to hear and decide, within the claims arising out of an employer-employee
relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral,
exemplary and other forms of damages.

Article 217 of the Labor Code provides for the jurisdiction of the Labor Arbiter and the National Labor Relations Commission, viz.:

ART. 217. Jurisdiction of Labor Arbiters and the Commission. – (a) Except as otherwise provided under this Code the Labor Arbiters
shall have original and exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the submission of the case by the
parties for decision without extension, even in the absence of stenographic notes, the following cases involving all workers, whether
agricultural or non-agricultural:

1. Unfair labor practice cases;

2. Termination disputes;

3. If accompanied with a claim for reinstatement, those cases that workers may file involving wage, rates of pay, hours of work and
other terms and conditions of employment;
4. Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations;

5. Cases arising from any violation of Article 264 of this Code, including questions involving the legality of strikes and lockouts;
and

6. Except claims for Employees Compensation, Social Security, Medicare and maternity benefits, all other claims, arising from
employer-employee relations, including those of persons in domestic or household service, involving an amount of exceeding five
thousand pesos (P5,000.00) regardless of whether accompanied with a claim for reinstatement.

(b) The commission shall have exclusive appellate jurisdiction over all cases decided by Labor Arbiters.

Moreover, Section 10 of Republic Act (R.A.) No. 8042, or the Migrant Workers and Overseas Filipinos Act of 1995, provides:

SECTION 10. Money Claims. — Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor
Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after
the filing of the complaint, the claims arising out of an employer-employee relationship or by virtue of any law or contract involving
Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of damages.

Also, Section 62 of the Omnibus Rules and Regulations Implementing R.A. No. 8042 provides that the Labor Arbiters of the NLRC shall
have the original and exclusive jurisdiction to hear and decide all claims arising out of employer-employee relationship or by virtue of any
law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of
damages, subject to the rules and procedures of the NLRC. In Philippine National Bank v. Cabansag, the Court pronounced:

“Whether employed locally or overseas, all Filipino workers enjoy the protective mantle of Philippine labor and social legislation, contract
stipulations to the contrary notwithstanding. This pronouncement is in keeping with the basic public policy of the State to afford
protection to labor, promote full employment, ensure equal work opportunities regardless of sex, race or creed, and regulate the relations
between workers and employers. For the State assures the basic rights of all workers to self-organization, collective bargaining, security of
tenure, and just and humane conditions of work [Article 3 of the Labor Code of the Philippines; See also Section 18, Article II and Section
3, Article XIII, 1987 Constitution]. This ruling is likewise rendered imperative by Article 17 of the Civil Code which states that laws
"which have for their object public order, public policy and good customs shall not be rendered ineffective by laws or judgments
promulgated, or by determination or conventions agreed upon in a foreign country."

DISPOSITIVE: Petition was denied due to procedural issues. The CA did not commit any error in dismissing the petition before it for
failure to file a prior motion for reconsideration with the NLRC. The Labor Arbiter and the NLRC's factual findings as regards the validity
of petitioner's dismissal are accorded great weight and respect and even finality when the same are supported by substantial evidence.

DOCTRINE: Labor arbiters have original and exclusive jurisdiction over claims arising from employer-employee relations, including
termination disputes involving all workers, among whom are overseas Filipino workers.

PHILIPS INDUSTRIAL DEVELOPMENT, INC. VS NLRC

Facts:

- PIDI is a domestic corporation engaged in the manufacturing and marketing of electronic products. Since 1971, it had a total of 6
collective bargaining agreements with private respondent Philips Employees Organization-FFW (PEO-FFW), a registered labor union and
the certified bargaining agent of all rank and file employees of PIDI.

- In the first CBA, the supervisors (referred to in RA 875), confidential employees, security guards, temporary employees and sales
representatives were excluded in the bargaining unit. In the second to the fifth, the sales force, confidential employees and heads of small
units, together with the managerial employees, temporary employees and security personnel were excluded from the bargaining unit. The
confidential employees are the division secretaries of light/telecom/data and consumer electronics, marketing managers, secretaries of the
corporate planning and business manager, fiscal and financial system manager and audit and EDP manager, and the staff of both the
General Management and the Personnel Department.
- In the sixth CBA, it was agreed that the subject of inclusion or exclusion of service engineers, sales personnel and confidential
employees in the coverage of the bargaining unit would be submitted for arbitration. The parties failed to agree on a voluntary arbitrator
and the Bureau of Labor Relations endorsed the petition to the Executive Labor Arbiter of the NCR for compulsory arbitration.

- March 1998, Labor Arbiter: A referendum will be conducted to determine the will of the service engineers and sales representatives as to
their inclusion or exclusion in the bargaining unit. It was also declared that the Division Secretaries and all staff of general management,
personnel and industrial relations department, secretaries of audit, EDP, financial system are confidential employees are deemed excluded
in the bargaining unit.

- PEO-FFW appealed to the NLRC; NLRC declared PIDI's Service Engineers, Sales Force, division secretaries, all Staff of General
Management, Personnel and Industrial Relations Department, Secretaries of Audit, EDP and Financial Systems are included within the
rank and file bargaining unit, citing the Implementing Rules of E.O 111 and Article 245 of the Labor Code (all workers, except
managerial employees and security personnel, are qualified to join or be a part of the bargaining unit)

Issue:

-Whether service engineers, sales representatives and confidential employees of petitioner are qualified to be part of the existing
bargaining unit

- Whether the "Globe Doctrine" should be applied

Held:

NLRC decision is set aside while the decision of the Executive Labor Arbiter is reinstated. Confidential employees are excluded from the
bargaining unit while a referendum will be conducted to determine the will of the service engineers and sales representatives as to their
inclusion or exclusion from the bargaining unit, but those who are holding supervisory positions or functions are ineligible to join a labor
organization of the rank and file employees but may join, assist or form a separate labor organization of their own.

Ratio:

The exclusion of confidential employees:

The rationale behind the ineligibility of managerial employees to form, assist or join a labor union equally applies to confidential
employees. With the presence of managerial employees in a union, the union can become company-dominated as their loyalty cannot be
assured. In Golden Farms vs Calleja, the Court states that confidential employees, who have access to confidential information, may
become the source of undue advantage.

As regards to the sales representatives and service engineers, according to the OSG, there is no doubt that they are entitled to form a union
as they are not disqualified by law from doing so.

Globe Doctrine:

Globe Doctrine states that in determining the proper bargaining unit, the express will or desire of the employees shall be
considered, they should be allowed to determine for themselves what union to join or form. The best way is through a referendum, as
decreed by the Executive Labor Arbiter. However, in this case, since the only issue is the employees' inclusion in or exclusion from the
bargaining unit in question, the Globe Doctrine has no application in this case. The doctrine applies only in instance of evenly balanced
claims by competitive groups for the right to be established as the bargaining unit. (many unions 'competing' to be the bargaining
representative?)
 GOLDEN FARMS VS SECRETARY OF LABOR AND PFL

FACTS:

Petitioner Golden Farms, Inc., is a corporation engaged in the production and marketing of bananas for export. On February 27,
1992, private respondent Progressive Federation of Labor (PFL) filed a petition before the Med-Arbiter praying for the holding of a
certification election among the monthly paid office and technical rank-and-file employees of petitioner Golden Farms. Petitioner moved
to dismiss claiming that PFL failed to show that it organized a chapter within the petitioner establishment, that there was already an
existing CBA between the rank and file employees represented by NFL and petitioner, and that the employees represented by PFL are
disqualified by the courts.

PFL countered that the monthly-paid office workers and technical employees should be allowed because they were expressly
excluded from the coverage of the CBA between Petitioner and NFL. Petitioner argued that the subject employees shoull have joined the
existing CBA if they are not managerial employees. On April 18,1991, the Med-Arbiter ordered the conduct of the certification elections.
Petitioner appealed to the Secretary of Labor which the LabSec denies the appeal for lack of merit.

ISSUE:

WON the Monthly Paid rank and file employee can constitute a bargaining unit separate from the existing bargaining units of its daily-
paid rank and file employees

HELD: Wherefore, Petition dismissed for lack of merit.

RATIO:

Yes, the Monthly Paid office and technical rank and file employee of the petitioner enjoy constitutional rights to self organization and
collective bargaining. The duties of the monthly paid employees primarily administrative and clerical which is of different nature from
daily paid employees whose main work is the cultivation of bananas. To be sure, the monthly paid group have even been excluded from
the bargaining unit of the daily paid rank and file employees.

In the case of UP vs Ferrer-Calleja, the SC sanctioned the formation of 2 separate bargaining units within the establishment.
Finally, the SC note that it was Petitioner company that filed the motion to dismiss the petition for election violating the general rule that
the employer has no standing to question a certification election since this is the so that the employer has no standing to question a
certification election since this is the sole concerns of the workers (Bystander Rule)

SUGBUANON RURAL BANK, INC. V. LAGUESMA

FACTS:

• Petitioner Bank is a duly-registered banking institution with a branch in Mandaue City. Private respondent SRBI-APSOTEU-
TUCP (Union) is a legitimate labor organization affiliated with the Trade Unions Congress of the Philippines.

• The Union was granted Certificate of Registration No. R0700-9310-UR-0064 by the DOLE Regional Office in Cebu. It later
filed a petition for certification election of the supervisory employees of SRBI. The Union alleged:

o It was a duly registered labor organization;

o The Bank employed five (5) or more supervisory employees;

o A majority of these employees supported the petition;

o There was no existing CBA between any union and the Bank; and

o No certification election had been conducted in the past 12 months prior to the petition.

• Prior to the pre-certification election conference, the Bank filed a motion to dismiss:

o Employees were managerial/confidential;

o ALU-TUCP, which represented the Union, was also representing the rank-and-file employees of the Bank, in violation of the
doctrine of separation of unions (Atlas Lithographic Services v. Laguesma).

• Med-Arbiter: Denied the MTD and scheduled inclusion-exclusion proceedings.

• SOLE: Denied the Bank’s appeal for lack of merit; ordered the conduct of a certification election.

• Med-Arbiter: Set the date for the election and identified the voting employees (Cashier-Main, Cashier-Mandaue, Accountant-
Mandaue, Acting Chief of the Loans Department).

o The Bank filed an urgent motion to suspend proceedings. Denied.

o MR was filed by the Bank. Med-Arbiter canceled the scheduled certification election in order to address the Bank’s MR.

o MR denied. The Bank appealed to the SOLE.

• Meanwhile, the Bank also filed a petition for cancellation of union registration before the DOLE Regional Office. It claimed that
the employees were managerial/confidential.

• DOLE Undersecretary: Denied the appeal for lack of merit (from the decision of the Med-Arbiter).

o The Union was a legitimate labor organization.

o Until and unless a final order is issued cancelling APSOTEU-TUCP’s registration certificate, it had the legal right to represent its
members for collective bargaining purposes.

o The question of whether the employees are managerial/confidential should be threshed out in exclusion proceedings.

o MR denied.

• Med-Arbiter: Scheduled the holding of a certification election.

ISSUES + RULING:

Are the members of respondent Union managerial employees? NO.

• Art. 212 (m) defines managerial employees:

“’Managerial employee’ one who is vested with powers or prerogatives to lay down and execute management policies and/or hire,
transfer, suspend, lay-off, recall, discharge, assign or discipline employees. ‘Supervisory employees’ are those who, in the interest of the
employer, effectively recommend such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but
requires the use of independent judgment. All employees not falling within any of the above definitions are considered rank- and-file
employees for purposes of this Book.”

• To support its stance, petitioner Bank cites Tabacalera Insurance v. NLRC, in which the Court held that a credit and collection
supervisor is a managerial employee. However, in that case, the employee concerned had effective recommendatory powers.

• In the case at bar, petitioner failed to show that the employees in question were vested with similar powers.

o They do not possess effective recommendatory powers.

o Neither do they formulate and execute management policies.

Are they confidential employees? NO.

• Confidential employees are whose who:

o Act or assist in a confidential capacity, in regard

o To persons who formulate, determine and effectuate management policies [especially in the field of labor relations].

• Both criteria must be met.

• While Art. 245 does not prohibit confidential employees from engaging in union activities, under the doctrine of necessary
implication, the disqualification of managerial employees equally applies to confidential employees.

• When an employee does not have access to confidential labor relations information, there is no legal prohibition against joining,
forming, or assisting a union.

• While petitioner submitted detailed job descriptions of the employees concerned to the effect that they handle sensitive data and
information, there was no proof offered to show that they had access to confidential information specifically relating to labor relations
policies.

Did the DOLE Undersecretary commit grave abuse of discretion in ordering the conduct of a certification election? NO.

• Petitioner Bank contends that the Union violated the doctrine of separation of unions as both the supervisory and rank-and-file
employees are represented by ALU or TUCP.

• However, there is nothing in the records which supports petitioner’s claim.

• While the Union was initially assisted by ALU during its preliminary stages of organization, a local union maintains its separate
personality despite affiliation with a larger national federation.

TUNAY NA PAGKAKAISA NG MANGGAGAWA SA ASIA BREWERY VS. ASIA BREWERY, INC G.R. No. 162025

FACTS:

1) Respondent ABI entered into a CBA with Bisig at Lakas ng mga Manggagawa sa Asia-Independent (BLMA-INDEPENDENT), the
exclusive bargaining representative of ABI’s rank-and-file employees.

2) Article I of the CBA defined the scope of the bargaining unit, as follows: The UNION shall not represent or accept for 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 defined shall be excluded from the bargaining unit, to wit:

xxx

Confidential and Executive Secretaries

xxx

Purchasing and Quality Control Staff.

3) The CBA expressly excluded Confidential and Executive Secretaries from the rank-and-file bargaining unit, for which reason ABI
seeks their disaffiliation from petitioner. ABI’s management stopped deducting union dues from 81 employees, believing that their
membership in BLMA-INDEPENDENT violated the CBA. 18 of these affected employees are QA Sampling Inspectors/Inspectresses and
Machine Gauge Technician (checkers) who formed part of the Quality Control Staff. The rest are secretaries/clerks directly under their
respective division managers.

4) Petitioner, however, maintains that except for those who had been promoted to monthly paid positions, the other secretaries/clerks
are deemed included among the rank-and-file employees of ABI. BLMA-INDEPENDENT claimed that ABI’s actions restrained the
employees’ right to self-organization.
5) VA ruled that 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.

6) CA reversed the VA, ruling that 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.

ISSUE: WON the checkers and secretaries/clerks of respondent company are rank-and-file employees who are eligible to join the Union
of the rank-and-file employees.

RULING: YES. The checkers and secretaries/clerks of respondent company are rank-and-file employees who are eligible to join the
Union of the rank-and-file employees.

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. Confidential employees are thus excluded from the rank-and-file bargaining unit. The rationale for their separate category and
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 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 membership. 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.

Confidential employees are defined as those who:

1) assist or act in a confidential capacity,

2) to persons who formulate, determine, and effectuate management policies in the field of labor relations.

The two (2) criteria are cumulative, and both must be met if an employee is to be considered a confidential employee 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.

A perusal of the job descriptions of these secretaries/clerks reveals that their assigned duties and responsibilities involve routine activities
of recording and monitoring, and other paper works for their respective departments while secretarial tasks such as receiving telephone
calls and filing of office correspondence appear to have been commonly imposed as additional duties. Respondent failed to indicate who
among these numerous secretaries/clerks have access to confidential data relating to management policies that could give rise to potential
conflict of interest with their Union membership. It is not even farfetched that the job category may exist only on paper since they are all
daily-paid workers. With respect to the Sampling Inspectors/Inspectresses and the Gauge Machine Technician, the job descriptions of
these checkers showed that they perform routine and mechanical tasks preparatory to the delivery of the finished products. No evidence
was presented by the respondent to prove that these daily-paid checkers actually form part of the company’s Quality Control Staff who as
such were exposed to sensitive, vital and confidential information about [company’s] products or have knowledge of mixtures of the
products, their defects, and even their formulas which are considered trade secrets.

DISPOSITIVE: Petitioner won.

DOCTRINE: 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. Confidential employees are thus excluded from the rank-and-file bargaining unit.