ART.

258 – 260
N.B.: DLSU, MSMG, and Alabang Country Club cases not included

T&H Shopfitters Corporation v. T&H Shopfitters Union,

G.R. No. 191714, 26 February 2014
MENDOZA, J.:

DOCTRINE:

In essence, ULP relates to the commission of acts that transgress the workers’ right to organize.
As specified in Articles 248 [now Article 257] and 249 [now Article 258] of the Labor Code, the
prohibited acts must necessarily relate to the workers' right to self-organization.

FACTS:

Petitioners are two separate corporations but respondents treated them as a single entity and
their sole employer in their complaint.

On November 23, 2003, respondents and other employees of the petitioner held a formal
meeting to discuss their desire to improve working conditions and formation of a union. The
following day and up to the days leading to the certification elections, the respondents alleged
that the actions of petitioner is tantamount to union busting and as such a basis for their
complaint of unfair labor practice against the latter.

Nov. 24, 2003: seventeen (17) employees were barred from entering petitioners’ factory
premises located in Castillejos, Zambales, and ordered to transfer to T&H Shopfitters’ warehouse
at Subic Bay Freeport Zone (SBFZ) purportedly because of its expansion. Afterwards, the said
seventeen (17) employees were repeatedly ordered to go on forced leave due to the
unavailability of work.

Several affected employees were not given work assignments while subcontractors were
continuously hired to perform their functions. Petitioner, despite reaching an agreement before
NCMB, failed to complied with its commitment to give priority to regular workers in the
distribution of work assignments.

Aus. 17, 2004: A memorandum was issued by one of the petitioners informing the employees of
the expiration of the lease contract between Gin Queen and its lessor in Castillejos, Zambales
and announced the relocation of its office and workers to Cabangan, Zambales. Respondents
discovered that it was a "talahiban" or grassland. Union officers and members were made to
work as grass cutters in Cabangan, under the supervision of a certain Barangay Captain Greg
Pangan. Due to these circumstances, the employees assigned in Cabangan did not report for
work. As a consequence, the THS-GQ Union president was made to explain why he should not be
terminated for insubordination. The other employees who likewise failed to report in Cabangan
were meted out with suspension.
Oct. 10, 2004: petitioners sponsored a field trip to Iba, Zambales, for its employees. The officers
and members of the THS-GQ Union were purportedly excluded from the field trip. On the evening
of the field trip, a certain Angel Madriaga, a sales officer of petitioners, campaigned against the
union in the forthcoming certification election.

Oct. 11, 2004: The employees were escorted from the field trip to the polling center in Zambales
to cast their votes.

Oct. 13, 2004: the remaining employees situated at the SBFZ plant cast their votes as well. Due
to the heavy pressure exerted by petitioners, the votes for "no union" prevailed

The following week after the certification elections were held, petitioners retrenched THG-GQ
Union officers and members assigned at the Zambales plant. Respondents claimed that the work
weeks of those employees in the SBFZ plant were drastically reduced to only three (3) days in a
month.

Respondents filed their Complaint7 for Unfair Labor Practice (ULP) by way of union busting, and
Illegal Lockout, with moral and exemplary damages and attorney’s fees, against T&H Shopfitters
Corporation (T&H Shopfitters) and Gin Queen Corporation (Gin Queen) (collectively referred to
as "petitioners"), before the Labor Arbiter (LA) on September 7, 2004.

In its defense, Gin Queen, claiming that it is a corporation separate and distinct from T&H
Shopfitters, stressed that respondents were all employees. Gin Queen claimed that due to the
decrease in orders from its customers, they had to resort to cost cutting measures to avoid
anticipated financial losses. Thus, it assigned work on a rotational basis. It was of the impression
that the employees, who opposed its economic measures, were merely motivated by spite in
filing the complaint for ULP against it.

In addition, Gin Queen explained that its transfer from Castillejos, Zambales to Cabangan,
Zambales was a result of the expiration of its lease agreement with Myra D. Lumibao (Myra), its
lessor. Since the Cabangan site was bare and still required construction, Gin Queen offered work,
to employees who opted to stay, on rotation as well.

ISSUE: Whether ULP acts were committed by petitioners against respondents

RULING IN LA: LA ruled in favor of the petitioner corporations. It dismissed the case.

RULING IN NLRC: Reversed the decision of LA. Petitioners committed several unfair labor practice
acts by interfering with the exercise of the employees’ right to self-organization through
sponsoring a field trip on the day preceding the certification election, warning the employees of
dire consequences should the union prevail, & escorting them to the polling center; and
discriminating in regard to conditions of employment in order to discourage union membership
by assigning union officers and active union members as grass cutters on rotation basis.

RULING IN CA:

Affirmed the decision of NLRC

RULING: YES

The concept of ULP is embodied in Article 258 (formerly Article 247) of the Labor Code,14 which
provides: Article 258. Concept of unfair labor practice and procedure for prosecution thereof.––
Unfair labor practices violate the constitutional right of workers and employees to self-
organization, are inimical to the legitimate interests of both labor and management, including
their right to bargain collectively and otherwise deal with each other in an atmosphere of
freedom and mutual respect, disrupt industrial peace and hinder the promotion of healthy and
stable labor-management relations.

Article 259 (formerly Article 248) of the Labor Code, enumerates acts that constitutes unfair labor
practice. The petitioners are being accused of violating paragraphs a, c and e. The prohibited acts
must necessarily relate to the right to self-organization.

The questioned acts of petitioners, namely: 1) sponsoring a field trip to Zambales for its
employees, to the exclusion of union members, before the scheduled certification election; 2)
the active campaign by the sales officer of petitioners against the union prevailing as a bargaining
agent during the field trip; 3) escorting its employees after the field trip to the polling center; 4)
the continuous hiring of subcontractors performing respondents’ functions; 5) assigning union
members to the Cabangan site to work as grass cutters; and 6) the enforcement of work on a
rotational basis for union members, all reek of interference on the part of petitioners.
Indubitably, the various acts of petitioners, taken together, reasonably support an inference that,
indeed, such were all orchestrated to restrict respondents’ free exercise of their right to self-
organization.

WHEREFORE, the November 12, 2009 Decision of the Court of Appeals and its March 24, 2010
Resolution, in CA-G.R. SP No. 107188, are AFFIRMED, except with respect to the award of
attorney's fees which is hereby DELETED.
REN TRANSPORT V. NLRC
G.R. No. 188020; June 27, 2016
Sereno, CJ

DOCTRINE:

Under Article 263 in relation to Article 267 of the Labor Code, it is during the freedom period —
or the last 60 days before the expiration of the CBA — when another union may challenge the
majority status of the bargaining agent through the filing of a petition for a certification election.
If there is no such petition filed during the freedom period, then the employer "shall continue to
recognize the majority status of the incumbent bargaining agent where no petition for
certification election is filed."

FACTS:

Samahan ng Manggagawa sa Ren Transport (SMART) is a registered union, which had a five-year
collective bargaining agreement (CBA) with Ren Transport Corp. set to expire on 31 December
2004. The 60-day freedom period of the CBA passed without a challenge to SMART'S majority
status as bargaining agent. SMART thereafter conveyed its willingness to bargain with Ren
Transport, to which it sent bargaining proposals. Ren Transport, however, failed to reply to the
demand.

Subsequently, two members of SMART wrote to the Department of Labor and Employment -
National Capital Region (DOLE-NCR). The office was informed that a majority of the members of
SMART had decided to disaffiliate from their mother federation to form another union, Ren
Transport Employees Association (RTEA). SMART contested the alleged disaffiliation.

During the pendency of the disaffiliation dispute at the DOLE-NCR, Ren Transport stopped the
remittance to SMART of the union dues that had been checked off from the salaries of union
workers as provided under the CBA. Further, Ren Transport voluntarily recognized RTEA as the
sole and exclusive bargaining agent of the rank-and-file employees of their company. SMART filed
with the labor arbiter a complaint for unfair labor practice against Ren Transport.

DECISION OF THE LA:

The LA rendered a decision finding Ren Transport guilty of acts of unfair labor practice. The LA
explained that since the disaffiliation issue remained pending, SMART continued to be the
certified collective bargaining agent; hence, Ren Transport's refusal to send a counter-proposal
to SMART was not justified. The LA also held that the company's failure to remit the union dues
to SMART and the voluntary recognition of RTEA were clear indications of interference with the
employees' exercise of the right to self-organize.
DECISION OF NLRC:

The NLRC affirmed the ruling of the LA. CA affirmed the NLRC.

ISSUE:
Whether or not Ren Transport was guilty of unfair labor practice.

RULING:

YES.

Violation of the duty to bargain collectively is an unfair labor practice under Article 258(g) of the
Labor Code. Ren Transport had a duty to bargain collectively with SMART. Under Article 263 in
relation to Article 267 of the Labor Code, it is during the freedom period — or the last 60 days
before the expiration of the CBA — when another union may challenge the majority status of the
bargaining agent through the filing of a petition for a certification election. If there is no such
petition filed during the freedom period, then the employer "shall continue to recognize the
majority status of the incumbent bargaining agent where no petition for certification election is
filed."

In the present case, the facts are not up for debate. No petition for certification election
challenging the majority status of SMART was filed during the freedom period, which was from
November 1 to December 31, 2004 — the 60-day period prior to the expiration of the five-year
CBA. SMART therefore remained the exclusive bargaining agent of the rank-and-file employees.

Given that SMART continued to be the workers' exclusive bargaining agent, Ren Transport had
the corresponding duty to bargain collectively with the former. Ren Transport's refusal to do so
constitutes an unfair labor practice.

Consequently, Ren Transport cannot avail itself of the defense that SMART no longer represents
the majority of the workers. The fact that no petition for certification election was filed within
the freedom period prevented Ren Transport from challenging SMART'S existence and
membership.
DIGITAL TELECOMMUNICATIONS PHILIPPINES, INC. v. DIGITEL EMPLOYEES UNION (DEU)
G.R. No. 184903, October 10, 2012

FACTS:

Digitel Employees Union and Digitel commenced collective bargaining negotiations which
resulted in a bargaining deadlock. On despite the order of the Labor Secretary to execute a CBA,
still, no CBA was forged between Digitel and the Union. Some Union members abandoned their
employment with Digitel. The Union later became dormant. 10 years thereafter, Digitel received
the President of the Union, a letter containing the list of officers, CBA proposals and ground rules.
Digitel was reluctant to negotiate with the Union and demanded that the latter show compliance
with the provisions of the Union’s Constitution and By-laws on union membership and election
of officers.

The faction filed a case for Preventive Mediation before the NCMB based on Digitel’s violation of
the duty to bargain. During the pendency, Interactive Technology Solutions, Inc. (I-tech) was
incorporated. Then, Labor Secretary assumed jurisdiction over the labor dispute.

During the pendency of the controversy, Digitel Service, Inc. (Digiserv) filed with the DOLE an
Establishment Termination Report stating that it will cease its business operation. The closure
affected at least 100 employees, 42 of whom are members of the herein respondent Union.

ISSUE:

Whether or not an employer commits ULP when it closed down one of its enterprises resulting
to the dismissal of the union members pending the assumption order of the Secretary of Labor
regarding its duty to bargain.

RULING:

Yes. Bad faith was manifested by the timing of the closure of Digiserv and the rehiring of some
employees to Interactive Technology Solutions, Inc. (I-tech), a corporate arm of Digitel. The
timing of the creation of I-tech is dubious. It was incorporated while the labor dispute within
Digitel was pending. I-tech’s primary purpose was to provide call center/customer contact
service, the same service provided by Digiserv. It conducts its business inside the Digitel office.
The former head of Digiserv is also an officer of I-tech. Thus, when Digiserv was closed down,
some of the employees presumably non-union members were rehired by I-tech.

Thus, the closure of Digiserv pending the existence of an assumption order coupled with the
creation of a new corporation performing similar functions as Digiserv leaves no iota of doubt
that the target of the closure are the union member-employees. These factual circumstances
prove that Digitel terminated the services of the affected employees to defeat their security of
tenure. The termination of service was not a valid retrenchment; it was an illegal dismissal of
employees.
It needs to be mentioned too that the dismissal constitutes an unfair labor practice under Article
248(c) of the Labor Code which refers to contracting out services or functions being performed
by union members when such will interfere with, restrain or coerce employees in the exercise of
their rights to self-organization. At the height of the labor dispute, occasioned by Digitel’s
reluctance to negotiate with the Union, I-tech was formed to provide, as it did provide, the same
services performed by Digiserv, the Union members’ nominal employer.

GENERAL SANTOS COCA-COLA PLANT FREE WORKERS UNION-TUPAS v. COCA-COLA BOTTLERS

PHILS., INC.

FACTS:

Respondent Coca-Cola Bottlers Phil., Inc. (CCBPI) experienced a significant decline in profitability
due to the Asian economic crisis, thus to curb the negative effects on the company, it
implemented three (3) waves of an Early Retirement Program. An inter-office memorandum was
also issued mandating to put on hold “all requests for hiring to fill in vacancies in both regular
and temporary positions in [the] Head Office and in the Plants.” Faced with the “freeze hiring”
directive, CCBPI Gen San engaged the services of JLBP Services Corporation (JLBP), a manning
agency.

Petitioner then filed with the National Conciliation and Mediation Board (NCMB) a Notice of
Strike on the ground of alleged unfair labor practice committed by CCBPI Gen San for contracting-
out services regularly performed by union members.

In a Resolution, the NLRC ruled that CCBPI was not guilty of unfair labor practice for contracting
out jobs to JLBP.

The NLRC held that petitioner failed to prove by substantial evidence that the system was meant
to curtail the right to self-organization of petitioner’s members. Petitioner filed a Petition for
Certiorari before the Court of Appeals.

The CA uphold the NLRC’s finding that CCBPI was not guilty of unfair labor practice. It held that
the contract between CCBPI and JLBP did not amount to labor-only contracting. It found that JLBP
was an independent contractor and that the decision to contract out jobs was a valid exercise of
management prerogative to meet exigent circumstances. Hence, this Petition for Review on
Certiorari under Rule 45.

RULING:

The petition is bereft of merit. Hence, the Court deny the Petition.
The issues raised by petitioner of whether JLBP is an independent contractor, whether CCBPI’s
contracting-out of jobs to JLBP amounted to unfair labor practice, and whether such action was
a valid exercise of management prerogative, call for a re-examination of evidence, which is not
within the ambit of this Court’s jurisdiction.

The CA squarely addressed the issue of job contracting in its assailed Decision and Resolution.
The CA itself examined the facts and evidence of the parties and found that, based on the
evidence, CCBPI did not engage in labor-only contracting and, therefore, was not guilty of unfair
labor practice.

The NLRC found – and the same was sustained by the CA – that the company’s action to contract-
out the services and functions performed by Union members did not constitute unfair labor
practice as this was not directed at the members’ right to self-organization.

Both the NLRC and the CA found that petitioner was unable to prove its charge of unfair labor
practice. It was the Union that had the burden of adducing substantial evidence to support its
allegations of unfair labor practice,17 which burden it failed to discharge.

WHEREFORE, the foregoing premises considered, the Petition is DENIED. The assailed Decision
and Resolution of the Court of Appeals are AFFIRMED.

UST Faculty Union vs. UST

GR No: 180892 Date: April 7, 2009 Ponente: Velasco, Jr., J.

Doctrine:

It is not the duty or obligation of respondents [employer] to inquire into the validity of the
election of the Gamilla Group. Such issue is properly an intra-union controversy subject to the
jurisdiction of the med-arbiter of the DOLE. Respondents could not have been expected to stop
dealing with the Gamilla Group on the mere accusation of the Mariño Group that the former was
not validly elected into office.

FACTS:

University of Santo Tomas Faculty Union (USTFU) wrote a letter to all its members informing
them of a General Assembly (GA) that was to be held on October 5, 1996. The letter contained
an agenda for the GA which included an election of officers. The then incumbent president of the
USTFU was Atty. Eduardo J. Mariño, Jr.

On October 2, 1996, Fr. Rodel Aligan, O.P., Secretary General of the UST, issued a Memorandum
allowing the request of the Faculty Clubs of the university to hold a convocation on October 4,
1996.
Members of the faculties of the university attended the convocation, including members of the
USTFU, without the participation of the members of the UST administration. Also during the
convocation, an election for the officers of the USTFU was conducted by a group called the
Reformist Alliance. Upon learning that the convocation was intended to be an election, members
of the USTFU walked out. Meanwhile, an election was conducted among those present, and Gil
Gamilla and other faculty members (Gamilla Group) were elected as the president and officers,
respectively, of the union. Such election was communicated to the UST administration. Thus,
there were two (2) groups claiming to be the USTFU: the Gamilla Group and the group led by
Atty. Mariño, Jr. (Mariño Group).

The Mariño Group filed a complaint for ULP against the UST with the Arbitration Branch of the
NLRC praying for the nullification of the election of the Gamilla Group as officers of the USTFU.
Then, a CBA was entered into by the Gamilla Group and the UST. The CBA superseded an existing
CBA entered into by the UST and USTFU.

The med-arbiter issued a Resolution, declaring the election of the Gamilla group as null and void
and ordering that this group cease and desist from performing the duties and responsibilities of
USTFU officers. The med-arbiter issued a Resolution, declaring the election of the Gamilla group
as null and void and ordering that this group cease and desist from performing the duties and
responsibilities of USTFU officers. This Resolution was appealed to the BLR which affirmed the
Resolution of the med-arbiter. His Resolution was then appealed to this Court which rendered its
November 16, 1999 Decision

Thus, USTFU then filed a Manifestation with the Arbitration Branch of the NLRC informing it of
the Decision of the Court. Thereafter, the Arbitration Branch of the NLRC issued a Decision
dismissing the complaint for lack of merit.

The complaint was dismissed on the ground that USTFU failed to establish with clear and
convincing evidence that indeed UST was guilty of ULP. The acts of UST which USTFU complained
of as ULP were the following: (1) allegedly calling for a convocation of faculty members which
turned out to be an election of officers for the faculty union; (2) subsequently dealing with the
Gamilla Group in establishing a new CBA.

LA/RTC/NLRC/CA RULING: The labor arbiter ruled that when the new CBA was entered into, (1)
the Gamilla Group presented more than sufficient evidence to establish that they had been duly
elected as officers of the USTFU; and (2) the ruling of the med-arbiter that the election of the
Gamilla Group was null and void was not yet final and executory. Thus, UST was justified in
dealing with and entering into a CBA with the Gamilla Group, including helping the Gamilla Group
in securing the USTFU office.

APPEAL TO THE SC:

Petitioner's Contention: Petitioner claims that the labor arbiter, NLRC, and CA should have found
that UST is guilty of ULP. Petitioner enumerates the acts constituting ULP as follows: (1)
respondents provided the Gamilla Group with the facilities and forum to conduct elections, in
the guise of a convocation; and (2) respondents transacted business with the Gamilla Group such
as the processing of educational and hospital benefits, deducting USTFU dues from the faculty
members without turning over the dues to the Mariño Group, and entering into a CBA with them.
Respondent's Contention: (not discussed)

ISSUE/S:

1. Whether or not UST was in connivance with the Gamilla group in the election of the former as
officers

2. Whether or not UST committed ULP in recognizing the Gamilla Group instead of the Marino
Group as the USTFU

HELD:

1. NO. Petitioner avers that: "Indeed, Respondents, under the guise of a faculty convocation,
ordered the suspension of classes and required the faculty members to attend the supposed
faculty convocation which was to be held at the Education Auditorium of the University of Santo
Tomas." An examination of the Memorandum dated October 2, 1996 would, however, rebut such
allegation. In no way can the contents of the memorandum be interpreted to mean that faculty
members were required to attend the convocation. Not one coercive term was used in the
memorandum to show that the faculty club members were compelled to attend such
convocation. And the phrase "we are allowing them to hold a convocation" negates any idea that
the UST would participate in the proceedings. More importantly, USTFU itself even admitted that
during the October 4, 1996 convocation/election, not a single University Official was present.
In other words, the Memorandum dated October 2, 1996 does not support a claim that UST
organized the convocation in connivance with the Gamilla Group.

2. NO. In the instant case, until our Decision that the Gamilla Group was not validly elected into
office, there was no reason to believe that the members of the Gamilla Group were not the validly
elected officers and directors of USTFU. To reiterate, the Gamilla Group submitted a Letter dated
October 4, 1996 whereby it informed Fr. Rolando De La Rosa that its members were the newly
elected officers and directors of USTFU.

More important though is the fact that the records are bereft of any evidence to show that the
Mariño Group informed the UST of their objections to the election of the Gamilla Group. In fact,
there is even no evidence to show that the scheduled elections on October 5, 1996 that was
supposed to be presided over by the Mariño Group ever pushed through. Instead, petitioner filed
a complaint with the med-arbiter praying for the nullification of the election of the Gamilla
Group.

As such, there was no reason not to recognize the Gamilla Group as the new officers and directors
of USTFU. UST was obligated to deal with the USTFU, as the recognized representative of the
bargaining unit, through the Gamilla Group. UST’s failure to negotiate with the USTFU would have
constituted ULP.

It is not the duty or obligation of respondents [employer] to inquire into the validity of the
election of the Gamilla Group. Such issue is properly an intra-union controversy subject to the
jurisdiction of the med-arbiter of the DOLE.

Respondents could not have been expected to stop dealing with the Gamilla Group on the mere
accusation of the Mariño Group that the former was not validly elected into office.

PHILIPPINE SKYLANDERS v. NLRC

GR No: 127374 ; Date: Jan 31, 2002

Doctrine:

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.

Facts:

In November 1993 the Philippine Skylanders Employees Association (PSEA), a local labor union
affiliated with the Philippine Association of Free Labor Unions (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, PSEA sent PAFLU a notice of disaffiliation.

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-formed 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. 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.
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 filed a complaint for unfair labor practice against PSI.

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.

LA: Declared PSEA's disaffiliation from PAFLU invalid and held PSI, PSEA-PAFLU and their
respective officers guilty of unfair labor practice.

NLRC: Affirmed LA decision.

Petitioner’s Contention: 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

Issue:

WON PSEA’s disaffiliation is legitimate.

Ruling:

YES.

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.

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. 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.
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.

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.

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.

TROPICAL HUT EMPLOYEE’S UNION v. TROPICAL HUT FOOD MARKET

FACTS:

On January 2, 1968, the rank and file workers of the Tropical Hut Food Market Incorporated,
organized a local union called the Tropical Hut Employees Union (THEU) and elected their officers,
and adopted their constitution and by-laws and immediately sought affiliation with the National
Association of Trade Unions (NATU).

On January 3, 1968, the NATU accepted the THEU application for affiliation. Following such
affiliation with NATU, Registration Certificate No. 5544-IP was issued by the Department of Labor
in the name of the Tropical Hut Employees Union —NATU. It appears, however, that NATU itself
as a labor federation, was not registered with the Department of Labor.

Collective Bargaining Agreement was concluded between the parties on April 1, 1968, the term
of which expired on March 31, 1971.

Sec. 1. The COMPANY recognizes the UNION as the sole and exclusive collective
bargaining agent for all its workers and employees in all matters concerning wages,
hours of work, and other terms and conditions of employment.

Sec. 1 —. . . Employees who are already members of the UNION at the time of the signing
of this Agreement or who become so thereafter shall be required to maintain their
membership therein as a conditionof continued employment. xxx
 Sec. 3—Any employee who is expelled from the UNION for joining another federation
or forming another union, or who fails or refuses to maintain his membership therein as
required, . . . shall, upon written request of the UNION be discharged by the COMPANY.

May 21, 1971, respondent company and THEU-NATU entered into a new Collective Bargaining
Agreement which ended on March 31, 1974. This new CBA incorporated the previous union-shop
security clause and the attached check off authorization form. NATU received a letter dated
December 15, 1973, jointly signed by the incumbent officers of the local union informing the
NATU that THEU was disaffiliating from the NATU federation. Secretary of the THEU, Nemesio
Barro, made an announcement in an open letter to the general membership of the THEU,
concerning the latter’s disaffiliation from the NATU and its affiliation with the Confederation of
General Workers (CGW). The letter was passed around among the members of the THEU-NATU,
to which around 137 signatures appeared as having given their consent to and acknowledgment
of the decision to disaffiliate the THEU from the NATU.

The then so-called THEU-CGW held its annual election of officers, with Jose Encinas elected as
President. On January 3, 1974, Encinas, in his capacity as THEU-CGW President, informed the
respondent company of the result of the elections. On January 9, 1974, Pacifico Rosal, President
of the Confederation of General Workers (CGW), wrote a letter in behalf of complainant THEU-
CGW to the respondent company demanding the remittance of the union dues collected by the
Tropical Hut Food Mart, Incorporated to the THEU-CGW, but this was refused by the respondent
company. A request made by the NATU federation to the respondent company to dismiss him
(Encinas) in view of his violation of Section 3 of Article III of the Collective Bargaining Agreement.
The respondent company applied for clearance with the Secretary of Labor to dismiss the other
officers and members of THEU-CGW. The company also suspended them effective that day.

NLRC Case No. LR-2521 was filed by THEU-CGW and individual complainants against private
respondents for unfair labor practices. THEU-CGW asked the employees to affirm their
membership. Some did not abidenso they were informed that they will be dismissed under the
CBA. President/General Manager of respondent company, upon Dilag’s request, suspended
twenty four (24) workers on March 5, 1974, another thirty seven (37) on March 8, 1974 and two
(2) more on March 11, 1974, pending approval by the Secretary of Labor of the application for
their dismissal.

Labor Arbiter: in an orderdated March 21, 1974, holding that the issues raised by the parties
became moot and academic with the issuance of NLRC Order dated February 25, 1974 in NLRC
Case No. LR-2670, which directed the holding of a certification election among the rank and file
workers of the respondent company between the THEU-NATU and THE CGW.

He also ordered: a) the reinstatement of all complainants; b) for the respondent company to
cease and desist from committing further acts of dismissals without previous order from the
NLRC and for the complainant Tropical Hut Employees UNION-CGW to file representation cases
on a case to case basis during the freedom period provided for by the existing CBA between the
parties.
NLRC reversed the decision. Secretary of Labor rendered a decision affirming the findings of the
Commission.

ISSUE:

Whether or not the dismissal of petitioner employees resulting from their Unions’ disaffiliation
for the mother federation was illegal and constituted unfair labor practice on the part of
respondent company and federation.

HELD:

YES

When the THEU disaffiliated from its mother federation, the former did not lose its legal
personality as the bargaining union under the CBA. Moreover, the union security clause
embodied in the agreements cannot be used to justify the dismissals meted to petitioners since
it is not applicable to the circumstances obtaining in this case.

The CBA imposes dismissal only in case an employee is expelled from the union for joining
another federation or for forming another union or who fails or refuses to maintain membership
therein. The case at bar does not involve the withdrawal of merely some employees from the
union but of the whole THEU itself from its federation. Clearly, since there is no violation of the
union security provision in theCBA, there was no sufficient ground to terminate the employment
of petitioners.

PUREFOODS CORP v. NAGKAKAISANG SAMAHANG MANGGAGAWA NG PUREFOODS RANK

AND FILE
G.R. No. 150896, August 28, 2008

FACTS:

3 Labor organizations and a federation are respondents in this case: NAGSAMA-Purefoods, the
exclusive bargaining agent of the rank-and-file workers of Purefoods, STFWU (Sto. Tomas
Batangas) and PGFWU (Sta. Rosa, Laguna).

These organizations were affiliates of the respondent federation, Purefoods Unified Labor
Organization (PULO). The 3 labor organizations manifested their desire to re-negotiate the CBA,
submitting their respective demands and proposals authorizing a negotiating panel which
included among others a PULO representative. While Purefoods formally acknowledge receipt of
the union’s proposals, it refused to negotiate with the unions should PULO representative be in
the panel which resulted in deadlock. Hoever, the petitioner company concluded a new CBA with
another union in its farm in Malvar, Batangas and terminated the service of rank-and-file workers
in Sto. Tomas. The farm manager, supervisors and electrical workers of the Sto .Tomas farm, who
were members of the union, were nevertheless retained by the company in its employ. The 4
respondent labor organizations jointly instated a complaint for ULP, illegal lockout/ dismissal and
damages.

ISSUE:

Whether the refusal of Purefoods to recognize PULO as labor organizatipns’ affiliation

constituted undue interference in, and restraint on the exercise of the employees’ right to self-
organization and free collective bargaining.

HELD:

YES.

It is clear that the closure of the Sto. Tomas farm was made in bad faith. Badges of bad faith are
evident from the following acts of the petitioner: 1) It unjustifiably refused to recognize the
STFWU’s and other unions’ affiliation with PULO; 2) it concluded a new CBA with another union
in another farm during the agreed indefinite suspension of the CB negotiations; 3) it
surreptitiously transferred and continued its business in a less hostile environment; and 4) it
suddenly terminated the STFWU members, but retained and brought the non-members to the
Malvar farm. Petitioner presented no evidence to support the contention that it was incurring
losses or that the subject farm’s lease agreement was pre-terminated. Ineluctably, the closure of
the Sto. Tomas farm circumvented the labor organizatipn’s right to collective bargaining thus
violating the members’ right to security of tenure.

DE LA SALLE UNIVERSITY v. DLSUEA-NAFTEU

MSMG_UWP

ALABANG COUNTRY CLUB

STANDARD CHARTERED BANK EMPLOYEES UNION (NUBE) v. HON. MA. NIEVES CONFESOR
G.R. No. 114974, June 16, 2004

FACTS:

Before the commencement of the negotiation for the new CBA between the bank and the Union,
the Union, through Divinagracia, suggested to the Bank’s Human Resource Manager and head of
the negotiating panel, Cielito Diokno, that the bank lawyers should be excluded from the
negotiating team. The Bank acceded. Meanwhile, Diokno(head of the negotiating team for the
bank) suggested to Divinagracia that Jose P. Umali, Jr., the President of the National Union of
Bank Employees (NUBE), the federation to which the Union was affiliated, be excluded from the
Union’s negotiating panel. However, Umali was retained as a member thereof.

There was deadlock in the negotiations. Both parties alleged ULP. Bank alleged that the Union
violated its no strike- no lockout clause by filing a notice of strike before the NCMB. Considering
that the filing of notice of strike was an illegal act, the Union officers should be dismissed. Union
alleged unfair labor practice when the bank allegedly interfered with the Union’s choice of
negotiator. It argued that, Diokno’s suggestion that the negotiation be limited as a “family affair”
was tantamount to suggesting that Federation President Jose Umali, Jr. be excluded from the
Union’s negotiating panel. It further argued that, damage or injury to the public interest need
not be present in order for unfair labor practice to prosper. The Union also contended that the
Bank merely went through the motions of collective bargaining without the intent to reach an
agreement

ISSUE:

1. WON there was interference

2. WON the bank committed “surface bargaining”

HELD:

1. NONE

Article 248(a) of the Labor Code, considers it an unfair labor practice when an employer
interferes, restrains or coerces employees in the exercise of their right to self-organization or the
right to form association. The right to self-organization necessarily includes the right to collective
bargaining. Parenthetically, if an employer interferes in the selection of its negotiators or coerces
the Union to exclude from its panel of negotiators a representative of the Union, and if it can be
inferred that the employer adopted the said act to yield adverse effects on the free exercise to
right to self-organization or on the right to collective bargaining of the employees, ULP under
Article 248(a) in connection with Article 243 of the Labor Code is committed.

In order to show that the employer committed ULP under the Labor Code, substantial evidence
is required to support the claim. Substantial evidence has been defined as such relevant evidence
as a reasonable mind might accept as adequate to support a conclusion. In the case at bar, the
Union bases its claim of interference on the alleged suggestions of Diokno to exclude Umali from
the Union’s negotiating panel.

The circumstances that occurred during the negotiation do not show that the suggestion made
by Diokno to Divinagracia is an anti-union conduct from which it can be inferred that the Bank
consciously adopted such act to yield adverse effects on the free exercise of the right to self-
organization and collective bargaining of the employees, especially considering that such was
undertaken previous to the commencement of the negotiation and simultaneously with
Divinagracia’s suggestion that the bank lawyers be excluded from its negotiating panel.

The records show that after the initiation of the collective bargaining process, with the inclusion
of Umali in the Union’s negotiating panel, the negotiations pushed through. The complaint was
made only on August 16, 1993 after a deadlock was declared by the Union on June 15, 1993.

It is clear that such ULP charge was merely an afterthought. The accusation occurred after the
arguments and differences over the economic provisions became heated and the parties had
become frustrated. It happened after the parties started to involve personalities. As the public
respondent noted, passions may rise, and as a result, suggestions given under less adversarial
situations may be colored with unintended meanings. Such is what appears to have happened in
this case.

2. NO.

Surface bargaining is defined as “going through the motions of negotiating” without any legal
intent to reach an agreement.”

The Union alleges that the Bank violated its duty to bargain; hence, committed ULP under Article
248(g) when it engaged in surface bargaining. It alleged that the Bank just went through the
motions of bargaining without any intent of reaching an agreement, as evident in the Bank’s
counter-proposals. It explained that of the 34 economic provisions it made, the Bank only made
6 economic counterproposals. Further, as borne by the minutes of the meetings, the Bank, after
indicating the economic provisions it had rejected, accepted, retained or were open for
discussion, refused to make a list of items it agreed to include in the economic package.

The minutes of meetings from March 12, 1993 to June 15, 1993 do not show that the Bank had
any intention of violating its duty to bargain with the Union. Records show that after the Union
sent its proposal to the Bank on February 17, 1993, the latter replied with a list of its counter-
proposals on February 24, 1993. Thereafter, meetings were set for the settlement of their
differences. The minutes of the meetings show that both the Bank and the Union exchanged
economic and non-economic proposals and counter-proposals.

The Union has not been able to show that the Bank had done acts, both at and away from the
bargaining table, which tend to show that it did not want to reach an agreement with the Union
or to settle the differences between it and the Union. Admittedly, the parties were not able to
agree and reached a deadlock. However, it is herein emphasized that the duty to bargain “does
not compel either party to agree to a proposal or require the making of a concession.”

Hence, the parties’ failure to agree did not amount to ULP under Article 248(g) for violation of
the duty to bargain.

GENERAL MILLING CORPORATION, petitioner, vs. HON. COURT OF APPEALS, GENERAL MILLING
CORPORATION INDEPENDENT LABOR UNION (GMC-ILU), and RITO MANGUBAT, respondents.

FACTS:

In its two plants located at Cebu City and Lapu-Lapu City, petitioner General Milling Corporation
(GMC) employed 190 workers. They were all members of private respondent General Milling
Corporation Independent Labor Union (union, for brevity), a duly certified bargaining agent. A
day before the expiration of the CBA, the union sent GMC a proposed CBA, with a request that a
counter-proposal be submitted within ten (10) days. GMC had received collective and individual
letters from workers who stated that they had withdrawn from their union membership, on
grounds of religious affiliation and personal differences. Believing that the union no longer had
standing to negotiate a CBA, GMC did not send any counter-proposal. Thus, the union filed, on
July 2, 1992, a complaint against GMC with the NLRC, Arbitration Division, Cebu City. The
complaint alleged unfair labor practice on the part of GMC for: (1) refusal to bargain collectively;
(2) interference with the right to self-organization; and (3) discrimination. The labor arbiter
dismissed the case with the recommendation that a petition for certification election be held to
determine if the union still enjoyed the support of the workers.

NLRC ordered GMC to abide by the CBA draft that the union proposed for a period of two (2)
years. NLRC pointed out that upon the effectivity of Rep. Act No. 6715, the duration of a CBA,
insofar as the representation aspect is concerned, is five (5) years which, in the case of GMC-
Independent Labor Union was from December 1, 1988 to November 30, 1993. All other
provisions of the CBA are to be renegotiated not later than three (3) years after its execution.
Thus, the NLRC held that respondent union remained as the exclusive bargaining agent with the
right to renegotiate the economic provisions of the CBA. Consequently, it was unfair labor
practice for GMC not to enter into negotiation with the union.

ISSUE/S: Did the company commit ULP?

RULING:

Yes. The law mandates that the representation provision of a CBA should last for five years. The
relation between labor and management should be undisturbed until the last 60 days of the fifth
year. Hence, it is indisputable that when the union requested for a renegotiation of the economic
terms of the CBA on November 29, 1991, it was still the certified collective bargaining agent of
the workers, because it was seeking said renegotiation within five (5) years from the date of
effectivity of the CBA on December 1, 1988. The unions proposal was also submitted within the
prescribed 3-year period from the date of effectivity of the CBA, albeit just before the last day of
said period. It was obvious that GMC had no valid reason to refuse to negotiate in good faith with
the union. For refusing to send a counter-proposal to the union and to bargain anew on the
economic terms of the CBA, the company committed an unfair labor practice under Article 248
of the Labor Code.

HACIENDA FATIMA vs. NATIONAL FEDERATION OF SUGARCANE WORKERS-FOOD AND

GENERAL TRADE
G. R. No. 149440; January 28, 2003

DOCTRINE:

An employment shall be deemed to be casual if it is not covered by the Article 280 of the Labor
Code. Provided, That, any employee who has rendered at least one year of service, whether such
service is continuous or broken, shall be considered a regular employee with respect to the
activity in which he is employed and his employment shall continue while such activity exist.

For respondents to be excluded from those classified as regular employees, it is not enough that
they perform work or services that are seasonal in nature. They must have also been employed
only for the duration of one season. The evidence proves the existence of the first, but not of the
second, condition. The fact that respondents with the exception of a few of them, repeatedly
worked as sugarcane workers for petitioners for several years is not denied by the latter.
Evidently, petitioners employed respondents for more than one season. Therefore, the general
rule of regular employment is applicable.

The primary standard, therefore, of determining regular employment is the reasonable

connection between the particular activity performed by the employee in relation to the usual
trade or business of the employer. The test is whether the former is usually necessary or desirable
in the usual trade or business of the employer. The connection can be determined by considering
the nature of the work performed and its relation to the scheme of the particular business or
trade in its entirety. Also if the employee has been performing the job for at least a year, even if
the performance is not continuous and merely intermittent, the law deems repeated and
continuing need for its performance as sufficient evidence of the necessity if not indispensability
of that activity to the business. Hence, the employment is considered regular, but only

FACTS:

Herein respondents, having performed the same tasks for petitioners every season for several
years, are considered the latter's regular employees for their respective tasks. Petitioners'
eventual refusal to use their services even if they were ready, able and willing to perform their
usual duties whenever these were available and hiring of other workers to perform the tasks
originally assigned to respondents amounted to illegal dismissal of the latter.

The Court finds no reason to disturb the CA's dismissal of what petitioners claim was their valid
exercise of a management prerogative. The sudden changes in work assignments reeked of bad
faith. These changes were implemented immediately after respondents had organized
themselves into a union and started demanding collective bargaining. Those who were union
members were effectively deprived of their jobs. Petitioners' move actually amounted to
unjustified dismissal of respondents, in violation of the Labor Code.

Where there is no showing of clear, valid and legal cause for the termination of employment, the
law considers the matter a case of illegal dismissal and the burden is on the employer to prove
that the termination was for a valid and authorized cause. In the case at bar, petitioners failed to
prove any such cause for the dismissal of respondents who, as discussed above, are regular
employees.

Contrary to the findings of the Labor Arbiter that complainants [herein respondents] refused to
work and/or were choosy in the kind of jobs they wanted to perform, the records is replete with
complainants' persistence and dogged determination in going back to work.

Indeed, it would appear that respondents did not look with favor workers' having organized
themselves into a union. Thus, when complainant union was certified as the collective bargaining
representative in the certification elections, respondents under the pretext that the result was
on appeal, refused to sit down with the union for the purpose of entering into a collective
bargaining agreement. Moreover, the workers including complainants herein were not given
work for more than one month. In protest, complainants staged a strike which was however
settled upon the signing of a Memorandum of Agreement.

However, alleging that complainants failed to load the fifteen wagons, respondents reneged on
its commitment to sit down and bargain collectively. Instead, respondent employed all means
including the use of private armed guards to prevent the organizers from entering the premises.

Moreover, starting September 1991, respondents did not any more give work assignments to the
complainants forcing the union to stage a strike on January 2, 1992. But due to the conciliation
efforts by the DOLE, another Memorandum of Agreement was signed by the complainants and
respondents which provides:

Whereas the union staged a strike against management on January 2, 1992 grounded on the
dismissal of the union officials and members;

Whereas parties to the present dispute agree to settle the case amicably once and for all;

Pursuant thereto, the parties subsequently met and the Minutes of the Conciliation Meeting
showed as follows:
The meeting started at 10:00 A.M. A list of employees was submitted by Atty. Tayko based on
who received their 13th month pay. "When respondents again reneged on its commitment;
complainants filed the present complaint.

But for all their persistence, the risk they had to undergo in conducting a strike in the face of
overwhelming odds, complainants in an ironic twist of fate now find themselves being accused
of refusing to work and being choosy in the kind of work they have to perform.

RULING OF THE COURT OF APPEALS

The CA affirmed that while the work of respondents was seasonal in nature, they were
considered to be merely on leave during the off-season and were therefore still employed by
petitioners. Moreover, the workers enjoyed security of tenure. Any infringement upon this right
was deemed by the CA to be tantamount to illegal dismissal.

The appellate court found neither "rhyme nor reason in petitioner's argument that it was the
workers themselves who refused to or were choosy in their work." As found by the NLRC, the
record of this case is "replete with complainants' persistence and dogged determination in going
back to work."

The CA likewise concurred with the NLRC's finding that petitioners were guilty of unfair labor
practice.

ISSUES

Whether or not the Court of Appeals committed grave abuse of discretion in upholding the
NLRC's conclusion that private respondents were illegally dismissed, that petitioners were guilty
of unfair labor practice, and that the union be awarded moral and exemplary damages.

HELD

The NLRC also found herein petitioners guilty of unfair labor practice. It ruled as follows:

Indeed, from respondents' refusal to bargain, to their acts of economic inducements resulting in
the promotion of those who withdrew from the union, the use of armed guards to prevent the
organizers to come in, and the dismissal of union officials and members, one cannot but conclude
that respondents did not want a union in their hacienda clear interference in the right of the
workers to self-organization.

The finding of unfair labor practice done in bad faith carries with it the sanction of moral and
exemplary damages.
JOHN COLLEGES, INC., VS. ST. JOHN ACADEMY FACULTY AND EMPLOYEES UNION
G.R. No. 167892 October 27, 2006

FACTS:

Petitioner St. John Colleges, Inc. (SJCI) is a domestic corporation which owns and operates the St.
John’s Academy (later renamed St. John Colleges) in Calamba, Laguna. Prior to 1998, the
Academy offered a secondary course only. The high school then employed about 80 teaching and
non-teaching personnel who were members of the St. John Academy Faculty & Employees Union
(Union).The CBA between SJCI and the Union was set to expire on May 31, 1997. During the
ensuing collective bargaining negotiations, SJCI rejected all the proposals of the Union for an
increase in worker’s benefits. This resulted to a bargaining deadlock which led to the holding of
a valid strike by the Union on November 10, 1997.In order to end the strike, SJCI and the Union,
through the efforts of the NCMB, agreed to refer the labor dispute to the Secretary of Labor and
Employment (SOLE) for assumption of jurisdiction. After which, the strike ended and classes
resumed. Subsequently, the SOLE issued an Order dated January19, 1998 assuming jurisdiction
over the labor dispute pursuant to Article 263 of the Labor Code. The parties were required to
submit their respective position papers. Pending resolution of the labor dispute before the SOLE,
the Board of Directors of SJCI approved on February 22, 1998 a resolution recommending the
closure of the high school which was approved by the stockholders on even date.

Thereafter, SJCI informed the DOLE, DECS, parents, students and the Union of the impending
closure of the high school which took effect on March 31, 1998. Subsequently, some teaching
and non-teaching personnel of the high school agreed to the closure. Some 51 employees had
received their separation compensation package while 25 employees refused to accept the same.
Instead, these employees conducted a protest action within the perimeter of the high school.
The Union filed a notice of strike. Thereafter SJCI filed a petition to declare the strike illegal before
the NLRC. It claimed that the strike was conducted in violation of the procedural requirements
for holding a valid strike under the Labor Code. Subsequently, the 25 employees filed a complaint
for unfair labor practice (ULP), illegal dismissal and non-payment of monetary benefits against
SJCI before the NLRC, alleging that the closure of the high school was done in bad faith in order
to get rid of the Union and render useless any decision of the SOLE on the CBA deadlocked issues.

LA: Dismissed the Union’s complaint for ULP and illegal dismissal while granting SJCI’s petition to
declare the strike illegal coupled with a declaration of loss of employment status of the 25 Union
members involved in the strike.[SOLE: Union filed a manifestation to maintain the status quo on
March 30, 1998 praying that SJCI be enjoined from closing the high school. It claimed that the
decision of SJCI to close the high school violated the SOLE’s assumption order and the agreement
of the parties not to take any retaliatory action against the other. For its part, SJCI filed a motion
to dismiss with entry of appearance on October 14, 1998 claiming that the closure of the high
school rendered the CBA deadlocked issues moot. The SOLE denied SJCI’s motions to dismiss and
certified the CBA deadlock case to the NLRC] After the favorable decision of the Labor Arbiter,
SJCI resolved to reopen the high school for school year 1999-2000. However, it did not restore
the high school teaching and non-teaching employees it earlier terminated. That same school
year SJCI opened an elementary and college department.

NLRC: Rendered judgment reversing the decision of the Labor Arbiter. It found SJCI guilty of ULP
and illegal dismissal and ordered it to reinstate the 25 employees to their former positions
without loss of seniority rights and other benefits, and with full backwages. It also required SJCI
to pay moral and exemplary damages, attorney’s fees, and two (2) months summer/vacation pay.
Moreover, it ruled that the mass actions conducted by the 25 employees on May 4, 1998 could
not be considered as a strike since, by then, the employer-employee relationship had already
been terminated due to the closure of the high school.

CA: Affirmed the Decision of the NLRC

ISSUE: W/N the petitioner is guilty of ULP and illegal dismissal

HELD:

Yes, the petitioner is guilty of UPL and illegal dismissal, based on the following premise:

When SJCI reopened its high school, it did not rehire the Union members. Evidently, the closure
had achieved its purpose, that is, to get rid of the Union members.

Evidence provides that subsequent reopening of the high school after only one year from its
closure further show that the high school’s closure was done in bad faith.

Thus, the SJCI asserts that the strike conducted by the 25 employees on May 4, 1998 was illegal
for failure to take the necessary strike vote and give a notice of strike. However, the High Court
finds for the findings of the NLRC and CA that the protest actions of the Union cannot be
considered a strike because, by then, the employer-employee relationship has long ceased to
exist because of the previous closure of the high school on March 31, 1998.

In sum, the timing of, and the reasons for the closure of the high school and its reopening after
only one year from the time it was closed down, show that the closure was done in bad faith for
the purpose of circumventing the Union’s right to collective bargaining and its members’ right to
security of tenure. Consequently, SJCI is liable for ULP and illegal dismissal.
CENTRAL AZUCARERA DE BAIS EMPLOYEES UNION NFL v. CENTRAL AZUCARERA DE BAIS INC.
G.R. No. 186605, 17 Number 2010

FACTS:

A collective bargaining negotiations between CABEU-NFL, the certified bargaining agent and
Central Azucarera De Bais, Inc. (CAB) resulted in a deadlock when the company, in its counter
proposal, did not agree with the proposal of the union. After that, the Union which Mr. Saguran,
the Union President, purportedly represents has already lost its majority status by reason of the
disauthorization and withdrawal of support thereto by more than 90% of the rank and file
employees in the bargaining unit of Central and the workers themselves, acting as principal, after
disauthorizing the previous agent CABEU-NFL have organized themselves into a new Union
known as Central Azucarera de Bais Employees Labor Association (CABELA) and after obtaining
their registration certificate and making due representation that it is a duly organized union
representing almost all the rank and file workers in the Central, had concluded a new collective
bargaining agreement with the Central. The aforesaid CBA had been duly ratified by the rank and
file workers constituting 91% of the collective bargaining unit.

LA dismissed the ULP case, however, NLRC reversed it, and the latter’s decision was reversed also
by CA.

ISSUE:

Whether or not an employer is guilty of unfair labor practice when it concludes a New CBA with
a new union composed of the former members of the Certified Bargaining Agent considering the
collective bargaining negotiations resulted in a deadlock.

RULING:

No. CAB is being accused of violating its duty to bargain collectively supposedly because of its act
in concluding a CBA with CABELA, another union in the bargaining unit, and its failure to resume
negotiations with CABEU-NFL.

For a charge of unfair labor practice to prosper, it must be shown that CAB was motivated by ill
will, “bad faith, or fraud, or was oppressive to labor, or done in a manner contrary to morals,
good customs, or public policy, and, of course, that social humiliation, wounded feelings or grave
anxiety resulted x x x” in suspending negotiations with CABEU-NFL. Notably, CAB believed that
CABEU-NFL was no longer the representative of the workers. It just wanted to foster industrial
peace by bowing to the wishes of the overwhelming majority of its rank and file workers and by
negotiating and concluding in good faith a CBA with CABELA.” Such actions of CAB are nowhere
tantamount to anti-unionism, the evil sought to be punished in cases of unfair labor practices.

Furthermore, basic is the principle that good faith is presumed and he who alleges bad faith has
the duty to prove the same. By imputing bad faith to the actuations of CAB, CABEU-NFL has the
burden of proof to present substantial evidence to support the allegation of unfair labor practice.
Apparently, CABEU-NFL refers only to the circumstances mentioned in the letter-response,
namely, the execution of the supposed CBA between CAB and CABELA and the request to
suspend the negotiations, to conclude that bad faith attended CAB’s actions. The Court is of the
view that CABEU-NFL, in simply relying on the said letter-response, failed to substantiate its claim
of unfair labor practice to rebut the presumption of good faith. Moreover, as correctly
determined by the LA, the filing of the complaint for unfair labor practice was premature
inasmuch as the issue of collective bargaining is still pending before the NCMB.

UNION OF FILIPRO EMPLOYEES v. NESTLE PHILIPPINES

G.R. No. 158930; March 3, 2008

FACTS:

UFE-DFA-KMU was the sole and exclusive bargaining agent of the rank-and- file employees of
Nestlé belonging to the latter's Alabang and Cabuyao plants. On 4 April 2001, as the existing
collective bargaining agreement (CBA) between Nestlé and UFEDFA-KMU was to end on 5 June
2001, the Presidents of the Alabang and Cabuyao Divisions of UFE-DFA-KMU informed Nestlé of
their intent to "open [our] new Collective Bargaining Negotiation for the year 2001-2004 . . . as
early as June 2001." In response thereto, Nestlé informed them that it was also preparing its own
counter-proposal and proposed ground rules to govern the impending conduct of the CBA
negotiations.

In another letter to the UFE-DFA-KMU (Cabuyao Division only) dated 29 May 2001, Nestlé
reiterated its stance that "unilateral grants, one-time company grants, company initiated policies
and programs, which include, but are not limited to the Retirement Plan, Incidental Straight Duty
Pay and Calling Pay Premium, are by their very nature not proper subjects of CBA negotiations
and therefore shall be excluded therefrom."

Nestlé requested the NCMB to conduct preventive mediation proceedings between it and UFE-
DFA-KMU because despite fifteen (15) meetings between them, the parties failed to reach any
agreement on the proposed CBA. Notice of Strike was led by the union, predicated on Nestlé's
alleged unfair labor practices, that is, bargaining in bad faith by setting pre-conditions in the
ground rules and/or refusing to include the issue of the Retirement Plan in the CBA negotiations.

On 29 November 2001, Sec. Sto. Tomas issued an Order assuming jurisdiction over the subject
labor dispute. Nestlé and UFE-DFA-KMU led their respective position papers. Nestlé addressed
several issues concerning economic provisions of the CBA as well as the non-inclusion of the issue
of the Retirement Plan in the collective bargaining negotiations. On the other hand, UFE-DFA-
KMU limited itself to the issue of whether or not the retirement plan was a mandatory subject in
its CBA negotiations.
ISSUE:

WON Nestlé violated its duty to bargain collectively when it purportedly imposed a precondition
(refusing to include the issue of the Retirement Plan in the CBA negotiations) to its agreement to
discuss and engage in collective bargaining negotiations with UFE-DFA-KMU.

RULING:

No. The duty to bargain collectively is mandated by Articles 252 and 253 of the Labor Code, as
amended. Obviously, the purpose of collective bargaining is the reaching of an agreement
resulting in a contract binding on the parties; but the failure to reach an agreement after
negotiations have continued for a reasonable period does not establish a lack of good faith. The
statutes invite and contemplate a collective bargaining contract, but they do not compel one.
The duty to bargain does not include the obligation to reach an agreement.

The crucial question, therefore, of whether or not a party has met his statutory duty to bargain
in good faith typically turns on the facts of the individual case. As we have said, there is no per se
test of good faith in bargaining. Good faith or bad faith is an inference to be drawn from the facts.
For a charge of unfair labor practice to prosper, it must be shown that Nestlé was motivated by
ill will, "bad faith, or fraud, or was oppressive to labor, or done in a manner contrary to morals,
good customs, or public policy, and, of course, that social humiliation, wounded feelings, or grave
anxiety resulted . . ." in disclaiming unilateral grants as proper subjects in their collective
bargaining negotiations. While the law makes it an obligation for the employer and the
employees to bargain collectively with each other, such compulsion does not include the
commitment to precipitately accept or agree to the proposals of the other. All it contemplates is
that both parties should approach the negotiation with an open mind and make reasonable effort
to reach a common ground of agreement.

Herein, the union merely bases its claim of refusal to bargain on a letter dated 29 May 2001
written by Nestlé. But as we have stated in this Court's Decision, said letter is not tantamount to
refusal to bargain. In thinking to exclude the issue of Retirement Plan from the CBA negotiations,
Nestlé, cannot be faulted for considering the same benefit as unilaterally granted, considering
that eight out of nine bargaining units have allegedly agreed to treat the Retirement Plan as a
unilaterally granted benefit.

In the case at bar, Nestle never refused to bargain collectively with UFE-DFAKMU. The
corporation simply wanted to exclude the Retirement Plan from the issues to be taken up during
CBA negotiations, on the postulation that such was in the nature of a unilaterally granted benefit.
It is but natural that at negotiations, management and labor adopt positions or make demands
and offer proposals and counter-proposals. The management's rm stand against the issue of the
Retirement Plan did not mean that it was bargaining in bad faith. It had a right to insist on its
position to the point of stalemate.
MALAYANG MANGGAGA NG STAYFAST PHILS., INC. v. NLRC and STAYFAST.
G.R. No. 155306, 28 August 2013

FACTS:

The Med-Arbiter who supervised the certification election issued an Order certifying NLMS-Olalia
as the sole and exclusive bargaining agent of all rank and file employees of Stayfast. On appeal
to the Secretary, it affirmed the MA’s decision. The matter was elevated via petition for certiorari
to the Supreme Court. Pending, when the company refused to bargain, it staged a strike which
was restrained. Then, it filed a Notice of Strike to the NCMB. The company opposed and
contended that the union lack personality to file notice of strike. During the conciliation-
mediation, the union withdrew its notice of strike.

However, the Union’s members staged a “sit-down strike” to dramatize their demand for a fair
and equal treatment as respondent company allegedly continued to discriminate against them.
Respondent company issued a memorandum requiring the alleged participants in the “sit-down
strike” to explain within 24 hours why they should not be terminated or suspended from work
for infraction of company rules and regulations pertaining to unauthorized work stoppage, acts
inimical to company interest, and disregard of instruction of immediate supervisor to perform
assigned task. As no one complied with the memorandum within the 24-hour deadline,
respondent company promptly terminated the service of the participants in the “sit-down
strike”. Consequently the day after, the union staged a strike and filed a complaint for unfair
labor practice, union busting and illegal lockout against respondent company and its General
Manager, Maria Almeida, in the NLRC.

ISSUE:

Whether or not the termination of the complainants/appellants resulted from ULP, Union Busting
and Unlawful Lockout

HELD:

NO.

Petitioner’s case rests on the alleged discriminatory acts of respondent company against
petitioner’s officers and members. However, both the Labor Arbiter and the NLRC held that there
was no sufficient proof of respondent company’s alleged discriminatory acts.

Also, petitioner was supposed to have made a self-imposed prohibition to stage a strike when it
submitted its labor dispute with respondent company for compulsory arbitration. Yet, petitioner
continued with its strike. Besides, union filed no new notice of strike that could have supported
its charges of discriminatory acts and unfair labor practice. Moreover, no evidence was presented
to establish such charges
Thus, petitioner’s unfair labor practice, union-busting and unlawful lockout claims do not hold
water. Moreover, the established facts as found by the NLRC are as follows: the “sit-down strike”
made by petitioner’s officers and members on July 21, 1997 was in violation of respondent
company’s rules, and petitioner’s officers and members ignored the opportunity given by
respondent company for them to explain their misconduct, which resulted in the termination of
their employment. The Court of Appeals ruled that the said findings were supported by
substantial evidence. This Court finds that such ruling of the appellate court is not grave abuse of
discretion, nor could it be considered wrong.

HOLY CHILD CATHOLIC SCHOOL v. HON. PATRICIA STO. TOMAS, IN HER OFFICIAL CAPACITY AS
SECRETARY OF THE DEPARTMENT OF LABOR AND EMPLOYMENT, AND PINAG-ISANG TINIG AT
LAKAS NG ANAKPAWIS – HOLY CHILD CATHOLIC SCHOOL TEACHERS AND EMPLOYEES LABOR
UNION (HCCS-TELU-PIGLAS)
July 23, 2013 ; G.R. No. 179146

Doctrine:

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 case of alleged inclusion of disqualified employees in a union, the proper procedure for an
employer like petitioner is to directly file a petition for cancellation of the unions certificate of
registration due to misrepresentation, false statement or fraud under the circumstances
enumerated in Article 239 of the Labor Code, as amended.

Facts:

On May 31, 2002, a petition for certification election was filed by private respondent Pinag-Isang
Tinig at Lakas ng Anakpawis – Holy Child Catholic School Teachers and Employees Labor Union
(HCCS-TELUPIGLAS).

In its Comment and Position Paper, petitioner raised that members of private respondent do not
belong to the same class; it is not only a mixture of managerial, supervisory, and rank-and-file
employees – as three (3) are vice-principals, one (1) is a department head/supervisor, and eleven
(11) are coordinators – but also a combination of teaching and non-teaching personnel – as
twenty-seven (27) are non-teaching personnel.

It insisted that, for not being in accord with Article 245 of the Labor Code, private respondent is
an illegitimate labor organization lacking in personality to file a petition for certification election,
as held in Toyota Motor Philippines Corporation v. Toyota Motor Philippines Corporation Labor
Union; and an inappropriate bargaining unit for want of community or mutuality of interest, as
ruled in Dunlop Slazenger (Phils.), Inc. v. Secretary of Labor and Employment and De La Salle
University Medical Center and College of Medicine v. Laguesma.

CONTENTION OF PRIVATE RESPONDENTS

Section 11 (II), Rule XI of DOLE Department Order (D.O.) No. 9, Series of 1997, provided for
specific instances in which a petition filed by a legitimate organization shall be dismissed by the
Med-Arbiter and that "mixture of employees" is not one of those enumerated.

Questions pertaining to qualifications of employees may be threshed out in the inclusion-

exclusion proceedings prior to the conduct of the certification election, pursuant to Section 2,
Rule XII of D.O. No. 9.

Similar to the ruling in In Re: Globe Machine and Stamping Company, it contended that the will
of petitioner’s employees should be respected as they had manifested their desire to be
represented by only one bargaining unit.

RULING OF LOWER COURTS

Med-Arbiter:

Med-Arbiter denied the petition for certification election on the ground that the unit which
private respondent sought to represent is inappropriate. A certification election proceeding
directly involves two (2) issues namely:

the proper composition and constituency of the bargaining unit; and

the validity of majority representation claims.

The definition of “bargaining unit” has provided the "community or mutuality of interest" test as
the standard in determining the constituency of a collective bargaining unit.

In the case at bar, the employees of petitioner, may be categorized into (2) general classes: one,
the teaching staff; and two, the non-teaching-staff. The teaching staff would find very little in
common with the non-teaching staff as regards responsibilities and function, working conditions,
compensation rates, social life and interests, skills and intellectual pursuits, etc. These dictate the
separation of these two categories of employees for purposes of collective bargaining.
(University of the Philippines vs. Ferrer-Calleja, 211 SCRA 451)

SOLE:
Private respondent appealed before the SOLE, who ruled against the dismissal of the petition and
directed the conduct of two separate certification elections for the teaching and the non-
teaching personnel.

CA:

Petitioner filed a petition for certiorari before the CA with prayer for Temporary Restraining
Order and Preliminary Injunction. The CA dismissed the petition and ruled that the vice-
principals, coordinators and department heads are not managerial nor supervisory employees.
Anent the alleged mixture of teaching and non-teaching personnel, the CA agreed with petitioner
that the nature of the formers work does not coincide with that of the latter.

Issues:

Whether or not a petition for certification election is dismissible on the ground that the labor
organization’s membership allegedly consists of supervisory and rank-and-file employees.

Whether or not a petition for certification election is dismissible on the ground that private
respondent is not qualified to file such petition for its failure to qualify as a legitimate labor
organization in view of the improper mixture of teaching and non-teaching personnel.

Ruling:

1. No.

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, it was 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.

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.

Then came Tagaytay Highlands Int'l. Golf Club, Inc. v. Tagaytay Highlands Employees Union-
PTGWO in which the core issue was whether mingling affects the legitimacy of a labor
organization and its right to file a petition for certification election. This time, given the altered
legal milieu, the Court abandoned the view in Toyota and Dunlop and reverted to its
pronouncement in Lopez that while there is a prohibition against the mingling of supervisory and
rank-and-file employees in one labor organization, the Labor Code does not provide for the
effects thereof.

Thus, the Court held that after a labor organization has been registered, it may exercise all the
rights and privileges of a legitimate labor organization. Any mingling between supervisory and
rank-and-file employees in its membership cannot affect its legitimacy for that is not among the
grounds for cancellation of its registration, unless such mingling was brought about by
misrepresentation, false statement or fraud under Article 239 of the Labor Code.

In San Miguel Corp. (Mandaue Packaging Products Plants) v. Mandaue Packing Products Plants-
San Miguel Packaging Products-San Miguel Corp. Monthlies Rank-and-File Union-FFW, the Court
explained that since the 1997 Amended Omnibus Rules does not require a local or chapter to
provide a list of its members, it would be improper for the DOLE to deny recognition to said local
or chapter on account of any question pertaining to its individual members.

More to the point is Air Philippines Corporation v. Bureau of Labor Relations, 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.

In case of alleged inclusion of disqualified employees in a union, the proper procedure for an
employer like petitioner is to directly file a petition for cancellation of the unions certificate of
registration due to misrepresentation, false statement or fraud under the circumstances
enumerated in Article 239 of the Labor Code, as amended. To reiterate, private respondent,
having been validly issued a certificate of registration, should be considered as having acquired
juridical personality which may not be attacked collaterally.
2. No.

The concepts of a union and of a legitimate labor organization are different from, but related to,
the concept of a bargaining unit.

Article 212(g) of 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." Any applicant labor
organization 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.

Private respondent, having been validly issued a certificate of registration, should be considered
as having acquired juridical personality which may not be attacked collaterally.

On the other hand, a bargaining unit has been defined as a "group of employees of a given
employer, comprised of all or less than all of the entire body of employees, which the collective
interests of all the employees, consistent with equity to the employer, indicated to be best suited
to serve reciprocal rights and duties of the parties under the collective bargaining provisions of
the law."

Petitioner appears to have confused the concepts of membership in a bargaining unit and
membership in a union. In emphasizing the phrase "to the exclusion of academic employees"
stated in U.P. v. Ferrer-Calleja, petitioner believed that the petitioning union could not admit
academic employees of the university to its membership. But such was not the intention of the
Supreme Court.

A bargaining unit is a group of employees sought to be represented by a petitioning union. Such

employees need not be members of a union seeking the conduct of a certification election. A
union certified as an exclusive bargaining agent represents not only its members but also other
employees who are not union members.

In the same manner, the teaching and non-teaching personnel of petitioner school must form
separate bargaining units. Thus, the order for the conduct of two separate certification elections,
one involving teaching personnel and the other involving non-teaching personnel.

It should be stressed that in the subject petition, private respondent union sought the conduct
of a certification election among all the rank-and-file personnel of petitioner school. Since the
decision of the Supreme Court in the U.P. case prohibits us from commingling teaching and non-
teaching personnel in one bargaining unit, they have to be separated into two separate
bargaining units with two separate certification elections to determine whether the employees
in the respective bargaining units desired to be represented by private respondent.
Rule 45 limits the Court to the review of questions of law raised against the assailed CA decision.
Whether the CA committed grave abuse of discretion is not what is ruled upon but whether it
correctly determined the existence or want of grave abuse of discretion on the part of the SOLE.
Hence, the petition is denied.

Notes/Other matters:

The "Bystander Rule" is already well entrenched in this jurisdiction; that a certification election
is the sole concern of the workers, except when the employer itself has to file the petition
pursuant to Article 259 of the Labor Code, as amended, but even after such filing its role in the
certification process ceases and becomes merely a bystander. The employer clearly lacks the
personality to dispute the election and has no right to interfere at all therein. This is so since any
uncalled-for concern on the part of the employer may give rise to the suspicion that it is batting
for a company union. This is based on the rationale that the employees’ bargaining
representative should be chosen free from any extraneous influence of the management; that,
to be effective, the bargaining representative must owe its loyalty to the employees alone and
to no other.

EMPLOYEE OF BAYER PHILS v. BAYER PHILS.

FACTS:

During the negotiations, EUBP rejected Bayer’s 9.9% wage-increase proposal resulting in a
bargaining deadlock. And the former staged a strike, prompting the Secretary of DOLE to assume
jurisdiction over the dispute. Pending the resolution of the dispute, respondent Avelina Remigio
(Remigio) and 27 other union members, without any authority from their union leaders, accepted
Bayer’s wage-increase proposal. EUBP’s grievance committee questioned Remigio’s action and
reprimanded Remigio and her allies. After a while, the DOLE Secretary issued an arbitral award
ordering EUBP and Bayer to execute a CBA.

Meanwhile, barely six months from the signing of the new CBA, during a company-sponsored
seminar, Remigio solicited signatures from union members in support of a resolution. containing
the decision of the signatories to: (1) disaffiliate from FFW, (2) rename the union as Reformed
Employees Union of Bayer Philippines (REUBP), (3) adopt a new constitution and by-laws for the
union, (4) abolish all existing officer positions in the union and elect a new set of interim officers,
and (5) authorize REUBP to administer the CBA between EUBP and Bayer.7 The said resolution
was signed by 147 of the 257 local union members. A subsequent resolution was also issued
affirming the first resolution.

A tug-of-war then ensued between the two rival groups, with both seeking recognition from
Bayer and demanding remittance of the union dues collected from its rank-and-file members.
Bayer remitted the union dues to REUBP and later on they agreed to sign a new CBA. LA and NLRC
dismissed the complaints for ULP on the ground of lack of jurisdiction.
ISSUE:

Whether or not an employer commits ULP when it signed a new CBA with a new union
considering there is an existing valid CBA.

RULING:

Yes. In the case at bar, the Supreme Court ruled that it must be remembered that a CBA is entered
into in order to foster stability and mutual cooperation between labor and capital. An employer
should not be allowed to rescind unilaterally its CBA with the duly certified bargaining agent it
had previously contracted with, and decide to bargain anew with a different group if there is no
legitimate reason for doing so and without first following the proper procedure. If such behavior
would be tolerated, bargaining and negotiations between the employer and the union will never
be truthful and meaningful, and no CBA forged after arduous negotiations will ever be honored
or be relied upon.

On the matter of damages prayed for by the petitioners, we have held that as a general rule, a
corporation cannot suffer nor be entitled to moral damages. A corporation, and by analogy a
labor organization, being an artificial person and having existence only in legal contemplation,
has no feelings, no emotions, no senses; therefore, it cannot experience physical suffering and
mental anguish. Mental suffering can be experienced only by one having a nervous system and
it flows from real ills, sorrows, and griefs of life – all of which cannot be suffered by an artificial,
juridical person.

SA FERNANDO COCA-COLA RANK-AND-FILE UNION (SACORU) v. COCA-COLA BOTTLERS

PHILIPPINES (CCBPI)
G.R. No. 200499, October 4, 2017

FACTS:

On May 29, 2009, the private respondent company, Coca-Cola Bottlers Philippines., Inc. ("CCBPI")
issued notices of termination to twenty seven (27) rank-and-file, regular employees and
members of the San Fernando Rank-and-File Union ("SACORU"), collectively stated as "union
members", on the bottom of redundancy because of the ceding out of two selling and distribution
systems, the standard Route System ("CRS") and Mini Bodega System ("MB") to the Market
Execution Partners ("MEPS"), better referred to as "Dealership System". The union members
were also granted individual separation packages, which twenty-two (22) of them accepted, but
under protest.
To SACORU, the new, reorganized selling and distribution systems adopted and implemented by
CCBPI would end in the diminution of the union membership amounting to union busting and to
a violation of the talks Agreement (CBA) provision against contracting out of services or
outsourcing of standard positions; hence, they filed a Notice of Strike with the National
Conciliation and Mediation Board (NCMB) on the bottom of ground of unfair labor practice,
among others.

CCBPI, for its part, argued that the new business scheme is essentially a management prerogative
designed to boost the system of selling and distributing products so as to achieve more
consumers at a lesser cost with fewer manpower complement, but leading to greater returns to
investment.

SACORU maintained that that the termination will seriously affect the union membership
because out of 250 members, only 120 members are going to be left upon plan implementation;
that there's no redundancy because the sales force still exists except that job positions are going
to be contracted dead set a sales contractor using company equipment for the aim of minimizing
labor costs because contractual employees don't enjoy CBA benefits; that the contractualization
program of the corporate is against the law because it'll render the union inutile in protecting the
rights of its members as there'll be more contractual employees than regular employees; which
the redundancy program will lead to the displacement of standard employees which could be a
clear case of union busting.

ISSUE: Whether or not CCBPI committed unfair labor practices.

RULING:

No.

To prove the existence of unfair labor practice, substantial evidence has got to be presented.
SACORU didn't proffer any proof that CCBPI acted in an exceedingly malicious or arbitrarily
manner in implementing the redundancy program which resulted within the dismissal of the 27
employees, which CCBPI engaged instead the services of independent contractors. As no
credible, countervailing evidence had been put forth by SACORU with which to challenge the
validity of the redundancy program implemented by CCBPI, the alleged unfair labor practice acts
allegedly perpetrated against union members might not be simply swallowed. SACORU was
unable to prove its charge of unfair labor practice and support its allegations that the termination
of the union members was through with the end-in-view of weakening union leadership and
representation. There was no showing that the redundancy program was motivated by ill will,
bad faith or malice, or that it had been conceived for the aim of interfering with the employees'
right to self-organize. The Court accordingly affirms these findings of the NLRC and also the CA
that SACORU did not present any evidence to prove that the redundancy program interfered with
their right to self-organize.
Sonedco Workers Free Labor Union (SWOFLU) v. UNIVERSAL ROBINA CORP.
G.R. No. 220383, July 5, 2017

DOCTRINE:
Generally, a wage increase not included in the Collective Bargaining Agreement is not
demandable. However, if it was withheld by the employer as part of its unfair labor practice
against the union members, this benefit should be granted.

FACTS:

In 2007, while there was no Collective Bargaining Agreement in effect, URC-SONEDCO offered,
among other benefits, a ₱l6.00/day wage increase to their employees. To receive the benefits,
employees had to sign a waiver that said: "In the event that a subsequent CBA is negotiated
between the Management and Union, the new CBA shall only be effective on January 1, 2008."
Realizing that the waiver was an unfair labor practice(ULP), some members of SONEDCO Workers
Free Labor Union refused to sign.

URC-SONEDCO offered the same arrangement in 2008 extending an additional ₱l6.00/day wage
increase to employees who would agree that any CBA negotiated for that year would only be
effective on January 1, 2009. Several members of SONEDCO Workers Free Labor Union again
refused to waive their rights. Consequently, they did not receive the wage increase amounting
to a total of ₱32.00/day, beginning 2009.

In 2009, SONEDCO and its members who refused to sign the 2007 and 2008 waivers filed a
complaint for ULP against URC-SONEDCO on the ground of interference to the employees' right
to self-organization, collective bargaining, and concerted action.

Both the NLRC and the CA found URC-SONEDCO not guilty of ULP but nonetheless, ordered URC-
SONEDCO to give petitioners the same benefits their co-workers received in 2007 and 2008.
However, SONEDCO Workers Free Labor Union's claim for the 2009 wage increase was denied.
Since a new CBA was already in effect by 2009, this CBA governed the relationship between the
management and the union.

As there was no provision in the existing CBA regarding wage increase of [₱]16.00 per day, the
NLRC was correct in ruling that it cannot further impose private respondents to pay petitioners
the subject wage increase for the year 2009 and onwards.

ISSUE:

Should the ₱32.00/day wage increase beginning January 1, 2009 to present be awarded to
petitioners
RULING:

YES.

The Court already granted the wage increases for 2007 and 2008 in its October 5, 2016 Decision.
Thus, the only wage increase in issue here is the continuing wage increase of ₱32.00/day starting
2009.

Generally, the Collective Bargaining Agreement controls the relationship between the parties.
Any benefit not included in it is not demandable. However, in light of the peculiar circumstances
in this case, the requested wage increase should be granted.

The wage increase was integrated in the salary of those who signed the waivers. When the
affiants waived their rights, respondent rewarded them with a ₱32.00/day wage increase that
continues to this day. The respondent company granted this benefit to its employees to induce
them to waive their collective bargaining rights. This Court has declared this an unfair labor
practice. Accordingly, it is illegal to continue denying the petitioners the wage increase that was
granted to employees who signed the waivers. To rule otherwise will perpetuate the
discrimination against petitioners. All the consequences of the unfair labor practice must be
addressed.

The grant of the ₱32.00/day wage increase is not an additional benefit outside the Collective
Bargaining Agreement of 2009. By granting this increase to petitioners, this Court is eliminating
the discrimination against them, which was a result of respondent's unfair labor practice.

Peninsula Employees Union v. Esquivel,

G.R. No. 218454, 1 December 2016

Doctrine:

Documentary requisites in order to justify a valid levy of increased union dues: 1. an authorization
by a written resolution of the majority of all members at the general membership meeting duly
called for the purpose; 2. the secretary’s record of the minutes of the meeting, which shall include
the list of all members present, the votes cast, the purpose of the special assessment or fees and
the recipient of such assessment or fees; and 3. individual written authorization for check-off
duly signed by the employees concerned. In the present case, however, PEU NUWHRAIN failed
to show compliance with the foregoing requirements. It attempted to remedy “inadvertent
omission” of the matter of the approval of the deduction of 2 percent union dues from the
monthly basic salary of each union member.
Facts:

On December 13, 2007, Peninsula Employees Union’ (PEU) Board of Directors passed Local Board
Resolution No. 12, series of 20078 authorizing, among others, the affiliation of PEU with National
Union of Workers in Hotel Restaurants and Allied Industries (NUWHRAIN), and the direct
membership of its individual members thereto. On the same day, the said act was submitted to
the general membership, and was duly ratified by 223 PEU members.

Beginning January 1, 2009, PEU-NUWHRAIN sought to increase the union dues/agency fees from
one percent (1% ) to two percent (2%) of the rank and file employees’ monthly salaries, brought
about by PEU’s affiliation with NUWHRAIN, which supposedly requires its affiliates to remit to it
two percent (2%) of their monthly salaries.

Meanwhile the Office of the Secretary (OSEC) of DOLE resolved the collective bargaining deadlock
by ordering the parties to execute a CBA. The parties have yet to actually sign a CBA but have, for
the most part, implemented the arbitral award.

The non-PEU members objected to the assessment of increased agency fees arguing that: (a) the
new CBA is unenforceable since no written CBA has been formally signed and executed by PEU-
NUWHRAIN and the Hotel; (b) the 2% agency fee is exorbitant and unreasonable; and (c) PEU-
NUWHRAIN failed to comply with the mandatory requirements for such increase.

OSEC: upheld PEU NUWHRAIN’s right to collect agency fees from the Non-PEU members in
accordance with Art. 4 Sec 2 of the expired CBA, which was declared to be in full force and effect
pursuant to Oct. 10, 2008 Decision , but only at the rate of one (1) percent, and denied its bid to
increase the agency fees to two percent for failure to show that its general membership approved
the same.

After a motion for reconsideration, OSEC issued an Order partially granting PEU-NUWHRAIN’s
motion declaring that it is entitled to collect two (2) percent agency fees from the non-PEU
members beginning July 2010 since General Membership Resolution (GMR) showing approval for
the increase in union dues from 1 percent to 2 percent was only procured at that time.

·CA: Set aside the order and stating that it failed to prove the requisites for a valid check-off since
the minutes of the meeting do not show that the increase in union dues was duly approved by
its general membership.

Issues:

1.) Whether PEU-NUWHRAIN has right to collect the increased agency fees.

2.) Whether PEU-NUWHRAIN failed to comply with the mandatory requirements for such
increase.
3.) Whether the agency is exorbitant and unreasonable.

Ruling:

PETITION: DENIED

1.) Yes. The recognized collective bargaining union which successfully negotiated the CBA with
the employer is given the right to collect a reasonable fee called “agency fee” from non-union
members who are employees of the appropriate bargaining unit, in an amount equivalent to the
dues and other fees paid by union members, in case they accept the benefits under the CBA.
While the collection of agency fees is recognized by Article 259 (formerly Article 248) of the Labor
Code, as amended, the legal basis of the union’s right to agency fees is neither contractual nor
statutory, but quasi-contractual, deriving from the established principle that non-union
employees may not unjustly enrich themselves by benefiting from employment conditions
negotiated by the bargaining union. In the present case, PEU-
NUWHRAIN’s right to collect agency fees is not disputed.

2.) Yes. Case law interpreting Article 250 (n) and ( o ) of the Labor Code mandates the submission
of three (3) documentary requisites in order to justify a valid levy of increased union dues. These
are: (a) an authorization by a written resolution of the majority of all the members at the general
membership meeting duly called for the purpose;

(b) the secretary’s record of the minutes of the meeting, which shall include the list of all
members present, the votes cast, the purpose of the special assessment or fees and the recipient
of such assessment or fees; and (c) individual written authorizations for check-off duly signed by
the employees concerned. In the present case, however, PEU-

NUWHRAIN failed to show compliance with the foregoing requirements. It attempted to remedy
the “inadvertent omission” of the matter of the approval of the deduction of two percent (2%)
union dues from the monthly basic salary of each union member.

While the matter of implementing the two percent (2%) union dues was taken up during the PEU-
NUWHRAIN’s 8th General Membership Meeting on October 28, 2008, there was no sufficient
showing that the same had been duly deliberated and approved. The minutes of the Assembly
itself belie PEU-NUWHRAIN’s claim that the increase in union dues and the corresponding check-
off were duly approved since it merely stated that “the [two percent (2%)] Union dues will have
to be implemented,” meaning, it would still require the submission of such matter to the
Assembly for deliberation and approval.

3.) Yes. Having failed to establish due deliberation and approval of the increase in union dues
from one percent ( 1 % ) to two percent (2% ), as well as the deduction of the two percent (2%)
union dues during PEU-NUWHRAIN’s 8th General Membership Meeting on October 28, 2008,
there was nothing to confirm, affirm, or ratify through the July 1, 2010 GMR. Contrary to the
ruling of the OSEC in its March 6, 2012 Order, the July 1 2010 GMR, by itself, cannot justify the
collection of two percent (2%) agency fees from the non-PEU members beginning July 2010. The
Assembly was not called for the purpose of approving the proposed increase in union dues and
the corresponding check-off, but merely to “confirm and affirm” a purported prior action which
PEU-NUWHRAIN, however, failed to establish.

Corollarily, no individual check-off authorizations can proceed therefrom, and the submission of
the November 2008 check-off authorizations becomes inconsequential. Jurisprudence states that
the express consent of the employee to any deduction in his compensation is required to be
obtained in accordance with the steps outlined by the law, which must be followed to the letter;
however, PEU-NUWHRAIN failed to comply. Thus, the CA correctly ruled that there is no legal
basis to impose union dues and agency fees more than that allowed in the expired CBA, .e., at
one percent (1 %) of the employee’s monthly basic salary.