[G.R. NO.
152356 : August 16, 2005] On 27 July 1998, petitioner filed a motion to dismiss the petition
SAN MIGUEL CORPORATION (MANDAUE PACKAGING
PRODUCTS PLANTS), Petitioners, v. MANDAUE
PACKING PRODUCTS PLANTS-SAN PACKAGING
PRODUCTS - SAN MIGUEL CORPORATION
MONTHLIES RANK-AND-FILE UNION - FFW (MPPP-
SMPP-SMAMRFU-FFW), Respondent.
DECISION
TINGA, J.:
The central question in this Petition for Review is on what date
did respondent Mandaue Packing Products Plants-San Miguel
Packaging Products'San Miguel Corporation Monthlies Rank-
And-File Union FFW acquire legal personality in accordance with
the Implementing Rules of the Labor Code. The matter is crucial
since respondent filed a petition for certification election at a date
when, it is argued, it had yet to acquire the requisite legal
personality. The Department of Labor and Employment (DOLE)
and the Court of Appeals both ruled that respondent had acquired
legal personality on the same day it filed the petition for
certification election. The procedure employed by the respondent
did not strictly conform with the relevant provisions of law. But
rather than insist on an overly literal reading of the law that
senselessly suffocates the constitutionally guaranteed right to self-
organization, we uphold the assailed decisions and the liberal
spirit that animates them.
Antecedent Facts
The present petition assailed the Decision dated 7 June 2001
rendered by the Court of Appeals Eighth Division1 which in turn
affirmed a Decision dated 22 Feburary 1999 by the DOLE
Undersecretary for Labor Relations, Rosalinda Dimapilis-Baldoz,
ordering the immediate conduct of a certification election among
the petitioner's rank-and-file employees, as prayed for by
respondent. The following facts are culled from the records.
On 15 June 1998, respondent, identifying itself as an affiliate of
Federation of Free Workers (FFW), filed a petition for
certification election with the DOLE Regional Office No. VII. In
the petition, respondent stated that it sought to be certified and to
represent the permanent rank-and-file monthly paid employees of
the petitioner.2 The following documents were attached to the
petition: (1) a Charter Certificate issued by FFW on 5 June 1998
certifying that respondent as of that date was duly certified as a
local or chapter of FFW; (2) a copy of the constitution of
respondent prepared by its Secretary, Noel T. Bathan and attested
by its President, Wilfred V. Sagun; (3) a list of respondent's
officers and their respective addresses, again prepared by Bathan
and attested by Sagun; (4) a certification signifying that
respondent had just been organized and no amount had yet been
collected from its members, signed by respondent's treasurer
Chita D. Rodriguez and attested by Sagun; and (5) a list of all the
rank-and-file monthly paid employees of the Mandaue Packaging
Products Plants and Mandaue Glass Plant prepared by Bathan and
attested by Sagun.3
The petition was assigned to Mediator-Arbiter Achilles V. Manit
of the DOLE Regional Office No. VII, and docketed as Case No.
R0700-9806-RU-013.4
for certification election on the sole ground that herein respondent
is not listed or included in the roster of legitimate labor
organizations based on the certification issued by the Officer-In-
Charge, Regional Director of the DOLE Regional Office No. VII,
Atty. Jesus B. Gabor, on 24 July 1998.
On 29 July 1998, respondent submitted to the Bureau of Labor
Relations the same documents earlier attached to its petition for
certification. The accompanying letter, signed by respondent's
president Sagun, stated that such documents were submitted in
compliance with the requirements for the creation of a
local/chapter pursuant to the Labor Code and its Implementing
Rules; and it was hoped that the submissions would facilitate the
listing of respondent under the roster of legitimate labor
organizations.5 On 3 August 1998, the Chief of Labor Relations
Division of DOLE Regional Office No. VII issued a Certificate
of Creation of Local/Chapter No. ITD. I-ARFBT-058/98,
certifying that from 30 July 1998, respondent has acquired legal
personality as a labor organization/worker's association, it having
submitted all the required documents.6
Opting not to file a comment on the Motion to
Dismiss,7 respondent instead filed a Position Paper wherein it
asserted that it had complied with all the necessary requirements
for the conduct of a certification election, and that the ground
relied upon in the Motion to Dismiss was a mere technicality.8
In turn, petitioner filed a Comment, wherein it reiterated that
respondent was not a legitimate labor organization at the time of
the filing of the petition. Petitioner also propounded that contrary
to respondent's objectives of establishing an organization
representing rank-and-file employees, two of respondent's
officers, namely Vice-President Emannuel L. Rosell and
Secretary Bathan, were actually supervisory employees. In
support of this allegation, petitioner attached various documents
evidencing the designation of these two officers in supervisory
roles, as well as their exercise of various supervisory
functions.9 Petitioner cited Article 245 of the Labor Code, which
provides that supervisory employees shall not be eligible for
membership in a labor organization of the rank-and-file
employees.10
On 20 August 1998, petitioner filed a petition to cancel the union
registration of respondent. However, this petition was denied, and
such denial was subsequently affirmed by the Court of Appeals in
a decision that has since become final.11
In the meantime, on 15 September 1998, Med-Arbiter Manit
issued an Order dismissing respondent's petition for certification
election. The sole ground relied upon for the dismissal was the
Med-Arbiter's Opinion that as of the date of filing of the petition
on 15 June 1998, respondent did not have the legal personality to
file the said petition for certification election.12 No discussion was
adduced on petitioner's claims that some of respondent's officers
were actually supervisory employees.
Respondent promptly appealed the 15 September 1998 Order to
the DOLE. On 22 February 1999, DOLE Undersecretary
Rosalinda Dimapilis-Baldoz rendered a Decision reversing
the Order. Undersecretary Baldoz concluded that respondent
acquired legal personality as early as 15 June 1998, the date it
submitted the required documents, citing Section 3, Rule VI of
the New Rules Implementing the Labor Code (Implementing
Rules) which deems that a local/chapter acquires legal personality
from the date of filing of the complete documentary requirements
as mandated in the Implementing Rules. The DOLE also ruled
that the contention that two of respondent's officers were actually
supervisors can be threshed out in the pre-election conferences
where the list of qualified voters is to be determined. The
dispositive portion of the DOLE Decision stated:
WHEREFORE, the appeal is GRANTED. The order dated 15
September 1999 of the Med-Arbiter is REVERSED and SET
ASIDE. Accordingly, let the 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
monthly-paid rank-and-file employees of the Mandaue Packaging
Products Plant San Miguel Corporation, with the following
choices:
1. MANDAUE PACKAGING PRODUCT PLANT SAN
MIGUEL PACKAGING PRODUCTS SAN MIGUEL
CORPORATION MONTHLIES RANK AND FILE UNION
FFW (MPPP-SMPP-SMCMRFUFFW),
2. NO UNION.
Pursuant to Rule XI, Section 11.1 of the New Implementing
Rules, the company is hereby directed to submit to the office of
origin the certified list of current employees in the bargaining
unit, along with the payrolls covering the members of the
bargaining unit for the last three months prior to the issuance of
this decision.
SO DECIDED.13
These two conclusions of the DOLE were affirmed in the
assailed Decision of the Court of Appeals. It is now our task to
review whether these conclusions are warranted under law and
jurisprudence. First, we shall discuss the aspect of respondent's
legal personality in filing the petition for certification election.
First Issue: On the Acquisition of
Legal Personality by Respondent
Statutory Provisions for Registration Of
Local/Chapter of Federation or National Union
Before we proceed to evaluate the particular facts of this case, it
would be useful to review the statutory paradigm that governs the
establishment and acquisition of legal personality by a
local/chapter of a labor organization. The applicable rules have
undergone significant amendments in the last decade, thus a
recapitulation of the framework is in order.
The Labor Code defines a labor organization as any union or
association of employees which exists in whole or in part for the
purpose of collective bargaining or of dealing with employers
concerning terms and conditions of employment,14 and a
"legitimate labor organization" as any labor organization duly
registered with the DOLE, including any branch or local
thereof.15 Only legitimate labor organizations may file a petition
for certification election.16
Article 234 of the Labor Code enumerates the requirements for
registration of an applicant labor organization, association, or
group of unions or workers in order that such entity could acquire
legal personality and entitlement to the rights and privileges
granted by law to legitimate labor organizations. These include a
registration fee of fifty pesos (P50.00); a list of the names of the
members and officers, and copies of the constitution and by-laws
of the applicant union.17
However, the Labor Code itself does not lay down the procedure
for the registration of a local or chapter of a labor organization.
Such has been traditionally provided instead in the Implementing
Rules, particularly in Book V thereof. However, in the last decade
or so, significant amendments have been introduced to Book V,
first by Department Order No. 9 which took effect on 21 June
1997, and again by Department Order No. 40 dated 17 February
2003. The differences in the procedures laid down in these
various versions are significant. However, since the instant
petition for certification was filed in 1998, the Implementing
Rules, as amended by Department Order No. 9, should govern the
resolution of this petition.18
Preliminarily, we should note that a less stringent procedure
obtains in the registration of a local or chapter than that of a labor
organization. Undoubtedly, the intent of the law in imposing
lesser requirements in the case of a branch or local of a registered
federation or national union is to encourage the affiliation of a
local union with a federation or national union in order to increase
the local union's bargaining powers respecting terms and
conditions of labor.19 This policy has remained consistent despite
the succeeding amendments to Book V of the Omnibus
Implementing Rules, as contained in Department Orders Nos. 9
and 40.
The case of Progressive Development Corp. v. Secretary of
Labor,20 applying Section 3, Rule II, Book V of the Implementing
Rules, in force before 1997, ruled that "a local or chapter
therefore becomes a legitimate labor organization only upon
submission of the following to the BLR: (1) a charter certificate,
within thirty (30) days from its issuance by the labor federation or
national union; and (2) The constitution and by-laws, a statement
of the set of officers, and the books of accounts all of which are
certified under oath by the secretary or treasurer, as the case may
be, of such local or chapter, and attested to by its president."21 The
submission by the local/chapter of duly certified books of
accounts as a prerequisite for registration of the local/chapter was
dropped in Department Order No. 9,22 a development noted by the
Court in Pagpalain Haulers v. Hon. Trajano,23 wherein it was
held that the previous doctrines requiring the submission of books
of accounts as a prerequisite for the registration of a local/chapter
"are already passé and therefore, no longer applicable."24
Department Order No. 40, now in effect, has eased the
requirements by which a local/chapter may acquire legal
personality. Interestingly, Department Order No. 40 no longer
uses the term "local/chapter," utilizing instead "chartered local,"
which is defined as a "labor organization in the private sector
operating at the enterprise level that acquired legal personality
through the issuance of a charter certificate by a duly registered
federation or national union, and reported to the Regional
Office."25 Clearly under the present rules, the first step to be
undertaken in the creation of a chartered local is the issuance of a
charter certificate by the duly registered federation or national
union. Said federation or national union is then obligated to report
to the Regional Office the creation of such chartered local,
attaching thereto the charter certificate it had earlier issued.26
But as stated earlier, it is Department Order No. 9 that governs in
this case. Section 1, Rule VI thereof prescribes the documentary
requirements for the creation of a local/chapter. It states:
Section 1. Chartering and creation of a local chapter - A duly
registered federation or national union may directly create a
local/chapter by submitting to the Regional Office or to the
Bureau two (2) copies of the following:
a) A charter certificate issued by the federation or national union
indicating the creation or establishment of the local/chapter;
(b) The names of the local/chapter's officers, their addresses, and
the principal office of the local/chapter;
(c) The local/chapter's constitution and by-laws; provided that
where the local/chapter's constitution and by-laws is the same as
that of the federation or national union, this fact shall be indicated
accordingly.
All the foregoing supporting requirements shall be certified under
oath by the Secretary or Treasurer of the local/chapter and
attested by its President.
In contrast, an independent union seeking registration is further
required under Dept. Order No. 90 to submit the number and
names of the members, and annual financial reports.27
Section 3, Rule VI of Department Order No. 9 provides when the
local/chapter acquires legal personality.
Section 3. Acquisition of legal personality by local chapter. 'A
local/chapter constituted in accordance with Section 1 of this Rule
shall acquire legal personality from the date of filing of the
complete documents enumerated therein. Upon compliance with
all the documentary requirements, the Regional Office or Bureau
shall issue in favor of the local/chapter a certificate indicating that
it is included in the roster of legitimate labor organizations.
It is evident based on this rule that the local/chapter acquires legal
personality from the date of the filing of the complete
documentary requirements, and not from the issuance of a
certification to such effect by the Regional Office or Bureau. On
the other hand, a labor organization is deemed to have acquired
legal personality only on the date of issuance of its certificate of
registration,28 which takes place only after the Bureau of Labor
Relations or its Regional Offices has undertaken an evaluation
process lasting up until thirty (30) days, within which period it
approves or denies the application.29 In contrast, no such period of
evaluation is provided in Department Order No. 9 for the
application of a local/chapter, and more importantly, under it such
local/chapter is deemed to acquire legal personality "from the date
of filing" of the documents enumerated under Section 1, Rule VI,
Book V.
Apart from promoting a policy of affiliation of local unions with
national unions,30 there is a practical reason for sanctioning a less
onerous procedure for the registration of a local/chapter, as
compared to the national union. The local/chapter relies in part on
the legal personality of the federation or national union, which in
turn, had already undergone evaluation and approval from the
Bureau of Legal Relations or Regional Office. In fact, a
federation or national union is required, upon registration, to
establish proof of affiliation of at least ten (10) locals or chapters
which are duly recognized as the collective bargaining agent in
the establishment or industry in which they operate; and the
names and addresses of the companies where the locals or
chapters operate and the list of all the members in each of the
companies.31 Once the national union or federation acquires legal
personality upon the issuance of its certificate or registration,32 its
legal personality cannot be subject to collateral attack.33
The fact that the local/chapter acquires legal personality from the
moment the complete documentary requirements are submitted
seems to imply that the duty of the Bureau or Regional Office to
register the local/chapter is merely ministerial. However,
in Progressive Development Corporation v. Laguesma,34 the
Court, in ruling against a petition for certification filed by a
chapter, held that the mere submission of the documentary
requirements does not render ministerial the function of the
Bureau of Labor Relations in according due recognition to the
labor organization.35 Still, that case was decided before the
enactment of Department Order No. 9, including the aforestated
Section 3. Should we consider the said 1997 amendments as
having obviated our characterization in Progressive of the
Bureau's duty as non-ministerial?chanroblesvirtualawlibrary
Notwithstanding the amendments, it still is good policy to
maintain that per Department Order No. 9, the duty of the Bureau
of Labor Relations to recognize the local/chapter upon the
submission of the documentary requirements is not ministerial,
insofar as the Bureau is obliged to adjudge the authenticity of the
documents required to be submitted. For example, the Bureau is
not mandated to accept just any purported charter certificate
matter how spurious it is in appearance. It is empowered to
ascertain whether the submitted charter certificate is genuine, and
if finding that said certificate is fake, deny recognition to the
local/chapter.
However, in ascertaining whether or not to recognize and register
the local/chapter, the Bureau or Regional Office should not look
beyond the authenticity and due execution of the documentary
requirements for the creation of the local/chapter as enumerated
under Section 1, Rule VI, Book V of Department Order No. 9.
Since the proper submission of these documentary requirements is
all that is necessary to recognize a local/chapter, it is beyond the
province of the Bureau or Regional Offices to resort to other
grounds as basis for denying legal recognition of the
local/chapter. For example, Department Order No. 9 does not
require the local/chapter to submit the names of its members as a
condition precedent to its registration.36 It therefore would be
improper to deny legal recognition to a local/chapter owing to
questions pertaining to its individual members since the
local/chapter is not even obliged to submit the names of its
individual members prior to registration.
Certainly, when a local/chapter applies for registration, matters
raised against the personality of the federation or national union
itself should not be acted upon by the Bureau or Regional Office,
owing to the preclusion of collateral attack. Instead, the proper
matter for evaluation by the Bureau or Regional Office should be
limited to whether the local/chapter is indeed a duly created
affiliate of the national union or federation.
Parenthetically, under the present Implementing Rules as
amended by Department Order No. 40, it appears that the
local/chapter (or now, "chartered local") acquires legal
personality upon the issuance of the charter certificate by the duly
registered federation or national union.37 This might signify that
the creation of the chartered local is within the sole discretion of
the federation or national union and thus beyond the review or
interference of the Bureau of Labor Relations or its Regional
Offices. However, Department Order No. 40 also requires that the
federation or national union report the creation of the chartered
local to the Regional Office.
Acquisition by Respondent of Legal Personality
We now proceed to determine if and when the respondent
acquired legal personality under the procedure laid down by the
rules then in effect, Department Order No. 9, that is.
At the onset, the arguments raised by petitioner on this point are
plainly erroneous. Petitioner cites the case of Toyota Motor
Philippines v. Toyota Motor Philippines Corporation Labor
Union,38 and the purported holding therein that "[if] it is true that
at the time of the filing of the petition, the said registration
certificate has not been approved yet, then, petitioner lacks the
legal personality to file the petition."39 However, an examination
of the case actually reveals that the cited portion was lifted from
one of the antecedent rulings of the Med-Arbiter in that case
which had not even been affirmed or reinstated by the Court on
review.40 Moreover, such pronouncement made prior to the
enactment of Department Order No. 9 squarely contradicts
Section 3, Rule VI thereof, which provides that legal personality
of the local/chapter is vested upon the submission of the complete
documentary requirements.
It is also worth noting that petitioner union in Toyota was an
independent labor union, and not a local/chapter, and under
Department Order No. 9, independent labor unions, unlike
local/chapters, acquire legal personality only upon issuance of the
certificate of registration by the Bureau or Regional Office. Still,
petitioner cites in its favor Section 5, Rule V of Dept. Order No.
9, which states that "the labor organization or workers' association
shall be deemed registered and vested with legal personality on
the date of issuance of its certificate of registration." Again, the
citation is obviously misplaced, as respondent herein is a
local/chapter, the acquisition of its legal personality being
governed instead by Section 3, Rule VI.
It is thus very clear that the issuance of the certificate of
registration by the Bureau or Regional Office is not the operative
act that vests legal personality upon a local/chapter under
Department Order No. 9. Such legal personality is acquired from
the filing of the complete documentary requirements enumerated
in Section 1, Rule VI. Admittedly, the manner by which
respondent was deemed to have acquired legal personality by the
DOLE and the Court of Appeals was not in strict conformity with
the provisions of Department Order No. 9. Nonetheless, are the
deviations significant enough for the Court to achieve a different
conclusion from that made by the DOLE and the Court of
Appeals?chanroblesvirtualawlibrary
In regular order, it is the federation or national union, already in
possession of legal personality, which initiates the creation of the
local/chapter. It issues a charter certificate indicating the creation
or establishment of the local/chapter. It then submits this charter
certificate, along with the names of the local/chapter's officers,
constitution and by-laws to the Regional Office or Bureau. It is
the submission of these documents, certified under oath by the
Secretary or Treasurer of the local/chapter and attested by the
President, which vests legal personality in the local/chapter,
which is then free to file on its own a petition for certification
election.
In this case, the federation in question, the FFW, did not submit
any of these documentary requirements to the Regional Office or
Bureau. It did however issue a charter certificate to the putative
local/chapter (herein respondent). Respondent then submitted the
charter certificate along with the other documentary requirements
to the Regional Office, but not for the specific purpose of creating
the local/chapter, but for filing the petition for certification
election.
It could be properly said that at the exact moment respondent was
filing the petition for certification, it did not yet possess any legal
personality, since the requisites for acquisition of legal
personality under Section 3, Rule VI of Department Order No. 9
had not yet been complied with. It could also be discerned that the
intention of the Labor Code and its Implementing Rules that only
those labor organizations that have acquired legal personality are
capacitated to file petitions for certification elections. Such is the
general rule.
Yet there are peculiar circumstances in this case that allow the
Court to rule that respondent acquired the requisite legal
personality at the same time it filed the petition for certification
election. In doing so, the Court acknowledges that the strict letter
of the procedural rule was not complied with. However, labor
laws are generally construed liberally in favor of labor, especially
if doing so affirms the constitutionally guaranteed right to self-
organization.
True enough, there was no attempt made by the national
federation, or the local/chapter for that matter, to submit the
enumerated documentary requirements to the Regional Office or
Bureau for the specific purpose of creating the local/chapter.
However, these same documents were submitted by the
local/chapter to the Regional Office as attachments to its petition
for certification election. Under Section 3, Rule VI of Department
Order No. 9, it is the submission of these same documents to the
Regional Office or Bureau that operates to vest legal personality
on the local/chapter.
Thus, in order to ascertain when respondent acquired legal
personality, we only need to determine on what date the Regional
Office or Bureau received the complete documentary
requirements enumerated under Section 1, Rule VI of Department
Order No. 9. There is no doubt that on 15 June 1998, or the date
respondent filed its petition for certification election, attached
thereto were respondent's constitution, the names and addresses of
its officers, and the charter certificate issued by the national union
FFW. The first two of these documents were duly certified under
oath by respondent's secretary Bathan and attested to by president
Sagun.41
It may be noted though that respondent never submitted a separate
by-laws, nor does it appear that respondent ever intended to
prepare a set thereof. Section 1(c), Rule VI, Book V of
Department Order No. 9 provides that the submission of both a
constitution and a set of by-laws is required, or at least an
indication that the local/chapter is adopting the constitution and
by-laws of the federation or national union. A literal reading of
the provision might indicate that the failure to submit a specific
set of by-laws is fatal to the recognition of the local/chapter. A
more critical analysis of this requirement though is in order,
especially as it should apply to this petition.
By-laws has traditionally been defined as regulations, ordinances,
rules or laws adopted by an association or corporation or the like
for its internal governance, including rules for routine matters
such as calling meetings and the like.42 The importance of by-laws
to a labor organization cannot be gainsaid. Without such
provisions governing the internal governance of the organization,
such as rules on meetings and quorum requirements, there would
be no apparent basis on how the union could operate. Without a
set of by-laws which provides how the local/chapter arrives at its
decisions or otherwise wields its attributes of legal personality,
then every action of the local/chapter may be put into legal
controversy.
However, if those key by-law provisions on matters such as
quorum requirements, meetings, or on the internal governance of
the local/chapter are themselves already provided for in the
constitution, then it would be feasible to overlook the requirement
for by-laws. Indeed in such an event, to insist on the submission
of a separate document denominated as "By-Laws" would be an
undue technicality, as well as a redundancy.
An examination of respondent's constitution reveals it sufficiently
comprehensive in establishing the necessary rules for its
operation. Article IV establishes the requisites for membership in
the local/chapter. Articles V and VI name the various officers and
what their respective functions are. The procedure for election of
these officers, including the necessary vote requirements, is
provided for in Article IX, while Article XV delineates the
procedure for the impeachment of these officers. Article VII
establishes the standing committees of the local/chapter and how
their members are appointed. Article VIII lays down the rules for
meetings of the union, including the notice and quorum
requirements thereof. Article X enumerates with particularity the
rules for union dues, special assessments, fines, and other
payments. Article XII provides the general rule for quorum in
meetings of the Board of Directors and of the members of the
local/chapter, and cites the applicability of the Robert's Rules of
Order43 in its meetings. And finally, Article XVI governs and
institutes the requisites for the amendment of the constitution.
Indeed, it is difficult to see in this case what a set of by-laws
separate from the constitution for respondent could provide that is
not already provided for by the Constitution. These premises
considered, there is clearly no need for a separate set of by-laws
to be submitted by respondent.
The Court likewise sees no impediment in deeming respondent as
having acquired legal personality as of 15 June 1998, the fact that
it was the local/chapter itself, and not the FFW, which submitted
the documents required under Section 1, Rule VI of Department
Order No. 9. The evident rationale why the rule states that it is the
federation or national union that submits said documents to the
Bureau or Regional Office is that the creation of the local/chapter
is the sole prerogative of the federation or national union, and not
of any other entity. Certainly, a putative local/chapter cannot,
without the imprimatur of the federation or national union, claim
affiliation with the larger unit or source its legal personality
therefrom.
In the ordinary course, it should have been FFW, and not
respondent, which should have submitted the subject documents
to the Regional Office. Nonetheless, there is no good reason to
deny legal personality or defer its conferral to the local/chapter if
it is evident at the onset that the federation or national union itself
has already through its own means established the local/chapter.
In this case, such is evidenced by the Charter Certificate dated 9
June 1998, issued by FFW, and attached to the petition for
certification election. The Charter Certificate expressly states that
respondent has been issued the said certificate "to operate as a
local or chapter of the [FFW]". The Charter Certificate expressly
acknowledges FFW's intent to establish respondent as of 9 June
1998.44 This being the case, we consider it permissible for
respondent to have submitted the required documents itself to the
Regional Office, and proper that respondent's legal personality be
deemed existent as of 15 June 1998, the date the complete
documents were submitted.
Second Issue: On the Alleged Presence
Of Supervisory Employees as
Officers of the Respondent
The second issue hinges on a point of some controversy and
frequent discussion in recent years. Petitioner claims error in the
common pronouncement in the assailed decisions that the matter
concerning the two officers who are allegedly supervisory
employees may be threshed out during pre-election conferences.
Petitioner cites the cases of Toyota Motors and Progressive
Development Corporation-Pizza Hut v. Ledesma45 wherein the
Court ruled that the question of prohibited membership of both
supervisory and rank-and-file employees in the same union must
be inquired into anterior to the granting of an order allowing a
certification election; and that a union composed of both of these
kinds of employees does not possess the requisite personality to
file for recognition as a legitimate labor organization. It should be
noted though that in the more recent case of Tagaytay Highlands
International Golf Club v. Tagaytay Highlands Employees
Union,46 the Court, notwithstanding Toyota and Progressive,
ruled that after a certificate of registration is issued to a union, its
legal personality cannot be subject to collateral attack, but
questioned only in an independent petition for cancellation.47
There is no need to apply any of the above cases at present
because the question raised by petitioner on this point is already
settled law, as a result of the denial of the independent petition for
cancellation filed by petitioner against respondent on 20 August
1998. The ground relied upon therein was the alleged fraud,
misrepresentation and false statement in describing itself as a
union of rank and file employees when in fact, two of its officers,
Emmanuel Rosell and Noel Bathan, were occupying supervisory
positions.48 Said petition was denied by the Regional Director,
this action was affirmed by the DOLE, the Court of Appeals, and
the Supreme Court.49 The denial made by the Court of Appeals
and the Supreme Court may have been based on procedural
grounds,50 but the prior decisions of the Regional Director and the
DOLE ruled squarely on the same issue now raised by the
petitioner. We quote from the Resolution of the DOLE dated 29
December 1998:
. . . . [The] substantive issue that is now before us is whether or
not the inclusion of the two alleged supervisory employees in
appellee union's membership amounts to fraud, misrepresentation,
or false statement within the meaning of Article 239(a) and (c) of
the Labor Code.
We rule in the negative.
Under the law, a managerial employee is "one who is vested with
powers or prerogatives to lay down and execute management
policies and/or to hire, transfer, suspend, layoff, recall, discharge,
assign or discipline employees." A supervisory employee is "one
who, in the interest of the employer, effectively recommends
managerial actions if the exercise of such recommendatory
authority is not merely routinary or clerical in nature but requires
the use of independent judgment. '" Finally, "all employees not
falling within the definition of managerial or supervisory
employee are considered rank-and-file employees". It is also well-
settled that the actual functions of an employee, not merely his
job title, are determinative in classifying such employee as
managerial, supervisory or rank and file.
In the case of Emmanuel Rossell, appellant's evidence shows that
he undertakes the filling out of evaluation reports on the
performance of mechanics, which in turn are used as basis for
reclassification. Given a ready and standard form to accomplish,
coupled with the nature of the evaluation, it would appear that his
functions are more routinary than recommendatory and hardly
leave room for independent judgment. In the case of Noel Bathan,
appellant's evidence does not show his job title although it shows
that his recommendations on disciplinary actions appear to have
carried some weight on higher management. On this limited
point, he may qualify as a supervisory employee within the
meaning of the law. This may, however, be outweighed by his
other functions which are not specified in the evidence.
Assuming that Bathan is a supervisory employee, this does not
prove the existence of fraud, false statement or misrepresentation.
Because good faith is presumed in all representations, an essential
element of fraud, false statement and misrepresentation in order
for these to be actionable is intent to mislead by the party making
the representation. In this case, there is no proof to show that
Bathan, or appellee union for that matter, intended to mislead
anyone. If this was appellee union's intention, it would have
refrained from using a more precise description of the
organization instead of declaring that the organization is
composed of 'rank and file monthlies'. Hence, the charge of fraud,
false statement or misrepresentation cannot be sustained.
Appellant's reliance on the Toyota case must be tempered by the
peculiar circumstances of the case. Even assuming that Bathan, or
Rossel for that matter, are supervisory employees,
the Toyota case cannot certainly be given an interpretation that
emasculates the right to self-organization and the promotion of
free trade unionism. We take administrative notice of the realities
in union organizing, during which the organizers must take their
chances, oftentimes unaware of the fine distinctions between
managerial, supervisory and rank and file employees. The
grounds for cancellation of union registration are not meant to be
applied automatically, but indeed with utmost discretion. Where a
remedy short of cancellation is available, that remedy should be
preferred. In this case, no party will be prejudiced if Bathan were
to be excluded from membership in the union. The vacancy he
will thus create can then be easily filled up through the succession
provision of appellee union's constitution and by-laws. What is
important is that there is an unmistakeable intent of the members
of appellee union to exercise their right to organize. We cannot
impose rigorous restraints on such right if we are to give meaning
to the protection to labor and social justice clauses of the
Constitution.51
The above-cited pronouncement by Bureau of Labor Relations
Director Benedicto Ernesto R. Bitonio, Jr. in BLR-A-C-41-11-11-
98 was affirmed by the Court of Appeals and the Supreme Court.
Hence, its pronouncement affirming, notwithstanding the
questions on the employment status of Rossell and Bathan, the
legitimacy of the respondent, stands as a final ruling beyond the
ambit of review, thus warranting the Court's respect. There may
be a difference between this case, which involves a petition for
certification election, and the other case, which concerns a
petition for cancellation. However, petitioner opposes the petition
for certification election on the ground of the illegitimacy of
respondent, owing to the alleged supervisory nature of the duties
of Rossell and Bathan. That matter has already been settled in the
final disposition of the petition for cancellation, and thus cannot
be unsettled by reason of this present petition.
Effect of Respondent's Manifestation
Of Subsequent Developments
A final note. In its Memorandum, petitioner alleges that the
bargaining unit that respondent sought to represent is no longer
the same because of the dynamic nature of petitioner's business, a
lot of changes having occurred in the work environment, and that
four of respondent's officers are no longer connected with
petitioner.52 Assuming that these manifestations are true, they
have no effect on the Court's ruling that a certification election
should be immediately conducted with respondent as one of the
available choices. Petitioner's bare manifestations adduce no
reason why the certification election should not be conducted
forthwith. If there are matters that have arisen since the filing of
the petition that serve to delay or cancel the election, these can be
threshed out during the pre-election conferences. Neither is the
fact that some of respondent's officers have since resigned from
petitioner of any moment. The local/chapter retains a separate
legal personality from that of its officers or members that remains
viable notwithstanding any turnover in its officers or members.
WHEREFORE, the Petition is DENIED. Costs against
petitioner.
SO ORDERED.
SAMAHANG MANGGAGAWA SA CHARTER
CHEMICAL SOLIDARITY OF UNIONS IN THE
PHILIPPINES FOR EMPOWERMENT AND REFORMS
(SMCC-SUPER), ZACARRIAS JERRY VICTORIO -
UNION PRESIDENT, PETITIONER,VS. CHARTER
CHEMICAL AND COATING CORPORATION,
RESPONDENT.
DECISION
DEL CASTILLO, J.:

The right to file a petition for certification election is accorded to
a labor organization provided that it complies with the
requirements of law for proper registration. The inclusion of
supervisory employees in a labor organization seeking to
represent the bargaining unit of rank-and-file employees does not
divest it of its status as a legitimate labor organization. We apply
these principles to this case.
This Petition for Review on Certiorari seeks to reverse and set
aside the Court of Appeal's March 15, 2005 Decision[1] in CA-
G.R. SP No. 58203, which annulled and set aside the January 13,
2000 Decision[2] of the Department of Labor and Employment
(DOLE) in OS-A-6-53-99 (NCR-OD-M-9902-019) and the
September 16, 2005 Resolution[3] denying petitioner union's
motion for reconsideration.
Factual Antecedents
On February 19, 1999, Samahang Manggagawa sa Charter
Chemical Solidarity of Unions in the Philippines for
Empowerment and Reforms (petitioner union) filed a petition for
certification election among the regular rank-and-file employees
of Charter Chemical and Coating Corporation (respondent
company) with the Mediation Arbitration Unit of the DOLE,
National Capital Region.
On April 14, 1999, respondent company filed an Answer with
Motion to Dismiss[4] on the ground that petitioner union is not a
legitimate labor organization because of (1) failure to comply
with the documentation requirements set by law, and (2) the
inclusion of supervisory employees within petitioner union.[5]
Med-Arbiter's Ruling
On April 30, 1999, Med-Arbiter Tomas F. Falconitin issued a
Decision[6] dismissing the petition for certification election.  The
Med-Arbiter ruled that petitioner union is not a legitimate labor
organization because the Charter Certificate, "Sama-samang
Pahayag ng Pagsapi at Authorization," and "Listahan ng mga
Dumalo sa Pangkalahatang Pulong at mga Sumang-ayon at
Nagratipika sa Saligang Batas" were not executed under oath and
certified by the union secretary and attested to by the union
president as required by Section 235 of the Labor Code[7] in
relation to Section 1, Rule VI of Department Order (D.O.) No. 9,
series of 1997. The union registration was, thus, fatally defective.
The Med-Arbiter further held that the list of membership of
petitioner union consisted of 12 batchman, mill operator and
leadman who performed supervisory functions. Under Article 245
of the Labor Code, said supervisory employees are prohibited
from joining petitioner union which seeks to represent the rank-
and-file employees of respondent company.
As a result, not being a legitimate labor organization, petitioner
union has no right to file a petition for certification election for
the purpose of collective bargaining.
Department of Labor and Employment's Ruling
On July 16, 1999, the DOLE initially issued a Decision[8] in favor
of respondent company dismissing petitioner union's appeal on
the ground that the latter's petition for certification election was
filed out of time. Although the DOLE ruled, contrary to the
findings of the Med-Arbiter, that the charter certificate need not
be verified and that there was no independent evidence presented
to establish respondent company's claim that some members of
petitioner union were holding supervisory positions, the DOLE
sustained the dismissal of the petition for certification after it took
judicial notice that another union, i.e., Pinag-isang
Lakas Manggagawa sa Charter Chemical and Coating
Corporation, previously filed a petition for certification election
on January 16, 1998. The Decision granting the said petition
became final and executory on September 16, 1998 and was
remanded for immediate implementation. Under Section 7, Rule
XI of D.O. No. 9, series of 1997, a motion for intervention
involving a certification election in an unorganized establishment
should be filed prior to the finality of the decision calling for a
certification election. Considering that petitioner union filed its
petition only on February 14, 1999, the same was filed out of
time.
On motion for reconsideration, however, the DOLE reversed its
earlier ruling. In its January 13, 2000 Decision, the DOLE found
that a review of the records indicates that no certification election
was previously conducted in respondent company. On the
contrary, the prior certification election filed by Pinag-isang
Lakas Manggagawa  sa Charter Chemical and Coating
Corporation was, likewise, denied by the Med-Arbiter and, on
appeal, was dismissed by the DOLE for being filed out of time.
Hence, there was no obstacle to the grant of petitioner union's
petition for certification election, viz:
WHEREFORE, the motion for reconsideration is
hereby GRANTED and the decision of this Office dated 16 July
1999 is MODIFIED to allow the certification election among the
regular rank-and-file employees of Charter Chemical and Coating
Corporation with the following choices:
1. Samahang Manggagawa sa Charter Chemical-Solidarity of
Unions in the Philippines for Empowerment and Reform (SMCC-
SUPER); and
2. No Union.
Let the records of this case be remanded to the Regional Office of
origin for the immediate conduct of a certification election,
subject to the usual pre-election conference.
SO DECIDED.[9]
Court of Appeal's Ruling
  On March 15, 2005, the CA promulgated the assailed
Decision, viz:
WHEREFORE, the petition is hereby GRANTED. The assailed
Decision and Resolution dated January 13, 2000 and February 17,
2000 are hereby [ANNULLED] and SET ASIDE.
SO ORDERED.[10]
In nullifying the decision of the DOLE, the appellate court gave
credence to the findings of the Med-Arbiter that petitioner union
failed to comply with the documentation requirements under the
Labor Code. It, likewise, upheld the Med-Arbiter's finding that
petitioner union consisted of both rank-and-file and supervisory
employees.  Moreover, the CA held that the issues as to the
legitimacy of petitioner union may be attacked collaterally in a
petition for certification election and the infirmity in the
membership of petitioner union cannot be remedied through the
exclusion-inclusion proceedings in a pre-election conference
pursuant to the ruling in Toyota Motor Philippines v. Toyota
Motor Philippines Corporation Labor Union.[11] Thus,
considering that petitioner union is not a legitimate labor
organization, it has no legal right to file a petition for certification
election.
Issues
I challenging the July 16, 1999 Decision of the DOLE. The said
Whether x x x the Honorable Court of Appeals committed grave
abuse of discretion tantamount to lack of jurisdiction in granting
the respondent [company's] petition for certiorari (CA G.R. No.
SP No. 58203) in spite of the fact that the issues subject of the
respondent company['s] petition was already settled with finality
and barred from being re-litigated.
II
Whether x x x the Honorable Court of Appeals committed grave
abuse of discretion tantamount to lack of jurisdiction in holding
that the alleged mixture of rank-and-file and supervisory
employee[s] of petitioner [union's] membership is [a] ground for
the cancellation of petitioner [union's] legal personality and
dismissal of [the] petition for certification election.
III
Whether x x x the Honorable Court of Appeals committed grave
abuse of discretion tantamount to lack of jurisdiction in holding
that the alleged failure to certify under oath the local charter
certificate issued by its mother federation and list of the union
membership attending the organizational meeting [is a ground]
for the cancellation of petitioner [union's] legal personality as a
labor organization and for the dismissal of the petition for
certification election.[12]
Petitioner Union's Arguments
Petitioner union claims that the litigation of the issue as to its
legal personality to file the subject petition for certification
election is barred by the July 16, 1999 Decision of the DOLE. In
this decision, the DOLE ruled that petitioner union complied with
all the documentation requirements and that there was no
independent evidence presented to prove an illegal mixture of
supervisory and rank-and-file employees in petitioner union.
After the promulgation of this Decision, respondent company did
not move for reconsideration, thus, this issue must be deemed
settled.
Petitioner union further argues that the lack of verification of its
charter certificate and the alleged illegal composition of its
membership are not grounds for the dismissal of a petition for
certification election under Section 11, Rule XI of D.O. No. 9,
series of 1997, as amended, nor are they grounds for the
cancellation of a union's registration under Section 3, Rule VIII of
said issuance. It contends that what is required to be certified
under oath by the local union's secretary or treasurer and attested
to by the local union's president are limited to the union's
constitution and by-laws, statement of the set of officers, and the
books of accounts.
Finally, the legal personality of petitioner union cannot be
collaterally attacked but may be questioned only in an
independent petition for cancellation pursuant to Section 5, Rule
V, Book IV of the Rules to Implement the Labor Code and the
doctrine enunciated in Tagaytay Highlands International Golf
Club Incoprorated v. Tagaytay Highlands Empoyees Union-
PTGWO.[13]
Respondent Company's Arguments
Respondent company asserts that it cannot be precluded from
decision did not attain finality because the DOLE subsequently
reversed its earlier ruling and, from this decision, respondent
company timely filed its motion for reconsideration.
On the issue of lack of verification of the charter certificate,
respondent company notes that Article 235 of the Labor Code and
Section 1, Rule VI of the Implementing Rules of Book V, as
amended by D.O. No. 9, series of 1997, expressly requires that
the charter certificate be certified under oath.
It also contends that petitioner union is not a legitimate labor
organization because its composition is a mixture of supervisory
and rank-and-file employees in violation of Article 245 of the
Labor Code. Respondent company maintains that the ruling
in Toyota Motor Philippines vs. Toyota Motor Philippines Labor
Union[14] continues to be good case law. Thus, the illegal
composition of petitioner union nullifies its legal personality to
file the subject petition for certification election and its legal
personality may be collaterally attacked in the proceedings for a
petition for certification election as was done here.
Our Ruling
The petition is meritorious.
The issue as to the legal personality of
petitioner union is not barred by the
July 16, 1999 Decision of the DOLE.
A review of the records indicates that the issue as to petitioner
union's legal personality has been timely and consistently raised
by respondent company before the Med-Arbiter, DOLE, CA and
now this Court. In its July 16, 1999 Decision, the DOLE found
that petitioner union complied with the documentation
requirements of the Labor Code and that the evidence was
insufficient to establish that there was an illegal mixture of
supervisory and rank-and-file employees in its membership.
Nonetheless, the petition for certification election was dismissed
on the ground that another union had previously filed a petition
for certification election  seeking  to  represent the  same 
bargaining unit  in respondent company.
Upon motion for reconsideration by petitioner union on January
13, 2000, the DOLE reversed its previous ruling. It upheld the
right of petitioner union to file the subject petition for certification
election because its previous decision was based on a mistaken
appreciation of facts.[15] From this adverse decision, respondent
company timely moved for reconsideration by reiterating its
previous arguments before the Med-Arbiter that petitioner union
has no legal personality to file the subject petition for certification
election.
The July 16, 1999 Decision of the DOLE, therefore, never
attained finality because the parties timely moved for
reconsideration. The issue then as to the legal personality of
petitioner union to file the certification election was properly
raised before the DOLE, the appellate court and now this Court.
The charter certificate need not be
certified under oath by the local union's
secretary or treasurer and attested to
by its president.
Preliminarily, we must note that Congress enacted Republic Act
(R.A.) No. 9481[16] which took effect on June 14, 2007.[17] This
law introduced substantial amendments to the Labor Code.
However, since the operative facts in this case occurred in 1999,
we shall decide the issues under the pertinent legal provisions
then in force (i.e., R.A. No. 6715,[18] amending Book V of the
Labor Code, and the rules and regulations[19] implementing R.A.
No. 6715, as amended by D.O. No. 9,[20]
series of 1997) pursuant to our ruling in Republic v. Kawashima
Textile Mfg., Philippines, Inc.[21]
In the main, the CA ruled that petitioner union failed to comply
with the requisite documents for registration under Article 235 of
the Labor Code and its implementing rules. It agreed with the
Med-Arbiter that the Charter Certificate, Sama-samang Pahayag
ng Pagsapi at Authorization, and Listahan ng mga Dumalo sa
Pangkalahatang Pulong at mga Sumang-ayon at Nagratipika sa
Saligang Batas were not executed under oath. Thus, petitioner
union cannot be accorded the status of a legitimate labor
organization.
We disagree.
The then prevailing Section 1, Rule VI of the Implementing Rules
of Book V, as amended by D.O. No. 9, series of 1997, provides:
Section 1. Chartering and creation of a local chapter -- A duly
registered federation or national union may directly create a
local/chapter by submitting to the Regional Office or to the
Bureau two (2) copies of the following:
(a)  A charter certificate issued by the federation or national union
indicating the creation or establishment of the local/chapter;
(b)  The names of the local/chapter's officers, their addresses, and
the principal office of the local/chapter; and
(c)  The local/chapter's constitution and by-laws provided that
where the local/chapter's constitution and by-laws [are] the same
as [those] of the federation or national union, this fact shall be
indicated accordingly.
All the foregoing supporting requirements shall be certified under
oath by the Secretary or the Treasurer of the local/chapter and
attested to by its President.
As readily seen, the Sama-samang Pahayag ng Pagsapi
at Authorization and Listahan ng mga Dumalo sa
Pangkalahatang Pulong at mga Sumang-ayon at Nagratipika sa
Saligang Batas are not among the documents that need to be
submitted to the Regional Office or Bureau of Labor Relations in
order to register a labor organization. As to the charter certificate,
the above-quoted rule indicates that it should be executed under
oath. Petitioner union concedes and the records confirm that its
charter certificate was not executed under oath. However, in San
Miguel Corporation (Mandaue Packaging Products Plants) v.
Mandaue Packing Products Plants-San Miguel Corporation
Monthlies Rank-and-File Union-FFW (MPPP-SMPP-
SMAMRFU-FFW),[22] which was decided under the auspices of
D.O. No. 9, Series of 1997, we ruled -
In San Miguel Foods-Cebu B-Meg Feed Plant v. Hon. Laguesma,
331 Phil. 356 (1996), the Court ruled that it was not
necessary for the charter certificate to be certified and attested by
the local/chapter officers. Id. While this ruling was based on the
interpretation of the previous Implementing Rules provisions
which were supplanted by the 1997 amendments, we believe
that the same doctrine obtains in this case. Considering that the
charter certificate is prepared and issued by the national union and
not the local/chapter, it does not make sense to have the
local/chapter's officers x x x certify or attest to a document
which they had no hand in the preparation of.[23] (Emphasis
supplied)
In accordance with this ruling, petitioner union's charter
certificate need not be executed under oath. Consequently, it
validly acquired the status of a legitimate labor organization upon
submission of (1) its charter certificate,[24] (2) the names of its
officers, their addresses, and its principal office,[25] and (3) its
constitution and by-laws[26]-- the last two requirements having
been executed under oath by the proper union officials as borne
out by the records.
The mixture of rank-and-file and supervisory
employees in petitioner union does not
nullify its legal personality as a legitimate
labor organization.
The CA found that petitioner union has for its membership both
rank-and-file and supervisory employees. However, petitioner
union sought to represent the bargaining unit consisting of rank-
and-file employees. Under Article 245[27] of the Labor Code,
supervisory employees are not eligible for membership in a labor
organization of rank-and-file employees. Thus, the appellate court
ruled that petitioner union cannot be considered a legitimate labor
organization pursuant to Toyota Motor Philippines v. Toyota
Motor Philippines Corporation Labor
Union[28] (hereinafter Toyota).
Preliminarily, we note that petitioner union questions the factual
findings of the Med-Arbiter, as upheld by the appellate court, that
12 of its members, consisting of batchman, mill operator and
leadman, are supervisory employees. However, petitioner union
failed to present any rebuttal evidence in the proceedings below
after respondent company submitted in evidence the job
descriptions[29] of the aforesaid employees. The job descriptions
indicate that the aforesaid employees exercise recommendatory
managerial actions which are not merely routinary but require the
use of independent judgment, hence, falling within the definition
of supervisory employees under Article 212(m)[30] of the Labor
Code. For this reason, we are constrained to agree with the Med-
Arbiter, as upheld by the appellate court, that petitioner union
consisted of both rank-and-file and supervisory employees.
Nonetheless, the inclusion of the aforesaid supervisory employees
in petitioner union does not divest it of its status as a legitimate
labor organization. The appellate court's reliance on Toyota is
misplaced in view of this Court's subsequent ruling in Republic v.
Kawashima Textile Mfg., Philippines, Inc.
[31]
 (hereinafter Kawashima).  In Kawashima, we explained at
length how and why the Toyota doctrine no longer holds sway
under the altered state of the law and rules applicable to this
case, viz:
R.A. No. 6715 omitted specifying the exact effect any violation
of the prohibition [on the co-mingling of supervisory and
rank-and-file employees] 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, 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."
(Emphasis supplied)
In Dunlop, in which the labor organization that filed a petition for
certification election was one for supervisory employees, but in
which the membership included rank-and-file employees, the
Court reiterated that such labor organization had no legal right to
file a certification election to represent a bargaining unit
composed of supervisors for as long as it counted rank-and-file
employees among its members.
It should be emphasized that the petitions for certification election
involved in Toyota and Dunlop were filed on November 26, 1992
and September 15, 1995, respectively; hence, the 1989 Rules was
applied in both cases.
But then, on June 21, 1997, the 1989 Amended Omnibus Rules
was further amended by Department Order No. 9, series of 1997
(1997 Amended Omnibus Rules). Specifically, the requirement
under Sec. 2(c) of the 1989 Amended Omnibus Rules - that the
petition for certification election indicate that the bargaining unit
of rank-and-file employees has not been mingled with supervisory
employees - was removed. Instead, what the 1997 Amended
Omnibus Rules requires is a plain description of the bargaining
unit, thus:
Rule XI
Certification Elections
xxxx
Sec. 4. Forms and contents of petition. - The petition shall be in
writing and under oath and shall contain, among others, the
following: x x x (c) The description of the bargaining unit.
In Pagpalain Haulers, Inc. v. Trajano, the Court had occasion to
uphold the validity of the 1997 Amended Omnibus Rules,
although the specific provision involved therein was only Sec. 1,
Rule VI, to wit:
"Section. 1. Chartering and creation of a local/chapter.- A duly
registered federation or national union may directly create a
local/chapter by submitting to the Regional Office or to the
Bureau two (2) copies of the following: a) a charter certificate
issued by the federation or national union indicating the creation
or establishment of the local/chapter; (b) the names of the
local/chapter's officers, their addresses, and the principal office of
the local/chapter; and (c) the local/ chapter's constitution and by-
laws; provided that where the local/chapter's constitution and by-
laws is the same as that of the federation or national union, this
fact shall be indicated accordingly.
All the foregoing supporting requirements shall be certified under
oath by the Secretary or the Treasurer of the local/chapter and
attested to by its President."
which does not require that, for its creation and registration, a
local or chapter submit a list of its members.
Then came Tagaytay Highlands Int'l. Golf Club, Inc. v. Tagaytay
Highlands Employees Union-PGTWO in which the core issue was
whether mingling affects the legitimacy of a labor organization
and its right to file a petition for certification election. This time,
given the altered legal milieu, the Court abandoned the view
in Toyota and Dunlop and reverted to its pronouncement
in Lopez that while there is a prohibition against the mingling of
supervisory and rank-and-file employees in one labor
organization, the Labor Code does not provide for the effects
thereof. Thus, the Court held that after a labor organization has
been registered, it may exercise all the rights and privileges of a
legitimate labor organization. Any mingling between supervisory
and rank-and-file employees in its membership cannot affect its
legitimacy for that is not among the grounds for cancellation of its
registration, unless such mingling was brought about by
misrepresentation, false statement or fraud under Article 239 of
the Labor Code.
In San Miguel Corp. (Mandaue Packaging Products Plants) v.
Mandaue Packing Products Plants-San Miguel Packaging
Products-San Miguel Corp. Monthlies Rank-and-File Union-
FFW, the Court explained that since the 1997 Amended Omnibus
Rules does not require a local or chapter to provide a list of its
members, it would be improper for the DOLE to deny recognition
to said local or chapter on account of any question pertaining to
its individual members.
More to the point is Air Philippines Corporation v. Bureau of
Labor Relations, which involved a petition for cancellation of
union registration filed by the employer in 1999 against a rank-
and-file labor organization on the ground of mixed
membership: the Court therein reiterated its ruling in Tagaytay
Highlands that the inclusion in a union of disqualified employees
is not among the grounds for cancellation, unless such inclusion is
due to misrepresentation, false statement or fraud under the
circumstances enumerated in Sections (a) and (c) of Article 239
of the Labor Code.
All said, while the latest issuance is R.A. No. 9481, the 1997
Amended Omnibus Rules, as interpreted by the Court
in Tagaytay Highlands, San Miguel and Air Philippines, had
already set the tone for it. Toyota and Dunlop no longer hold
sway in the present altered state of the law and the rules.
[32]
 [Underline supplied]
The applicable law and rules in the instant case are the same as
those in Kawashima because the present petition for certification
election was filed in 1999 when D.O. No. 9, series of 1997, was
still in effect. Hence, Kawashima applies with equal force here.
As a result, petitioner union was not divested of its status as a
legitimate labor organization even if some of its members were
supervisory employees; it had the right to file the subject petition
for certification election.
The legal personality of petitioner union
cannot be collaterally attacked by respondent
company in the certification election proceedings.
Petitioner union correctly argues that its legal personality cannot
be collaterally attacked in the certification election proceedings.
As we explained in Kawashima:
Except when it is requested to bargain collectively, an employer
is a mere bystander to any petition for certification election; such
proceeding is non-adversarial and merely investigative, for the
purpose thereof is to determine which organization will represent
the employees in their collective bargaining with the employer.
The choice of their representative is the exclusive concern of the
employees; the employer cannot have any partisan interest
therein; it cannot interfere with, much less oppose, the process by
filing a motion to dismiss or an appeal from it; not even a mere
allegation that some employees participating in a petition for
certification election are actually managerial employees will lend
an employer legal personality to block the certification election.
The employer's only right in the proceeding is to be notified or
informed thereof.
The amendments to the Labor Code and its implementing rules
have buttressed that policy even more.[33]
WHEREFORE, the petition is GRANTED. The March 15, 2005
Decision and September 16, 2005 Resolution of the Court of
Appeals in CA-G.R. SP No. 58203 are REVERSED and SET
ASIDE. The January 13, 2000 Decision of the Department of
Labor and Employment in OS-A-6-53-99 (NCR-OD-M-9902-
019) is REINSTATED.
No pronouncement as to costs.
SO ORDERED.
G.R. No. 183317               December 21, 2009
MARIWASA SIAM CERAMICS, INC., Petitioner,
vs.
THE SECRETARY OF THE DEPARTMENT OF LABOR
AND EMPLOYMENT, CHIEF OF THE BUREAU OF
LABOR RELATIONS, DEPARTMENT OF LABOR AND
EMPLOYMENT, REGIONAL DIRECTOR OF DOLE
REGIONAL OFFICE NUMBER IV-A & SAMAHAN NG
MGA MANGGAGAWA SA MARIWASA SIAM
CERAMICS, INC. (SMMSC-INDEPENDENT), Respondents.
DECISION
NACHURA, J.:
This is a petition for review on certiorari1 under Rule 45 of the
Rules of Court, seeking to annul the Decision2 dated December
20, 2007 and the Resolution3 dated June 6, 2008 of the Court of
Appeals in CA-G.R. SP No. 98332.
The antecedent facts are as follows—
On May 4, 2005, respondent Samahan Ng Mga Manggagawa Sa
Mariwasa Siam Ceramics, Inc. (SMMSC-Independent) was
issued a Certificate of Registration4 as a legitimate labor
organization by the Department of Labor and Employment
(DOLE), Region IV-A.
On June 14, 2005, petitioner Mariwasa Siam Ceramics, Inc. filed
a Petition for Cancellation of Union Registration against
respondent, claiming that the latter violated Article 2345 of the
Labor Code for not complying with the 20% requirement, and
that it committed massive fraud and misrepresentation in violation
of Article 2396 of the same code. The case was docketed as Case
No. RO400-0506-AU-004.
On August 26, 2005, the Regional Director of DOLE IV-A issued
an Order granting the petition, revoking the registration of
respondent, and delisting it from the roster of active labor unions.
Aggrieved, respondent appealed to the Bureau of Labor Relations
(BLR).
In a Decision7 dated June 14, 2006, the BLR granted respondent’s
appeal and disposed as follows—
WHEREFORE, premises considered, the appeal by Samahan ng
Manggagawa sa Mariwasa Siam Ceramics, Inc. (SMMSC-
Independent) is hereby GRANTED, and the Decision dated 26
August 2005 by DOLE-Region-IV-A Director Maximo B. Lim is
hereby REVERSED and SET ASIDE. Samahan ng Manggagawa
sa Mariwasa Siam Ceramics, Inc. (SMMSC-Independent), under
Registration Certificate No. RO400-200505-UR-002, remains in
the roster of legitimate labor organizations.
SO DECIDED.8
Petitioner filed a Motion for Reconsideration but the BLR denied
it in a Resolution9 dated February 2, 2007.
Petitioner sought recourse with the Court of Appeals (CA)
through a Petition for Certiorari; but the CA denied the petition
for lack of merit.
Petitioner’s motion for reconsideration of the CA Decision was
likewise denied, hence, this petition based on the following
grounds—
Review of the Factual Findings of the Bureau of Labor Relations,
adopted and confirmed by the Honorable Court of Appeals is
warranted[;]
The Honorable Court of Appeals seriously erred in ruling that the
affidavits of recantation cannot be given credence[;]
The Honorable Court of Appeals seriously erred in ruling that
private respondent union complied with the 20% membership
requirement[; and]
The Honorable Court of Appeals seriously erred when it ruled
that private respondent union did not commit misrepresentation,
fraud or false statement.10
The petition should be denied.
The petitioner insists that respondent failed to comply with the
20% union membership requirement for its registration as a
legitimate labor organization because of the disaffiliation from the
total number of union members of 102 employees who executed
affidavits recanting their union membership.
It is, thus, imperative that we peruse the affidavits appearing to
have been executed by these affiants.
The affidavits uniformly state—
Ako, _____________, Pilipino, may sapat na gulang, regular na
empleyado bilang Rank & File sa Mariwasa Siam Ceramics, Inc.,
Bo. San Antonio, Sto. Tomas, Batangas, matapos na
makapanumpa ng naaayon sa batas ay malaya at kusang loob na
nagsasaad ng mga sumusunod:
1. Ako ay napilitan at nilinlang sa pagsapi sa Samahan
ng mga Manggagawa sa Mariwasa Siam Ceramics, Inc.
o SMMSC-Independent sa kabila ng aking pag-
aalinlangan[;]
2. Aking lubos na pinagsisihan ang aking pagpirma sa
sipi ng samahan, at handa ako[ng] tumalikod sa
anumang kasulatan na aking nalagdaan sa kadahilanan
na hindi angkop sa aking pananaw ang mga mungkahi o
adhikain ng samahan.
SA KATUNAYAN NANG LAHAT, ako ay lumagda ng aking
pangalan ngayong ika-____ ng ______, 2005 dito sa Lalawigan
ng Batangas, Bayan ng Sto. Tomas.
____________________
Nagsasalaysay
Evidently, these affidavits were written and prepared in advance,
and the pro forma affidavits were ready to be filled out with the
employees’ names and signatures.
The first common allegation in the affidavits is a declaration that,
in spite of his hesitation, the affiant was forced and deceived into
joining the respondent union. It is worthy to note, however, that
the affidavit does not mention the identity of the people who
allegedly forced and deceived the affiant into joining the union,
much less the circumstances that constituted such force and
deceit. Indeed, not only was this allegation couched in very
general terms and sweeping in nature, but more importantly, it
was not supported by any evidence whatsoever.
The second allegation ostensibly bares the affiant’s regret for
joining respondent union and expresses the desire to abandon or
renege from whatever agreement he may have signed regarding
his membership with respondent.
Simply put, through these affidavits, it is made to appear that the
affiants recanted their support of respondent’s application for
registration.
In appreciating affidavits of recantation such as these, our ruling
in La Suerte Cigar and Cigarette Factory v. Director of the Bureau
of Labor Relations11 is enlightening, viz.—
On the second issue—whether or not the withdrawal of 31 union
members from NATU affected the petition for certification
election insofar as the 30% requirement is concerned, We reserve
the Order of the respondent Director of the Bureau of Labor
Relations, it appearing undisputably that the 31 union members
had withdrawn their support to the petition before the filing of
said petition. It would be otherwise if the withdrawal was made
after the filing of the petition for it would then be presumed that
the withdrawal was not free and voluntary. The presumption
would arise that the withdrawal was procured through duress,
coercion or for valuable consideration. In other words, the
distinction must be that withdrawals made before the filing of the
petition are presumed voluntary unless there is convincing proof
to the contrary, whereas withdrawals made after the filing of the
petition are deemed involuntary.
The reason for such distinction is that if the withdrawal or
retraction is made before the filing of the petition, the names of
employees supporting the petition are supposed to be held secret
to the opposite party. Logically, any such withdrawal or retraction
shows voluntariness in the absence of proof to the contrary.
Moreover, it becomes apparent that such employees had not given
consent to the filing of the petition, hence the subscription
requirement has not been met.
When the withdrawal or retraction is made after the petition is
filed, the employees who are supporting the petition become
known to the opposite party since their names are attached to the
petition at the time of filing. Therefore, it would not be
unexpected that the opposite party would use foul means for the
subject employees to withdraw their support.12
In the instant case, the affidavits of recantation were executed
after the identities of the union members became public, i.e., after
the union filed a petition for certification election on May 23,
2005, since the names of the members were attached to the
petition. The purported withdrawal of support for the registration
of the union was made after the documents were submitted to the
DOLE, Region IV-A. The logical conclusion, therefore, following
jurisprudence, is that the employees were not totally free from the
employer’s pressure, and so the voluntariness of the employees’
execution of the affidavits becomes suspect.
It is likewise notable that the first batch of 25 pro forma affidavits
shows that the affidavits were executed by the individual affiants
on different dates from May 26, 2005 until June 3, 2005, but they
were all sworn before a notary public on June 8, 2005.
There was also a second set of standardized affidavits executed on
different dates from May 26, 2005 until July 6, 2005. While these
77 affidavits were notarized on different dates, 56 of these were
notarized on June 8, 2005, the very same date when the first set of
25 was notarized.
Considering that the first set of 25 affidavits was submitted to the
DOLE on June 14, 2005, it is surprising why petitioner was able
to submit the second set of affidavits only on July 12, 2005.
Accordingly, we cannot give full credence to these affidavits,
which were executed under suspicious circumstances, and which
contain allegations unsupported by evidence. At best, these
affidavits are self-serving. They possess no probative value.
A retraction does not necessarily negate an earlier declaration. For
this reason, retractions are looked upon with disfavor and do not
automatically exclude the original statement or declaration based
solely on the recantation. It is imperative that a determination be
first made as to which between the original and the new
statements should be given weight or accorded belief, applying
the general rules on evidence. In this case, inasmuch as they
remain bare allegations, the purported recantations should not be
upheld.13
Nevertheless, even assuming the veracity of the affidavits of
recantation, the legitimacy of respondent as a labor organization
must be affirmed. While it is true that the withdrawal of support
may be considered as a resignation from the union, the fact
remains that at the time of the union’s application for registration,
the affiants were members of respondent and they comprised
more than the required 20% membership for purposes of
registration as a labor union. Article 234 of the Labor Code
merely requires a 20% minimum membership during the
application for union registration. It does not mandate that a union
must maintain the 20% minimum membership requirement all
throughout its existence.141avvphi1
Respondent asserts that it had a total of 173 union members at the
time it applied for registration. Two names were repeated in
respondent’s list and had to be deducted, but the total would still
be 171 union members. Further, out of the four names alleged to
be no longer connected with petitioner, only two names should be
deleted from the list since Diana Motilla and T.W. Amutan
resigned from petitioner only on May 10, 2005 and May 17, 2005,
respectively, or after respondent’s registration had already been
granted. Thus, the total union membership at the time of
registration was 169. Since the total number of rank-and-file
employees at that time was 528, 169 employees would be
equivalent to 32% of the total rank-and-file workers complement,
still very much above the minimum required by law.
For the purpose of de-certifying a union such as respondent, it
must be shown that there was misrepresentation, false statement
or fraud in connection with the adoption or ratification of the
constitution and by-laws or amendments thereto; the minutes of
ratification; or, in connection with the election of officers, the
minutes of the election of officers, the list of voters, or failure to
submit these documents together with the list of the newly
elected-appointed officers and their postal addresses to the BLR.15
The bare fact that two signatures appeared twice on the list of
those who participated in the organizational meeting would not, to
our mind, provide a valid reason to cancel respondent’s certificate
of registration. The cancellation of a union’s registration
doubtless has an impairing dimension on the right of labor to self-
organization. For fraud and misrepresentation to be grounds for
cancellation of union registration under the Labor Code, the
nature of the fraud and misrepresentation must be grave and
compelling enough to vitiate the consent of a majority of union
members.
In this case, we agree with the BLR and the CA that respondent
could not have possibly committed misrepresentation, fraud, or
false statements. The alleged failure of respondent to indicate
with mathematical precision the total number of employees in the
bargaining unit is of no moment, especially as it was able to
comply with the 20% minimum membership requirement. Even if
the total number of rank-and-file employees of petitioner is 528,
while respondent declared that it should only be 455, it still
cannot be denied that the latter would have more than complied
with the registration requirement.
WHEREFORE, the petition is DENIED. The assailed December
20, 2007 Decision and the June 6, 2008 Resolution of the Court of
Appeals are AFFIRMED. Costs against petitioner.
SO ORDERED.
G.R. No. 178989               March 18, 2010
EAGLE RIDGE GOLF & COUNTRY CLUB, Petitioner,
vs.
COURT OF APPEALS and EAGLE RIDGE EMPLOYEES
UNION (EREU), Respondents.
DECISION
VELASCO, JR., J.:
In this petition for certiorari under Rule 65, Eagle Ridge Golf &
Country Club (Eagle Ridge) assails and seeks to nullify the
Resolutions of the Court of Appeals (CA) dated April 27,
20071 and June 6, 2007,2 issued in CA-G.R. SP No. 98624,
denying a similar recourse petitioner earlier interposed to set
aside the December 21, 2006 Decision3 of the Bureau of Labor
Relations (BLR), as reiterated in a Resolution4 of March 7, 2007.
Petitioner Eagle Ridge is a corporation engaged in the business of
maintaining golf courses. It had, at the end of CY 2005, around
112 rank-and-file employees. The instant case is an off-shot of the
desire of a number of these employees to organize themselves as
a legitimate labor union and their employer’s opposition to their
aspiration.
The Facts
On December 6, 2005, at least 20% of Eagle Ridge’s rank-and-
file employees—the percentage threshold required under Article
234(c) of the Labor Code for union registration—had a meeting
where they organized themselves into an independent labor union,
named "Eagle Ridge Employees Union" (EREU or
Union),5 elected a set of officers,6 and ratified7 their constitution
and by-laws.8
On December 19, 2005, EREU formally applied for
registration9 and filed BLR Reg. Form No. I-LO, s. 199810 before
the Department of Labor and Employment (DOLE) Regional
Office IV (RO IV). In time, DOLE RO IV granted the application
and issued EREU Registration Certificate (Reg. Cert.) No.
RO400-200512-UR-003.
The EREU then filed a petition for certification election in Eagle
Ridge Golf & Country Club, docketed as Case No. RO400-0601-
RU-002. Eagle Ridge opposed this petition,11 followed by its
filing of a petition for the cancellation12 of Reg. Cert. No. RO400-
200512-UR-003. Docketed as RO400-0602-AU-003, Eagle
Ridge’s petition ascribed misrepresentation, false statement, or
fraud to EREU in connection with the adoption of its constitution
and by-laws, the numerical composition of the Union, and the
election of its officers.
Going into specifics, Eagle Ridge alleged that the EREU declared
in its application for registration having 30 members, when the
minutes of its December 6, 2005 organizational meeting showed
it only had 26 members. The misrepresentation was exacerbated
by the discrepancy between the certification issued by the Union
secretary and president that 25 members actually ratified the
constitution and by-laws on December 6, 2005 and the fact that
26 members affixed their signatures on the documents, making
one signature a forgery.
Finally, Eagle Ridge contended that five employees who attended
the organizational meeting had manifested the desire to withdraw
from the union. The five executed individual affidavits
or Sinumpaang Salaysay13 on February 15, 2006, attesting that
they arrived late at said meeting which they claimed to be
drinking spree; that they did not know that the documents they
signed on that occasion pertained to the organization of a union;
and that they now wanted to be excluded from the Union. The
withdrawal of the five, Eagle Ridge maintained, effectively
reduced the union membership to 20 or 21, either of which is
below the mandatory minimum 20% membership requirement
under Art. 234(c) of the Labor Code. Reckoned from 112 rank-
and-file employees of Eagle Ridge, the required number would be
22 or 23 employees.
As a counterpoint, EREU, in its Comment,14 argued in gist:
1) the petition for cancellation was procedurally
deficient as it does not contain a certification against
forum shopping and that the same was verified by one
not duly authorized by Eagle Ridge’s board;
2) the alleged discrepancies are not real for before filing
of its application on December 19, 2005, four additional
employees joined the union on December 8, 2005, thus
raising the union membership to 30 members as of
December 19, 2005;
3) the understatement by one member who ratified the
constitution and by-laws was a typographical error,
which does not make it either grave or malicious
warranting the cancellation of the union’s registration;
4) the retraction of 5 union members should not be
given any credence for the reasons that: (a) the sworn
statements of the five retracting union members sans
other affirmative evidence presented hardly qualify as
clear and credible evidence considering the joint
affidavits of the other members attesting to the orderly
conduct of the organizational meeting; (b) the retracting
members did not deny signing the union documents; (c)
following, Belyca Corporation v. Ferrer-
Calleja15 and Oriental Tin Can Labor Union v.
Secretary of Labor and Employment,16 it can be
presumed that "duress, coercion or valuable
consideration" was brought to bear on the retracting
members; and (d) citing La Suerte Cigar and Cigarette
Factory v. Director of Bureau of Labor
Relations,17 Belyca Corporation and Oriental Tin Can
Labor Union, where the Court ruled that "once the
required percentage requirement has been reached, the
employees’ withdrawal from union membership taking
place after the filing of the petition for certification
election will not affect the petition," it asserted the
 applicability of said ruling as the petition for
certification election was filed on January 10, 2006 or
long before February 15, 2006 when the affidavits of
retraction were executed by the five union members,
thus contending that the retractions do not affect nor be
deemed compelling enough to cancel its certificate of
registration.
The Union presented the duly accomplished union membership
forms18 dated December 8, 2005 of four additional members. And
to rebut the allegations in the affidavits of retraction of the five
union members, it presented the Sama-Samang Sinumpaang
Salaysay19 dated March 20, 2006 of eight union members;
another Sama-Samang Sinumpaang Salaysay,20 also bearing date
March 20, 2006, of four other union members; and the Sworn
Statement21 dated March 16, 2006 of the Union’s legal counsel,
Atty. Domingo T. Añonuevo. These affidavits attested to the
orderly and proper proceedings of the organizational meeting on
December 6, 2005.
In its Reply,22 Eagle Ridge reiterated the grounds it raised in its
petition for cancellation and asserted further that the four
additional members were fraudulently admitted into the Union.
As Eagle Ridge claimed, the applications of the four neither
complied with the requirements under Section 2, Art. IV of the
union’s constitution and by-laws nor were they shown to have
been duly received, issued receipts for admission fees, processed
with recommendation for approval, and approved by the union
president.
Moreover, Eagle Ridge presented another Sinumpaang
Salaysay23 of retraction dated March 15, 2006 of another union
member. The membership of EREU had thus been further
reduced to only 19 or 20. This same member was listed in the
first Sama-Samang Sinumpaang Salaysay24 presented by the
Union but did not sign it.
The Ruling of the DOLE Regional Director
After due proceedings, the DOLE Regional Director, Region IV-
A, focusing on the question of misrepresentation, issued on April
28, 2006 an Order25 finding for Eagle Ridge, its petition to cancel
Reg. Cert. No. RO400-200512-UR-003 being granted and EREU
being delisted from the roster of legitimate labor organizations.
Aggrieved, the Union appealed to the BLR, the recourse docketed
as BLR A-C-30-5-31-06 (Case No. RO400-0602-AU-003).
The Ruling of the BLR
Initially, the BLR, then headed by an Officer-in-Charge (OIC),
affirmed26 the appealed order of the DOLE Regional Director.
Undeterred by successive set backs, EREU interposed a motion
for reconsideration, contending that:
1) Contrary to the ruling of the BLR OIC Director, a
certificate of non-forum shopping is mandatory
requirement, under Department Order No. (DO) 40-03
and the Rules of Court, non-compliance with which is a
ground to dismiss a petition for cancellation of a
certificate of registration;
2) It was erroneous for both the Regional Director and
the BLR OIC Director to give credence to the retraction
statements of union members which were not presented
for reaffirmation during any of the hearings of the case,
contrary to the requirement for the admission of such
evidence under Sec. 11, Rule XI of DO 40-03.
In a Decision dated December 21, 2006, the BLR, now headed by
Director Rebecca C. Chato, set aside the July 28, 2006 order of
the BLR OIC Director, disposing as follows:
WHEREFORE, the motion for reconsideration is hereby
GRANTED and our Resolution dated 28 July 2006 is hereby
VACATED. Accordingly, the Eagle Ridge Employees Union
(EREU) shall remain in the roster of legitimate organizations.
In finding for the Union, the BLR Director eschewed procedural
technicalities. Nonetheless, she found as without basis allegations
of misrepresentation or fraud as ground for cancellation of
EREU’s registration.
In turn aggrieved, Eagle Ridge sought but was denied
reconsideration per the BLR’s Resolution dated March 7, 2007.
Eagle Ridge thereupon went to the CA on a petition for certiorari.
The Ruling of the CA
On April 27, 2007, the appellate court, in a terse two-page
Resolution,27 dismissed Eagle Ridge’s petition for being deficient,
as:
1. the questioned [BLR] Decision dated December 21,
2006 and the Resolution dated March 7, 2007
Resolution [appended to the petition] are mere machine
copies; and
2. the verification and certification of non-forum
shopping was subscribed to by Luna C. Piezas on her
representation as the legal counsel of the petitioner, but
sans [the requisite] Secretary’s Certificate or Board
Resolution authorizing her to execute and sign the same.
The CA later denied, in its second assailed resolution, Eagle
Ridge’s motion for reconsideration, albeit the latter had submitted
a certificate to show that its legal counsel has been authorized, per
a board resolution, to represent the corporation.
The Issues
Eagle Ridge is now before us via this petition for certiorari on the
submissions that:
I.
[THE CA] COMMITTED SERIOUS ERROR AND GRAVE
ABUSE OF DISCRETION AMOUNTING TO LACK OR
EXCESS OF JURISDICTION IN DISMISSING THE
COMPANY’S PETITION FOR CERTIORARI AND DENYING
ITS MOTION FOR RECONSIDERATION CONSIDERING
THAT THE COMPANY’S PREVIOUS COUNSEL WAS
AUTHORIZED TO REPRESENT THE COMPANY IN THE
PETITION FOR CERTIORARI FILED BEFORE THE [CA];
II.
IN ORDER NOT TO FURTHER PREJUDICE THE
COMPANY, IT IS RESPECTFULLY SUBMITTED THAT
THIS HONORABLE COURT COULD TAKE COGNIZANCE
OF THE MERITS OF THIS CASE AND RESOLVE THAT
BASED ON THE EVIDENCE ON RECORD, THERE WAS
FRAUD, MISREPRESENTATION AND/OR FALSE
STATEMENT WHICH WARRANT THE CANCELLATION
OF CERTIFICATE OF REGISTRATION OF EREU.28
The Court’s Ruling
We dismiss the petition.
Procedural Issue: Lack of Authority
Certiorari is an extraordinary, prerogative remedy and is never
issued as a matter of right.29 Accordingly, the party who seeks to
avail of it must strictly observe the rules laid down by law.30
Petitions for certiorari under Rule 65 of the Rules of Court require
a "sworn certification of non-forum shopping as provided in the
third paragraph of Section 3, Rule 46."31 Sec. 3, paragraphs 4 and
6 of Rule 46 pertinently provides:
SEC. 3. Contents and filing of petition; effect of non-compliance
with requirements. — x x x x
xxxx
xxxx
The petitioner shall also submit together with the petition
a sworn certification that he has not theretofore commenced
any action involving the same issues in the Supreme Court, the
Court of Appeals x x x, or any other tribunal or agency; if there is
such other action or proceeding, he must state the status of the
same x x x.
xxxx
The failure of the petitioner to comply with any of the
foregoing requirements shall be sufficient ground for the
dismissal of the petition. (Emphasis supplied.)
Evidently, the Rules requires the petitioner, not his counsel, to
sign under oath the requisite certification against non-forum
shopping. Such certification is a peculiar personal representation
on the part of the principal party, an assurance to the court that
there are no other pending cases involving basically the same
parties, issues, and cause of action.32
In the instant case, the sworn verification and certification of non-
forum shopping in the petition for certiorari of Eagle Ridge filed
before the CA carried the signature of its counsel without the
requisite authority.
Eagle Ridge tried to address its faux pas by submitting its board
secretary’s Certificate33 dated May 15, 2007, attesting to the
issuance on May 10, 2007 of Board Resolution No. ERGCCI
07/III-01 that authorized its counsel of record, Atty. Luna C.
Piezas, to represent it before the appellate court.
The CA, however, rejected Eagle Ridge’s virtual plea for the
relaxation of the rules on the signing of the verification and
certification against forum shopping, observing that the board
resolution adverted to was approved after Atty. Piezas has signed
and filed for Eagle Ridge the petition for certiorari.
The appellate court’s assailed action is in no way tainted with
grave abuse of discretion, as Eagle Ridge would have this Court
believed. Indeed, a certification of non-forum shopping signed by
counsel without the proper authorization is defective and
constitutes a valid cause for dismissal of the petition.34
The submission of the board secretary’s certificate through a
motion for reconsideration of the CA’s decision dismissing the
petition for certiorari may be considered a substantial compliance
with the Rules of Court.35 Yet, this rule presupposes that the
authorizing board resolution, the approval of which is certified to
by the secretary’s certification, was passed within the
reglementary period for filing the petition. This particular
situation does not, however, obtain under the premises. The
records yield the following material dates and incidents: Eagle
Ridge received the May 7, 2007 resolution of the BLR Director
on March 9, 2007, thus giving it 60 days or up to May 8, 2007 to
file a petition for certiorari, as it in fact filed its petition on April
18, 2007 before the CA. The authorization for its counsel,
however, was only issued in a meeting of its board on May 10,
2007 or a couple of days beyond the 60-day reglementary period
referred to in filing a certiorari action. Thus, there was no
substantial compliance with the Rules.
As with most rules of procedure, however, exceptions are
invariably recognized and the relaxation of procedural rules on
review has been effected to obviate jeopardizing substantial
justice.36 This liberality stresses the importance of review in our
judicial grievance structure to accord every party litigant the
amplest opportunity for the proper and just disposition of his
cause, freed from the constraints of technicalities.37 But
concomitant to a liberal interpretation of the rules of procedure
should be an effort on the part of the party invoking liberality to
adequately explain his failure to abide by the rules.381avvphi1
To us, Eagle Ridge has not satisfactorily explained its failure to
comply. It may be true, as Eagle Ridge urges, that its counsel’s
authority to represent the corporation was never questioned before
the DOLE regional office and agency. But EREU’s misstep could
hardly lend Eagle Ridge comfort. And obviously, Eagle Ridge
and its counsel erred in equating the latter’s representation as
legal counsel with the authority to sign the verification and the
certificate of non-forum shopping in the former’s behalf. We note
that the authority to represent a client before a court or quasi-
judicial agency does not require an authorizing board resolution,
as the counsel-client relationship is presumed by the counsel’s
representation by the filing of a pleading on behalf of the client.
In filing a pleading, the counsel affixes his signature on it, but it is
the client who must sign the verification and the certification
against forum shopping, save when a board resolution authorizes
the former to sign so.
It is entirely a different matter for the counsel to sign the
verification and the certificate of non-forum shopping. The
attestation or certification in either verification or certification of
non-forum shopping requires the act of the principal party. As
earlier indicated, Sec. 3 of Rule 46 exacts this requirement; so
does the first paragraph of Sec. 5 of Rule 7 pertinently reading:
SEC. 5. Certification against forum shopping. — The plaintiff or
principal party shall certify under oath in the complaint or other
initiatory pleading asserting a claim for relief, or in a sworn
certification annexed thereto and simultaneously filed therewith:
(a) that he has not theretofore commenced any action or filed any
claim involving the same issues in any court, tribunal or quasi-
judicial agency and, to the best of his knowledge, no such other
action or claim is pending therein; (b) if there is such other
pending action or claim, a complete statement of the present
status thereof; and (c) if he should thereafter learn that the same
or similar action or claim has been filed or is pending, he shall
report that fact within five (5) days therefrom to the court wherein
his aforesaid complaint or initiatory pleading has been filed.
(Emphasis added.)
It is, thus, clear that the counsel is not the proper person to sign
the certification against forum shopping. If, for any reason, the
principal party cannot sign the petition, the one signing on his
behalf must have been duly authorized.39
In addition, Eagle Ridge maintains that the submitted board
resolution, albeit passed after the filing of the petition was filed,
should be treated as a ratificatory medium of the counsel’s act of
signing the sworn certification of non-forum shopping.
We are not inclined to grant the desired liberality owing to Eagle
Ridge’s failure to sufficiently explain its failure to follow the
clear rules.
If for the foregoing considerations alone, the Court could very
well dismiss the instant petition. Nevertheless, the Court will
explore the merits of the instant case to obviate the inequity that
might result from the outright denial of the petition.
Substantive Issue: No Fraud in the Application
Eagle Ridge cites the grounds provided under Art. 239(a) and (c)
of the Labor Code for its petition for cancellation of the EREU’s
registration. On the other hand, the Union asserts bona
fide compliance with the registration requirements under Art. 234
of the Code, explaining the seeming discrepancies between the
number of employees who participated in the organizational
meeting and the total number of union members at the time it
filed its registration, as well as the typographical error in its
certification which understated by one the number of union
members who ratified the union’s constitution and by-laws.
Before their amendment by Republic Act No. 948140 on June 15,
2007, the then governing Art. 234 (on the requirements of
registration of a labor union) and Art. 239 (on the grounds for
cancellation of union registration) of the Labor Code respectively
provided as follows:
ART. 234. REQUIREMENTS OF REGISTRATION. ––
Any applicant labor organization, association or group of
unions or workers shall acquire legal personality and shall be
entitled to the rights and privileges granted by law to legitimate
labor organizations upon issuance of the certificate of registration
based on the following requirements:
(a) Fifty pesos (P50.00) registration fee;
(b) The names of its officers, their addresses, the
principal address of the labor organization, the minutes
of the organizational meetings and the list of workers
who participated in such meetings;
(c) The names of all its members comprising at least
twenty percent (20%) of all the employees in the
bargaining unit where it seeks to operate;
xxxx
(e) Four copies (4) of the constitution and by-laws of the
applicant union, minutes of its adoption or
ratification and the list of the members who
participated in it.41
xxxx
ART. 239. GROUNDS FOR CANCELLATION OF UNION
REGISTRATION. –– The following shall constitute grounds for
cancellation of union registration:
(a) Misrepresentation, false statements or fraud in
connection with the adoption or ratification of the
constitution and by-laws or amendments thereto,
the minutes of ratification, and the list of members
who took part in the ratification;
xxxx
(c) Misrepresentation, false statements or fraud in
connection with the election of officers, minutes of
the election of officers, the list of voters, or failure to
submit these documents together with the list of the
newly elected/appointed officers and their postal
addresses within thirty (30) days from
election.42 (Emphasis supplied.)
A scrutiny of the records fails to show any misrepresentation,
false statement, or fraud committed by EREU to merit
cancellation of its registration.
First. The Union submitted the required documents
attesting to the facts of the organizational meeting on
December 6, 2005, the election of its officers, and the
adoption of the Union’s constitution and by-laws. It
submitted before the DOLE Regional Office with its
Application for Registration and the duly filled out BLR
Reg. Form No. I-LO, s. 1998, the following documents,
to wit:
(a) the minutes of its organizational
meeting43 held on December 6, 2005 showing
26 founding members who elected its union
officers by secret ballot;
 (b) the list of rank-and-file employees44 of
Eagle Ridge who attended the organizational
meeting and the election of officers with their
individual signatures;
(c) the list of rank-and-file employees45 who
ratified the union’s constitution and by-laws
showing the very same list as those who
attended the organizational meeting and the
election of officers with their individual
signatures except the addition of four
employees without their signatures, i.e., Cherry
Labajo, Grace Pollo, Annalyn Poniente and
Rowel Dolendo;
(d) the union’s constitution and by-laws46 as
approved on December 6, 2005;
(e) the list of officers47 and their addresses;
(f) the list of union members48 showing a total
of 30 members; and
(g) the Sworn Statement49 of the union’s
elected president and secretary. All the
foregoing documents except the sworn
statement of the president and the secretary
were accompanied by Certifications50 by the
union secretary duly attested to by the union
president.
Second. The members of the EREU totaled 30
employees when it applied on December 19, 2005 for
registration. The Union thereby complied with the
mandatory minimum 20% membership requirement
under Art. 234(c). Of note is the undisputed number of
112 rank-and-file employees in Eagle Ridge, as shown
in the Sworn Statement of the Union president and
secretary and confirmed by Eagle Ridge in its petition
for cancellation.
Third. The Union has sufficiently explained the
discrepancy between the number of those who attended
the organizational meeting showing 26 employees and
the list of union members showing 30. The difference is
due to the additional four members admitted two days
after the organizational meeting as attested to by their
duly accomplished Union Membership forms.
Consequently, the total number of union members, as of
December 8, 2005, was 30, which was truthfully
indicated in its application for registration on December
19, 2005.
As aptly found by the BLR Director, the Union already
had 30 members when it applied for registration, for the
admission of new members is neither prohibited by law
nor was it concealed in its application for registration.
Eagle Ridge’s contention is flawed when it equated the
requirements under Art. 234(b) and (c) of the Labor
Code. Par. (b) clearly required the submission of the
minutes of the organizational meetings and the list of
workers who participated in the meetings, while par. (c)
merely required the list of names of all the union
members comprising at least 20% of the bargaining unit.
The fact that EREU had 30 members when it applied for
registration on December 19, 2005 while only 26
actually participated in the organizational meeting is
borne by the records.
Fourth. In its futile attempt to clutch at straws, Eagle
Ridge assails the inclusion of the additional four
members allegedly for not complying with what it
termed as "the sine qua non requirements" for union
member applications under the Union’s constitution and
by-laws, specifically Sec. 2 of Art. IV. We are not
persuaded. Any seeming infirmity in the application and
admission of union membership, most especially in
cases of independent labor unions, must be viewed in
favor of valid membership.
The right of employees to self-organization and
membership in a union must not be trammeled by undue
difficulties. In this case, when the Union said that the
four employee-applicants had been admitted as union
members, it is enough to establish the fact of admission
of the four that they had duly signified such desire by
accomplishing the membership form. The fact, as
pointed out by Eagle Ridge, that the Union, owing to its
scant membership, had not yet fully organized its
different committees evidently shows the direct and
valid acceptance of the four employee applicants rather
than deter their admission—as erroneously asserted by
Eagle Ridge.
Fifth. The difference between the number of 26
members, who ratified the Union’s constitution and by-
laws, and the 25 members shown in the certification of
the Union secretary as having ratified it, is, as shown by
the factual antecedents, a typographical error. It was an
insignificant mistake committed without malice or
prevarication. The list of those who attended the
organizational meeting shows 26 members, as evidenced
by the signatures beside their handwritten names. Thus,
the certification’s understatement by one member, while
not factual, was clearly an error, but neither a
misleading one nor a misrepresentation of what had
actually happened.
Sixth. In the more meaty issue of the affidavits of
retraction executed by six union members, we hold that
the probative value of these affidavits cannot overcome
those of the supporting affidavits of 12 union members
and their counsel as to the proceedings and the conduct
of the organizational meeting on December 6, 2005. The
DOLE Regional Director and the BLR OIC Director
obviously erred in giving credence to the affidavits of
retraction, but not according the same treatment to the
supporting affidavits.
The six affiants of the affidavits of retraction were not
presented in a hearing before the Hearing Officer
(DOLE Regional Director), as required under the Rules
Implementing Book V of the Labor Code covering
Labor Relations. Said Rules is embodied in Department
Order No. (DO) 40-03 which was issued on February
17, 2003 and took effect on March 15, 2003 to replace
DO 9 of 1997. Sec. 11, Rule XI of DO 40-03
specifically requires:
Section 11. Affirmation of testimonial evidence.
– Any affidavit submitted by a party to prove his/her
claims or defenses shall be re-affirmed by the
presentation of the affiant before the Med-Arbiter
or Hearing Officer, as the case may be. Any affidavit
submitted without the re-affirmation of the
affiant during a scheduled hearing shall not be
admitted in evidence, except when the party against
whom the affidavit is being offered admits all
allegations therein and waives the examination of the
affiant.
It is settled that affidavits partake the nature of hearsay
evidence, since they are not generally prepared by the
affiant but by another who uses his own language in
writing the affiant’s statement, which may thus be either
omitted or misunderstood by the one writing them.51 The
above rule affirms the general requirement in adversarial
proceedings for the examination of the affiant by the
party against whom the affidavit is offered. In the
instant case, it is required for affiants to re-affirm the
contents of their affidavits during the hearing of the
instant case for them to be examined by the opposing
party, i.e., the Union.
For their non-presentation and consonant to the above-
quoted rule, the six affidavits of retraction are
inadmissible as evidence against the Union in the instant
case. Moreover, the affidavit and joint-affidavits
presented by the Union before the DOLE Regional
Director were duly re-affirmed in the hearing of March
20, 2006 by the affiants. Thus, a reversible error was
committed by the DOLE Regional Director and the BLR
OIC Director in giving credence to the inadmissible
affidavits of retraction presented by Eagle Ridge while
not giving credence to the duly re-affirmed affidavits
presented by the Union.
Evidently, the allegations in the six affidavits of
retraction have no probative value and at the very least
cannot outweigh the rebutting attestations of the duly re-
affirmed affidavits presented by the Union.
Seventh. The fact that six union members, indeed,
expressed the desire to withdraw their membership
through their affidavits of retraction will not cause the
cancellation of registration on the ground of violation of
Art. 234(c) of the Labor Code requiring the mandatory
minimum 20% membership of rank-and-file employees
in the employees’ union.
The six retracting union members clearly severed and
withdrew their union membership. The query is whether
such separation from the Union can detrimentally affect
the registration of the Union.
We answer in the negative.
Twenty percent (20%) of 112 rank-and-file employees
in Eagle Ridge would require a union membership of at
least 22 employees (112 x 205 = 22.4). When the EREU
filed its application for registration on December 19,
2005, there were clearly 30 union members. Thus, when
the certificate of registration was granted, there is no
dispute that the Union complied with the mandatory
20% membership requirement.
Besides, it cannot be argued that the six affidavits of
retraction retroact to the time of the application of
registration or even way back to the organizational
meeting. Prior to their withdrawal, the six employees in
question were bona fide union members. More so, they
never disputed affixing their signatures beside their
handwritten names during the organizational meetings.
While they alleged that they did not know what they
were signing, it bears stressing that their affidavits of
retraction were not re-affirmed during the hearings of
the instant case rendering them of little, if any,
evidentiary value.
With the withdrawal of six union members, there is still
compliance with the mandatory membership
requirement under Art. 234(c), for the remaining 24
union members constitute more than the 20%
membership requirement of 22 employees.
Eagle Ridge further argues that the list of union
members includes a supervisory employee. This is a
factual issue which had not been raised at the first
instance before the DOLE Regional Director and cannot
be appreciated in this proceeding. To be sure, Eagle
Ridge knows well who among its personnel belongs or
does not belong to the supervisory group. Obviously, its
attempt to raise the issue referred to is no more than an
afterthought and ought to be rejected.
Eighth. Finally, it may not be amiss to note, given the
factual antecedents of the instant case, that Eagle Ridge
has apparently resorted to filing the instant case for
cancellation of the Union’s certificate of registration to
bar the holding of a certification election. This can be
gleaned from the fact that the grounds it raised in its
opposition to the petition for certification election are
basically the same grounds it resorted to in the instant
case for cancellation of EREU’s certificate of
registration. This amounts to a clear circumvention of
the law and cannot be countenanced.
For clarity, we reiterate the following undisputed
antecedent facts:
(1) On December 6, 2005, the Union was
organized, with 26 employees of Eagle Ridge
attending;
(2) On December 19, 2005, the Union filed its
formal application for registration indicating a
total of 30 union members with the inclusion
of four additional members on December 8,
2005 (Reg. Cert. No. RO400-200512-UR-003
was eventually issued by the DOLE RO IV-A);
 (3) On January 10, 2006, the Union filed
before the DOLE RO IV-A its petition for
certification election in Eagle Ridge;
(4) On February 13, 2006, Eagle Ridge filed its
Position Paper opposing the petition for
certification election on essentially the same
grounds it raised in the instant case; and
(5) On February 24, 2006, Eagle Ridge filed
the instant case for cancellation of the Union’s
certificate of registration on essentially the
same grounds it raised in its opposition to the
Union’s petition for certification election.
Evidently, as the Union persuasively argues, the withdrawal of six
member-employees from the Union will affect neither the
Union’s registration nor its petition for certification election, as
their affidavits of retraction were executed after the Union’s
petition for certification election had been filed. The initial five
affidavits of retraction were executed on February 15, 2006; the
sixth, on March 15, 2006. Indisputably, all six were executed way
after the filing of the petition for certification election on January
10, 2006.
In Eastland Manufacturing Company, Inc. v. Noriel,52 the Court
emphasized, and reiterated its earlier rulings,53 that "even if there
were less than 30% [the required percentage of minimum
membership then] of the employees asking for a certification
election, that of itself would not be a bar to respondent Director
ordering such an election provided, of course, there is no grave
abuse of discretion."54 Citing Philippine Association of Free
Labor Unions v. Bureau of Labor Relations,55 the Court
emphasized that a certification election is the most appropriate
procedure for the desired goal of ascertaining which of the
competing organizations should represent the employees for the
purpose of collective bargaining.56
Indeed, where the company seeks the cancellation of a union’s
registration during the pendency of a petition for certification
election, the same grounds invoked to cancel should not be used
to bar the certification election. A certification election is the
most expeditious and fairest mode of ascertaining the will of a
collective bargaining unit as to its choice of its exclusive
representative.57 It is the fairest and most effective way of
determining which labor organization can truly represent the
working force. It is a fundamental postulate that the will of the
majority, if given expression in an honest election with freedom
on the part of the voters to make their choice, is controlling.58
The Court ends this disposition by reproducing the following apt
excepts from its holding in S.S. Ventures International, Inc. v.
S.S. Ventures Labor Union (SSVLU) on the effect of the
withdrawal from union membership right before or after the filing
of a petition for certification election:
We are not persuaded. As aptly noted by both the BLR and CA,
these mostly undated written statements submitted by Ventures on
March 20, 2001, or seven months after it filed its petition for
cancellation of registration, partake of the nature of withdrawal of
union membership executed after the Union’s filing of a petition
for certification election on March 21, 2000. We have in
precedent cases said that the employees’ withdrawal from a
labor union made before the filing of the petition for
certification election is presumed voluntary, while withdrawal
after the filing of such petition is considered to be involuntary
and does not affect the same. Now then, if a withdrawal from
union membership done after a petition for certification
election has been filed does not vitiate such petition, is it not
but logical to assume that such withdrawal cannot work to
nullify the registration of the union? Upon this light, the Court
is inclined to agree with the CA that the BLR did not abuse its
discretion nor gravely err when it concluded that the affidavits of
retraction of the 82 members had no evidentiary
weight.59 (Emphasis supplied.)
WHEREFORE, premises considered, we DISMISS the instant
petition for lack of merit.
Costs against petitioner.
SO ORDERED.
G.R. No. 178296               January 12, 2011
THE HERITAGE HOTEL MANILA, acting through its
owner, GRAND PLAZA HOTEL
CORPORATION, Petitioner,
vs.
NATIONAL UNION OF WORKERS IN THE HOTEL,
RESTAURANT AND ALLIED INDUSTRIES-HERITAGE
HOTEL MANILA SUPERVISORS CHAPTER
(NUWHRAIN-HHMSC), Respondent.
DECISION
NACHURA, J.:
Before the Court is a petition for review on certiorari of the
Decision1 of the Court of Appeals (CA) dated May 30, 2005 and
Resolution dated June 4, 2007. The assailed Decision affirmed the
dismissal of a petition for cancellation of union registration filed
by petitioner, Grand Plaza Hotel Corporation, owner of Heritage
Hotel Manila, against respondent, National Union of Workers in
the Hotel, Restaurant and Allied Industries-Heritage Hotel Manila
Supervisors Chapter (NUWHRAIN-HHMSC), a labor
organization of the supervisory employees of Heritage Hotel
Manila.
The case stemmed from the following antecedents:
On October 11, 1995, respondent filed with the Department of
Labor and Employment-National Capital Region (DOLE-NCR) a
petition for certification election.2 The Med-Arbiter granted the
petition on February 14, 1996 and ordered the holding of a
certification election.3 On appeal, the DOLE Secretary, in a
Resolution dated August 15, 1996, affirmed the Med-Arbiter’s
order and remanded the case to the Med-Arbiter for the holding of
a preelection conference on February 26, 1997. Petitioner filed a
motion for reconsideration, but it was denied on September 23,
1996.
The preelection conference was not held as initially scheduled; it
was held a year later, or on February 20, 1998. Petitioner moved
to archive or to dismiss the petition due to alleged repeated non-
appearance of respondent. The latter agreed to suspend
proceedings until further notice. The preelection conference
resumed on January 29, 2000.
Subsequently, petitioner discovered that respondent had failed to
submit to the Bureau of Labor Relations (BLR) its annual
financial report for several years and the list of its members since
it filed its registration papers in 1995. Consequently, on May 19,
2000, petitioner filed a Petition for Cancellation of Registration of
respondent, on the ground of the non-submission of the said
documents. Petitioner prayed that respondent’s Certificate of
Creation of Local/Chapter be cancelled and its name be deleted
from the list of legitimate labor organizations. It further requested
the suspension of the certification election proceedings.4
On June 1, 2000, petitioner reiterated its request by filing a
Motion to Dismiss or Suspend the [Certification Election]
Proceedings,5 arguing that the dismissal or suspension of the
proceedings is warranted, considering that the legitimacy of
respondent is seriously being challenged in the petition for
cancellation of registration. Petitioner maintained that the
resolution of the issue of whether respondent is a legitimate labor
organization is crucial to the issue of whether it may exercise
rights of a legitimate labor organization, which include the right
to be certified as the bargaining agent of the covered employees.
Nevertheless, the certification election pushed through on June
23, 2000. Respondent emerged as the winner.6
On June 28, 2000, petitioner filed a Protest with Motion to Defer
Certification of Election Results and Winner,7 stating that the
certification election held on June 23, 2000 was an exercise in
futility because, once respondent’s registration is cancelled, it
would no longer be entitled to be certified as the exclusive
bargaining agent of the supervisory employees. Petitioner also
claimed that some of respondent’s members were not qualified to
join the union because they were either confidential employees or
managerial employees. It then prayed that the certification of the
election results and winner be deferred until the petition for
cancellation shall have been resolved, and that respondent’s
members who held confidential or managerial positions be
excluded from the supervisors’ bargaining unit.
Meanwhile, respondent filed its Answer8 to the petition for the
cancellation of its registration. It averred that the petition was
filed primarily to delay the conduct of the certification election,
the respondent’s certification as the exclusive bargaining
representative of the supervisory employees, and the
commencement of bargaining negotiations. Respondent prayed
for the dismissal of the petition for the following reasons: (a)
petitioner is estopped from questioning respondent’s status as a
legitimate labor organization as it had already recognized
respondent as such during the preelection conferences; (b)
petitioner is not the party-in-interest, as the union members are
the ones who would be disadvantaged by the non-submission of
financial reports; (c) it has already complied with the reportorial
requirements, having submitted its financial statements for 1996,
1997, 1998, and 1999, its updated list of officers, and its list of
members for the years 1995, 1996, 1997, 1998, and 1999; (d) the
petition is already moot and academic, considering that the
certification election had already been held, and the members had
manifested their will to be represented by respondent.
Citing National Union of Bank Employees v. Minister of Labor,
et al.9 and Samahan ng Manggagawa sa Pacific Plastic v. Hon.
Laguesma,10 the Med-Arbiter held that the pendency of a petition
for cancellation of registration is not a bar to the holding of a
certification election. Thus, in an Order11 dated January 26, 2001,
the Med-Arbiter dismissed petitioner’s protest, and certified
respondent as the sole and exclusive bargaining agent of all
supervisory employees.
Petitioner subsequently appealed the said Order to the DOLE
Secretary.12 The appeal was later dismissed by DOLE Secretary
Patricia A. Sto. Tomas (DOLE Secretary Sto. Tomas) in the
Resolution of August 21, 2002.13 Petitioner moved for
reconsideration, but the motion was also denied.14
In the meantime, Regional Director Alex E. Maraan (Regional
Director Maraan) of DOLE-NCR finally resolved the petition for
cancellation of registration. While finding that respondent had
indeed failed to file financial reports and the list of its members
for several years, he, nonetheless, denied the petition,
ratiocinating that freedom of association and the employees’ right
to self-organization are more substantive considerations. He took
into account the fact that respondent won the certification election
and that it had already been certified as the exclusive bargaining
agent of the supervisory employees. In view of the foregoing,
Regional Director Maraan—while emphasizing that the non-
compliance with the law is not viewed with favor—considered
the belated submission of the annual financial reports and the list
of members as sufficient compliance thereof and considered them
as having been submitted on time. The dispositive portion of the
decision15 dated December 29, 2001 reads:
WHEREFORE, premises considered, the instant petition to delist
the National Union of Workers in the Hotel, Restaurant and
Allied Industries-Heritage Hotel Manila Supervisors Chapter
from the roll of legitimate labor organizations is hereby DENIED.
SO ORDERED.16
Aggrieved, petitioner appealed the decision to the BLR.17 BLR
Director Hans Leo Cacdac inhibited himself from the case
because he had been a former counsel of respondent.
In view of Director Cacdac’s inhibition, DOLE Secretary Sto.
Tomas took cognizance of the appeal. In a resolution18 dated
February 21, 2003, she dismissed the appeal, holding that the
constitutionally guaranteed freedom of association and right of
workers to self-organization outweighed respondent’s
noncompliance with the statutory requirements to maintain its
status as a legitimate labor organization.
Petitioner filed a motion for reconsideration,19 but the motion was
likewise denied in a resolution20 dated May 30, 2003. DOLE
Secretary Sto. Tomas admitted that it was the BLR which had
jurisdiction over the appeal, but she pointed out that the BLR
Director had voluntarily inhibited himself from the case because
he used to appear as counsel for respondent. In order to maintain
the integrity of the decision and of the BLR, she therefore
accepted the motion to inhibit and took cognizance of the appeal.
Petitioner filed a petition for certiorari with the CA, raising the
issue of whether the DOLE Secretary acted with grave abuse of
discretion in taking cognizance of the appeal and affirming the
dismissal of its petition for cancellation of respondent’s
registration.
In a Decision dated May 30, 2005, the CA denied the petition.
The CA opined that the DOLE Secretary may legally assume
jurisdiction over an appeal from the decision of the Regional
Director in the event that the Director of the BLR inhibits himself
from the case. According to the CA, in the absence of the BLR
Director, there is no person more competent to resolve the appeal
than the DOLE Secretary. The CA brushed aside the allegation of
bias and partiality on the part of the DOLE Secretary, considering
that such allegation was not supported by any evidence.
The CA also found that the DOLE Secretary did not commit
grave abuse of discretion when she affirmed the dismissal of the
petition for cancellation of respondent’s registration as a labor
organization. Echoing the DOLE Secretary, the CA held that the
requirements of registration of labor organizations are an exercise
of the overriding police power of the State, designed for the
protection of workers against potential abuse by the union that
recruits them. These requirements, the CA opined, should not be
exploited to work against the workers’ constitutionally protected
right to self-organization.
Petitioner filed a motion for reconsideration, invoking this
Court’s ruling in Abbott Labs. Phils., Inc. v. Abbott Labs.
Employees Union,21 which categorically declared that the DOLE
Secretary has no authority to review the decision of the Regional
Director in a petition for cancellation of union registration, and
Section 4,22 Rule VIII, Book V of the Omnibus Rules
Implementing the Labor Code.
In its Resolution23 dated June 4, 2007, the CA denied petitioner’s
motion, stating that the BLR Director’s inhibition from the case
was a peculiarity not present in the Abbott case, and that such
inhibition justified the assumption of jurisdiction by the DOLE
Secretary.
In this petition, petitioner argues that:
I.
The Court of Appeals seriously erred in ruling that the Labor
Secretary properly assumed jurisdiction over Petitioner’s appeal
of the Regional Director’s Decision in the Cancellation Petition x
x x.
A. Jurisdiction is conferred only by law. The Labor
Secretary had no jurisdiction to review the decision of
the Regional Director in a petition for cancellation. Such
jurisdiction is conferred by law to the BLR.
B. The unilateral inhibition by the BLR Director cannot
justify the Labor Secretary’s exercise of jurisdiction
over the Appeal.
C. The Labor Secretary’s assumption of jurisdiction
over the Appeal without notice violated Petitioner’s
right to due process.
II.
The Court of Appeals gravely erred in affirming the dismissal of
the Cancellation Petition despite the mandatory and unequivocal
provisions of the Labor Code and its Implementing Rules.24
The petition has no merit.
Jurisdiction to review the decision of the Regional Director lies
with the BLR. This is clearly provided in the Implementing Rules
of the Labor Code and enunciated by the Court in Abbott. But as
pointed out by the CA, the present case involves a peculiar
circumstance that was not present or covered by the ruling in
Abbott. In this case, the BLR Director inhibited himself from the
case because he was a former counsel of respondent. Who, then,
shall resolve the case in his place?
In Abbott, the appeal from the Regional Director’s decision was
directly filed with the Office of the DOLE Secretary, and we
ruled that the latter has no appellate jurisdiction. In the instant
case, the appeal was filed by petitioner with the BLR, which,
undisputedly, acquired jurisdiction over the case. Once
jurisdiction is acquired by the court, it remains with it until the
full termination of the case.25
Thus, jurisdiction remained with the BLR despite the BLR
Director’s inhibition. When the DOLE Secretary resolved the
appeal, she merely stepped into the shoes of the BLR Director and
performed a function that the latter could not himself perform.
She did so pursuant to her power of supervision and control over
the BLR.26
Expounding on the extent of the power of control, the Court, in
Araneta, et al. v. Hon. M. Gatmaitan, et al.,27 pronounced that, if a
certain power or authority is vested by law upon the Department
Secretary, then such power or authority may be exercised directly
by the President, who exercises supervision and control over the
departments. This principle was incorporated in the
Administrative Code of 1987, which defines "supervision and
control" as including the authority to act directly whenever a
specific function is entrusted by law or regulation to a
subordinate.28 Applying the foregoing to the present case, it is
clear that the DOLE Secretary, as the person exercising the power
of supervision and control over the BLR, has the authority to
directly exercise the quasi-judicial function entrusted by law to
the BLR Director.
It is true that the power of control and supervision does not give
the Department Secretary unbridled authority to take over the
functions of his or her subordinate. Such authority is subject to
certain guidelines which are stated in Book IV, Chapter 8, Section
39(1)(a) of the Administrative Code of 1987.29 However, in the
present case, the DOLE Secretary’s act of taking over the
function of the BLR Director was warranted and necessitated by
the latter’s inhibition from the case and the objective to "maintain
the integrity of the decision, as well as the Bureau itself."30
Petitioner insists that the BLR Director’s subordinates should
have resolved the appeal, citing the provision under the
Administrative Code of 1987 which states, "in case of the absence
or disability of the head of a bureau or office, his duties shall be
performed by the assistant head."31 The provision clearly does not
apply considering that the BLR Director was neither absent nor
suffering from any disability; he remained as head of the BLR.
Thus, to dispel any suspicion of bias, the DOLE Secretary opted
to resolve the appeal herself.
Petitioner was not denied the right to due process when it was not
notified in advance of the BLR Director’s inhibition and the
DOLE Secretary’s assumption of the case. Well-settled is the rule
that the essence of due process is simply an opportunity to be
heard, or, as applied to administrative proceedings, an opportunity
to explain one’s side or an opportunity to seek a reconsideration
of the action or ruling complained of.32 Petitioner had the
opportunity to question the BLR Director’s inhibition and the
DOLE Secretary’s taking cognizance of the case when it filed a
motion for reconsideration of the latter’s decision. It would be
well to state that a critical component of due process is a hearing
before an impartial and disinterested tribunal, for all the elements
of due process, like notice and hearing, would be meaningless if
the ultimate decision would come from a partial and biased
judge.33 It was precisely to ensure a fair trial that moved the BLR
Director to inhibit himself from the case and the DOLE Secretary
to take over his function.
Petitioner also insists that respondent’s registration as a legitimate
labor union should be cancelled. Petitioner posits that once it is
determined that a ground enumerated in Article 239 of the Labor
Code is present, cancellation of registration should follow; it
becomes the ministerial duty of the Regional Director to cancel
the registration of the labor organization, hence, the use of the
word "shall." Petitioner points out that the Regional Director has
admitted in its decision that respondent failed to submit the
required documents for a number of years; therefore, cancellation
of its registration should have followed as a matter of course.
We are not persuaded.
Articles 238 and 239 of the Labor Code read:
ART. 238. CANCELLATION OF REGISTRATION; APPEAL
The certificate of registration of any legitimate labor organization,
whether national or local, shall be canceled by the Bureau if it has
reason to believe, after due hearing, that the said labor
organization no longer meets one or more of the requirements
herein prescribed.34
ART. 239. GROUNDS FOR CANCELLATION OF UNION
REGISTRATION.
The following shall constitute grounds for cancellation of union
registration:
xxxx
(d) Failure to submit the annual financial report to the Bureau
within thirty (30) days after the closing of every fiscal year and
misrepresentation, false entries or fraud in the preparation of the
financial report itself;
xxxx
(i) Failure to submit list of individual members to the Bureau
once a year or whenever required by the Bureau.35
These provisions give the Regional Director ample discretion in
dealing with a petition for cancellation of a union’s registration,
particularly, determining whether the union still meets the
requirements prescribed by law. It is sufficient to give the
Regional Director license to treat the late filing of required
documents as sufficient compliance with the requirements of the
law. After all, the law requires the labor organization to submit
the annual financial report and list of members in order to verify
if it is still viable and financially sustainable as an organization so
as to protect the employer and employees from fraudulent or fly-
by-night unions. With the submission of the required documents
by respondent, the purpose of the law has been achieved, though
belatedly.
We cannot ascribe abuse of discretion to the Regional Director
and the DOLE Secretary in denying the petition for cancellation
of respondent’s registration. The union members and, in fact, all
the employees belonging to the appropriate bargaining unit should
not be deprived of a bargaining agent, merely because of the
negligence of the union officers who were responsible for the
submission of the documents to the BLR.
Labor authorities should, indeed, act with circumspection in
treating petitions for cancellation of union registration, lest they
be accused of interfering with union activities. In resolving the
petition, consideration must be taken of the fundamental rights
guaranteed by Article XIII, Section 3 of the Constitution, i.e., the
rights of all workers to self-organization, collective bargaining
and negotiations, and peaceful concerted activities. Labor
authorities should bear in mind that registration confers upon a
union the status of legitimacy and the concomitant right and
privileges granted by law to a legitimate labor organization,
particularly the right to participate in or ask for certification
election in a bargaining unit.36 Thus, the cancellation of a
certificate of registration is the equivalent of snuffing out the life
of a labor organization. For without such registration, it loses - as
a rule - its rights under the Labor Code.37
It is worth mentioning that the Labor Code’s provisions on
cancellation of union registration and on reportorial requirements
have been recently amended by Republic Act (R.A.) No. 9481,
An Act Strengthening the Workers’ Constitutional Right to Self-
Organization, Amending for the Purpose Presidential Decree No.
442, As Amended, Otherwise Known as the Labor Code of the
Philippines, which lapsed into law on May 25, 2007 and became
effective on June 14, 2007. The amendment sought to strengthen
the workers’ right to self-organization and enhance the
Philippines’ compliance with its international obligations as
embodied in the International Labour Organization (ILO)
Convention No. 87,38 pertaining to the non-dissolution of
workers’ organizations by administrative authority.39 Thus, R.A.
No. 9481 amended Article 239 to read:
ART. 239. Grounds for Cancellation of Union Registration.—The
following may constitute grounds for cancellation of union
registration:
(a) Misrepresentation, false statement or fraud in
connection with the adoption or ratification of the
constitution and by-laws or amendments thereto, the
minutes of ratification, and the list of members who
took part in the ratification;
 (b) Misrepresentation, false statements or fraud in
connection with the election of officers, minutes of the
election of officers, and the list of voters;
(c) Voluntary dissolution by the members.
R.A. No. 9481 also inserted in the Labor Code Article 242-A,
which provides:
ART. 242-A. Reportorial Requirements.—The following are
documents required to be submitted to the Bureau by the
legitimate labor organization concerned:
(a) Its constitution and by-laws, or amendments thereto,
the minutes of ratification, and the list of members who
took part in the ratification of the constitution and by-
laws within thirty (30) days from adoption or ratification
of the constitution and by-laws or amendments thereto;
(b) Its list of officers, minutes of the election of officers,
and list of voters within thirty (30) days from election;
(c) Its annual financial report within thirty (30) days
after the close of every fiscal year; and
(d) Its list of members at least once a year or whenever
required by the Bureau.
Failure to comply with the above requirements shall not be a
ground for cancellation of union registration but shall subject the
erring officers or members to suspension, expulsion from
membership, or any appropriate penalty.
ILO Convention No. 87, which we have ratified in 1953, provides
that "workers’ and employers’ organizations shall not be liable to
be dissolved or suspended by administrative authority." The ILO
has expressed the opinion that the cancellation of union
registration by the registrar of labor unions, which in our case is
the BLR, is tantamount to dissolution of the organization by
administrative authority when such measure would give rise to
the loss of legal personality of the union or loss of advantages
necessary for it to carry out its activities, which is true in our
jurisdiction. Although the ILO has allowed such measure to be
taken, provided that judicial safeguards are in place, i.e., the right
to appeal to a judicial body, it has nonetheless reminded its
members that dissolution of a union, and cancellation of
registration for that matter, involve serious consequences for
occupational representation. It has, therefore, deemed it preferable
if such actions were to be taken only as a last resort and after
exhausting other possibilities with less serious effects on the
organization.40
The aforesaid amendments and the ILO’s opinion on this matter
serve to fortify our ruling in this case. We therefore quote with
approval the DOLE Secretary’s rationale for denying the petition,
thus:
It is undisputed that appellee failed to submit its annual financial
reports and list of individual members in accordance with Article
239 of the Labor Code. However, the existence of this ground
should not necessarily lead to the cancellation of union
registration. Article 239 recognizes the regulatory authority of the
State to exact compliance with reporting requirements. Yet there
is more at stake in this case than merely monitoring union
activities and requiring periodic documentation thereof.
The more substantive considerations involve the constitutionally
guaranteed freedom of association and right of workers to self-
organization. Also involved is the public policy to promote free
trade unionism and collective bargaining as instruments of
industrial peace and democracy.1avvphi1 An overly stringent
interpretation of the statute governing cancellation of union
registration without regard to surrounding circumstances cannot
be allowed. Otherwise, it would lead to an unconstitutional
application of the statute and emasculation of public policy
objectives. Worse, it can render nugatory the protection to labor
and social justice clauses that pervades the Constitution and the
Labor Code.
Moreover, submission of the required documents is the duty of
the officers of the union. It would be unreasonable for this Office
to order the cancellation of the union and penalize the entire
union membership on the basis of the negligence of its officers.
In National Union of Bank Employees vs. Minister of Labor, L-
53406, 14 December 1981, 110 SCRA 296, the Supreme Court
ruled:
As aptly ruled by respondent Bureau of Labor Relations Director
Noriel: "The rights of workers to self-organization finds general
and specific constitutional guarantees. x x x Such constitutional
guarantees should not be lightly taken much less nullified. A
healthy respect for the freedom of association demands that acts
imputable to officers or members be not easily visited with capital
punishments against the association itself."
At any rate, we note that on 19 May 2000, appellee had submitted
its financial statement for the years 1996-1999. With this
submission, appellee has substantially complied with its duty to
submit its financial report for the said period. To rule differently
would be to preclude the union, after having failed to meet its
periodic obligations promptly, from taking appropriate measures
to correct its omissions. For the record, we do not view with favor
appellee’s late submission. Punctuality on the part of the union
and its officers could have prevented this petition.41
WHEREFORE, premises considered, the Court of Appeals
Decision dated May 30, 2005 and Resolution dated June 4, 2007
are AFFIRMED.
SO ORDERED.
[G.R. Nos. 100342-44. October 29, 1999.]
RURAL BANK OF ALAMINOS EMPLOYEES UNION
(RBAEU) and ISMAEL TAMAYO, SR., Petitioner, v.
NATIONAL LABOR RELATIONS COMMISSION, Third
Division, Exec. Labor Arbiter JOSE B. BOLISAY and
RURAL BANK OF ALAMINOS, Inc., Respondents.
DECISION
PURISIMA, J.:

Before The Court is a Petition for Certiorari under Rule 65 of the
Revised Rules of Court to nullify and set aside the Resolution of
the National Labor Relations Commission, dated January 31,
1991, and the subsequent Resolution of March 26, 1991 denying
petitioner’s motion for reconsideration, for being tainted with
grave abuse of discretion amounting to lack or excess of
jurisdiction. The assailed Resolutions set aside the consolidated
decision of Labor Arbiter Ricardo N. Olairez and remanded the
cases to the Regional Arbitration Branch of origin for further
proceedings.chanrobles virtual lawlibrary
The Petition stems from three cases originally instituted before
Sub-Regional Arbitration Branch No. 1 of the National Labor
Relations Commission in Dagupan City. The first case, NLRC
Case No. 01-03-7-0049-89, was commenced by the herein
petitioner, Ismael Tamayo, Sr., against Rural Bank of Alaminos,
Inc. (RBAI) for illegal dismissal and damages. The second case,
docketed as NLRC Case No. 01-04-7-0059-89, was filed by the
herein private respondent, Rural Bank of Alaminos, Inc., against
the Rural Bank of Alaminos Employees Union for unfair labor
practice, declaration of illegality of strike and damages. While the
third case, docketed as NLRC Case No. 01-06-0097-89, was filed
by the Employees Union against the Bank, charging the latter
with unfair labor practice and damages.
As gathered by the respondent National Labor Relations
Commission, the facts of the controversy litigated upon are as
follows:chanrob1es virtual 1aw library
With the appointment of one Benefredo Quinto to the position of
internal auditor, which position he had held since January 1,
1976, Ismael P. Tamayo, Sr., who had been with Rural Bank of
Alaminos, Inc. (RBAI for brevity) since it started operations in
September of 1956, feeling shortchanged, filed on June 3, 1988 a
complaint against RBAI for illegal dismissal.
In an effort to buy peace, that is, to settle the case amicably,
RBAI agreed on a compromise agreement dated July 13, 1988 to
reinstate Ismael P. Tamayo, Sr. to the position of internal
auditor.chanrobles
Claiming that his services were not actually needed, RBAI
terminated effective January 1, 1989 Ismael P. Tamayo, Sr.’s
services. This led to the filing on March 27, 1989 of a complaint
for illegal dismissal by Ismael P. Tamayo, Sr. against Rural Bank
of Alaminos, Inc. docketed as NLRC Case No. SUB-RAB-01-03-
7-0049-89.
Subsequent to its certification on December 12, 1989 as the sole
bargaining agent of the employees of RBAI, the Rural Bank of
Alaminos Employees Union (hereinafter called the Union)
submitted sometime in February 1989 proposals with respect to
salary/wage increases.
RBAI’s counter-proposals not (sic) acceptable to it, the Union,
which had earlier filed a notice of strike on March 3, 1989, went
on strike on April 3, 1989.
Its position being that the strike staged by the Union is illegal and
in violation of Article 248 (e) of the Labor Code, RBAI instituted
a petition for the declaration of the strike as illegal and for actual
damages it incurred by way of loss of earnings to the tune of
P30,000.00 per day. This petition was docketed as NLRC CASE
NO. SUB-RAB-01-04-7-0059-89.
The Union, assailing the alleged constructive dismissal of its
members brought about or resulting from the strike, lodged
against RBAI a complaint for unfair labor practice with prayer for
moral and exemplary damages. This complaint has been docketed
as NLRC CASE NO. SUB-RAB-01-06-7-0097-89.
The identity of the parties led the Labor Arbiter, Ricardo N.
Olairez, to consolidate the three (3) aforementioned cases.
On December 14, 1989, Labor Arbiter Ricardo N. Olairez
rendered a consolidated decision.chanrobles virtual lawlibrary
With respect to Ismael P. Tamayo’s complaint for illegal
dismissal against RBAI, the Labor Arbiter held that complainant,
whose nature of work, that of internal auditor, was usually
necessary and desirable in the business engaged in by the
respondent, was a regular employee whose summary discharge
from the service effective January 1, 1989, was illegal.
The dismissal being illegal, complainant should have ordinarily
been reinstated to his former position. However, the Labor
Arbiter, finding the complainant to have reached the retirable age,
opted instead to award the latter the following amounts, to wit:
P63,442.56 representing full backwages/benefits; P29,822.80 as
retirement pay; and P9,326.53 as attorney’s fees, or a grand total
of P102, 591.89 plus one (1) percent interest per month until
actually paid.
Regarding the bank’s petition, NLRC Case No. SUB-RAB-01-04-
7-0059-89, the Labor Arbiter disposed of the same by holding
that the strike staged by the Union was legal and not in violation
of any provision of the Labor Code. Hence, the dismissal of the
petition.
In the third case, NLRC CASE NO. SUB-RAB-01-06-0097-89,
the Labor Arbiter held the bank accountable for the full
backwages and other benefits due the Union members who he
found to have been constructively dismissed during the strike.
Moreover, the Labor Arbiter, on the Union’s claim for damages
of not less than P200,000.00, ruled that the award of P10,000.00
moral damages and P5,000.00 exemplary damages to each of the
union member is in order.
The Labor Arbiter disposed thus:jgc:chanrobles.com.ph
"WHEREFORE, with all the foregoing considerations, judgment
is hereby rendered as follows:chanrob1es virtual 1aw library
1. In the first case, we find complainant Ismael Tamayo, Sr.
illegally and unjustly dismissed and we hereby order the
respondent Rural Bank of Alaminos, Inc. to pay him as
follows:chanrob1es virtual 1aw library
P 63,442.56 — Total full backwages/benefits
29,822.80 — Retirement pay
————
P 93,265.36
9,326.53 — 10% Attorney’s fees
————
P102,591.89 — Total award as of December 31, 1989
plus one (l) percent interest per month until the award is actually
paid.
2. In the second case, we find the strike legal and the Union
having violated no provision of the Labor Code, the complaint of
the Rural Bank of Alaminos, Inc. is hereby dismissed for lack of
merit.chanroblesvirtuallawlibrary
3. In the third case, we find the respondent Rural Bank of
Alaminos, Inc. guilty of unfair labor practice, whose act is
tantamount to an illegal lockout amounting to a constructive
dismissal of the Union members, and we hereby order the bank to
pay them their full backwages and other benefits for the nine (9)
months period from April to December 1989 with the
computations to include the wage increase under R.A. 6727
effective July 1, 1989.
The Bank is hereby ordered to re-open and accept/reinstate the
striking union members without loss of seniority rights and the
union members are likewise ordered to return to work and may
now claim their respective 13th month pay for 1989. In case they
are not immediately reinstated, their full backwages shall not
exceed a maximum of three (3) years.
The respondent bank is further ordered to pay the Union members
P10,000.00 as moral damages and P5,000.00 as exemplary
damages to each of the Union members, plus attorney’s fees and
litigation expenses of ten (10) percent of the total awards.
The order of reinstatement or return to work is immediately
executory, hence the Bank is commanded to reopen its banking
business immediately.
SO ORDERED"
Dissatisfied with the disposition of the Labor Arbiter, the Rural
Bank of Alaminos, Inc. appealed to the National Labor Relations
Commission, which promulgated, on January 31, 1991 its assailed
Resolution setting aside the ruling of the Labor Arbiter and
ordering the remand of all the three cases to
wit:jgc:chanrobles.com.ph
". . . In the broader interest of justice, We deem it best to remand
all the afore-numbered cases to Regional Arbitration Branch of
origin for further proceedings.
WHEREFORE, premises considered, all the aforenumbered cases
are hereby remanded to the Regional Arbitration Branch of origin
for further proceedings.
SO ORDERED." chanrobles virtual lawlibrary
The reversal by the respondent Commission of the Labor
Arbiter’s original Resolution prompted petitioners to bring the
present petition imputing grave abuse of discretion amounting to
lack of or excess jurisdiction to the respondent Commission,
particularly describing the errors under attack:chanrob1es virtual
1aw library
A. Case No. 0059-89:chanrob1es virtual 1aw library
Whether or not the respondent NLRC Third Division committed
grave abuse of discretion and exceeded its jurisdiction amounting
to lack of jurisdiction in remanding the case for further
proceedings, in spite of its finding which affirmed the ruling of
the Labor Arbiter that the strike is legal and where the complaint
is for a declaration of illegality of the strike.
B. Case No. 0097-89:chanrob1es virtual 1aw library
Whether or not the respondent NLRC Third Division committed
grave abuse of discretion and exceeded its jurisdiction amounting
to lack of jurisdiction in remanding the case for further
proceedings, despite the fact that the private respondent failed to
appeal the Labor Arbiter’s finding that the respondent is guilty of
unfair labor practice thus the said issue not raised on appeal had
become final.
Whether or not the respondent NLRC Third Division committed
grave abuse of discretion and exceeded its jurisdiction amounting
to lack of jurisdiction in remanding the case for further
proceedings for the reason that it could not resolve the issues
squarely because it was at a loss as to the exact number of the
bank’s employees, but which is contrary to the record of the case,
as evidenced by the list of employees in private respondent’s
Annex "A" .
C. Case No. 0049-89:chanrob1es virtual 1aw library
Whether or not respondent NLRC Third Division committed
grave abuse of discretion amounting to lack of jurisdiction where
it ruled that private respondent was denied the right to cross-
examine petitioner Ismael Tamayo, in spite of the express
mandate of Article 221 of the Labor Code and the 90-day Rule
under Executive Order No.109 (1-23-89)
D. In all three cases:chanrob1es virtual 1aw library
Whether or not the right of petitioners to speedy disposition of
labor justice has been violated in the remand of the cases for
further proceedings and consequently, whether a writ of
prohibition shall lie.chanroblesvirtual|awlibrary
Whether or not respondent NLRC Third Division committed
grave abuse of discretion amounting to lack of jurisdiction when
it denied the motion for reconsideration for being filed out of
time, despite the fact that neither petitioner Ismael Tamayo, Sr.
nor his deceased counsel was furnished with a copy of the
resolution, and likewise the copy for the petitioner union was
served to a stranger who is not an employee of the law office of
petitioner’s counsel.
Respondent NLRC ordered the remand of all the three cases to
the Labor Arbiter for further proceedings: opining that with
respect to NLRC Case No. 0049-89, respondent Bank should
have been given an opportunity to cross-examine the petitioner,
Ismael Tamayo, Sr., as to the veracity of the allegations contained
in his unverified position paper, the lack or absence of which
amounted to a denial of due process. As regards, Case No. 097-
89, the NLRC held that the finding by the Labor Arbiter of an
illegal lock-out was not substantiated by evidence, as it was found
out that no proof was ever adduced by the Union to show that the
bank refused them employment during the pendency of the strike,
thus necessitating the remand of the case to the Labor Arbiter for
reception of evidence. So also, the NLRC ruled that a complete
disposition of the case could not be had since there was nothing in
the record which indicates the number of employees
constructively dismissed by the respondent Bank.
Before delving into the merits of the case, it should be
remembered that in the decision in the case of St. Martin Funeral
Homes v. National Labor Relations Commission, G.R. No.
130866, promulgated on September 16, 1998, this Court
pronounced that petitions for certiorari relating to NLRC
decisions must be filed directly with the Court of Appeals, and
labor cases pending before this Court should be referred to the
appellate court for proper disposition. However, in cases where
the Memoranda of both parties have been filed with this Court
prior to the promulgation of the St. Martin decision, the Court
generally opts to take the case itself for its final disposition.
With respect to the first assigned error, petitioners contend that it
was an error for NLRC to remand Case No. 0059-89 to the Labor
Arbiter as the issue of legality of subject strike has been resolved
in favor of the Union by the Arbiter and the Commission.
There is merit in petitioners’ contention. NLRC Case No. 0059-
89 was filed by the respondent Bank against the Union, for
declaration of illegality of the strike, unfair labor practice and
damages. In the proceedings below, the Labor Arbiter found that
the strike conducted by the Union was legal and complied with all
the requirements of law. Such finding was, in fact, affirmed by
the NLRC in the following Resolution, to wit:chanroblesvirtual|
awlibrary
". . . It appears that the Union filed its notice of strike on March 3,
1989 and that it commenced its strike thirty (30) days thereafter,
or on April 3, 1989.
Obviously, the Union had duly observed the mandatory cooling-
off period such that the strike it eventually undertook complied
with what is required by the Labor Code. Hence, Our finding that
the strike is legal."cralaw virtua1aw library
It is well-settled that when findings of fact by the labor arbiter are
sufficiently supported by the evidence on record, the same must
be accorded due respect by this Court. 1 More so when such
findings by the Labor Arbiter are affirmed by the NLRC on
appeal. Since the NLRC found the strike conducted by the Union
legal, the Court finds no justifiable reason for the Commission to
remand Case No. 0059-89 to the Labor Arbiter for further
proceedings. The allegation of unfair labor practice and the claim
for damages proceed from and are consequences of the strike, the
findings of which are based on the legality or illegality thereof.
The strike thus being adjudged as legal, the charges of unfair
labor practice and damages are thereby negated and bereft of any
basis. Therefore, the NLRC gravely abused its discretion when it
ordered the remand of NLRC Case No. 0059-89 to the Labor
Arbiter for further proceedings.
Anent the second assigned error which pertains to NLRC Case
No. 0097-89, the case instituted by the Union against the
respondent Bank for unfair labor practice with damages, the Court
believes, and so holds, that the remand of said case was in
order.chanroblesvirtuallawlibrary:red
NLRC Case No. 0097-89 charged RBAI with unfair labor
practice and the Labor Arbiter concluded that the Bank employed
all available means to further delay the resolution of the dispute,
thus creating a scenario of an illegal lock-out.
A "lock-out" means the temporary refusal of an employer to
furnish work as a result of an industrial or labor dispute. 2 As
correctly found by the NLRC, in the case under consideration
evidence of illegal lock-out is wanting such that there can be no
conclusive determination by the NLRC as to the charge.
Petitioners failed to present sufficient proof to support the
allegation of illegal lock-out. No evidence was adduced by the
Union to show that the Bank really refused them employment
during the pendency of the strike. As to the allegation that the
Bank was interfering with and restraining the employees in the
exercise of their right to self-organization, suffice it to state that
filing a petition for cancellation of the Union’s registration is not
per se an act of unfair labor practice. It must be shown by
substantial evidence that the filing of the petition for cancellation
of union registration by the employer was aimed to oppress the
Union. Consequently, the NLRC was right in ordering the remand
of Case No. 0097-89 for further proceedings.
Anent the observation of NLRC that it was at a loss as to the
exact number of employees who were constructively dismissed by
the Bank, such claim is belied by the records clearly indicating
that in its Complaint in NLRC Case. 0059-89, petitioner Union
did attach a letter addressed to the respondent Bank containing a
list of the bank’s employees together with their length of service
and monthly basic salary. 3 Respondent avers that since the said
list was presented in evidence in Case No. 0059-89, the same
could not be considered as evidence in Case No. 0097-89 because
these two cases are separate and distinct from each other.
The contention is untenable. It must be recalled that Case No.
0097-89 was filed in the nature of a countercharge to Case No.
0059-89 by the petitioner Union against respondent Bank.
Besides, all the three cases were consolidated before the Labor
Arbiter because of the identity of the parties. Thus, the list,
although introduced in Case No. 0059-89, could likewise be
properly considered as evidence in Case No. 0097-89. As held by
this Court, proceedings before a labor arbiter are non-litigious in
nature in which, subject to the requirements of due process, the
technicalities of law and procedure and the rules obtaining in
courts of law do not strictly apply. 4
Petitioners’ stance that the finding of unfair labor practice already
became final as the issue was not raised on appeal, is untenable.
The first, fourth and fifth issues raised by the Bank in its Appeal
Memorandum filed with the NLRC on December 24, 1989
theorized that:chanrobles law library : red
"1. The Labor Arbiter gravely abused his discretion in holding
that appellant violated its duty to bargain collectively.
x       x       x
4. The Labor Arbiter gravely abused his discretion in holding that
appellant is guilty of illegal lock-out.
5. The Labor Arbiter gravely abused his discretion in holding that
appellant illegally dismissed its employees.
x       x       x." 5
Although the issue was not collectively appealed as unfair labor
practice, the first, fourth and fifth issues relate to acts which by
themselves constitute unfair labor practice.

As regards the third assigned error, petitioners maintain that the
NLRC acted with grave abuse of discretion in remanding NLRC
Case No. 0049-89 for further proceedings because the Labor
Arbiter denied respondent Bank’s right to cross-examine
petitioner Ismael Tamayo, Sr. Respondent NLRC, on the other
hand, ruled that the Labor Arbiter should have granted respondent
Bank the right to cross-examine the said petitioner on the veracity
of the allegations in his unverified position paper, and it was
grave abuse of discretion not to allow respondent Bank to cross-
examine petitioner Tamayo.
In a long line of cases, this Court has held that the holding of a
trial is discretionary on the part of the Labor Arbiter, and it cannot
be demanded as a matter of right by the parties. 6 The absence of
a formal hearing or trial before the Labor Arbiter is no cause for a
party to impute grave abuse of discretion. 7 The submission of
position papers and memoranda in labor cases satisfies the
requirements of due process, and a decision rendered on the basis
of the position papers which were found to be sufficient, meets
the requirements of a fair and open hearing. 8 Thus, in the case
under scrutiny, the Labor Arbiter did not act with grave abuse his
discretion in not conducting a formal hearing or trial and in
basing his decision solely on the position papers submitted by the
parties. The fact that the position paper submitted by petitioner
Tamayo was not verified is of no moment. Succinct and clear is
the ruling of this Court that the lack of a verification of a position
paper is only a formal and not a jurisdictional defect. 9 It is not
fatal and could be easily corrected by requiring an oath. 10
Petitioner Tamayo faults respondent NLRC for denying his
motion for reconsideration for the reason that it was filed out of
time. He contends that neither he nor his deceased former
counsel, Atty. de Vera was furnished a copy of the NLRC’s
resolution.chanroblesvirtuallawlibrary
Petitioner’s allegation is not meritorious. It is axiomatic that
notice to counsel is notice to parties and when a party is
represented by counsel, notices should be made upon the counsel
of record at his given address, to which notices of all kinds
emanating from the court should be sent. 11 In the appeal before
the respondent Commission, it was Atty. Teofilo Humilde who
entered appearance in behalf of the Union and petitioner Tamayo.
It was thus reasonable for the NLRC to send a copy of the NLRC
Resolution to the said lawyer. Since the said resolution was
received by counsel on February 26, 1991 and the motion for
reconsideration was filed only on March 13, 1991, the denial by
the NLRC was in order, the ten-day period for filing a motion for
reconsideration having lapsed.
WHEREFORE, the petition is partly GRANTED in that the Order
of the NLRC remanding NLRC Cases No. 0049-89 and No. 0059-
89 to the Labor Arbiter is SET ASIDE but, the Order remanding
NLRC Case No. 0097-89 to said Labor Arbiter for further
proceedings, is UPHELD. No pronouncement as to costs.
SO ORDERED.
[G.R. NO. 171153 : September 12, 2007]
SAN MIGUEL CORPORATION EMPLOYEES UNION
PHILIPPINE TRANSPORT AND GENERAL WORKERS
ORGANIZATION (SMCEU PTGWO), Petitioner, v. SAN
MIGUEL PACKAGING PRODUCTS EMPLOYEES UNION
PAMBANSANG DIWA NG MANGGAGAWANG PILIPINO
(SMPPEU PDMP), Respondent 1 .
DECISION
CHICO-NAZARIO, J.:
In this Petition for Review on Certiorari under Rule 45 of the
Revised Rules of Court, petitioner SAN MIGUEL
CORPORATION EMPLOYEES UNION-PHILIPPINE
TRANSPORT AND GENERAL WORKERS ORGANIZATION
(SMCEU-PTGWO) prays that this Court reverse and set aside the
(a) Decision2 dated 9 March 2005 of the Court of Appeals in CA-
G.R. SP No. 66200, affirming the Decision3 dated 19 February
2001 of the Bureau of Labor Relations (BLR) of the Department
of Labor and Employment (DOLE) which upheld the Certificate
of Registration of respondent SAN MIGUEL PACKAGING
PRODUCTS EMPLOYEES UNION PAMBANSANG DIWA
NG MANGGAGAWANG PILIPINO (SMPPEU PDMP); and (b)
the Resolution4 dated 16 January 2006 of the Court of Appeals in
the same case, denying petitioner's Motion for Reconsideration of
the aforementioned Decision.
The following are the antecedent facts:
Petitioner is the incumbent bargaining agent for the bargaining
unit comprised of the regular monthly-paid rank and file
employees of the three divisions of San Miguel Corporation
(SMC), namely, the San Miguel Corporate Staff Unit (SMCSU),
San Miguel Brewing Philippines (SMBP), and the San Miguel
Packaging Products (SMPP), in all offices and plants of SMC,
including the Metal Closure and Lithography Plant in Laguna. It
had been the certified bargaining agent for 20 years - from 1987
to 1997.
Respondent is registered as a chapter of Pambansang Diwa ng
Manggagawang Pilipino (PDMP). PDMP issued Charter
Certificate No. 112 to respondent on 15 June 1999.5 In
compliance with registration requirements, respondent submitted
the requisite documents to the BLR for the purpose of acquiring
legal personality.6 Upon submission of its charter certificate and
other documents, respondent was issued Certificate of Creation of
Local or Chapter PDMP-01 by the BLR on 6 July
1999.7 Thereafter, respondent filed with the Med-Arbiter of the
DOLE Regional Officer in the National Capital Region (DOLE-
NCR), three separate petitions for certification election to
represent SMPP, SMCSU, and SMBP.8 All three petitions were
dismissed, on the ground that the separate petitions fragmented a
single bargaining unit.9
On 17 August 1999, petitioner filed with the DOLE-NCR a
petition seeking the cancellation of respondent's registration and
its dropping from the rolls of legitimate labor organizations. In its
petition, petitioner accused respondent of committing fraud and
falsification, and non-compliance with registration requirements
in obtaining its certificate of registration. It raised allegations that
respondent violated Articles 239(a), (b) and (c)10 and 234(c)11 of
the Labor Code. Moreover, petitioner claimed that PDMP is not a
legitimate labor organization, but a trade union center, hence, it
cannot directly create a local or chapter. The petition was
docketed as Case No. NCR-OD-9908-007-IRD.12
On 14 July 2000, DOLE-NCR Regional Director Maximo B. Lim
issued an Order dismissing the allegations of fraud and
misrepresentation, and irregularity in the submission of
documents by respondent. Regional Director Lim further ruled
that respondent is allowed to directly create a local or chapter.
However, he found that respondent did not comply with the 20%
membership requirement and, thus, ordered the cancellation of its
certificate of registration and removal from the rolls of legitimate
labor organizations.13 Respondent appealed to the BLR. In a
Decision dated 19 February 2001, it declared:
As a chartered local union, appellant is not required to submit the
number of employees and names of all its members comprising at
least 20% of the employees in the bargaining unit where it seeks
to operate. Thus, the revocation of its registration based on non-
compliance with the 20% membership requirement does not have
any basis in the rules.
Further, although PDMP is considered as a trade union center, it
is a holder of Registration Certificate No. FED-11558-LC issued
by the BLR on 14 February 1991, which bestowed upon it the
status of a legitimate labor organization with all the rights and
privileges to act as representative of its members for purposes of
collective bargaining agreement. On this basis, PDMP can
charter or create a local, in accordance with the provisions of
Department Order No. 9.
WHEREFORE, the appeal is hereby GRANTED. Accordingly,
the decision of the Regional Director dated July 14, 2000,
canceling the registration of appellant San Miguel Packaging
Products Employees Union-Pambansang Diwa ng
Manggagawang Pilipino (SMPPEU-PDMP) is REVERSED and
SET ASIDE. Appellant shall hereby remain in the roster of
legitimate labor organizations.14
While the BLR agreed with the findings of the DOLE Regional
Director dismissing the allegations of fraud and
misrepresentation, and in upholding that PDMP can directly
create a local or a chapter, it reversed the Regional Director's
ruling that the 20% membership is a requirement for respondent
to attain legal personality as a labor organization. Petitioner
thereafter filed a Motion for Reconsideration with the BLR. In a
Resolution rendered on 19 June 2001 in BLR-A-C-64-05-9-00
(NCR-OD-9908-007-IRD), the BLR denied the Motion for
Reconsideration and affirmed its Decision dated 19 February
2001.15
Invoking the power of the appellate court to review decisions of
quasi-judicial agencies, petitioner filed with the Court of Appeals
a Petition for Certiorari under Rule 65 of the 1997 Rules of Civil
Procedure docketed as CA-G.R. SP No. 66200. The Court of
Appeals, in a Decision dated 9 March 2005, dismissed the petition
and affirmed the Decision of the BLR, ruling as follows:
In Department Order No. 9, a registered federation or national
union may directly create a local by submitting to the BLR copies
of the charter certificate, the local's constitution and by-laws, the
principal office address of the local, and the names of its officers
and their addresses. Upon complying with the documentary
requirements, the local shall be issued a certificate and included
in the roster of legitimate labor organizations. The [herein
respondent] is an affiliate of a registered federation PDMP,
having been issued a charter certificate. Under the rules we have
reviewed, there is no need for SMPPEU to show a membership of
20% of the employees of the bargaining unit in order to be
recognized as a legitimate labor union.
xxx
In view of the foregoing, the assailed decision and resolution of
the BLR are AFFIRMED, and the petition is DISMISSED.16
Subsequently, in a Resolution dated 16 January 2006, the Court of
Appeals denied petitioner's Motion for Reconsideration of the
aforementioned Decision.
Hence, this Petition for Certiorari under Rule 45 of the Revised
Rules of Court where petitioner raises the sole issue of:
WHETHER OR NOT THE HONORABLE COURT OF
APPEALS COMMITTED REVERSIBLE ERROR IN RULING
THAT PRIVATE RESPONDENT IS NOT REQUIRED TO
SUBMIT THE NUMBER OF EMPLOYEES AND NAMES OF
ALL ITS MEMBERS COMPRISING AT LEAST 20% OF THE
EMPLOYEES IN THE BARGAINING UNIT WHERE IT
SEEKS TO OPERATE.
The present petition questions the legal personality of respondent
as a legitimate labor organization.
Petitioner posits that respondent is required to submit a list of
members comprising at least 20% of the employees in the
bargaining unit before it may acquire legitimacy, citing Article
234(c) of the Labor Code which stipulates that any applicant labor
organization, association or group of unions or workers shall
acquire legal personality and shall be entitled to the rights and
privileges granted by law to legitimate labor organizations upon
issuance of the certificate of registration based on the following
requirements:
A. Fifty pesos (P50.00) registration fee;
b. The names of its officers, their addresses, the principal address
of the labor organization, the minutes of the organizational
meetings and the list of the workers who participated in such
meetings;
c. The names of all its members comprising at least twenty
percent (20%) of all the employees in the bargaining unit where it
seeks to operate;
d. If the applicant union has been in existence for one or more
years, copies of its annual financial reports; andcralawlibrary
e. Four (4) copies of the constitution and by-laws of the applicant
union, minutes of its adoption or ratification and the list of the
members who participated in it.17
Petitioner also insists that the 20% requirement for registration of
respondent must be based not on the number of employees of a
single division, but in all three divisions of the company in all the
offices and plants of SMC since they are all part of one
bargaining unit. Petitioner refers to Section 1, Article 1 of the
Collective Bargaining Agreement (CBA),18 quoted hereunder:
ARTICLE 1
SCOPE
Section 1. Appropriate Bargaining Unit. The appropriate
bargaining unit covered by this Agreement consists of all regular
rank and file employees paid on the basis of fixed salary per
month and employed by the COMPANY in its Corporate Staff
Units (CSU), San Miguel Brewing Products (SMBP) and San
Miguel Packaging Products (SMPP) and in different operations
existing in the City of Manila and suburbs, including Metal
Closure and Lithography Plant located at Canlubang, Laguna
subject to the provisions of Article XV of this Agreement
provided however, that if during the term of this Agreement, a
plant within the territory covered by this Agreement is transferred
outside but within a radius of fifty (50) kilometers from the Rizal
Monument, Rizal Park, Metro Manila, the employees in the
transferred plant shall remain in the bargaining unit covered by
this Agreement. (Emphasis supplied.)
Petitioner thus maintains that respondent, in any case, failed to
meet this 20% membership requirement since it based its
membership on the number of employees of a single division
only, namely, the SMPP.
There is merit in petitioner's contentions.
A legitimate labor organization19 is defined as "any labor
organization duly registered with the Department of Labor and
Employment, and includes any branch or local thereof."20 The
mandate of the Labor Code is to ensure strict compliance with the
requirements on registration because a legitimate labor
organization is entitled to specific rights under the Labor
Code,21 and are involved in activities directly affecting matters of
public interest. Registration requirements are intended to afford a
measure of protection to unsuspecting employees who may be
lured into joining unscrupulous or fly-by-night unions whose sole
purpose is to control union funds or use the labor organization for
illegitimate ends.22 Legitimate labor organizations have exclusive
rights under the law which cannot be exercised by non-legitimate
unions, one of which is the right to be certified as the exclusive
representative23 of all the employees in an appropriate collective
bargaining unit for purposes of collective bargaining.24 The
acquisition of rights by any union or labor organization,
particularly the right to file a petition for certification election,
first and foremost, depends on whether or not the labor
organization has attained the status of a legitimate labor
organization.25
A perusal of the records reveals that respondent is registered with
the BLR as a "local" or "chapter" of PDMP and was issued
Charter Certificate No. 112 on 15 June 1999. Hence, respondent
was directly chartered by PDMP.
The procedure for registration of a local or chapter of a labor
organization is provided in Book V of the Implementing Rules of
the Labor Code, as amended by Department Order No. 9 which
took effect on 21 June 1997, and again by Department Order No.
40 dated 17 February 2003. The Implementing Rules as amended
by D.O. No. 9 should govern the resolution of the petition at bar
since respondent's petition for certification election was filed with
the BLR in 1999; and that of petitioner on 17 August 1999.26
The applicable Implementing Rules enunciates a two-fold
procedure for the creation of a chapter or a local. The first
involves the affiliation of an independent union with a federation
or national union or industry union. The second, finding
application in the instant petition, involves the direct creation of a
local or a chapter through the process of chartering.27
A duly registered federation or national union may directly create
a local or chapter by submitting to the DOLE Regional Office or
to the BLR two copies of the following:
(a) A charter certificate issued by the federation or national union
indicating the creation or establishment of the local/chapter;
(b) The names of the local/chapter's officers, their addresses, and
the principal office of the local/chapter; andcralawlibrary
(c) The local/chapter's constitution and by-laws; Provided, That
where the local/chapter's constitution and by-laws is the same as
that of the federation or national union, this fact shall be indicated
accordingly.
All the foregoing supporting requirements shall be certified under
oath by the Secretary or the Treasurer of the local/chapter and
attested to by its President.28
The Implementing Rules stipulate that a local or chapter may be
directly created by a federation or national union. A duly
constituted local or chapter created in accordance with the
foregoing shall acquire legal personality from the date of filing of
the complete documents with the BLR.29 The issuance of the
certificate of registration by the BLR or the DOLE Regional
Office is not the operative act that vests legal personality upon a
local or a chapter under Department Order No. 9. Such legal
personality is acquired from the filing of the complete
documentary requirements enumerated in Section 1, Rule VI.30
Petitioner insists that Section 3 of the Implementing Rules, as
amended by Department Order No. 9, violated Article 234 of the
Labor Code when it provided for less stringent requirements for
the creation of a chapter or local. This Court disagrees.
Article 234 of the Labor Code provides that an independent labor
organization acquires legitimacy only upon its registration with
the BLR:
Any applicant labor organization, association or group of unions
or workers shall acquire legal personality and shall be entitled to
the rights and privileges granted by law to legitimate labor
organizations upon issuance of the certificate of registration based
on the following requirements:
(a) Fifty pesos (P50.00) registration fee;
(b) The names of its officers, their addresses, the principal address
of the labor organization, the minutes of the organizational
meetings and the list of the workers who participated in such
meetings;
(c) The names of all its members comprising at least twenty
percent (20%) of all the employees in the bargaining unit where
it seeks to operate;
(d) If the applicant union has been in existence for one or more
years, copies of its annual financial reports; andcralawlibrary
(e) Four (4) copies of the constitution and by-laws of the
applicant union, minutes of its adoption or ratification, and the list
of the members who participated in it. (Italics supplied.)
It is emphasized that the foregoing pertains to the registration of
an independent labor organization, association or group of unions
or workers.
However, the creation of a branch, local or chapter is treated
differently. This Court, in the landmark case of Progressive
Development Corporation v. Secretary, Department of Labor and
Employment,31 declared that when an unregistered union becomes
a branch, local or chapter, some of the aforementioned
requirements for registration are no longer necessary or
compulsory. Whereas an applicant for registration of an
independent union is mandated to submit, among other things, the
number of employees and names of all its members comprising at
least 20% of the employees in the bargaining unit where it seeks
to operate, as provided under Article 234 of the Labor Code and
Section 2 of Rule III, Book V of the Implementing Rules, the
same is no longer required of a branch, local or chapter.32 The
intent of the law in imposing less requirements in the case of a
branch or local of a registered federation or national union is to
encourage the affiliation of a local union with a federation or
national union in order to increase the local union's bargaining
powers respecting terms and conditions of labor.33
Subsequently, in Pagpalain Haulers, Inc. v. Trajano34 where the
validity of Department Order No. 9 was directly put in issue, this
Court was unequivocal in finding that there is no inconsistency
between the Labor Code and Department Order No. 9.
As to petitioner's claims that respondent obtained its Certificate of
Registration through fraud and misrepresentation, this Court finds
that the imputations are not impressed with merit. In the instant
case, proof to declare that respondent committed fraud and
misrepresentation remains wanting. This Court had, indeed, on
several occasions, pronounced that registration based on false and
fraudulent statements and documents confer no legitimacy upon a
labor organization irregularly recognized, which, at best, holds on
to a mere scrap of paper. Under such circumstances, the labor
organization, not being a legitimate labor organization, acquires
no rights.35
This Court emphasizes, however, that a direct challenge to the
legitimacy of a labor organization based on fraud and
misrepresentation in securing its certificate of registration is a
serious allegation which deserves careful scrutiny. Allegations
thereof should be compounded with supporting circumstances and
evidence. The records of the case are devoid of such evidence.
Furthermore, this Court is not a trier of facts, and this doctrine
applies with greater force in labor cases. Findings of fact of
administrative agencies and quasi-judicial bodies, such as the
BLR, which have acquired expertise because their jurisdiction is
confined to specific matters, are generally accorded not only great
respect but even finality.36
Still, petitioner postulates that respondent was not validly and
legitimately created, for PDMP cannot create a local or chapter as
it is not a legitimate labor organization, it being a trade union
center.
Petitioner's argument creates a predicament as it hinges on the
legitimacy of PDMP as a labor organization. Firstly, this line of
reasoning attempts to predicate that a trade union center is not a
legitimate labor organization. In the process, the legitimacy of
PDMP is being impugned, albeit indirectly. Secondly, the same
contention premises that a trade union center cannot directly
create a local or chapter through the process of chartering.
Anent the foregoing, as has been held in a long line of cases, the
legal personality of a legitimate labor organization, such as
PDMP, cannot be subject to a collateral attack. The law is very
clear on this matter. Article 212 (h) of the Labor Code, as
amended, defines a legitimate labor organization37 as "any labor
organization duly registered with the DOLE, and includes any
branch or local thereof."38 On the other hand, a trade union center
is any group of registered national unions or federations
organized for the mutual aid and protection of its members; for
assisting such members in collective bargaining; or for
participating in the formulation of social and employment
policies, standards, and programs, and is duly registered with the
DOLE in accordance with Rule III, Section 2 of the Implementing
Rules.39
The Implementing Rules stipulate that a labor organization shall
be deemed registered and vested with legal personality on the date
of issuance of its certificate of registration. Once a certificate of
registration is issued to a union, its legal personality cannot be
subject to collateral attack.40 It may be questioned only in an
independent petition for cancellation in accordance with Section 5
of Rule V, Book V of the Implementing Rules. The
aforementioned provision is enunciated in the following:
Sec. 5. Effect of registration. The labor organization or workers'
association shall be deemed registered and vested with legal
personality on the date of issuance of its certificate of registration.
Such legal personality cannot thereafter be subject to collateral
attack, but may be questioned only in an independent petition for
cancellation in accordance with these Rules.
PDMP was registered as a trade union center and issued
Registration Certificate No. FED-11558-LC by the BLR on 14
February 1991. Until the certificate of registration of PDMP is
cancelled, its legal personality as a legitimate labor organization
subsists. Once a union acquires legitimate status as a labor
organization, it continues to be recognized as such until its
certificate of registration is cancelled or revoked in an
independent action for cancellation.41 It bears to emphasize that
what is being directly challenged is the personality of respondent
as a legitimate labor organization and not that of PDMP. This
being a collateral attack, this Court is without jurisdiction to
entertain questions indirectly impugning the legitimacy of PDMP.
Corollarily, PDMP is granted all the rights and privileges
appurtenant to a legitimate labor organization,42 and continues to
be recognized as such until its certificate of registration is
successfully impugned and thereafter cancelled or revoked in an
independent action for cancellation.
We now proceed to the contention that PDMP cannot directly
create a local or a chapter, it being a trade union center.
This Court reverses the finding of the appellate court and BLR on
this ground, and rules that PDMP cannot directly create a local or
chapter.
After an exhaustive study of the governing labor law provisions,
both statutory and regulatory,43 we find no legal justification to
support the conclusion that a trade union center is allowed to
directly create a local or chapter through chartering. Apropos, we
take this occasion to reiterate the first and fundamental duty of
this Court, which is to apply the law. The solemn power and duty
of the Court to interpret and apply the law does not include the
power to correct by reading into the law what is not written
therein.44
Presidential Decree No. 442, better known as the Labor Code,
was enacted in 1972. Being a legislation on social justice,45 the
provisions of the Labor Code and the Implementing Rules have
been subject to several amendments, and they continue to evolve,
considering that labor plays a major role as a socio-economic
force. The Labor Code was first amended by Republic Act No.
6715, and recently, by Republic Act No. 9481. Incidentally, the
term trade union center was never mentioned under Presidential
Decree No. 442, even as it was amended by Republic Act No.
6715. The term trade union center was first adopted in the
Implementing Rules, under Department Order No. 9.
Culling from its definition as provided by Department Order No.
9, a trade union center is any group of registered national unions
or federations organized for the mutual aid and protection of its
members; for assisting such members in collective bargaining; or
for participating in the formulation of social and employment
policies, standards, and programs, and is duly registered with the
DOLE in accordance with Rule III, Section 2 of the Implementing
Rules.46 The same rule provides that the application for
registration of an industry or trade union center shall be supported
by the following:
(a) The list of its member organizations and their respective
presidents and, in the case of an industry union, the industry
where the union seeks to operate;
(b) The resolution of membership of each member organization,
approved by the Board of Directors of such union;
(c) The name and principal address of the applicant, the names of
its officers and their addresses, the minutes of its organizational
meeting/s, and the list of member organizations and their
representatives who attended such meeting/s; andcralawlibrary
(d) A copy of its constitution and by-laws and minutes of its
ratification by a majority of the presidents of the member
organizations, provided that where the ratification was done
simultaneously with the organizational meeting, it shall be
sufficient that the fact of ratification be included in the minutes of
the organizational meeting.47
Evidently, while a "national union" or "federation" is a labor
organization with at least ten locals or chapters or affiliates, each
of which must be a duly certified or recognized collective
bargaining agent;48 a trade union center, on the other hand, is
composed of a group of registered national unions or
federations.49
The Implementing Rules, as amended by Department Order No.
9, provide that "a duly registered federation or national union"
may directly create a local or chapter. The provision reads:
Section 1. Chartering and creation of a local/chapter. - A duly
registered federation or national union may directly create a
local/chapter by submitting to the Regional Office or to the
Bureau two (2) copies of the following:
(a) A charter certificate issued by the federation or national union
indicating the creation or establishment of the local/chapter;
(b) The names of the local/chapter's officers, their addresses, and
the principal office of the local/chapter; andcralawlibrary
(c) The local/chapter's constitution and by-laws; provided that
where the local/chapter's constitution and by-laws is the same as
that of the federation or national union, this fact shall be indicated
accordingly.
All the foregoing supporting requirements shall be certified under
oath by the Secretary or the Treasurer of the local/chapter and
attested to by its President.50
Department Order No. 9 mentions two labor organizations either
of which is allowed to directly create a local or chapter through
chartering - a duly registered federation or a national union.
Department Order No. 9 defines a "chartered local" as a labor
organization in the private sector operating at the enterprise level
that acquired legal personality through a charter certificate, issued
by a duly registered federation or national union and reported to
the Regional Office in accordance with Rule III, Section 2-E of
these Rules.51
Republic Act No. 9481 or "An Act Strengthening the Workers'
Constitutional Right to Self-Organization, Amending for the
Purpose Presidential Decree No. 442, As Amended, Otherwise
Known as the Labor Code of the Philippines" lapsed52 into law on
25 May 2007 and became effective on 14 June 2007.53 This law
further amends the Labor Code provisions on Labor Relations.
Pertinent amendments read as follows:
SECTION 1. Article 234 of Presidential Decree No. 442, as
amended, otherwise known as the Labor Code of the Philippines,
is hereby further amended to read as follows:
ART. 234. Requirements of Registration. - A federation, national
union or industry or trade union center or an independent union
shall acquire legal personality and shall be entitled to the rights
and privileges granted by law to legitimate labor organizations
upon issuance of the certificate of registration based on the
following requirements:
(a) Fifty pesos (P50.00) registration fee;
(b) The names of its officers, their addresses, the principal address
of the labor organization, the minutes of the organizational
meetings and the list of the workers who participated in such
meetings;
(c) In case the applicant is an independent union, the names of all
its members comprising at least twenty percent (20%) of all the
employees in the bargaining unit where it seeks to operate;
(d) If the applicant union has been in existence for one or more
years, copies of its annual financial reports; andcralawlibrary
(e) Four copies of the constitution and by-laws of the applicant
union, minutes of its adoption or ratification, and the list of the
members who participated in it.
SECTION 2. A new provision is hereby inserted into the Labor
Code as Article 234-A to read as follows:
ART. 234-A. Chartering and Creation of a Local Chapter. - A
duly registered federation or national union may directly create a
local chapter by issuing a charter certificate indicating the
establishment of the local chapter. The chapter shall acquire legal
personality only for purposes of filing a petition for certification
election from the date it was issued a charter certificate.
The chapter shall be entitled to all other rights and privileges of a
legitimate labor organization only upon the submission of the
following documents in addition to its charter certificate:
(a) The names of the chapter's officers, their addresses, and the
principal office of the chapter; andcralawlibrary
(b) The chapter's constitution and by-laws: Provided, That where
the chapter's constitution and by-laws are the same as that of the
federation or the national union, this fact shall be indicated
accordingly.
The additional supporting requirements shall be certified under
oath by the secretary or treasurer of the chapter and attested by its
president. (Emphasis ours.)
Article 234 now includes the term trade union center, but
interestingly, the provision indicating the procedure for chartering
or creating a local or chapter, namely Article 234-A, still makes
no mention of a "trade union center."
Also worth emphasizing is that even in the most recent
amendment of the implementing rules,54 there was no mention of
a trade union center as being among the labor organizations
allowed to charter.
This Court deems it proper to apply the Latin maxim expressio
unius est exclusio alterius. Under this maxim of statutory
interpretation, the expression of one thing is the exclusion of
another. When certain persons or things are specified in a law,
contract, or will, an intention to exclude all others from its
operation may be inferred. If a statute specifies one exception to a
general rule or assumes to specify the effects of a certain
provision, other exceptions or effects are excluded.55 Where the
terms are expressly limited to certain matters, it may not, by
interpretation or construction, be extended to other
matters.56 Such is the case here. If its intent were otherwise, the
law could have so easily and conveniently included "trade union
centers" in identifying the labor organizations allowed to charter a
chapter or local. Anything that is not included in the enumeration
is excluded therefrom, and a meaning that does not appear nor is
intended or reflected in the very language of the statute cannot be
placed therein.57 The rule is restrictive in the sense that it proceeds
from the premise that the legislating body would not have made
specific enumerations in a statute if it had the intention not to
restrict its meaning and confine its terms to those expressly
mentioned.58 Expressium facit cessare tacitum.59 What is
expressed puts an end to what is implied. Casus omissus pro
omisso habendus est. A person, object or thing omitted must have
been omitted intentionally.
Therefore, since under the pertinent status and applicable
implementing rules, the power granted to labor organizations to
directly create a chapter or local through chartering is given to a
federation or national union, then a trade union center is without
authority to charter directly.
The ruling of this Court in the instant case is not a departure from
the policy of the law to foster the free and voluntary organization
of a strong and united labor movement,60 and thus assure the
rights of workers to self-organization.61 The mandate of the Labor
Code in ensuring strict compliance with the procedural
requirements for registration is not without reason. It has been
observed that the formation of a local or chapter becomes a handy
tool for the circumvention of union registration requirements.
Absent the institution of safeguards, it becomes a convenient
device for a small group of employees to foist a not-so-desirable
federation or union on unsuspecting co-workers and pare the need
for wholehearted voluntariness, which is basic to free
unionism.62 As a legitimate labor organization is entitled to
specific rights under the Labor Code and involved in activities
directly affecting public interest, it is necessary that the law afford
utmost protection to the parties affected.63 However, as this Court
has enunciated in Progressive Development Corporation v.
Secretary of Department of Labor and Employment, it is not this
Court's function to augment the requirements prescribed by law.
Our only recourse, as previously discussed, is to exact strict
compliance with what the law provides as requisites for local or
chapter formation.64
In sum, although PDMP as a trade union center is a legitimate
labor organization, it has no power to directly create a local or
chapter. Thus, SMPPEU-PDMP cannot be created under the more
lenient requirements for chartering, but must have complied with
the more stringent rules for creation and registration of an
independent union, including the 20% membership requirement.
WHEREFORE, the instant Petition is GRANTED. The
Decision dated 09 March 2005 of the Court of Appeals in CA-GR
SP No. 66200 is REVERSED and SET ASIDE. The Certificate
of Registration of San Miguel Packaging Products Employees
Union Pambansang Diwa ng Manggagawang Pilipino
is ORDERED CANCELLED, and SMPPEU-
PDMP DROPPED from the rolls of legitimate labor
organizations.
Costs against petitioner.
SO ORDERED.
Ynares-Santiago, J., Chairperson, Austria-Martinez, Nachura,
Reyes, JJ., concur.
[G.R. NO. 167141 : March 13, 2009]
SAMAHAN NG MGA MANGGAGAWA SA SAMMA-
LAKAS SA INDUSTRIYA NG KAPATIRANG HALIGI NG
ALYANSA (SAMMA-LIKHA), Petitioner, v. SAMMA
CORPORATION, Respondent.
DECISION
CORONA, J.:
This is a Petition for Review on Certiorari 1 of the August 31,
2004 decision2 and February 15, 2005 resolution3 of the Court of
Appeals (CA) in CA-G.R. SP No. 77156.
Petitioner Samahan ng mga Manggagawa sa Samma' Lakas sa
Industriya ng Kapatirang Haligi ng Alyansa (SAMMA-LIKHA)
filed a petition for certification election on July 24, 2001 in the
Department of Labor and Employment (DOLE), Regional Office
IV.4 It claimed that: (1) it was a local chapter of the LIKHA
Federation, a legitimate labor organization registered with the
DOLE; (2) it sought to represent all the rank-and-file employees
of respondent Samma Corporation; (3) there was no other
legitimate labor organization representing these rank-and-file
employees; (4) respondent was not a party to any collective
bargaining agreement and (5) no certification or consent election
had been conducted within the employer unit for the last 12
months prior to the filing of the petition.
Respondent moved for the dismissal of the petition arguing that
(1) LIKHA Federation failed to establish its legal personality; (2)
petitioner failed to prove its existence as a local chapter; (3) it
failed to attach the certificate of non-forum shopping and (4) it
had a prohibited mixture of supervisory and rank-and-file
employees.5
In an order dated November 12, 2002, med-arbiter Arturo V.
Cosuco ordered the dismissal of the petition on the following
grounds: (1) lack of legal personality for failure to attach the
certificate of registration purporting to show its legal personality;
(2) prohibited mixture of rank-and-file and supervisory
employees and (3) failure to submit a certificate of non-forum
shopping.6
Petitioner moved for reconsideration on November 29, 2001. The
Regional Director of DOLE Regional Office IV forwarded the
case to the Secretary of Labor. Meanwhile, on December 14,
2002, respondent filed a petition for cancellation of petitioner's
union registration in the DOLE Regional Office IV.7
On January 17, 2003, Acting Secretary Manuel G. Imson, treating
the motion for reconsideration as an appeal, rendered a decision
reversing the order of the med-arbiter. He ruled that the legal
personality of a union cannot be collaterally attacked but may
only be questioned in an independent petition for cancellation of
registration. Thus, he directed the holding of a certification
election among the rank-and-file employees of respondent,
subject to the usual pre-election conference and inclusion-
exclusion proceedings.8
On January 23, 2003 or six days after the issuance of said
decision, respondent filed its comment on the motion for
reconsideration of petitioner, asserting that the order of the med-
arbiter could only be reviewed by way of appeal and not by a
motion for reconsideration pursuant to Department Order (D.O.)
No. 9, series of 1997.9
On February 6, 2003, respondent filed its motion for
reconsideration of the January 17, 2003 decision. In a resolution
dated April 3, 2003, Secretary Patricia A. Sto. Tomas denied the
motion.10
Meanwhile, on April 14, 2003, Crispin D. Dannug, Jr., Officer-in-
Charge/Regional Director of DOLE Regional Office IV, issued a
resolution revoking the charter certificate of petitioner as local
chapter of LIKHA Federation on the ground of prohibited mixture
of supervisory and rank-and-file employees and non-compliance
with the attestation clause under paragraph 2 of Article 235 of the
Labor Code.11 On May 6, 2003, petitioner moved for the
reconsideration of this resolution.12
Respondent filed a petition for certiorari 13 in the CA assailing
the January 17, 2003 decision and April 3, 2003 resolution of the
Secretary of Labor. In a decision dated August 31, 2004, the CA
reversed the same.14 It denied reconsideration in a resolution
dated February 15, 2005. It held that Administrative Circular No.
04-94 which required the filing of a certificate of non-forum
shopping applied to petitions for certification election. It also
ruled that the Secretary of Labor erred in granting the appeal
despite the lack of proof of service on respondent. Lastly, it found
that petitioner had no legal standing to file the petition for
certification election because its members were a mixture of
supervisory and rank-and-file employees.15
Hence, this petition.
The issues for our resolution are the following: (1) whether a
certificate for non-forum shopping is required in a petition for
certification election; (2) whether petitioner's motion for
reconsideration which was treated as an appeal by the Secretary
of Labor should not have been given due course for failure to
attach proof of service on respondent and (3) whether petitioner
had the legal personality to file the petition for certification
election.
Requirement of Certificate
Of Non-Forum Shopping
Is Not Required in a Petition
For Certification Election
In ruling against petitioner, the CA declared that under
Administrative Circular No. 04-94,16 a certificate of non-forum
shopping was required in a petition for certification election. The
circular states:
The complaint and other initiatory pleadings referred to and
subject of this Circular are the original civil complaint,
counterclaim, cross-claim, third (fourth, etc.) party complaint, or
complaint-in-intervention, petition, or application wherein a
party asserts his claim for relief. (Emphasis
supplied)cralawlibrary
According to the CA, a petition for certification election asserts a
claim, i.e., the conduct of a certification election. As a result, it is
covered by the circular.17
We disagree.
The requirement for a certificate of non-forum shopping refers to
complaints, counter-claims, cross-claims, petitions or applications
where contending parties litigate their respective positions
regarding the claim for relief of the complainant, claimant,
petitioner or applicant. A certification proceeding, even though
initiated by a "petition," is not a litigation but an investigation of a
non-adversarial and fact-finding character.18
Such proceedings are not predicated upon an allegation of
misconduct requiring relief, but, rather, are merely of an
inquisitorial nature. The Board's functions are not judicial in
nature, but are merely of an investigative character. The object of
the proceedings is not the decision of any alleged commission of
wrongs nor asserted deprivation of rights but is merely the
determination of proper bargaining units and the ascertainment of
the will and choice of the employees in respect of the selection of
a bargaining representative. The determination of the proceedings
does not entail the entry of remedial orders to redress rights, but
culminates solely in an official designation of bargaining units
and an affirmation of the employees' expressed choice of
bargaining agent.19 (Emphasis supplied)cralawlibrary
In Pena v. Aparicio,20 we ruled against the necessity of attaching a
certification against forum shopping to a disbarment complaint.
We looked into the rationale of the requirement and concluded
that the evil sought to be avoided is not present in disbarment
proceedings.
'[The] rationale for the requirement of a certification against
forum shopping is to apprise the Court of the pendency of another
action or claim involving the same issues in another court,
tribunal or quasi-judicial agency, and thereby precisely avoid the
forum shopping situation. Filing multiple petitions or complaints
constitutes abuse of court processes, which tends to degrade the
administration of justice, wreaks havoc upon orderly judicial
procedure, and adds to the congestion of the heavily burdened
dockets of the courts. Furthermore, the rule proscribing forum
shopping seeks to promote candor and transparency among
lawyers and their clients in the pursuit of their cases before the
courts to promote the orderly administration of justice, prevent
undue inconvenience upon the other party, and save the precious
time of the courts. It also aims to prevent the embarrassing
situation of two or more courts or agencies rendering conflicting
resolutions or decisions upon the same issue.
It is in this light that we take a further look at the necessity of
attaching a certification against forum shopping to a disbarment
complaint. It would seem that the scenario sought to be
avoided, i.e., the filing of multiple suits and the possibility of
conflicting decisions, rarely happens in disbarment
complaints considering that said proceedings are either "taken by
the Supreme Court motu proprio, or by the Integrated Bar of the
Philippines (IBP) upon the verified complaint of any person."
Thus, if the complainant in a disbarment case fails to attach a
certification against forum shopping, the pendency of another
disciplinary action against the same respondent may still be
ascertained with ease.21 (Emphasis supplied)cralawlibrary
The same situation holds true for a petition for certification
election. Under the omnibus rules implementing the Labor Code
as amended by D.O. No. 9,22 it is supposed to be filed in the
Regional Office which has jurisdiction over the principal office of
the employer or where the bargaining unit is principally
situated.23 The rules further provide that where two or more
petitions involving the same bargaining unit are filed in one
Regional Office, the same shall be automatically
consolidated.24 Hence, the filing of multiple suits and the
possibility of conflicting decisions will rarely happen in this
proceeding and, if it does, will be easy to discover.
Notably, under the Labor Code and the rules pertaining to the
form of the petition for certification election, there is no
requirement for a certificate of non-forum shopping either in D.O.
No. 9, series of 1997 or in D.O. No. 40-03, series of 2003 which
replaced the former.25
Considering the nature of a petition for certification election and
the rules governing it, we therefore hold that the requirement for a
certificate of non-forum shopping is inapplicable to such a
petition.
Treatment of Motion for Reconsideration as an Appeal
The CA ruled that petitioner's motion for reconsideration, which
was treated as an appeal by the Secretary of Labor, should not
have been given due course for lack of proof of service in
accordance with the implementing rules as amended by D.O. No.
9:
Section 12. Appeal; finality of decision. - The decision of the
Med-Arbiter may be appealed to the Secretary for any violation of
these Rules. Interloculory orders issued by the Med-Arbiter prior
to the grant or denial of the petition, including order granting
motions for intervention issued after an order calling for a
certification election, shall not be appealable. However, any issue
arising therefrom may be raised in the appeal on the decision
granting or denying the petition.
The appeal shall be under oath and shall consist of a
memorandum of appeal specifically stating the grounds relied
upon by the appellant with the supporting arguments and
evidence. The appeal shall be deemed not filed unless
accompanied by proof of service thereof to
appellee.26 (Emphasis supplied)cralawlibrary
In accepting the appeal, the Secretary of Labor stated:
[Petitioner's] motion for reconsideration of the Med-Arbiter's
Order dated November 12, 2002 was verified under oath by
[petitioner's] president Gil Dispabiladeras before Notary Public
Wilfredo A. Ruiz on 29 November 2002, and recorded in the
Notarial Register under Document No. 186, Page No. 38, Book
V, series of 2002. On page 7 of the said motion also appears the
notation "copy of respondent to be delivered personally with the
name and signature of one Rosita Simon, 11/29/02." The
motion contained the grounds and arguments relied upon by
[petitioner] for the reversal of the assailed Order. Hence, the
motion for reconsideration has complied with the formal
requisites of an appeal.
The signature of Rosita Simon appearing on the last page of the
motion can be considered as compliance with the required
proof of service upon respondent. Rosita Simon's employment
status was a matter that should have been raised earlier by
[respondent]. But [respondent] did not question the same and
slept on its right to oppose or comment on [petitioner's] motion
for reconsideration. It cannot claim that it was unaware of the
filing of the appeal by [petitioner], because a copy of the
indorsement of the entire records of the petition to the Office of
the Secretary "in view of the memorandum of appeal filed by Mr.
Jesus B. Villamor" was served upon the employer and legal
counsels Atty. Ismael De Guzman and Atty. Anatolio Sabillo at
the Samma Corporation Office, Main Avenue, PEZA, Rosario,
Cavite on December 5, 2002.27 (Emphasis supplied)cralawlibrary
The motion for reconsideration was properly treated as an appeal
because it substantially complied with the formal requisites of the
latter. The lack of proof of service was not fatal as respondent had
actually received a copy of the motion. Consequently, it had the
opportunity to oppose the same. Under these circumstances, we
find that the demands of substantial justice and due process were
satisfied.
We stress that rules of procedure are interpreted liberally to
secure a just, speedy and inexpensive disposition of every action.
They should not be applied if their application serves no useful
purpose or hinders the just and speedy disposition of cases.
Specifically, technical rules and objections should not hamper the
holding of a certification election wherein employees are to select
their bargaining representative. A contrary rule will defeat the
declared policy of the Stateςηαñrοblεš νιr†υαl lαω lιbrαrÿ
to promote the free and responsible exercise of the right to self-
organization through the establishment of a simplified
mechanism for the speedy registration of labor organizations and
workers' associations, determination of representation status,
and resolution of intra and inter-union disputes.28 xxx (Emphasis
supplied)cralawlibrary
Legal Personality of Petitioner
Petitioner argues that the erroneous inclusion of one supervisory
employee in the union of rank-and-file employees was not a
ground to impugn its legitimacy as a legitimate labor organization
which had the right to file a petition for certification election.
We agree.
LIKHA was granted legal personality as a federation under
certificate of registration no. 92-1015-032-11638-FED-LC.
Subsequently, petitioner as its local chapter was issued its charter
certificate no. 2-01.29 With certificates of registration issued in
their favor, they are clothed with legal personality as legitimate
labor organizations:
Section 5. Effect of registration. - The labor organization or
workers' association shall be deemed registered and vested with
legal personality on the date of issuance of its certificate of
registration. Such legal personality cannot thereafter be subject to
collateral attack, but may be questioned only in an independent
petition for cancellation in accordance with these Rules.30
-0-
Section 3. Acquisition of legal personality by local chapter. - A
local/chapter constituted in accordance with Section 1 of this Rule
shall acquire legal personality from the date of filing of the
complete documents enumerated therein. Upon compliance with
all the documentary requirements, the Regional Office or Bureau
of Labor Relations shall issue in favor of the local/chapter a
certificate indicating that it is included in the roster of legitimate
labor organizations.31
Such legal personality cannot thereafter be subject to collateral
attack, but may be questioned only in an independent petition for
cancellation of certificate of registration.32 Unless petitioner's
union registration is cancelled in independent proceedings, it shall
continue to have all the rights of a legitimate labor organization,
including the right to petition for certification election.
Furthermore, the grounds for dismissal of a petition for
certification election based on the lack of legal personality of a
labor organization are the following: (a) petitioner is not listed by
the Regional Office or the Bureau of Labor Relations in its
registry of legitimate labor organizations or (b) its legal
personality has been revoked or cancelled with finality in
accordance with the rules.33
As mentioned, respondent filed a petition for cancellation of the
registration of petitioner on December 14, 2002. In a resolution
dated April 14, 2003, petitioner's charter certificate was revoked
by the DOLE. But on May 6, 2003, petitioner moved for the
reconsideration of this resolution. Neither of the parties alleged
that this resolution revoking petitioner's charter certificate had
attained finality. However, in this petition, petitioner prayed that
its charter certificate be "reinstated in the roster of active
legitimate labor [organizations]."34 This cannot be granted here.
To repeat, the proceedings on a petition for cancellation of
registration are independent of those of a petition for certification
election. This case originated from the latter. If it is shown that
petitioner's legal personality had already been revoked or
cancelled with finality in accordance with the rules, then it is no
longer a legitimate labor organization with the right to petition for
a certification election.
A Final Note
Respondent, as employer, had been the one opposing the holding
of a certification election among its rank-and-file employees. This
should not be the case. We have already declared that, in
certification elections, the employer is a bystander; it has no right
or material interest to assail the certification election.35
[This] Court notes that it is petitioner, the employer, which has
offered the most tenacious resistance to the holding of a
certification election among its monthly-paid rank-and-file
employees. This must not be so, for the choice of a collective
bargaining agent is the sole concern of the employees. The only
exception to this rule is where the employer has to file the petition
for certification election pursuant to Article 258 of the Labor
Code because it was requested to bargain collectively, which
exception finds no application in the case before us. Its role in a
certification election has aptly been described in Trade Unions of
the Philippines and Allied Services (TUPAS) v. Trajano, as that of
a mere bystander. It has no legal standing in a certification
election as it cannot oppose the petition or appeal the Med-
Arbiter's orders related thereto. . .36
WHEREFORE, the petition is hereby GRANTED. Let the
records of the case be remanded to the office of origin, the
Regional Office IV of the Department of Labor and Employment,
for determination of the status of petitioner's legal personality. If
petitioner is still a legitimate labor organization, then said office
shall conduct a certification election subject to the usual pre-
election conference.
SO ORDERED.
[G.R. No. 169754, February 23 : 2011]
LEGEND INTERNATIONAL RESORTS LIMITED,
PETITIONER, VS. KILUSANG MANGGAGAWA NG
LEGENDA (KML- INDEPENDENT), RESPONDENT.
DECISION
DEL CASTILLO, J.:
This Petition for Review on Certiorari assails the September 18,
2003 Decision of the Court of Appeals in CA-G.R. SP No. 72848
which found no grave abuse of discretion on the part of the Office
of the Secretary of the Department of Labor and Employment
(DOLE) which ruled in favor of Kilusang Manggagawa ng
Legenda (KML).  Also assailed is the September 14, 2005
Resolution denying petitioner's motion for reconsideration.
Factual Antecedents
On June 6, 2001, KML filed with the Med-Arbitration Unit of the
DOLE, San Fernando, Pampanga, a Petition for Certification
Election[1] docketed as Case No. RO300-0106-RU-001. KML
alleged that it is a legitimate labor organization of the rank and
file employees of Legend International Resorts Limited
(LEGEND).  KML claimed that it was issued its Certificate of
Registration No. RO300-0105-UR-002 by the DOLE on May 18,
2001.
LEGEND moved to dismiss[2] the petition alleging that KML is
not a legitimate labor organization because its membership is a
mixture of rank and file and supervisory employees in violation of
Article 245 of the Labor Code. LEGEND also claimed that KML
committed acts of fraud and misrepresentation when it made it
appear that certain employees attended its general membership
meeting on April 5, 2001 when in reality some of them were
either at work; have already resigned as of March 2001; or were
abroad.
In its Comment,[3] KML argued that even if 41 of its members are
indeed supervisory employees and therefore excluded from its
membership, the certification election could still proceed because
the required number of the total rank and file employees
necessary for certification purposes is still sustained. KML also
claimed that its legitimacy as a labor union could not be
collaterally attacked in the certification election proceedings but
only through a separate and independent action for cancellation of
union registration. Finally, as to the alleged acts of
misrepresentation, KML asserted that LEGEND failed to
substantiate its claim.
Ruling of the Med-Arbiter
On September 20, 2001, the Med-Arbiter[4] rendered
judgment[5] dismissing for lack of merit the petition for
certification election.  The Med-Arbiter found that indeed there
were several supervisory employees in KML's membership. 
Since Article 245 of the Labor Code expressly prohibits
supervisory employees from joining the union of rank and file
employees, the Med-Arbiter concluded that KML is not a
legitimate labor organization.  KML was also found to have
fraudulently procured its registration certificate by
misrepresenting that 70 employees were among those who
attended its organizational meeting on April 5, 2001 when in fact
they were either at work or elsewhere.
KML thus appealed to the Office of the Secretary of the DOLE.
Ruling of the Office of the Secretary of DOLE
On May 22, 2002, the Office of the Secretary of DOLE rendered
its Decision[6] granting KML's appeal thereby reversing and
setting aside the Med-Arbiter's Decision.  The Office of the
Secretary of DOLE held that KML's legitimacy as a union could
not be collaterally attacked, citing Section 5,[7] Rule V of
Department Order No. 9, series of 1997.
The Office of the Secretary of DOLE also opined that Article 245
of the Labor Code merely provides for the prohibition on
managerial employees to form or join a union and the ineligibility
of supervisors to join the union of the rank and file employees
and vice versa. It declared that any violation of the provision of
Article 245 does not ipso facto render the existence of the labor
organization illegal. Moreover, it held that Section 11, paragraph
II of Rule XI which provides for the grounds for dismissal of a
petition for certification election does not include mixed
membership in one union.
The dispositive portion of the Office of the Secretary of DOLE's
Decision reads:
WHEREFORE, the appeal is hereby GRANTED and the order of
the Med-Arbiter dated 20 September 2001 is REVERSED and
SET ASIDE.
Accordingly, let the entire record of the case be remanded to the
regional office of origin for the immediate conduct of the
certification election, subject to the usual pre-election conference,
among the rank and file employees of LEGEND
INTERNATIONAL RESORTS LIMITED with the following
choices:
1. KILUSANG MANGGAGAWA NG LEGENDA (KML-
INDEPENDENT); and
2. NO UNION.
Pursuant to Rule XI, Section II.1 of D.O. No. 9, the employer is
hereby directed to submit to the office of origin, within ten days
from receipt of the decision, the certified list of employees in the
bargaining unit for the last three (3) months prior to the issuance
of this decision.
SO DECIDED.[8]
[9]
LEGEND filed its Motion for Reconsideration  reiterating its
earlier arguments.  It also alleged that on August 24, 2001, it filed
a Petition[10] for Cancellation of Union Registration of KML
docketed as Case No. RO300-0108-CP-001 which was
granted[11] by the DOLE Regional Office No. III of San Fernando,
Pampanga in its Decision[12] dated November 7, 2001.
In a Resolution[13] dated August 20, 2002, the Office of the
Secretary of DOLE denied LEGEND's motion for
reconsideration. It opined that Section 11, paragraph II(a), Rule
XI of Department Order No. 9 requires a final order of
cancellation before a petition for certification election may be
dismissed on the ground of lack of legal personality.  Besides, it
noted that the November 7, 2001 Decision of DOLE Regional
Office No. III of San Fernando, Pampanga in Case No. RO300-
0108-CP-001 was reversed by the Bureau of Labor Relations in a
Decision dated March 26, 2002.
Ruling of the Court of Appeals
Undeterred, LEGEND filed a Petition for Certiorari[14] with the
Court of Appeals docketed as CA-G.R. SP No. 72848.  LEGEND
alleged that the Office of the Secretary of DOLE gravely abused
its discretion in reversing and setting aside the Decision of the
Med-Arbiter despite substantial and overwhelming evidence
against KML.
For its part, KML alleged that the Decision dated March 26, 2002
of the Bureau of Labor Relations in Case No. RO300-0108-CP-
001 denying LEGEND's petition for cancellation and upholding
KML's legitimacy as a labor organization has already become
final and executory, entry of judgment having been made on
August 21, 2002.[15]
The Office of the Secretary of DOLE also filed its
Comment[16] asserting that KML's legitimacy cannot be attacked
collaterally.  Finally, the Office of the Secretary of DOLE
stressed that LEGEND has no legal personality to participate in
the certification election proceedings.
On September 18, 2003, the Court of Appeals rendered its
Decision[17] finding no grave abuse of discretion on the part of the
Office of the Secretary of DOLE.  The appellate court held that
the issue on the legitimacy of KML as a labor organization has
already been settled with finality in Case No. RO300-0108-CP-
001.  The March 26, 2002 Decision of the Bureau of Labor
Relations upholding the legitimacy of KML as a labor
organization had long become final and executory for failure of
LEGEND to appeal the same.  Thus, having already been settled
that KML is a legitimate labor organization, the latter could
properly file a petition for certification election.  There was
nothing left for the Office of the Secretary of DOLE to do but to
order the holding of such certification election.
The dispositive portion of the Decision reads:
WHEREFORE, in view of the foregoing, and finding that no
grave abuse of discretion amounting to lack or excess of
jurisdiction has been committed by the Department of Labor and
Employment, the assailed May 22, 2002 Decision and August 20,
2002 Resolution in Case No. RO300-106-RU-001 are UPHELD
and AFFIRMED.  The instant petition is DENIED due course
and, accordingly, DISMISSED for lack of merit.[18]
LEGEND filed a Motion for Reconsideration[19] alleging, among
others, that it has appealed to the Court of Appeals the March 26,
2002 Decision in Case No. RO300-0108-CP-001 denying its
petition for cancellation and that it is still pending resolution.
On September 14, 2005, the appellate court denied LEGEND's
motion for reconsideration.
Hence, this Petition for Review on Certiorari raising the lone
assignment of error, viz:
WHETHER X X X THE HONORABLE COURT OF APPEALS
COMMITTED SERIOUS ERRORS IN THE APPLICATION OF
LAW IN DENYING THE PETITIONER'S PETITION FOR
CERTIORARI.[20]
Petitioner's Arguments
 LEGEND submits that the Court of Appeals grievously erred in
ruling that the March 26, 2002 Decision denying its Petition for
Cancellation of KML's registration has already become final and
executory.  It asserts that it has seasonably filed a Petition
for Certiorari[21] before the CA docketed as CA-G.R. SP No.
72659 assailing said Decision.  In fact, on June 30, 2005, the
Court of Appeals granted the petition, reversed the March 26,
2002 Decision of the Bureau of Labor Relations and reinstated the
November 7, 2001 Decision of the DOLE Regional Office III
ordering the cancellation of KML's registration.
Finally, LEGEND posits that the cancellation of KML's
certificate of registration should retroact to the time of its
issuance.[22]  It thus claims that the petition for certification
election and all of KML's activities should be nullified because it
has no legal personality to file the same, much less demand
collective bargaining with LEGEND.[23]
LEGEND thus prays that the September 20, 2001 Decision of the
Med-Arbiter dismissing KML's petition for certification election
be reinstated.[24]
Respondent's Arguments
In its Comment filed before this Court dated March 21, 2006,
KML insists that the Decision of the Bureau of Labor Relations
upholding its legitimacy as a labor organization has already
attained finality[25] hence there was no more hindrance to the
holding of a certification election.  Moreover, it claims that the
instant petition has become moot because the certification
election sought to be prevented had already been conducted.
Our Ruling
The petition is partly meritorious.
LEGEND has timely appealed the
March 26, 2002 Decision of the Bureau
of Labor Relations to the Court of
Appeals.
We cannot understand why the Court of Appeals totally
disregarded LEGEND's allegation in its Motion for
Reconsideration that the March 26, 2002 Decision of the Bureau
of Labor Relations has not yet attained finality considering that it
has timely appealed the same to the Court of Appeals and which
at that time is still pending resolution.   The Court of Appeals
never bothered to look into this allegation and instead dismissed
outright LEGEND's motion for reconsideration.  By doing so, the
Court of Appeals in effect maintained its earlier ruling that the
March 26, 2002 Decision of the Bureau of Labor Relations
upholding the legitimacy of KML as a labor organization has long
become final and executory for failure of LEGEND to appeal the
same.
This is inaccurate.  Records show that (in the cancellation of
registration case) LEGEND has timely filed on September 6,
2002 a petition for certiorari[26] before the Court of Appeals
which was docketed as CA-G.R. SP No. 72659 assailing the
March 26, 2002 Decision of the Bureau of Labor Relations.   In
fact, KML received a copy of said petition on September 10,
2002[27] and has filed its Comment thereto on December 2, 2002.
[28]
 Thus, we find it quite interesting for KML to claim in its
Comment (in the certification petition case) before this Court
dated March 21, 2006[29] that the Bureau of Labor Relations'
Decision in the petition for cancellation case has already attained
finality.   Even in its Memorandum[30] dated March 13, 2007 filed
before us, KML is still insisting that the Bureau of Labor
Relations' Decision has become final and executory.
Our perusal of the records shows that on June 30, 2005, the Court
of Appeals rendered its Decision[31] in CA-G.R. SP No. 72659
reversing the March 26, 2002 Decision of the Bureau of Labor
Relations and reinstating the November 7, 2001 Decision of the
Med-Arbiter which canceled the certificate of registration of
KML.[32]  On September 30, 2005, KML's motion for
reconsideration was denied for lack of merit.[33]  On November
25, 2005, KML filed its Petition for Review
on Certiorari[34] before this Court which was docketed as G.R.
No. 169972.  However, the same was denied in a
Resolution[35] dated February 13, 2006 for having been filed out of
time.  KML moved for reconsideration but it was denied with
finality in a Resolution[36] dated June 7, 2006.  Thereafter, the said
Decision canceling the certificate of registration of KML as a
labor organization became final and executory and entry of
judgment was made on July 18, 2006.[37]
The cancellation of KML's certificate of
registration should not retroact to the
time of its issuance.
Notwithstanding the finality of the Decision canceling the
certificate of registration of KML, we cannot subscribe to
LEGEND's proposition that the cancellation of KML's certificate
of registration should retroact to the time of its issuance. 
LEGEND claims that KML's petition for certification election
filed during the pendency of the petition for cancellation and its
demand to enter into collective bargaining agreement with
LEGEND should be dismissed due to KML's lack of legal
personality.
This issue is not new or novel.  In Pepsi-Cola Products
Philippines, Inc. v. Secretary of Labor,[38] we already ruled that:
Anent the issue of whether or not the Petition to cancel/revoke
registration is a prejudicial question to the petition for
certification election, the following ruling in the case
of Association of the Court of Appeals Employees (ACAE) v.
Hon. Pura Ferrer-Calleja, x x x is in point, to wit:
x x x It is well-settled rule that `a certification proceedings is not
a litigation in the sense that the term is ordinarily understood, but
an investigation of a non-adversarial and fact finding character.'
(Associated Labor Unions (ALU) v. Ferrer-Calleja, 179 SCRA
127 [1989]; Philippine Telegraph and Telephone Corporation v.
NLRC, 183 SCRA 451 [1990].  Thus, the technical rules of evidence
do not apply if the decision to grant it proceeds from an
examination of the sufficiency of the petition as well as a careful
look into the arguments contained in the position papers and other
documents.
At any rate, the Court applies the established rule correctly
followed by the public respondent that an order to hold a
certification election is proper despite the pendency of the
petition for cancellation of the registration certificate of the
respondent union.  The rationale for this is that at the time
the respondent union filed its petition, it still had the legal
personality to perform such act absent an order directing the
cancellation.[39] (Emphasis supplied.)
In Capitol Medical Center, Inc. v. Hon. Trajano,[40] we also held
that "the pendency of a petition for cancellation of union
registration does not preclude collective bargaining."[41]  Citing
the Secretary of Labor, we held viz:
That there is a pending cancellation proceedings against the
respondent Union is not a bar to set in motion the mechanics
of collective bargaining.  If a certification election may still be
ordered despite the pendency of a petition to cancel the
union's registration certificate x x x more so should the
collective bargaining process continue despite its pendency. [42]
(Emphasis supplied.)
In Association of Court of Appeals Employees v. Ferrer-Calleja,
[43]
 this Court was tasked to resolve the issue of whether "the
certification proceedings should be suspended pending [the
petitioner's] petition for the cancellation of union registration of
the UCECA[44]."[45]  The Court resolved the issue in the negative
holding that "an order to hold a certification election is proper
despite the pendency of the petition for cancellation of the
registration certificate of the respondent union.  The rationale
for this is that at the time the respondent union filed its petition, it
still had the legal personality to perform such act absent an order
directing a cancellation."[46]  We reiterated this view in Samahan
ng Manggagawa sa Pacific Plastic v. Hon. Laguesma[47] where
we declared that "a certification election can be conducted
despite pendency of a petition to cancel the union registration
certificate.  For the fact is that at the time the respondent union
filed its petition for certification, it still had the legal personality
to perform such act absent an order directing its cancellation."[48]
Based on the foregoing jurisprudence, it is clear that a
certification election may be conducted during the pendency of
the cancellation proceedings.  This is because at the time the
petition for certification was filed, the petitioning union is
presumed to possess the legal personality to file the same.  There
is therefore no basis for LEGEND's assertion that the cancellation
of KML's certificate of registration should retroact to the time of
its issuance or that it effectively nullified all of KML's activities,
including its filing of the petition for certification election and its
demand to collectively bargain.
The legitimacy of the legal personality
of KML cannot be collaterally attacked
in a petition for certification election.

We agree with the ruling of the Office of the Secretary of DOLE
that the legitimacy of the legal personality of KML cannot be
collaterally attacked in a petition for certification election
proceeding.  This is in consonance with our ruling in Laguna
Autoparts Manufacturing Corporation v. Office of the Secretary,
Department of Labor and Employment[49] that "such legal
personality may not be subject to a collateral attack but only
through a separate action instituted particularly for the purpose of
assailing it."[50]  We further held therein that:
This is categorically prescribed by Section 5, Rule V of the
Implementing Rules of Book V, which states as follows:
SEC. 5.[51]  Effect of registration. - The labor organization or
worker's association shall be deemed registered and vested with
legal personality on the date of issuance of its certificate of
registration.  Such legal personality cannot thereafter be subject
to collateral attack but may be questioned only in an independent
petition for cancellation in accordance with these Rules.
Hence, to raise the issue of the respondent union's legal
personality is not proper in this case.  The pronouncement of the
Labor Relations Division Chief, that the respondent union
acquired a legal personality x x x cannot be challenged in a
petition for certification election.
The discussion of the Secretary of Labor and Employment on this
point is also enlightening, thus:
. . . Section 5, Rule V of D.O. 9 is instructive on the matter.  It
provides that the legal personality of a union cannot be the subject
of collateral attack in a petition for certification election, but may
be questioned only in an independent petition for cancellation of
union registration.  This has been the rule since NUBE v. Minister
of Labor, 110 SCRA 274 (1981).  What applies in this case is the
principle that once a union acquires a legitimate status as a labor
organization, it continues as such until its certificate of
registration is cancelled or revoked in an independent action for
cancellation.
Equally important is Section 11, Paragraph II, Rule IX of D.O. 9,
which provides for the dismissal of a petition for certification
election based on the lack of legal personality of a labor
organization only in the following instances: (1) appellant is not
listed by the Regional Office or the BLR in its registry of
legitimate labor organizations; or (2) appellant's legal personality
has been revoked or cancelled with finality.  Since appellant is
listed in the registry of legitimate labor organizations, and its
legitimacy has not been revoked or cancelled with finality, the
granting of its petition for certification election is proper.[52]
"[T]he legal personality of a legitimate labor organization x x x
cannot be subject to a collateral attack.  The law is very clear on
this matter. x x x The Implementing Rules stipulate that a labor
organization shall be deemed registered and vested with legal
personality on the date of issuance of its certificate of
registration.  Once a certificate of registration is issued to a union,
its legal personality cannot be subject to a collateral attack.  In
may be questioned only in an independent petition for
cancellation in accordance with Section 5 of Rule V, Book V of
the Implementing Rules."[53]
WHEREFORE, in view of the foregoing, the petition
is PARTLY GRANTED.  The Decision of the Court of Appeals
dated September 18, 2003 in CA-G.R. SP No. 72848 insofar as it
affirms the May 22, 2002 Decision and August 20, 2002
Resolution of the Office of the Secretary of Department of Labor
and Employment is AFFIRMED.  The Decision of the Court of
Appeals insofar as it declares that the March 26, 2002 Decision of
the Bureau of Labor Relations in Case No. RO300-0108-CP-001
upholding that the legitimacy of KML as a labor organization has
long become final and executory for failure of LEGEND to
appeal the same, is REVERSED and SET ASIDE.
SO ORDERED.
G.R. No. 87332 August 13, 1990
EDUARDO CRUZ, MOISES MACASO, ROY GALLINERA,
PERCIVAL CRUZ, BUBBY VALERIO, ROY PAMITTAN,
MANOLO ORBETA & MARIANO VILLA, petitioners,
vs.
THE HON. PURA FERRER-CALLEJA, in her capacity as
Director of the Bureau of Labor Relations, & ROLANDO G.
OCAMPO, ET AL., * respondents.
Douglas G. Baarde for petitioners.
Banzuela, Flores, Miralles, Raneses, Taquio, Sy and Associates
for private respondents.
GRIÑO-AQUINO, J.:
The only issue raised by the petition for certiorari in this case is
whether the respondent, Pura Ferrer-Calleja, Director of the
Bureau of Labor Relations, gravely abused her discretion in
nullifying the resolution of the Board of Administrators of the
Allied Bank Employees Union which extended for one year the
term of office of the union officers which should have expired on
February 10, 1987 and postponed to February 10, 1988 the
holding of the election.
In 1984, the Allied Bank Employees Union (ABEU), which was
then a mere chapter of the National Union of Bank Employees
(NUBE), elected its officers, whose term of office would expire
on February 10, 1987.
Before the expiration of the old CBA between the ABEU and
Allied Bank on June 30, 1984, the ABEU negotiated for a new
CBA. However, because the Union and the Bank could not agree
on major economic proposals, a bargaining deadlock ensued.
ABEU filed a Notice of Strike on November 26, 1984. Labor
Minister Blas Ople assumed jurisdiction over the labor dispute on
December 19, 1984.
In defiance of the Minister's return-to-work order, the Union
declared a strike on January 3, 1985 and established picketlines at
the Bank's Head Office and Binondo Branch.
On January 31, 1985, Minister Ople issued an Order resolving the
deadlock issues in the collective bargaining and in effect drew up
a new CBA for the parties. The 3-year term of the new CBA
would expire on January 31, 1988. The union asked for
reconsideration, and on February 11, 1985, continued its strike.
Two hundred seventy (270) striking officers and employees of
ABEU (among them were the private respondents) were
dismissed by the Bank for abandonment of work and commission
of illegal acts.
On March 4, 1985, the Bank filed in the Arbitration Branch,
NCR, NLRC, a petition to declare the strike illegal.
Upon receipt of the Resolution dated March 7, 1985 modifying
Minister Ople's order dated January 31, 1985, the ABEU on
March 8, 1985 lifted its picketlines and announced its intention to
return to work. However, the Bank refused to admit the strikers.
On March 19, 1985, a referendum was conducted by the ABEU to
ratify the 1985-1988 CBA incorporating the additional benefits
awarded in the March 7, 1985 resolution. A majority voted for
ratification.
On July 15, 1985, the Bank filed a motion praying for the
issuance of an order directing the Union to hold a general
membership meeting for the purpose of designating union
representatives who would sign the CBA inasmuch as the Union's
officers had already been dismissed by the Bank.
On November 11, 1985, the NUBE issued a special resolution
creating an ABEU Interim Board tasked to sign the new CBA
with the Bank in lieu of the union officers who had been
dismissed by the Bank. **
In January, 1987, the Interim Board commenced negotiations with
the Bank for a one-year extension of the CBA which was expiring
on January 31, 1988. A drive for the extension of the CBA began
in March 1987 for the referendum would take place on June 23,
1987. However, the Interim Board also submitted to the
referendum the matter of extending for one year the term of office
of the Interim Board, in effect, postponing for one year the
election of the regular officers of the Union. The overwhelming
majority of the union members voted yes in the referendum. The
postponement of the election did not sit well with the ousted
officers led by private respondent Rolando Ocampo. On June 23,
1987, they filed in the Office of Labor Secretary Franklin Drilon a
letter-petition against the postponement of the election of the
officers of the Union and to nullify the one year extension of the
CBA.
After the referendum result was announced on July 3, 1987, the
Bank granted a P600 "signing bonus" to all the employees.
Private respondents and other employees stationed in the Strata
Building in Pasig, Metro Manila, collected the signing bonus but,
in protest, they deposited it in the Equitable Banking Corporation,
payable to Allied Bank through Secretary Drilon.
The Office of the Secretary of Labor forwarded the letter-petition
of respondent Rolando Ocampo to the National Capital Region,
DOLE, Manila, which subsequently treated it as a formal petition,
docketed as Case No. NCR-OP-M-8-611-87.
After the hearing of the petition and the submission of the parties'
position papers, the Med-Arbiter, on January 4, 1988, issued an
order directing the Union to call a general membership meeting
where the manner of conducting the election could be discussed
before fixing the date of the election. The order declared null and
void the one-year extension of the CBA from February 1, 1988 to
January 31, 1989.
Petitioners filed a motion for reconsideration (which was treated
as an appeal) of the order of the Med-Arbiter. In a resolution
dated January 6, 1988, the Interim Board appointed a Comelec
which, on January 8, 1988, issued a resolution setting the election
of officers on February 10, 1988.
On motion of Ocampo, et al, the Bureau of Labor Relations
issued on February 9, 1988, a temporary restraining order
enjoining petitioners, including the Union's Comelec, from
proceeding with the election on February 10, 1988. However,
despite the restraining order, the Union held the election on
February 10, 1988 as scheduled. Petitioners were declared the
winners in the election.
On March 2, 1989, the public respondent, Director Pura Calleja of
the BLR, issued a resolution whose dispositive portion reads as
follows:
WHEREFORE, premises considered, the
election conducted in Allied Bank Employees
Union on February 10, 1988 is hereby declared
null and void.
Another election is hereby ordered conducted
in accordance with the express tenor of the
Med-Arbiter's Order dated 4 January 1988,
that a general membership meeting shall first
be held where the mechanics of the election
shall be fully threshed out.
In the meantime, the officers who were elected
on 10 February 1988 and whose election to
office we now declare null and void are hereby
temporarily charged with the safekeeping of
the union funds subject to accounting before
the new set of officers which shall be elected
in accordance with this Order.
The respondent Bank is likewise enjoined to
observe absolute neutrality during these
activities, they being purely an internal affair
of the union. (p. 7, Rollo.)
The issues raised in this petition for certiorari are as follows:
a) Whether or not the public respondent erred in declaring null
and void the election held on February 10, 1988; and
b) Whether or not the extension of the CBA was valid.
There is no merit in the petitioners' contention that the public
respondent gravely abused her discretion in annulling the
February 10, 1988 election of officers. The public respondent
correctly noted that in ordering the postponement of the election
for one year (in effect extending their term of office for one year),
the ABEU Interim Board "overstepped its bounds" for it was
constituted and authorized only "to sign for and in behalf of the
union the Collective Bargaining Agreement with the Bank and
administer the CBA and the operation of the union." (p.
27, Rollo.)
Instead of calling a regular election of officers
of ABEU on 11 February 1987, as mandated
by the Union's Constitution and by-laws,
respondents submitted in a "referendum" the
extension of their term of office for yet another
year, from 11 February 1987 to 10 February
1988.
From the very inception the referendum
process initiated by the Interim Board was
improper. The results therefrom are therefore,
invalid. It may be true, that the task of
administering the operation of the union was
given to the ABEU-Interim Board at the time it
was constituted, to fill in the vacuum in the
local union's leadership during that time.
Nonetheless said task could not be exercised
beyond the regular term of the regular officers.
Stated simply, the exercise of said task is only
coterminous with the term of the regular
officers, in whose shoes, the members of the
ABEU-Interim Board merely stepped into.
When the term of the union's regular officers
expired on February 11, 1987 the election of
officers should have been held, in accordance
with the provision of the union constitution
and by laws. With the expiration of the term of
the regular officers, the term of the ABEU-
Interim Board, expired too. In calling the
referendum therefore, the ABEU-Interim
Board clearly overstepped its bounds. (pp. 27-
28, Rollo.)
The second issue regarding the validity of the one-year extension
of the CBA, as observed by the BLR, has become moot and
academic. The public respondent's view that the one-year
extension was also null and void is not quite correct for the
extension was approved by the Union in a referendum which was
properly supervised by the Department of Labor. It was accepted
by the Bank which gave a "signing bonus" to the employees who
voted for it. Since the holding of the referendum was within the
authority of the Interim Board "to administer the CBA and
operate the union," and the extension was acceptable to both of
the parties to the agreement, and did not violate any law, it is
valid and binding on them.
WHEREFORE, the instant petition for certiorari is dismissed for
lack of merit. No costs.
SO ORDERED.
G.R. No. 85333 February 26, 1990
CARMELITO L. PALACOL, ET AL., petitioners,
vs.
PURA FERRER-CALLEJA, Director of the Bureau of Labor
Relations, MANILA CCBPI SALES FORCE UNION, and
COCA-COLA BOTTLERS (PHILIPPINES),
INC., respondents.
Wellington B. Lachica for petitioners.
Adolpho M. Guerzon for respondent Union.
GANCAYCO, J.:
Can a special assessment be validly deducted by a labor union
from the lump-sum pay of its members, granted under a collective
bargaining agreement (CBA), notwithstanding a subsequent
disauthorization of the same by a majority of the union members?
This is the main issue for resolution in the instant petition for
certiorari.
As gleaned from the records of the case, the pertinent facts are as
follows:
On October 12, 1987, the respondent Manila CCBPI Sales Force
Union (hereinafter referred to as the Union), as the collective
bargaining agent of all regular salesmen, regular helpers, and
relief helpers of the Manila Plant and Metro Manila Sales Office
of the respondent Coca-Cola Bottlers (Philippines), Inc.
(hereinafter referred to as the Company) concluded a new
collective bargaining agreement with the latter. 1 Among the
compensation benefits granted to the employees was a general
salary increase to be given in lump sum including recomputation
of actual commissions earned based on the new rates of increase.
On the same day, the president of the Union submitted to the
Company the ratification by the union members of the new CBA
and authorization for the Company to deduct union dues
equivalent to P10.00 every payday or P20.00 every month and, in
addition, 10% by way of special assessment, from the CBA lump-
sum pay granted to the union members. The last one among the
aforementioned is the subject of the instant petition.
As embodied in the Board Resolution of the Union dated
September 29, 1987, the purpose of the special assessment sought
to be levied is "to put up a cooperative and credit union; purchase
vehicles and other items needed for the benefit of the officers and
the general membership; and for the payment for services
rendered by union officers, consultants and others." 2 There was
also an additional proviso stating that the "matter of allocation ...
shall be at the discretion of our incumbent Union President."
This "Authorization and CBA Ratification" was obtained by the
Union through a secret referendum held in separate local
membership meetings on various dates. 3 The total membership of
the Union was about 800. Of this number, 672 members
originally authorized the 10% special assessment, while 173
opposed the same. 4
Subsequently however, one hundred seventy (170) members of
the Union submitted documents to the Company stating that
although they have ratified the new CBA, they are withdrawing or
disauthorizing the deduction of any amount from their CBA lump
sum. Later, 185 other union members submitted similar
documents expressing the same intent. These members,
numbering 355 in all (170 + 185), added to the original oppositors
of 173, turned the tide in favor of disauthorization for the special
assessment, with a total of 528 objectors and a remainder of 272
supporters. 5
On account of the above-mentioned disauthorization, the
Company, being in a quandary as to whom to remit the payment
of the questioned amount, filed an action for interpleader with the
Bureau of Labor Relations in order to resolve the conflicting
claims of the parties concerned. Petitioners, who are regular rank-
and-file employees of the Company and bona fide members of the
Union, filed a motion/complaint for intervention therein in two
groups of 161 and 94, respectively. They claimed to be among
those union members who either did not sign any individual
written authorization, or having signed one, subsequently
withdrew or retracted their signatures therefrom.
Petitioners assailed the 10% special assessment as a violation of
Article 241(o) in relation to Article 222(b) of the Labor Code.
Article 222(b) provides as follows:
ART. 222. Appearances and Fees. —
xxx xxx xxx
(b) No attorney's fees,
negotiation fees or similar
charges of any kind arising
from any collective
bargaining negotiations or
conclusion of the collective
agreement shall be imposed
on any individual member
of the contracting union;
Provided, however, that
attorney's fees may be
charged against union funds
in an amount to be agreed
upon by the parties. Any
contract, agreement or
arrangement of any sort to
the contrary shall be null
and void.
On the other hand, Article 241(o) mandates that:
ART. 241. Rights and conditions of
membership in a labor organization. —
xxx xxx xxx
(o) Other than for
mandatory activities under
the Code, no special
assessments, attorney's fees,
negotiation fees or any
other extraordinary fees
may be checked off from
any amount due to an
employee without an
individual written
authorization duly signed
by the employee. The
authorization should
specifically state the
amount, purpose and
beneficiary of the
deduction;
As authority for their contention, petitioners cited Galvadores v.
Trajano, 6 wherein it was ruled that no check-offs from any
amount due employees may be effected without individual written
authorizations duly signed by the employees specifically stating
the amount, purpose, and beneficiary of the deduction.
In its answer, the Union countered that the deductions not only
have the popular indorsement and approval of the general
membership, but likewise complied with the legal requirements of
Article 241 (n) and (o) of the Labor Code in that the board
resolution of the Union imposing the questioned special
assessment had been duly approved in a general membership
meeting and that the collection of a special fund for labor
education and research is mandated.
Article 241(n) of the Labor Code states that —
ART. 241. Rights and conditions of
membership in a labor organization. —
xxx xxx xxx
(n) No special assessment or other
extraordinary fees may be levied upon the
members of a labor organization unless
authorized by a written resolution of a majority
of all the members at a general membership
meeting duly called for the purpose. The
secretary of the organization shall record the
minutes of the meeting including the list of all
members present, the votes cast, the purpose of
the special assessment or fees and the recipient
of such assessments or fees. The record shall
be attested to by the president;
Med-Arbiter Manases T. Cruz ruled in favor of petitioners in an
order dated February 15, 1988 whereby he directed the Company
to remit the amount it had kept in trust directly to the rank-and-
file personnel without delay.
On appeal to the Bureau of Labor Relations, however, the order
of the Med-Arbiter was reversed and set aside by the respondent-
Director in a resolution dated August 19, 1988 upholding the
claim of the Union that the special assessment is authorized under
Article 241 (n) of the Labor Code, and that the Union has
complied with the requirements therein.
Hence, the instant petition.
Petitioners allege that the respondent-Director committed a grave
abuse of discretion amounting to lack or excess of jurisdiction
when she held Article 241 (n) of the Labor Code to be the
applicable provision instead of Article 222(b) in relation to
Article 241(o) of the same law.
According to petitioners, a cursory examination and comparison
of the two provisions of Article 241 reveals that paragraph (n)
cannot prevail over paragraph (o). The reason advanced is that a
special assessment is not a matter of major policy affecting the
entire union membership but is one which concerns the individual
rights of union members.
Petitioners further assert that assuming arguendo that Article
241(n) should prevail over paragraph (o), the Union has
nevertheless failed to comply with the procedure to legitimize the
questioned special assessment by: (1) presenting mere minutes of
local membership meetings instead of a written resolution; (2)
failing to call a general membership meeting; (3) having the
minutes of three (3) local membership meetings recorded by a
union director, and not by the union secretary as required; (4)
failing to have the list of members present included in the minutes
of the meetings; and (5) failing to present a record of the votes
cast. 7 Petitioners concluded their argument by citing Galvadores.
After a careful review of the records of this case, We are
convinced that the deduction of the 10% special assessment by
the Union was not made in accordance with the requirements
provided by law.
Petitioners are correct in citing the ruling of this Court
in Galvadores which is applicable to the instant case. The
principle "that employees are protected by law from unwarranted
practices that diminish their compensation without their known
edge and consent" 8 is in accord with the constitutional principle
of the State affording full protection to labor. 9
The respondent-Union brushed aside the defects pointed out by
petitioners in the manner of compliance with the legal
requirements as "insignificant technicalities." On the contrary, the
failure of the Union to comply strictly with the requirements set
out by the law invalidates the questioned special assessment.
Substantial compliance is not enough in view of the fact that the
special assessment will diminish the compensation of the union
members. Their express consent is required, and this consent must
be obtained in accordance with the steps outlined by law, which
must be followed to the letter. No shortcuts are allowed.
The applicable provisions are clear. The Union itself admits that
both paragraphs (n) and (o) of Article 241 apply. Paragraph (n)
refers to "levy" while paragraph (o) refers to "check-off" of a
special assessment. Both provisions must be complied with.
Under paragraph (n), the Union must submit to the Company a
written resolution of a majority of all the members at a general
membership meeting duly called for the purpose. In addition, the
secretary of the organization must record the minutes of the
meeting which, in turn, must include, among others, the list of all
the members present as well as the votes cast.
As earlier outlined by petitioners, the Union obviously failed to
comply with the requirements of paragraph (n). It held local
membership meetings on separate occasions, on different dates
and at various venues, contrary to the express requirement that
there must be a general membership meeting. The contention of
the Union that "the local membership meetings are precisely the
very general meetings required by law" 10 is untenable because the
law would not have specified a general membership meeting had
the legislative intent been to allow local meetings in lieu of the
latter.
It submitted only minutes of the local membership meetings when
what is required is a written resolution adopted at the general
meeting. Worse still, the minutes of three of those local meetings
held were recorded by a union director and not by the union
secretary. The minutes submitted to the Company contained no
list of the members present and no record of the votes cast. Since
it is quite evident that the Union did not comply with the law at
every turn, the only conclusion that may be made therefrom is
that there was no valid levy of the special assessment pursuant to
paragraph (n) of Article 241 of the Labor Code.
Paragraph (o) on the other hand requires an individual written
authorization duly signed by every employee in order that a
special assessment may be validly checked-off. Even assuming
that the special assessment was validly levied pursuant to
paragraph (n), and granting that individual written authorizations
were obtained by the Union, nevertheless there can be no valid
check-off considering that the majority of the union members had
already withdrawn their individual authorizations. A withdrawal
of individual authorizations is equivalent to no authorization at
all. Hence, the ruling in Galvadores that "no check-offs from any
amounts due employees may be effected without an individual
written authorization signed by the employees ... " is applicable.
The Union points out, however, that said disauthorizations are not
valid for being collective in form, as they are "mere bunches of
randomly procured signatures, under loose sheets of
paper." 11 The contention deserves no merit for the simple reason
that the documents containing the disauthorizations have the
signatures of the union members. The Court finds these
retractions to be valid. There is nothing in the law which requires
that the disauthorization must be in individual form.
Moreover, it is well-settled that "all doubts in the implementation
and interpretation of the provisions of the Labor Code ... shall be
resolved in favor of labor."12 And as previously stated, labor in
this case refers to the union members, as employees of the
Company. Their mere desire to establish a separate bargaining
unit, albeit unproven, cannot be construed against them in relation
to the legality of the questioned special assessment. On the
contrary, the same may even be taken to reflect their
dissatisfaction with their bargaining representative, the
respondent-Union, as shown by the circumstances of the instant
petition, and with good reason.
The Med-Arbiter correctly ruled in his Order that:
The mandate of the majority rank and file have
(sic) to be respected considering they are the
ones directly affected and the realities of the
high standards of survival nowadays. To
ignore the mandate of the rank and file would
enure to destabilizing industrial peace and
harmony within the rank and file and the
employer's fold, which we cannot
countenance.
 Moreover, it will be recalled that precisely
union dues are collected from the union
members to be spent for the purposes alluded
to by respondent. There is no reason shown
that the regular union dues being now
implemented is not sufficient for the alleged
expenses. Furthermore, the rank and file have
spoken in withdrawing their consent to the
special assessment, believing that their regular
union dues are adequate for the purposes stated
by the respondent. Thus, the rank and file
having spoken and, as we have earlier
mentioned, their sentiments should be
respected.
Of the stated purposes of the special assessment, as embodied in
the board resolution of the Union, only the collection of a special
fund for labor and education research is mandated, as correctly
pointed out by the Union. The two other purposes, namely, the
purchase of vehicles and other items for the benefit of the union
officers and the general membership, and the payment of services
rendered by union officers, consultants and others, should be
supported by the regular union dues, there being no showing that
the latter are not sufficient to cover the same.
The last stated purpose is contended by petitioners to fall under
the coverage of Article 222 (b) of the Labor Code. The contention
is impressed with merit. Article 222 (b) prohibits attorney's fees,
negotiations fees and similar charges arising out of the conclusion
of a collective bargaining agreement from being imposed on any
individual union member. The collection of the special
assessment partly for the payment for services rendered by union
officers, consultants and others may not be in the category of
"attorney's fees or negotiations fees." But there is no question that
it is an exaction which falls within the category of a "similar
charge," and, therefore, within the coverage of the prohibition in
the aforementioned article. There is an additional proviso giving
the Union President unlimited discretion to allocate the proceeds
of the special assessment. Such a proviso may open the door to
abuse by the officers of the Union considering that the total
amount of the special assessment is quite considerable —
P1,027,694.33 collected from those union members who
originally authorized the deduction, and P1,267,863.39 from
those who did not authorize the same, or subsequently retracted
their authorizations. 13 The former amount had already been
remitted to the Union, while the latter is being held in trust by the
Company.
The Court, therefore, stakes down the questioned special
assessment for being a violation of Article 241, paragraphs (n)
and (o), and Article 222 (b) of the Labor Code.
WHEREFORE, the instant petition is hereby GRANTED. The
Order of the Director of the Bureau of Labor Relations dated
August 19, 1988 is hereby REVERSED and SET ASIDE, while
the order of the Med-Arbiter dated February 17, 1988 is
reinstated, and the respondent Coca-Cola Bottlers (Philippines),
Inc. is hereby ordered to immediately remit the amount of
P1,267,863.39 to the respective union members from whom the
said amount was withheld. No pronouncement as to costs. This
decision is immediately executory.
SO ORDERED.
G.R. No. 115949             March 16, 2000
EVANGELINE J. GABRIEL, TERESITA C. LUALHATI,
EVELYN SIA, RODOLFO EUGENIO, ISAGANI MAKISIG,
and DEMETRIO SALAS, petitioners,
vs.
THE HONORABLE SECRETARY OF LABOR AND
EMPLOYMENT and SIMEON SARMIENTO, JESUS
CARLOS MARTINEZ III, ALBERT NAPIAL, MARVIN
ALMACIN, ROGELIO MATEO, GLENN SIAPNO,
EMILIANO CUETO, SALOME ATIENZA, NORMA V. GO,
JUDITH DUDANG, MONINA DIZON, EUSEBIO
ROMERO, ISAGANI MORALES, ELISEO
BUENAVENTURA, CLEMENTE AGCAMARAN,
CARMELITA NOLASCO, JOVITA FERI, LULU ACOSTA,
CAROL LAZARO, NIDA ARRIZA, ROMAN BERNARDO,
DOMINGO B. MACALDO, EUGENE PIDLAOAN, MA.
SOCORRO T. ANGOB, JOSEPHINE ALVAREZ,
LOURDES FERRER, JACQUILINE BAQUIRAN, GRACIA
R. ESCUADRO, KRISTINA HERNANDEZ, LOURDES
IBEAS, MACARIO GARCIA, BILLY TECSON, ALEX
RECTO III, LEBRUDO, JOSE RICAFORTE, RODOLFO
MORADA, TERESA AMADO, ROSITA TRINIDAD,
JEANETTE ONG, VICTORINO LAS-AY, RANIEL DAYAO
OSCAR SANTOS, CRISTINA SALAVER, VICTORIA
ARINO, A.H. SAJO, MICHAEL BIETE, RED RP, GLORIA
JUAT, ETHELINDA CASILAN, FAMER DIPASUPIL, MA.
HIDELISA POMER, MA. CHARLOTTE TAWATAO,
GRACE REYES, ERNIE COLINA, ZENAIDA MENDOZA,
PAULITA ADORABLE, BERNARDO MADUMBA,
NESTOR NAVARRO, EASTER YAP, ALMA LIM, FELISA
YU, TIMOTEO GANASTRA, REVELITA CARTAJENAS,
ANGELITO CABUAL, ROBERTA TAN, DOMINADOR
TAPO, GRACE LIM GADIANE JEMIE, CHRISTHDY
DAUD, BENEDICTO ACOSTA, JESUSA ACOSTA, MA.
AVELINA ARYAP, EVELYN BENITEZ, ESTERITA CHU,
EVANGELINE CHU, BETTY CINCO, RICARDO
CONNEJO, MANULITO EVALO, FRANCIS LEONIDA,
GREGORIO NOBLEZA, RODOLFO RIVERAL, ELSA SIA,
CLARA SUGBO, EDGARDO TABAO, MANUEL VELOSO,
MARLYN YU, ABSALON BUENA, WILFREDO PUERTO,
FLORENTINA PINGOL, MARILOU DAR, FE MORALES,
MALEN BELLO, LORENA TAMAYO, CESAR LIM, PAUL
BALTAZAR, ALFREDO GAYAGAS, DUMAGUETE
EMPLOYEES, CEBU EMPLOYEES, OZAMIZ
EMPLOYEES, TACLOBAN EMPLOYEES AND ALL
OTHER SOLID BANK UNION MEMBERS, respondents.
QUISUMBING, J.:
Before us is a special civil action for certiorari seeking to reverse
partially the Order1 of public respondent dated June 3, 1994, in
Case No. OS-MA-A-8-170-92, which ruled that the workers
through their union should be made to shoulder the expenses
incurred for the professional services of a lawyer in connection
with the collective bargaining negotiations and that the
reimbursement for the deductions from the workers should be
charged to the union's general fund or account.
The records show the following factual antecedents:
Petitioners comprise the Executive Board of the SolidBank their conformity to the check-off of attorney's fees; and
Union, the duly recognized collective bargaining agent for the (2) the directive on the payment of 5% attorney's fees
rank and file employees of Solid Bank Corporation. Private should be deleted for lack of basis.
respondents are members of said union.
SO ORDERED.7
Sometime in October 1991, the union's Executive Board decided
to retain anew the service of Atty. Ignacio P. Lacsina (now On Motion for Reconsideration, public respondent affirmed the
deceased) as union counsel in connection with the negotiations said Order with modification that the union's counsel be dropped
for a new Collective Bargaining Agreement (CBA). Accordingly, as a party litigant and that the workers through their union should
on October 19, 1991, the board called a general membership be made to shoulder the expenses incurred for the attorney's
meeting for the purpose. At the said meeting, the majority of all services. Accordingly, the reimbursement should be charged to
union members approved and signed a resolution confirming the the union's general fund/account.8
decision of the executive board to engage the services of Atty.
Lacsina as union counsel.
Hence, the present petition seeking to partially annul the above-
cited order of the public respondent for being allegedly tainted
As approved, the resolution provided that ten percent (10%) of with grave abuse of discretion amounting to lack of jurisdiction.
the total economic benefits that may be secured through the
negotiations be given to Atty. Lacsina as attorney's fees. It also
The sole issue for consideration is, did the public respondent act
contained an authorization for SolidBank Corporation to check-
with grave abuse of discretion in issuing the challenged order?
off said attorney's fees from the first lump sum payment of
benefits to the employees under the new CBA and to turn over
said amount to Atty. Lacsina and/or his duly authorized Petitioners argue that the General Membership Resolution
representative.2 authorizing the bank to check-off attorney's fee from the first
lump sum payment of the legal benefits to the employees under
the new CBA satisfies the legal requirements for such
The new CBA was signed on February 21, 1992. The bank then,
assessment.9 Private respondents, on the other hand, claim that the
on request of the union, made payroll deductions for attorney's
check-off provision in question is illegal because it was never
fees from the CBA benefits paid to the union members in
submitted for approval at a general membership meeting called
accordance with the abovementioned resolution.
for the purpose and that it failed to meet the formalities mandated
by the Labor Code. 10
On October 2, 1992, private respondents instituted a complaint
against the petitioners and the union counsel before the
In check-off, the employer, on agreement with the Union, or on
Department of Labor and Employment (DOLE) for illegal
prior authorization from employees, deducts union dues or agency
deduction of attorney's fees as well as for quantification of the
fees from the latter's wages and remits them directly to the
benefits in the 1992 CBA.3 Petitioners, in response, moved for the
union. 11 It assures continuous funding; for the labor organization.
dismissal of the complaint citing litis pendentia, forum shopping
As this Court has acknowledged, the system of check-off is
and failure to state a cause of action as their grounds.4
primarily for the benefit of the union and only indirectly for the
individual employees. 12
On April 22, 1993, Med-Arbiter Paterno Adap of the DOLE-NCR
issued the following Order:
The pertinent legal provisions on check-offs are found in Article
222 (b) and Article 241 (o) of the Labor Code.
WHEREFORE, premises considered, the Respondents
Union Officers and Counsel are hereby directed to
Art. 222 (b) states:
immediately return or refund to the Complainants the
illegally deducted amount of attorney's fees from the
package of benefits due herein complainants under the No attorney's fees, negotiation fees or similar charges of
aforesaid new CBA. any kind arising from any collective bargaining
negotiations or conclusions of the collective agreement
shall be imposed on any individual member of the
Furthermore, Complainants are directed to pay five
contracting union: Provided, however, that attorney's
percent (5%) of the total amount to be refunded or
fees may be charged against unions funds in an amount
returned by the Respondent Union Officers and Counsel
to be agreed upon by the parties. Any contract,
to them in favor of Atty. Armando D. Morales, as
agreement or arrangement of any sort to the contrary
attorney's fees, in accordance with Section II, Rule VIII
shall be null and void. (Emphasis ours)
of Book II (sic) of the Omnibus Rules Implementing the
Labor Code.5
Art. 241 (o) provides:
6 
On appeal, the Secretary of Labor rendered a Resolution dated
December 27, 1993, stating: Other than for mandatory activities under the Code, no
special assessment, attorney's fees, negotiation fees or
any other extraordinary fees may be checked off from
WHEREFORE, the appeal of respondents Evangeline
any amount due to an employee without an individual
Gabriel, et. al., is hereby partially granted and the Order
written authorization duly signed by the employee. The
of the Med-Arbiter dated 22 April 1993 is hereby
authorization should specifically state the amount,
modified as follows: (1) that the ordered refund shall be
limited to those union members who have not signified
 purpose and beneficiary of the deduction. (Emphasis
ours).
Art. 241 has three (3) requisites for the validity of the special
assessment for union's incidental expenses, attorney's fees and
representation expenses. These are: 1) authorization by a written
resolution of the majority of all the members at the general
membership meeting called for the purpose; (2) secretary's record
of the minutes of the meeting; and (3) individual written
authorization for check off duly signed by the employees
concerned.
Clearly, attorney's fees may not be deducted or checked off from
any amount due to an employee without his written consent.
After a thorough review of the records, we find that the General
Membership Resolution of October 19, 1991 of the SolidBank
Union did not satisfy the requirements laid down by law and
jurisprudence for the validity of the ten percent (10%) special
assessment for union's incidental expenses, attorney's fees and
representation expenses. There were no individual written check
off authorizations by the employees concerned and so the
assessment cannot be legally deducted by their employer.
Even as early as February 1990, in the case of Palacol vs. Ferrer-
Calleja 13 we said that the express consent of employees is
required, and this consent must be obtained in accordance with
the steps outlined by law, which must be followed to the letter.
No shortcuts are allowed. In Stellar Industrial Services, Inc. vs.
NLRC 14 we reiterated that a written individual authorization duly
signed by the employee concerned is a condition sine qua non for
such deduction.
These pronouncements are also in accord with the recent ruling of
this Court in the case of ABS-CBN Supervisors Employees Union
Members vs. ABS-CBN Broadcasting
Corporation, et. al., 15 which provides:
Premises studiedly considered, we are of the irresistible
conclusion and, so find that the ruling in BPIEU-ALU
vs. NLRC that (1) the prohibition against attorney's fees
in Article 222, paragraph (b) of the Labor Code applies
only when the payment of attorney's fees is effected
through forced contributions from the workers; and (2)
that no deduction must be take from the workers who
did not sign the check-off authorization, applies to the
case under consideration. (Emphasis ours.)
We likewise ruled in Bank of the Philippine Islands Employees
Union-Association Labor Union (BPIEU-ALU) vs. NLRC, 16
. . . the afore-cited provision (Article 222 (b) of the
Labor Code) as prohibiting the payment of attorney's
fees only when it is effected through forced
contributions from workers from their own funds as
distinguished from the union funds. The purpose of the
provision is to prevent imposition on the workers of the
duty to individually contribute their respective shares in
the fee to be paid the attorney for his services on behalf
of the union in its negotiations with management. The
obligation to pay the attorney's fees belongs to the
union and cannot be shunted to the workers as their
direct responsibility. Neither the lawyer nor the union
itself may require the individual worker to assume the
obligation to pay attorney's fees from their own pockets.
So categorical is this intent that the law makes it clear
that any agreement to the contrary shall be null and
void ab initio. (Emphasis ours.)1âwphi1
From all the foregoing, we are of the considered view that public
respondent did not act with grave abuse of discretion in ruling
that the workers through their union should be made to shoulder
the expenses incurred for the services of a lawyer. And
accordingly the reimbursement should be charged to the union's
general fund or account. No deduction can be made from the
salaries of the concerned employees other than those mandated by
law.
WHEREFORE, the petition is DENIED. The assailed Order dated
June 3, 1994, of respondent Secretary of Labor signed by
Undersecretary Bienvenido E. Laguesma is AFFIRMED. No
pronouncement as to costs.1âwphi1.nêt
SO ORDERED.
G.R. No. L-45824 June 19, 1985
VOLKSCHEL LABOR UNION, petitioner,
vs.
BUREAU OF LABOR RELATIONS, ASSOCIATED
LABOR UNION FOR METAL, WORKERS, DMG, INC.,
PEOPLE'S CAR, INC., KARBAYAN INC., and RTC
TRADING, INC., respondents.
Ignacio P. Lacsina for petitioner.
William D. Dichoso for respondent DMG, Inc.
Abraham B. Drapiza for private respondent.
CUEVAS, J.:
Petition for certiorari to review the Resolutions dated January 25,
1977 and March 14, 1977 of the Bureau of Labor Relations.
On April 25. 1977, however, a Supplemental Petition was filed
seeking the issuance of —
(1) A preliminary mandatory injunction
commanding respondents to return to
petitioner the union dues amounting to about
P55,000.00 lawfully pertaining to it but
illegally levied upon, collected and handed
over by respondent Bureau, acting through the
NLRC sheriff, to respondent Associated Labor
Union for Metal workers, with the collusion of
respondents DMG, Inc., Karbayan, Inc. and
RTC Machineries, Inc.;
 (2) A preliminary restraining order prohibiting
respondents from making further delivery to
respondent Associated Labor Union for Metal
workers of Union dues collected or to be
collected through check-off from the wages of
petitioner's members by respondents, DMG,
Inc., Karbayan, Inc., RTC Machineries, Inc.,
and People's Car, Inc., under or by virtue of the
questioned writ of execution issued by
respondent Bureau, dated April 4, 1977.
Petitioner was once affiliated with the Associated Labor Union
for Metal Workers (ALUMETAL for short). On August 1, 1975,
both unions, using the name Volkschel Labor Union Associated
Labor Union for Metal Workers, jointly entered into a collective
bargaining agreement with respondent companies. One of the
subjects dealt with is the payment of union dues which is
provided for in Section 3, Article 1, of the CBA, which reads:
Section 3. CHECK-OFF. — The COMPANY
agrees to make payroll deductions not softener
than twice a month of UNION membership
dues and such special assessments fees or fines
as may be duly authorized by the UNION,
provided that the same is covered by the
individual check-off authorization of the
UNION members. All said deductions shall be
promptly transmitted within five (5) days by
the COMPANY to the UNION Treasurer. The
COMPANY shall prepare two (2) checks. One
(1) check will be under the name of the local
union as their local fund including local special
assessment funds and the other check will be
for the ALU Regional Office regarding the
remittance of the UNION dues deduction.
On March 10, 1976, a majority of petitioner's members decided to
disaffiliate from respondent federation in order to operate on its
own as an independent labor group pursuant to Article 241
(formerly Article 240) of the Labor Code of the Philippines, the
pertinent portion of which reads:
Incumbent affiliates of existing federations or
national unions may disaffiliate only for the
purpose of joining a federation or national
union in the industry or region in which it
properly belongs or for the purpose of
operating as an independent labor group.
Accordingly, a resolution was adopted and signed by petitioner's
members revoking their check-off authorization in favor of
ALUMETAL and notices thereof were served on ALUMETAL
and respondent companies.
Confronted with the predicament of whether or not to continue
deducting from employees' wages and remitting union dues to
respondent, ALUMETAL which wrote respondent companies
advising them to continue deducting union dues and remitting
them to said federation, respondent companies sought the legal
opinion of the respondent Bureau as regards the controversy
between the two unions. On November 11, 1976, Med-Arbiter
George A. Eduvalla of respondent Bureau rendered a Resolution
which in effect found the disaffiliation legal but at the same time
gave the opinion that, petitioner's members should continue
paying their dues to ALUMETAL in the concept of agency fees. 1
From the said Resolution, of the Med-Arbiter both petitioner and
respondent ALUMETAL appealed to the Director of respondent
Bureau. Petitioner' contended that the Med-Arbiter's opinion to
the effect that petitioner's members remained obligated to pay
dues to respondent ALUMETAL was inconsistent with the
dispositive finding that petitioner's disaffiliation from
ALUMETAL was valid. ALUMETAL, on the other hand,
assailed the Resolution in question asserting that the disaffiliation
should have been declared contrary to law.
On January 25, 1977, respondent Bureau, through its Acting
Director, Francisco L. Estrella, REVERSED the Med-Arbiter's
Resolution., and declared that the Bureau recognized "the
continued affiliation of Volkschel Labor Union with the
Associated Labor Union for Metal Workers." 2
Petitioner appealed the Acting Director's Resolution to the
Secretary of Labor know Minister of Labor and Employment)
who, treating the appeal as a Motion for Reconsideration referred
the same back to respondent Bureau On March 14, 1977, the
Bureau denied the appeal for lack of merit.
Hence, the instant petition.
Meanwhile, on April 4, 1977, on motion of ALUMETAL, the
then Acting Secretary of Labor, Amado Gat Inciong, issued a of
execution commanding the Sheriff of the National Labor
Relations Commission to enforce and execute the order of
January 25, 1977, which has become final and
executory. 3 Pursuant thereto, the NLRC Sheriff enforced and
implemented the Order of January 25, 1977, as a result of which
respondent companies turned over and handed to respondent
federation the union dues and other assessments in accordance
with the check-off provision of the CBA,
From the pleadings filed and arguments of counsel, the following
issues present themselves for this Court's resolution.
I
Is petitioner union's disaffiliation from
respondent federation valid?
II
Do respondent companies have the right to
effect union dues collections despite
revocation by the employees of the check-off
authorization? and
III
Is respondent federation entitled to union dues
payments from petitioner union's members
notwithstanding their disaffiliation from said
federation?
We resolve the first issue in the affirmative.
The right of a local union to disaffiliate from its mother union is
well-settled. In previous cases, it has been repeatedly held that a
local union, being a separate and voluntary association, is free to
serve the interest of all its members including the freedom to
disaffiliate when circumstances warrant. 4 This right is consistent
with the Constitutional guarantee of freedom of association
(Article IV, Section 7, Philippine Constitution).
Petitioner contends that the disaffiliation was not due to any
opportunists motives on its part. Rather it was prompted by the
federation's deliberate and habitual dereliction of duties as mother
federation towards petitioner union. Employees' grievances were
allegedly left unattended to by respondent federation to the
detriment of the employees' rights and interests.
In reversing the Med-Arbiter's resolution, respondent Bureau
declared: the Department of Labor is set on a task to restructure
the labor movement to the end that the workers will unite
themselves along industry lines. Carried to its complete fruition,
only one union for every industry will remain to bargain
collectively for the workers. The clear policy therefore even now
is to conjoin workers and worker groups, not to dismember
them. 5 This policy is commendable. However, we must not lose
sight of the constitutional mandate of protecting labor and the
workers' right to self-organization. In the implementation and
interpretation of the provisions of the Labor Code and its
implementing regulations, the workingman's welfare should be
the primordial and paramount consideration. In the case at bar, it
would go against the spirit of the labor law to restrict petitioner's
right to self-organization due to the existence of the CBA. We
agree with the Med-Arbiter's opinion that "A disaffiliation does
not disturb the enforceability and administration of a collective
agreement; it does not occasion a change of administrators of the
contract nor even an amendment of the provisions thereof." 6 But
nowhere in the record does it appear that the contract entered into
by the petitioner and ALUMETAL prohibits the withdrawal of
the former from the latter.
This now brings us to the second issue. Under Section 3, Article I,
of the CBA, the obligation of the respondent companies to deduct
and remit dues to ALUMETAL is conditioned on the individual
check-off authorization of petitioner's members, In other words,
ALUMETAL is entitled to receive the dues from respondent
companies as long as petitioner union is affiliated with it and
respondent companies are authorized by their employees
(members of petitioner union) to deduct union dues. Without said
affiliation, the employer has no link to the mother union. The
obligation of an employee to pay union dues is coterminous with
his affiliation or membership. "The employees' check-off
authorization, even if declared irrevocable, is good only as long as
they remain members of the union concerned." 7 A contract
between an employer and the parent organization as bargaining
agent for the employees is terminated by the disaffiliation of the
local of which the employees are members. 8 Respondent
companies therefore were wrong in continuing the check-off in
favor of respondent federation since they were duly notified of the
disaffiliation and of petitioner's members having already
rescinded their check-off authorization.
With the view we take on those two issues, we find no necessity
in dwelling further on the last issue. Suffice it to state that
respondent federation is not entitled to union dues payments from
petitioner's members. "A local union which has validly withdrawn
from its affiliation with the parent association and which
continues to represent the employees of an employer is entitled to
the check-off dues under a collective bargaining contract." 9
WHEREFORE, the Resolutions of the Bureau of Labor Relations
of January 25, 1977 and March 14, 1977 are REVERSED and
SET ASIDE. Respondent ALUMETAL is ordered to return to
petitioner union all the union dues enforced and collected through
the NLRC Sheriff by virtue of the writ of execution dated April 4,
1977 issued by respondent Bureau.
No costs.
SO ORDERED.
This is a petition for certiorari[1] seeking to set aside the 31 July
1996 Decision[2] of the National Labor Relations Commission
affirming the 30 June 1995 Decision of the Labor Arbiter holding
petitioners Philippine Skylanders, Inc., Mariles C. Romulo[3] and
Francisco Dakila as well as the elected officers of the Philippine
Skylanders Employees and Workers Association-PAFLU[4] guilty
of unfair labor practice and ordering them to pay private
respondent Philippine Association of Free Labor Union  (PAFLU)
September[5] P150,000.00 as damages.  Petitioners likewise seek
the reversal of the 31 October 1996 Resolution of the NLRC
denying their Motion for Reconsideration.
In November 1993 the Philippine Skylanders Employees
Association (PSEA), a local labor union affiliated with the
Philippine Association of Free Labor Unions (PAFLU)
September (PAFLU),  won in the certification election conducted
among the rank and file employees of Philippine Skylanders, Inc.
(PSI).  Its rival union, Philippine Skylanders Employees
Association-WATU (PSEA-WATU) immediately protested the
result of the election before the Secretary of Labor.
Several months later, pending settlement of the controversy,
PSEA sent PAFLU a notice of disaffiliation citing as reason
PAFLU's supposed deliberate and habitual dereliction of duty
toward its members.  Attached to the notice was a copy of the
resolution adopted and signed by the officers and members of
PSEA authorizing their local union to disaffiliate from its mother
federation.
PSEA subsequently affiliated itself with the National Congress of
Workers (NCW), changed its name to Philippine Skylanders
Employees Association - National Congress of Workers (PSEA-
NCW), and to maintain continuity within the organization,
allowed the former officers of PSEA-PAFLU to continue
occupying their positions as elected officers in the newly-forged
PSEA-NCW.
On 17 March 1994 PSEA-NCW entered into a collective
bargaining agreement with PSI which was immediately registered
with the Department of Labor and Employment.
Meanwhile, apparently oblivious to PSEA's shift of allegiance,
PAFLU Secretary General Serafin Ayroso wrote Mariles C.
Romulo requesting a copy of PSI's audited financial statement. 
Ayroso explained that with the dismissal of PSEA-WATU's
election protest the time was ripe for the parties to enter into a
collective bargaining agreement.

On 30 July 1994 PSI through its personnel manager Francisco
Dakila denied the request citing as reason PSEA's disaffiliation
from PAFLU and its subsequent affiliation with NCW.
Agitated by PSI's recognition of PSEA-NCW, PAFLU through
Serafin Ayroso filed a complaint for unfair labor practice against
PSI, its president Mariles Romulo and personnel manager
Francisco Dakila.   PAFLU alleged that aside from PSI's refusal
to bargain collectively with its workers, the company through its
president and personnel manager, was also liable for interfering
with its employees' union activities.[6]
Two (2) days later or on 6 October 1994 Ayroso filed another
complaint in behalf of PAFLU for unfair labor practice against
Francisco Dakila.  Through Ayroso PAFLU claimed that Dakila
was present in PSEA's organizational meeting thereby confirming
his illicit participation in union activities.  Ayroso added that the
members of the local union had unwittingly fallen into the
manipulative machinations of PSI and were lured into endorsing a
collective bargaining agreement which was detrimental to their
interests.[7] The two (2) complaints were thereafter consolidated.
On 1 February 1995 PAFLU amended its complaint by including
the elected officers of PSEA-PAFLU as additional party
respondents.   PAFLU averred that the local officers of PSEA-
PAFLU, namely Macario Cabanias, Pepito Rodillas, Sharon
Castillo, Danilo Carbonel, Manuel Eda, Rolando Felix, Jocelyn
Fronda, Ricardo Lumba, Joseph Mirasol, Nerisa Mortel, Teofilo
Quirong, Leonardo Reyes, Manuel Cadiente, and Herminia Riosa,
were equally guilty of unfair labor practice since they brazenly
allowed themselves to be manipulated and influenced by
petitioner Francisco Dakila.[8]
PSI, its president Mariles C. Romulo, and its personnel manager
Dakila moved for the dismissal of the complaint on the ground
that the issue of disaffiliation was an inter-union conflict which
lay beyond the jurisdiction of the Labor Arbiter.  On the other
hand, PSEA-NCW took the cudgels for its officers who were
being sued in their capacities as former officers of PSEA-PAFLU
and asserted that since PSEA was no longer affiliated with
PAFLU, Ayroso or PAFLU for that matter had no personality to
file the instant complaint.  In support of this assertion, PSEA-
NCW submitted in evidence a Katunayan signed by 111 out of
120 rank and file employees of PSI disauthorizing Ayroso or
PAFLU from instituting any action in their behalf.[9]
In a Decision rendered on 30 June 1995 the Labor Arbiter
declared PSEA's disaffiliation from PAFLU invalid and held PSI,
PSEA-PAFLU and their respective officers guilty of unfair labor
practice.  The Decision explained that despite PSEA-PAFLU's
status as the sole and exclusive bargaining agent of PSI's rank and
file employees, the company knowingly sanctioned and
confederated with Dakila in actively assisting a rival union.  This,
according to the Labor Arbiter, was a classic case of interference
for which PSI could be held responsible.  As PSEA-NCW's
personality was not accorded recognition, its collective bargaining
agreement with PSI was struck down for being invalid.  Ayroso's
legal personality to file the complaint was sustained on the
ratiocination that under the Labor Code no petition questioning
the majority status of the incumbent bargaining agent shall be
entertained outside of the sixty (60)-day period immediately
before the expiry date of such five (5)-year term of the collective
bargaining agreement that the parties may enter into.  for the parties.
Accordingly, judgment was rendered ordering PSI, PSEA-
PAFLU and their officers to pay PAFLU P150,000.00 in
damages.[10]
PSI, PSEA and their respective officers appealed to the National
Labor Relations Commission (NLRC).  But the NLRC upheld the
Decision of the Labor Arbiter and conjectured that since an
election protest questioning PSEA-PAFLU's certification as the
sole and exclusive bargaining agent was pending resolution
before the Secretary of Labor, PSEA could not validly separate
from PAFLU, join another national federation and subsequently
enter into a collective bargaining agreement with its employer-
company.[11]
Petitioners separately moved for reconsideration but both motions
were denied.   Hence, these petitions for certiorari filed by PSI
and PSEA-NCW together with their respective officers pleading
for a reversal of the NLRC's Decision which they claimed to have
been rendered in excess of jurisdiction.  In due time, both
petitions were consolidated.
In these petitions, petitioner PSEA together with its officers
argued that by virtue of their disaffiliation PAFLU as a mere
agent had no authority to represent them before any proceedings.  
They further asserted that being an independent labor union
PSEA may freely serve the interest of all its members and readily
disaffiliate from its mother federation when circumstances so
warrant.   This right, they averred, was consistent with the
constitutional guarantee of freedom of association.[12]
For their part, petitioners PSI, Romulo and Dakila alleged that
their decision to bargain collectively with PSEA-NCW was
actuated, to a large extent, by PAFLU's behavior.   Having heard
no objections or protestations from PAFLU relative to PSEA's
disaffiliation, they reckoned that PSEA's subsequent association
with NSW was done bona fide.[13]
The Solicitor General filed a Manifestation in Lieu of
Comment recommending that both petitions be granted.  In
his Manifestation, the Solicitor General argued against the Labor
Arbiter's assumption of jurisdiction citing the following as
reasons:  first, there was no employer-employee relationship
between complainant Ayroso and PSI over which the Labor
Arbiter could rightfully assert his jurisdiction; second, since the
case involved a dispute between PAFLU as mother federation and
PSEA as local union, the controversy fell within the jurisdiction
of the Bureau of Labor Relations; and lastly, the relationship of
principal-agent between PAFLU and PSEA had been severed by
the local union through the lawful exercise of its right of
disaffiliation.[14]
Stripped of non-essentials, the fundamental issue tapers down to
the legitimacy of PSEA's disaffiliation.  To be more precise, may
PSEA, which is an independent and separate local union, validly
disaffiliate from PAFLU pending the settlement of an election
protest questioning its status as the sole and exclusive bargaining
agent of PSI's rank and file employees?
At the outset, let it be noted that the issue of disaffiliation is an
inter-union conflict the jurisdiction of which properly lies with
the Bureau of Labor Relations (BLR) and not with the Labor
Arbiter.[15] Nonetheless, with due recognition of this fact, we
deem it proper to settle the controversy at this instance since to
remand the case to the BLR would only mean intolerable delay
The right of a local union to disaffiliate from its mother federation
is not a novel thesis unillumined by case law.  In the landmark
case of Liberty Cotton Mills Workers Union vs. Liberty Cotton
Mills, Inc.[16] we upheld the right of local unions to separate from
their mother federation on the ground that as separate and
voluntary associations, local unions do not owe their creation and
existence to the national federation to which they are affiliated
but, instead, to the will of their members.  The sole essence of
affiliation is to increase, by collective action, the common
bargaining power of local unions for the effective enhancement
and protection of their interests.   Admittedly, there are times
when without succor and support local unions may find it hard,
unaided by other support groups, to secure justice for themselves.
Yet the local unions remain the basic units of association, free to
serve their own interests subject to the restraints imposed by the
constitution and by-laws of the national federation, and free also
to renounce the affiliation upon the terms laid down in the
agreement which brought such affiliation into existence.
Such dictum has been punctiliously followed since then.[17]
Upon an application of the aforecited principle to the issue at
hand, the impropriety of the questioned Decisions becomes
clearly apparent.  There is nothing shown in the records nor is it
claimed by PAFLU that the local union was expressly forbidden
to disaffiliate from the federation nor were there any conditions
imposed for a valid breakaway.  As such, the pendency of an
election protest involving both the mother federation and the local
union did not constitute a bar to a valid disaffiliation.  Neither
was it disputed by PAFLU that 111 signatories out of the 120
members of the local union, or an equivalent of 92.5% of the total
union membership supported the claim of disaffiliation and had in
fact disauthorized PAFLU from instituting any complaint in their
behalf.  Surely, this is not a case where one (1) or two (2)
members of the local union decided to disaffiliate from the
mother federation, but it is a case where almost all local union
members decided to disaffiliate.
It was entirely reasonable then for PSI to enter into a collective
bargaining agreement with PSEA-NCW.  As PSEA had validly
severed itself from PAFLU, there would be no restrictions which
could validly hinder it from subsequently affiliating with NCW
and entering into a collective bargaining agreement in behalf of
its members.
There is a further consideration that likewise argues for the
granting of the petitions.   It stands unchallenged that PAFLU
instituted the complaint for unfair labor practice against the
wishes of workers whose interests it was supposedly protecting.  remaining officers of petitioner Union and allegedly gratified by
The mere act of disaffiliation did not divest PSEA of its own
personality; neither did it give PAFLU the license to act
independently of the local union.  Recreant to its mission, PAFLU
cannot simply ignore the demands of the local chapter and decide
for its welfare.  PAFLU might have forgotten that as an agent it
could only act in representation of and in accordance with the
interests of the local union.  The complaint then for unfair labor
practice lodged by PAFLU against PSI, PSEA and their
respective officers, having been filed by a party which has no
legal personality to institute the complaint, should have been
dismissed at the first instance for failure to state a cause of action.
Policy considerations dictate that in weighing the claims of a local
union as against those of a national federation, those of the former
must be preferred.  Parenthetically though, the desires of the
mother federation to protect its locals are not altogether to be
shunned.  It will however be to err greatly against the
Constitution if the desires of the federation would be favored over
those of its members.  That, at any rate, is the policy of the law. 
For if it were otherwise, instead of protection, there would be
disregard and neglect of the lowly workingmen.
WHEREFORE, the petitions of Philippine Skylanders, Inc. and of
Philippine Skylanders and Workers Association-NCW, together
with their respective officers, are GRANTED.    The  Decision of
the National Labor Relations Commission of  31 July 1996
affirming the Decision of the Labor Arbiter of 30 June 1995
holding petitioners Philippine Skylanders and Workers
Association-NCW, Philippine Skylanders, Inc. and their
respective officers, guilty of unfair labor practice and ordering
them to pay damages to private respondent Philippine Association
of Free Labor Unions (PAFLU) September (now UNIFIED
PAFLU) as well as the Resolution of 31 October 1996 denying
reconsideration is REVERSED and SET ASIDE.  No costs.
SO ORDERED.
[G.R. No. 190515, June 06 : 2011]
CIRTEK EMPLOYEES LABOR UNION-FEDERATION OF
FREE WORKERS PETITIONER, VS. CIRTEK
ELECTRONICS, INC., RESPONDENT.
RESOLUTION
CARPIO MORALES, J.:
This resolves the motion for reconsideration and supplemental
motion for reconsideration filed by respondent, Cirtek
Electronics, Inc., of the Court's Decision dated November 15,
2010.
Respondent-movant avers that petitioner, in filing the petition for
certiorari under Rule 65, availed of the wrong remedy, hence, the
Court should have dismissed the petition outright.  It goes on to
aver that the Court erred in resolving a factual issue — whether
the August 24, 2005
Memorandum of Agreement (MOA) was validly entered into —,
which is not the office of a petition for certiorari.
Respondent-movant further avers that the MOA[1] signed by the
its members should have been given credence by the Court.
Furthermore, respondent-movant maintains that the Secretary of
Labor cannot insist on a ruling beyond the compromise agreement
entered into by the parties; and that, as early as February 5, 2010,
petitioner Union had already filed with the Department of Labor
and Employment (DOLE) a resolution of disaffiliation from the
Federation of Free Workers resulting in the latter's lack of
personality to represent the workers in the present case.
The motion is bereft of merit.
Respondent indeed availed of the wrong remedy of certiorari
under Rule 65. Due, however, to the nature of the case, ape
involving workers' wages and benefits, and the fact that whether
the petition was filed under Rule 65 or appeal by certiorari under
Rule 45 it was filed within 15 days (the reglementary period
under Rule 45) from petitioner's receipt of the resolution of the
Court of Appeals' Resolution denying its motion for
reconsideration, the Court resolved to give it due course.
As Almelor v. RTC of Las Piñas, et al.[2] restates:
Generally, on appeal taken either to the Supreme Court or
the CA by the wrong or inappropriate mode shall be
dismissed. This is to prevent the party from benefiting from one's
neglect and mistakes. However, like most rules, it carries
certain exceptions. After all, the ultimate purpose of all rules
of procedures is to achieve substantial justice as expeditously
as possible. (emphasis and underscoring supplied)
Respecting the attribution of error to the Court in ruling on a
question of fact, it bears recalling that a QUESTION OF FACET
arises when the doubt or difference arises as to the truth or
falsehood of alleged facts,[3] while a QUESTION OF LAW exists
when the doubt or difference arises as to what the law is on a
certain set of facts.
The present case presents the primordial issue of whether the
Secretary of Labor is empowered to give arbitral awards in the
exercise of his authority to assume jurisdiction over labor
disputes.
Ineluctably, the issue involves a determination and application of
existing law, the provisions of the Labor Code, and prevailing
jurisprudence.
Intertwined with the issue, however, is the question of validity of
the MOA and its ratification which, as movant correctly points
out, is a question of fact and one which is not appropriate for a
petition for review on certiorari under Rule 45. The rule,
however, is not without exceptions, viz:
This rule provides that Hie parlies may raise only iquestions of
law, because the Supreme Court is dot a trier of facts. Generally,
we are not duty-bound to analyze again and weigh the
evidence'introduced in and considered by the tribunals
below.  When supported by substantial evidence, the findings
of fact of the CA are conclusive and binding on the parties
and are not renewable by this Court, unless the case falls
under any of the following recognized exceptions:
(1) When the conclusion is a finding grounded entirely on
speculation, surmises and conjectures:
(2) When the inference made is manifestly mistaken, absurd or
impossible;
(3) Where there is a grave abuse of discretion:
(4) When the  judgment is based on a misapprehension of
facts;
(5) When the findings of fact are conflating:
(6) When the Court of Appeals, in making its findings, went
beyond the issues of the case and the same is contrary to the
admissions of both appellant and appellee;
(7) When the findings arc contrary  to those of , the trial
court:
(8) When the findings of fact art without citation of specific
evidence on which the conclusions are based;
(9) When the facts set forth in the petition as well as in the
petitioners1 main and reply briefs are not disputed by the
respondents; and
(10) When the findings of  fact of the  Court  of Appeals are
premised on the supposed absence of evidence and contradicted
by the evidence on record, (emphasis and underscoring supplied)
In the present case, the findings of the Secretary of Labor and the
appellate court on whether the MOA is valid and binding are
conflicting, the former giving scant consideration thereon, latter
affording it more and the weight.
As found by the Secretary of Labor, the MOA came about as a
result of the constitution, at respondent's behest, of the Labor-
Management Council (LMC) which, he reminded the parties,
should not be used as an avenue for bargaining but for the
purpose of affording workers to participate in policy and
derision-making.  Hence, the agreements embodied in the MOA
were not the proper subject of the LMC deliberation or procedure
but of CBA negotiations and, therefore, deserving little weight.
The appellate court, held, however, that the Secretary did not
have the authority to give an arbitral award higher than what was
stated in the MOA. The conflicting views drew the Court to re-
evaluate the facts as borne by the records, an exception to the rule
that only questions of law may be dealt with in an appeal by
certiorari under Rule 45.
As discussed in the Decision under reconsideration, the then
Acting Secretary of Labor Manuel G. Imson acted well within his
jurisdiction in ruling that the wage increases to be given are P10
per day effective January 1, 2004 and P15 per day effective
January 1, 2005, pursuant to his power to assume jurisdiction
under Art. 263 (g)[4] of the Labor Code.
While an arbitral award cannot per se be categorized as an
agreement voluntarily entered into by the parties because it
requires the interference and imposing power of the State thru the
Secretary of Labor when he assumes jurisdiction, the award can
be considered, as an approximation of a collective bargaining
agreement which would otherwise have been entered into by
the parties. Hence, it has the force and effect of a valid contract
obligation between the parties.[5]
In determining arbitral awards then, aside from the MOA, courts
considered  other factors and documents including, as in this case,
the financial documents[6] submitted by  respondent as well as  its
previous bargaining history and financial outlook and
improvements as stated in its own website.[7]
The appellate court's ruling that giving credence to the "Pahavag"
and the minutes of the meeting which were not verified and
notarized would violate the rule on parol evidence is erroneous. 
The parol evidence rule, like other rules on  evidence, should not
be strictly applied in labor cases. Interphil Laboratories
Employees Union-FFW v.  Interphil Laboratories Inc.[8] teaches:
[R]eliance on the parol evidence rule is misplaced.  In labor
cases pending before the Commission or the Labor Arbiter, the
rules of evidence prevailing in courts of law or equity are not
controlling.  Rules of procedure and evidence are not applied in a
very rigid and technical sense in labor cases. Hence, the Labor
Arbiter is not precluded from accepting and evaluating evidence
other than. and even contrary to, what is stated in the CBA.
(emphasis and underscoring [supplied)
On the contention that the MOA should have been given credence
because it was validly entered into by the parties, the Court notes
that even those who signed it expressed reservations, thereto.  A
CBA (assuming in this case that the MOA can be treated as one)
is a contract imbued with public interest.  It must thus be given a
liberal, practical and realistic, rather than a narrow and technical
construction, with due consideration to the context in which it is
negotiated and the purpose for which it is intended.[9]
As for the contention that the alleged disaffiliation of the Union
from the FFW during the pendency of the case resulted in the
FFW losing its personality to represent the Union, the same does
not affect the Court's upholding of the authority of the Secretary
of Labor to impose arbitral awards higher than what was
supposedly agreed upon in the MOA. Contrary to respondent's
assertion, the "unavoidable issue of disaffiliation" bears no
significant legal repercussions to warrant the reversal of the
Court's Decision.
En passant, whether there was a valid disaffiliation is a factual
issue.  Besides, the alleged disaffiliation of the Union from the
FFW was by virtue of a Resolution signed on February 23, 2010
and submitted to the DOLE Laguna Field Office on March 5,
2010 two months after the present petition was filed on December
22, 2009, - hence, it did not affect FFW and its Legal Center's
standing to file the petition nor this Court's jurisdiction to resolve
the same.
At all events, the issue of disaffiliation is an infra-union dispute
which must be resolved in a different forum in an action at the
instance of either or both the FFW and the Union or a rival labor
organization, not the employer.
An infra-union dispute refers to any conflict between; and
among union members, including grievances arising from any
violation of the rights and conditions of membership, violation
of or disagreement over any provision of (he union's
constitution and by-laws, or disputes arising from chartering
or disaffiliation of the union. Sections 1 and 2. Rule XI of
Department Order No. 40-03, Series of 2003 of the DOLE
enumerate the following circumstances as inter/intra-union
disputes, viz:
RULE XI
INTER/INTRA-UNION DISPUTES AND
OTHER RELATED LABOR RELATIONS DISPUTES
SECTION I. Coverage. - Inter/intra-union disputes shall include:
(a) cancellation of registration of a labor organization filed by its
members or by another labor organization:
(b) conduct of election of union and workers' association
officers/nullification of election of union and workers'
association officers;
(c) audit/accounts examination of union or workers association
funds:
(d) deregistration of collective bargaining agreements:
(e) validity/invalidity of union affiliation or disaffiliation:
(f) validity/invalidity of acceptance/non-acceptance for union
membership;
(g) validity/invalidity of impeachment/expulsion;- of union and
workers' association officers and members:
(h) validity/invalidity of voluntary recognition;
(i) opposition to application for union and CBA registration:
(j) violations of or disagreements over any provision in a union or
workers' association constitution and by-laws:
(k) disagreements over chartering or registration of labor
organizations and collective bargaining agreements:
(l) violations of the rights and conditions of union or workers'
association membership;
(m violations of the rights of legitimate labor organizations,
) except interpretation of collective bargaining agreements;
(n) such other disputes or conflicts involving the rights to self-
organization, union membership and collective bargaining -
(1) between and among legitimate labor organizations;
(2) between and  among members of a union or workers'
association.
SECTION 2. Coverage. - Other related labor relations disputes
shall include any conflict between a labor union and the employer
or any individual, entity or group that is not a labor organization
or workers' association. This
includes: (1) cancellation of registration of unions and workers'
associations; and (2) a petition for interpleader.[10] (emphasis
supplied)
Indeed, as respondent-movant itself argues, a local union may
disaffiliate at any time from its mother federation, absent any
showing that the same is  prohibited under its constitution or rule. 
Such, however, does not result in it losing its legal personality
altogether.  Verily, Anglo-KMU v. Samahan Ng Mga
Manggagawang Nagkakaisa Sa Manila Bar Spinning Mills At
J.P. Coats[11] enlightens
A local labor union is a separate and distinct unit primarily
designed to secure and maintain an equality of bargaining power
between the employer and their employee-members. A local
union does not one its existence to the federation with which it
is affiliated.  It is a separate and distinct voluntary association
owing its creation to the will of its members.  The mere act of
affiliation does not divest the local union of its own
personality, neither does it give the mother federation the
license to act independently of the local union.  It only gives
rise to a contract of agency where the former acts in
representation of the latter, (emphasis and underscoring
supplied)
Whether then, as respondent claims, FFW "went against the will
and wishes of its principal" (the member-employees) by pursuing
the case despite the signing of the MOA, is not for the Court, nor
for respondent to determine, but for the Union and FFW to
resolve on their own pursuant to their principal-agent relationship.
WHEREFORE, the motion for reconsiders ion of this Court's
Decision of November 15, 2010 is DENIED.
SO ORDERED