CONTENTS

GUIJARNO VS CIR ........................................................................................................................................... 2

ELECTROMAT MANUFACTURING VS LAGUNAD .......................................................................................... 5
MARIWASA SIAM CERAMICS VS SOLE........................................................................................................ 12
COASTAL SUBIC BAY TERMINAL VS DOLE ................................................................................................. 18
PROGRESSIVE DEVELOPMENT CORP VS LAGUESMA ............................................................................. 25
SAN MIGUEL FOODS VS LAGUESMA .......................................................................................................... 38
ACEDERA VS INTERNATIONAL CONTAINER .............................................................................................. 44
MINETTE BAPTISTA ET AL VS ROSARIO VILLANUEVA .............................................................................. 48
EDEN GLADS ABARIA VS NLRC ................................................................................................................... 53
HERITAGE HOTEL MANILA VS PINAG-ISANG GLAING AT LAKAS ............................................................. 69

1
GUIJARNO VS CIR

Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. Nos. L-28791-93 August 27, 1973

VALENTIN GUIJARNO, HERMINIGILDO DE JUAN, NICOLAS CASUMPANG, ELEUTERIO BOBLO,

BENITO GUAVEZ, ARSENIO JEMENA, DIMAS BOCBOCILA, NICOLAS ALAMON, ISMAEL BILLONES,
RAYMUNDO ALAMON, SANTIAGO BAES, SOFRONIO CONCLARA, ADRIANO BIAS, AURELIO
ALAMON, SIMEON BERNIL, RESURRECION DIAZ, FELICIANO BELGIRA, FEDERICO BOSQUE, and
AGOSTO PULMONES,petitioners,
vs.
COURT OF INDUSTRIAL RELATIONS, CENTRAL SANTOS LOPEZ CO., INC. and UNITED SUGAR
WORKERS UNION-ILO respondents.

Pedrito A. Gianzon for petitioners.

Luis H. Garganera for private respondents.

FERNANDO, J.:

The failure of respondent Court of Industrial Relations to order the reinstatement of petitioners to their
employment gave rise to this appeal by way of certiorari. The need for resort to this Court could have been
obviated had there been no such marked inattention to the authoritative principle that a closed-shop provision
of a collective bargaining contract is not to be applied retroactively for, at the time the decision was
rendered on November 2, 1967 and its affirmance by a resolution of respondent Court en banc on January 22,
1968, such a doctrine was controlling and did call for application. So it was indicated in the leading case
of Confederated Sons of Labor v. Anakan Lumber and Co., 1 a 1960 decision. As a matter of law then, the
stand of petitioners is well-nigh impregnable. It would follow that their appeal must be sustained and
respondent Court must be reversed.

Three unfair labor practice cases for unlawful dismissal allegedly based on legitimate union activity were filed
against respondent Central Santos Lopez Co., Inc. and respondent United Sugar Workers Union-ILO, with
eight of the present petitioners as complainants in the first, 2 six of them in the second, 3 and five, in the
third. 4 There was a consolidated hearing and a consolidated decision not only for convenience, but also due to
there being hardly any difference as to the nature of the alleged grievance and the defense of management.
There was no question about the expulsion from respondent labor union of the former. In view of a closed-shop
provision in the then existing collective bargaining contract, respondent Central Santos Lopez Co., Inc.
assumed it had to dismiss them. So it was noted in the decision of the then associate Judge Joaquin M.
Salvador of respondent Court. Thus: "The respondent company, in its answer, alleged that the only reason for
the dismissal of the complainants herein is because their said dismissal was asked by the USWU-ILO of which
union respondent company has a valid and existing collective bargaining contract with a closed-shop provision
to the effect that those laborers who are no longer members of good standing in the union may be dismissed
by the respondent company if their dismissal is sought by the union; that respondent company has never
committed acts of unfair labor practice against its employees or workers much less against the complainants
herein but that it has a solemn obligation to comply with the terms and conditions of the contract; and that a
closed-shop agreement is sanctioned under this jurisdiction for such kind of agreement is expressly allowed
under the provisions of Republic Act 875 known as the Industrial Peace Act and the dismissal of complainants
is merely an exercise of a right allowed by said law." 5 There was no question, however, as to petitioners
having been employed by such respondent Company long before the collective bargaining contract, the first
instance noted being that of Resurrecion Diaz, who was in the service as far back as 1928; 6 Santiago Baez,
as far back as 1929; 7 Dimas Bocbocila, as far back as 1933; 8 Simeon Bernil, as far back as 1935; 9 Aurelio
Alamon, as far back as 1936; 10 Valentin Guijarno, as far back as 1937; 11 Benito Guavez, as far back as
1938; 12 Raymundo Alamon, as far back as 1939; 13 Eleuterio Boblo, Nicolas Alamon, Sofronio Conclara,
Adriano Bias and Federico Bosque, as far back as 1947;14 Herminigildo de Juan and Nicolas Casumpang, as
far back as 1948; 15 Agosto Pulmones, as far back as 1949; 16 and Feliciano Belgira, as far back as 1954. 17

2
In the decision of respondent Court, there was an acknowledgment of the prior existence of such employment
relationship. Nonetheless, the conclusion reached, both by the trial judge and then by respondent Court en
banc was that the dismissal was justifiable under the closed-shop provision of the collective bargaining
agreement. Hence, this petition for review, which, as noted at the outset, is impressed with merit.

1. The authoritative doctrine that a closed-shop provision in a collective bargaining agreement is not to be
given a retroactive effect so as to preclude its being applied to employees already in the service, is traceable,
as set forth in the opening paragraph of this opinion, to the leading case of Confederated Sons of Labor v.
Anakan Lumber Co. 18 decided in April of 1960. In discussing the particular stipulation in the contract, it was
made clear in the opinion of the then Justice, later Chief Justice, Concepcion: "In order that an employer may
be deemed bound, under a collective bargaining agreement, to dismiss employees for non-union membership,
the stipulation to this effect must be so clear and unequivocal as to leave no room for doubt thereon. An
undertaking of this nature is so harsh that it must be strictly construed, and doubts must be resolved against
the existence of "closed shop"." 19 Less than a year later, to be more precise, on January 28, 1961, in Freeman
Shirt Manufacturing Co., Inc. v. Court of Industrial Relations, 20 this Court, speaking through Justice Gutierrez
David, went further. Thus: "The closed-shop agreement authorized under sec. 4, subsec. a(4) of the Industrial
Peace Act above quoted should however, apply to persons to be hired or to employees who are not yet
members of any labor organization. It is inapplicable to those already in the service who are members of
another union. To hold otherwise, i. e., that the employees in a company who are members of a minority union
may be compelled to disaffiliate from their union and join the majority or contracting union, would render
nugatory the right of all employees to self-organization and to form, join or assist labor organizations of their
own choosing, a right guaranteed by the Industrial Peace Act (sec. 3, Rep. Act No. 875) as well as by the
Constitution (Art. III, sec. 1[6])." 21 Thereafter, in Kapisanan Ng Mga Mangagagawa Ng Alak v. Hamilton
Distillery Company, 22 this Court, again speaking through the former, minced no words in characterizing a
stipulation that would allow a dismissal of those already employed as "null and void." 23 In 1967, this time
already elevated to his position as head of the Court, Chief Justice Concepcion in Salunga v. Court of
Industrial Relations 24 did stress that while "generally, a state may not compel ordinary voluntary associations
to admit thereto any given individual, because membership therein may be accorded or withheld as a matter of
privilege, the rule is qualified in respect of labor unions holding a monopoly in the supply of labor, either in a
given locality, or as regards a particular employer with which it has a closed-shop agreement. ... ." 25 He
continued: "Consequently, it is well settled that such unions are not entitled to arbitrarily exclude qualified
applicants for membership, and a closed-shop provision would not justify the employer in discharging, or a
union in insisting upon the discharge of, an employee whom the union thus refuses to admit to membership,
without any reasonable ground therefor. Needless to say, if said unions may be compelled to
admitnew members, who have the requisite qualifications, with more reason may the law and the courts
exercise the coercive power when the employee involved is a long standing union member, who, owing to
provocations of union officers, was impelled to tender his resignation, which he forthwith withdrew or revoked.
Surely, he may, at least, invoke the rights of those who seek admission for the first time, and can not arbitrarily
be denied re-admission." 26

Nothing can be clearer therefore than that this Court looks with disfavor on a provision of this character being
utilized as an excuse for the termination of employment. To complete the picture, mention should be made of
Elegance, Inc. v. Court of Industrial Relations, 27 where this Court, through the present Acting Chief Justice
Makalintal, harked back to Freeman Shirt Manufacturing Co., Inc. v. Court of Industrial Relations 28 to stress
the point of non-retroactivity. What should be immediately apparent, but unfortunately respondent Court
seemed to have closed its eyes to it, is that when the decision was rendered by the trial judge on November 2,
1967 and affirmed with the Court sitting en banc on January 22, 1968, the controlling doctrine to which
deference ought to have been paid was that petitioners should not have been dismissed.

2. Nor is there anything unusual in this Court's adherence with remarkable consistency to such a basic
doctrine. The obligation was categorically imposed on the State, under the 1935 Constitution, to "afford
protection to labor, especially to working women and minors ... ." 29 That is to carry out the purpose implicit in
one of the five declared principles, namely, the promotion of social justice "to insure the well-being and
economic security of all the people ... ." 30 It is then the individual employee, as a separate, finite human being,
with his problems and his needs, who must be attended to. He is the beneficiary of the concern thus made
manifest by the fundamental law. The present Constitution is even more explicit on the matter. The principle
that the State shall promote social justice is categorically based on the concept of insuring "the dignity, welfare,
and security of all the people." 31 Insofar as the provision on the State affording protection to labor is
concerned, it is further required to "promote full employment and equality in employment, ensure equal work
opportunities regardless of sex, race, or creed, and regulate the relations between workers and employers.
The State shall assure the rights of workers to self-organization, collective bargaining, security of tenure, and
just and humane conditions of work." 32 Where does that leave a labor union, it may be asked. Correctly
understood, it is nothing but the means of assuring that such fundamental objectives would be achieved. It is
the instrumentality through which an individual laborer who is helpless as against a powerful employer may,
through concerted effort and activity, achieve the goal of economic well-being. That is the philosophy

3
underlying the Industrial Peace Act. 33 For, rightly has it been said that workers unorganized are weak;
workers organized are strong. Necessarily then, they join labor unions. To further increase the effectiveness of
such organizations, a closed-shop has been allowed. 34 It could happen, though, that such a stipulation which
assures further weight to a labor union at the bargaining table could be utilized against minority groups or
individual members thereof. There are indications that such a deplorable situation did so manifest itself here.
Respondent Court, it would appear, was not sufficiently alert to such a danger. What is worse, it paid no heed
to the controlling doctrine which is merely a recognition of a basic fact in life, namely, that power in a collectivity
could be the means of crushing opposition and stifling the voices of those who are in dissent. The right to join
others of like persuasion is indeed valuable. An individual by himself may feel inadequate to meet the
exigencies of life or even to express his personality without the right to association being vitalized. It could
happen though that whatever group may be in control of the organization may simply ignore his most-
cherished desires and treat him as if he counts for naught. The antagonism between him and the group
becomes marked. Dissatisfaction if given expression may be labeled disloyalty. In the labor field, the union
under such circumstances may no longer be a haven of refuge, but indeed as much of a potential foe as
management itself. Precisely with the Anakan doctrine, such an undesirable eventuality has been sought to be
minimized, if not entirely avoided. There is no justification then, both as a matter of precedent and as a matter
of principle, for the decision reached by respondent Court.

3. Now as to the remedy to which petitioners are entitled. Clearly, they should be reinstated with back pay. In
Salunga v. Court of Industrial Relations, 35 reinstatement was ordered but it was the labor union that was held
liable for the back wages. That is a rule dictated by fairness because management, in this case respondent
Central Santos Lopez Company, Inc., would not have taken the action it did had it not been for the insistence
of the labor union seeking to give effect to its interpretation of a closed-shop provision. As we decided then, so
do we now. These words of the Chief Justice in Salunga carry persuasion: "Just the same, having been denied
re-admission into the Union and having been dismissed from the service owing to an unfair labor practice on
the part of the Union, petitioner is entitled to reinstatement as member of the Union and to his former or
substantially equivalent position in the Company, without prejudice to his seniority and/or rights and privileges,
and with back pay, which back pay shall be borne exclusively by the Union. In the exercise of its sound
judgment and discretion, the lower court may, however, take such measures as it may deem best, including
the power to authorize the Company to make deductions, for petitioner's benefit, from the sums due to the
Union, by way of check off or otherwise, with a view to executing this decision, and, at the same time
effectuating the purposes of the Industrial Peace Act." 36

WHEREFORE, the decision of respondent Court of November 2, 1967 and the resolution of respondent
Court en banc sustaining the same of January 2, 1968 are hereby reversed. Respondent Central Lopez Co.,
Inc. is hereby ordered to reinstate petitioners to the positions they occupied prior to their illegal dismissal, with
back wages to be paid by respondent United Sugar Workers Union-ILO, deducting therefrom whatever wages
they may have earned in the meanwhile. With costs against private respondents.

4
ELECTROMAT MANUFACTURING VS LAGUNAD

SECOND DIVISION

ELECTROMAT MANUFACTURING and G. R. No. 172699

RECORDING CORPORATION,
Petitioner,

- versus -

Present:

CARPIO, J.,
HON. CIRIACO LAGUNZAD, in his capacity Chairperson,
as Regional Director, National Capital LEONARDO-DE CASTRO,*
Region, Department of Labor and BRION,
Employment; and HON. HANS LEO J. PERALTA,** and
CACDAC, in his capacity as Director of PEREZ, JJ.
Bureau of Labor Relations, Department of
Labor and Employment, Promulgated:
Public Respondents.
July 27, 2011
NAGKAKAISANG SAMAHAN NG
MANGGAGAWA NG ELECTROMAT-
WASTO,
Private Respondent.
x----------------------------------------------------------------------------------------x

DECISION

BRION, J.:

We resolve the present petition for review on certiorari[1] assailing the decision[2] and the resolution[3] of the
Court of Appeals (CA) dated February 3, 2006 and May 11, 2006, respectively, rendered in CA G.R. SP No.
83847.

The Antecedents

The private respondent Nagkakaisang Samahan ng Manggagawa ng Electromat-Wasto (union), a charter

affiliate of the Workers Advocates for Struggle, Transformation and Organization (WASTO), applied for
registration with the Bureau of Labor Relations (BLR). Supporting the application were the following
documents: (1) copies of its ratified constitution and by-laws (CBL); (2) minutes of the CBLs adoption and
ratification; (3) minutes of the organizational meetings; (4) names and addresses of the union officers; (5) list of
union members; (6) list of rank-and-file employees in the company; (7) certification of non-existence of a
collective bargaining agreement (CBA) in the company; (8) resolution of affiliation with WASTO, a labor
federation; (9) WASTOs resolution of acceptance; (10) Charter Certificate; and (11) Verification under oath.

5
The BLR thereafter issued the union a Certification of Creation of Local Chapter (equivalent to the certificate of
registration of an independent union), pursuant to Department Order No. (D.O.) 40-03.[4]

On October 1, 2003, the petitioner Electromat Manufacturing and Recording Corporation (company) filed a
petition for cancellation of the unions registration certificate, for the unions failure to comply with Article 234 of
the Labor Code. It argued that D.O. 40-03 is an unconstitutional diminution of the Labor Codes union
registration requirements under Article 234.

On November 27, 2003, Acting Director Ciriaco A. Lagunzad of the Department of Labor and Employment
(DOLE)-National Capital Region dismissed the petition.[5]

In the appeal by the company, BLR Director Hans Leo J. Cacdac affirmed the dismissal.[6] The company
thereafter sought relief from the CA through a petition for certiorari, contending that the BLR committed grave
abuse of discretion in affirming the unions registration despite its non-compliance with the requirements for
registration under Article 234 of the Labor Code. It assailed the validity of D.O. 40-03 which amended the rules
of Book V (Labor Relations) of the Labor Code. It posited that the BLR should have strictly adhered to the
union registration requirements under the Labor Code, instead of relying on D.O. 40-03 which it considered as
an invalid amendment of the law since it reduced the requirements under Article 234 of the Labor Code. It
maintained that the BLR should not have granted the unions registration through the issuance of a Certification
of Creation of Local Chapter since the union submitted only the Charter Certificate issued to it by WASTO.

The CA Decision

In its decision rendered on February 3, 2006,[7] the CA Tenth Division dismissed the petition and affirmed the
assailed BLR ruling. It brushed aside the companys objection to D.O. 40-03, and its submission that D.O. 40-
03 removed the safety measures against the commission of fraud in the registration of unions. It noted that
there are sufficient safeguards found in other provisions of the Labor Code to prevent the same. [8] In any event,
it pointed out that D.O. 40-03 was issued by the DOLE pursuant to its rule-making power under the law.[9]

The company moved for reconsideration, arguing that the unions registration certificate was invalid as there
was no showing that WASTO, the labor federation to which the union is affiliated, had at least ten (10) locals or
chapters as required by D.O. 40-03. The CA denied the motion,[10] holding that no such requirement is found
under the rules. Hence, the present petition.

The Case for the Petitioner

6
The company seeks a reversal of the CA rulings, through its submissions (the petition[11] and the
memorandum[12]), on the ground that the CA seriously erred and gravely abused its discretion in affirming the
registration of the union in accordance with D.O. 40-03. Specifically, it assails as unconstitutional Section 2(E),
Rule III of D.O. 40-03 which provides:

The report of creation of a chartered local shall be accompanied by a charter certificate

issued by the federation or national union indicating the creation or establishment of the
chartered local.

The company points out that D.O. 40-03 delisted some of the requirements under Article 234 of the Labor
Code for the registration of a local chapter. Article 234 states:

ART. 234. Requirements of Registration.[13] Any applicant labor organization, association or

group of unions or workers shall acquire legal personality and shall be entitled to the rights and
privileges granted by law to legitimate labor organizations upon issuance of the certificate of
registration based on the following requirements:

(a) Fifty pesos (P50.00) registration fee;

(b) The names of its officers, their addresses, the principal address of the labor
organization, the minutes of the organizational meetings and the list of the
workers who participated in such meetings;

(c) The names of all its members comprising at least twenty percent (20%) of
all the employees in the bargaining unit where it seeks to operate;

(d) If the applicant union has been in existence for one or more years, copies of
its annual financial reports; and

(e) Four (4) copies of the constitution and by-laws of the applicant union,
minutes of its adoption or ratification, and the list of the members who
participated in it.

The company contends that the enumeration of the requirements for union registration under the law is
exclusive and should not be diminished, and that the same requirements should apply to all labor unions
whether they be independent labor organizations, federations or local chapters. It adds that in making a
different rule for local chapters, D.O. 40-03 expanded or amended Article 234 of the Labor Code, resulting in
an invalid exercise by the DOLE of its delegated rule-making power. It thus posits that the unions certificate of

7
registration which was issued in violation of the letters of Article 234 of the Labor Code[14] is void and of no
effect, and that the CA committed grave abuse of discretion when it affirmed the unions existence.

The Case for the Union

In a Resolution dated January 16, 2008,[15] the Court directed union board member Alex Espejo, in lieu of
union President Roberto Beltran whose present address could not be verified, to furnish the Court a copy of
the union comment/opposition to the companys motion for reconsideration dated February 22, 2006 in CA G.R.
SP No. 83847, which the union adopted as its comment on the present petition.[16]

Through this comment/opposition,[17] the union submits that the company failed to show that the CA
committed reversible error in upholding the registration certificate issued to it by the BLR. Citing Castillo v.
National Labor Relations Commission,[18] it stressed that the issuance of the certificate by the DOLE agencies
was supported by substantial evidence, which should be entitled to great respect and even finality.

The Courts Ruling

We resolve the core issue of whether D.O. 40-03 is a valid exercise of the rule-making power of
the DOLE.

We rule in the affirmative. Earlier in Progressive Development Corporation v. Secretary, Department

of Labor and Employment,[19] the Court encountered a similar question on the validity of the old Section 3, Rule
II, Book V of the Rules Implementing the Labor Code[20] which stated:

Union affiliation; direct membership with a national union. - The affiliate of a labor
federation or national union may be a local or chapter thereof or an independently registered
union.

a) The labor federation or national union concerned shall issue a charter certificate
indicating the creation or establishment of a local or chapter, copy of which shall be
submitted to the Bureau of Labor Relations within thirty (30) days from issuance of
such charter certificate.

xxxx

e) The local or chapter of a labor federation or national union shall have and maintain a
constitution and by-laws, set of officers and books of accounts. For reporting

8
 purposes, the procedure governing the reporting of independently registered unions,
federations or national unions shall be observed.

Interpreting these provisions of the old rules, the Court said that by force of law, [21] the local or chapter
of a labor federation or national union becomes a legitimate labor organization upon compliance with Section
3, Rule II, Book V of the Rules Implementing the Labor Code, the only requirement being the submission of the
charter certificate to the BLR. Further, the Court noted that Section 3 omitted several requirements which are
otherwise required for union registration, as follows:

1) The requirement that the application for registration must be signed by at least
20% of the employees in the appropriate bargaining unit;

2) The submission of officers addresses, principal address of the labor organization,

the minutes of organization meetings and the list of the workers who participated in
such meetings;

3) The submission of the minutes of the adoption or ratification of the constitution and
by-laws and the list of the members who participated in it.[22]

Notwithstanding these omissions, the Court upheld the governments implementing policy expressed in
the old rules when it declared in Progressive Development

Undoubtedly, the intent of the law in imposing lesser requirements in the case of a branch or
local of a registered federation or national union is to encourage the affiliation of a local union
with a federation or national union in order to increase the local unions bargaining powers
respecting terms and conditions of labor.[23]

It was this same Section 3 of the old rules that D.O. 40-03 fine-tuned when the DOLE amended the rules on
Book V of the Labor Code, thereby modifying the governments implementing policy on the registration of locals
or chapters of labor federations or national unions. The company now assails this particular amendment as an
invalid exercise of the DOLEs rule-making power.

We disagree. As in the case of D.O. 9 (which introduced the above-cited Section 3 of the old rules)
in Progressive Development, D.O. 40-03 represents an expression of the governments implementing policy on
trade unionism. It builds upon the old rules by further simplifying the requirements for the establishment of
locals or chapters. As in D.O. 9, we see nothing contrary to the law or the Constitution in the adoption by the

9
Secretary of Labor and Employment of D.O. 40-03 as this department order is consistent with the intent of the
government to encourage the affiliation of a local union with a federation or national union to enhance the
locals bargaining power. If changes were made at all, these were those made to recognize the distinctions
made in the law itself between federations and their local chapters, and independent unions; local chapters
seemingly have lesser requirements because they and their members are deemed to be direct members of the
federation to which they are affiliated, which federations are the ones subject to the strict registration
requirements of the law.

In any case, the local union in the present case has more than satisfied the requirements the petitioner
complains about; specifically, the union has submitted: (1) copies of the ratified CBL; (2) the minutes of the
CBLs adoption and ratification; (3) the minutes of the organizational meetings; (4) the names and addresses of
the union officers; (5) the list of union members; (6) the list of rank-and-file employees in the company; (7) a
certification of non-existence of a CBA in the company; (8) the resolution of affiliation with WASTO and the
latters acceptance; and (9) their Charter Certificate. These submissions were properly verified as required by
the rules. In sum, the petitioner has no factual basis for questioning the unions registration, as even the
requirements for registration as an independent local have been substantially complied with.

We, thus, find no compelling justification to nullify D.O. 40-03. Significantly, the Court declared in
another case:[24]

Pagpalain cannot also allege that Department Order No. 9 is violative of public policy. x x x
[T]he sole function of our courts is to apply or interpret the laws. It does not formulate public
policy, which is the province of the legislative and executive branches of government. It cannot,
thus, be said that the principles laid down by the Court in Progressive and Protection
Technology constitute public policy on the matter. They do, however, constitute the Courts
interpretation of public policy, as formulated by the executive department through its
promulgation of rules implementing the Labor Code. However, this public policy has itself been
changed by the executive department, through the amendments introduced in Book V of the
Omnibus Rules by Department Order No. 9. It is not for us to question this change in policy, it
being a well-established principle beyond question that it is not within the province of the courts
to pass judgments upon the policy of legislative or executive action.

This statement is as true then as it is now.

In light of the foregoing, we find no merit in the appeal.

WHEREFORE, premises considered, we DENY the petition for lack of merit. The assailed decision and
resolution of the Court of Appeals are AFFIRMED. Costs against the petitioner Electromat Manufacturing and
Recording Corporation.

SO ORDERED.
10
11
MARIWASA SIAM CERAMICS VS SOLE

THIRD DIVISION

MARIWASA SIAM CERAMICS, INC., G.R. No. 183317

Petitioner,

Present:

CORONA, J.,

Chairperson,
- versus -
VELASCO, JR.,

NACHURA,

PERALTA, and

DEL CASTILLO,* JJ.

THE SECRETARY OF THE DEPARTMENT OF

LABOR AND EMPLOYMENT, CHIEF OF THE
BUREAU OF LABOR RELATIONS,
DEPARTMENT OF LABOR AND EMPLOYMENT,
REGIONAL DIRECTOR OF DOLE REGIONAL
OFFICE NUMBER IV-A &

SAMAHAN NG MGA MANGGAGAWA SA

MARIWASA SIAM CERAMICS, INC. (SMMSC-
INDEPENDENT),

Respondents.

Promulgated:

December 21, 2009

x------------------------------------------------------------------------------------x

DECISION

NACHURA, J.:

12
This is a petition for review on certiorari[1] under Rule 45 of the Rules of Court, seeking to annul the
Decision[2] dated December 20, 2007 and the Resolution[3] dated June 6, 2008 of the Court of Appeals in CA-
G.R. SP No. 98332.

The antecedent facts are as follows

On May 4, 2005, respondent Samahan Ng Mga Manggagawa Sa Mariwasa Siam Ceramics, Inc. (SMMSC-
Independent) was issued a Certificate of Registration[4] as a legitimate labor organization by the Department of
Labor and Employment (DOLE), Region IV-A.

On June 14, 2005, petitioner Mariwasa Siam Ceramics, Inc. filed a Petition for Cancellation of Union
Registration against respondent, claiming that the latter violated Article 234[5] of the Labor Code for not
complying with the 20% requirement, and that it committed massive fraud and misrepresentation in violation of
Article 239[6] of the same code.The case was docketed as Case No. RO400-0506-AU-004.

On August 26, 2005, the Regional Director of DOLE IV-A issued an Order granting the petition, revoking the
registration of respondent, and delisting it from the roster of active labor unions.

Aggrieved, respondent appealed to the Bureau of Labor Relations (BLR).

In a Decision[7] dated June 14, 2006, the BLR granted respondents appeal and disposed as follows

WHEREFORE, premises considered, the appeal by Samahan ng Manggagawa sa Mariwasa

Siam Ceramics, Inc. (SMMSC-Independent) is hereby GRANTED, and the Decision dated 26
August 2005 by DOLE-Region-IV-A Director Maximo B. Lim is hereby REVERSED and SET
ASIDE. Samahan ng Manggagawa sa Mariwasa Siam Ceramics, Inc. (SMMSC-Independent),
under Registration Certificate No. RO400-200505-UR-002, remains in the roster of legitimate
labor organizations.

SO DECIDED.[8]

Petitioner filed a Motion for Reconsideration but the BLR denied it in a Resolution[9] dated February 2, 2007.

Petitioner sought recourse with the Court of Appeals (CA) through a Petition for Certiorari; but the CA denied
the petition for lack of merit.

13
Petitioners motion for reconsideration of the CA Decision was likewise denied, hence, this petition based on
the following grounds

Review of the Factual Findings of the Bureau of Labor Relations, adopted and confirmed
by the Honorable Court of Appeals is warranted[;]

The Honorable Court of Appeals seriously erred in ruling that the affidavits of recantation
cannot be given credence[;]

The Honorable Court of Appeals seriously erred in ruling that private respondent union
complied with the 20% membership requirement[; and]

The Honorable Court of Appeals seriously erred when it ruled that private respondent
union did not commit misrepresentation, fraud or false statement.[10]

The petition should be denied.

The petitioner insists that respondent failed to comply with the 20% union membership requirement for its
registration as a legitimate labor organization because of the disaffiliation from the total number of union
members of 102 employees who executed affidavits recanting their union membership.

It is, thus, imperative that we peruse the affidavits appearing to have been executed by these affiants.

The affidavits uniformly state

Ako, _____________, Pilipino, may sapat na gulang, regular na empleyado bilang Rank & File
sa Mariwasa Siam Ceramics, Inc., Bo. San Antonio, Sto. Tomas, Batangas, matapos na
makapanumpa ng naaayon sa batas ay malaya at kusang loob na nagsasaad ng mga
sumusunod:

1. Ako ay napilitan at nilinlang sa pagsapi sa Samahan ng mga Manggagawa sa Mariwasa

Siam Ceramics, Inc. o SMMSC-Independent sa kabila ng aking pag-aalinlangan[;]

2. Aking lubos na pinagsisihan ang aking pagpirma sa sipi ng samahan, at handa ako[ng]
tumalikod sa anumang kasulatan na aking nalagdaan sa kadahilanan na hindi angkop
sa aking pananaw ang mga mungkahi o adhikain ng samahan.

14
 SA KATUNAYAN NANG LAHAT, ako ay lumagda ng aking pangalan ngayong ika-____
ng ______, 2005 dito sa Lalawigan ng Batangas, Bayan ng Sto. Tomas.

____________________

Nagsasalaysay

Evidently, these affidavits were written and prepared in advance, and the pro forma affidavits were ready to be
filled out with the employees names and signatures.

The first common allegation in the affidavits is a declaration that, in spite of his hesitation, the affiant
was forced and deceived into joining the respondent union. It is worthy to note, however, that the affidavit does
not mention the identity of the people who allegedly forced and deceived the affiant into joining the union,
much less the circumstances that constituted such force and deceit. Indeed, not only was this allegation
couched in very general terms and sweeping in nature, but more importantly, it was not supported by any
evidence whatsoever.

The second allegation ostensibly bares the affiants regret for joining respondent union and expresses
the desire to abandon or renege from whatever agreement he may have signed regarding his membership with
respondent.

Simply put, through these affidavits, it is made to appear that the affiants recanted their support of
respondents application for registration.

In appreciating affidavits of recantation such as these, our ruling in La Suerte Cigar and Cigarette
Factory v. Director of the Bureau of Labor Relations[11] is enlightening,viz.

On the second issuewhether or not the withdrawal of 31 union members from NATU affected
the petition for certification election insofar as the 30% requirement is concerned, We reserve
the Order of the respondent Director of the Bureau of Labor Relations, it appearing undisputably
that the 31 union members had withdrawn their support to the petition before the filing of said
petition. It would be otherwise if the withdrawal was made after the filing of the petition for it
would then be presumed that the withdrawal was not free and voluntary. The presumption would
arise that the withdrawal was procured through duress, coercion or for valuable
consideration. In other words, the distinction must be that withdrawals made before the filing of
the petition are presumed voluntary unless there is convincing proof to the contrary, whereas
withdrawals made after the filing of the petition are deemed involuntary.

The reason for such distinction is that if the withdrawal or retraction is made before the filing of
the petition, the names of employees supporting the petition are supposed to be held secret to

15
 the opposite party. Logically, any such withdrawal or retraction shows voluntariness in the
absence of proof to the contrary. Moreover, it becomes apparent that such employees had not
given consent to the filing of the petition, hence the subscription requirement has not been met.

When the withdrawal or retraction is made after the petition is filed, the employees who are
supporting the petition become known to the opposite party since their names are attached to
the petition at the time of filing. Therefore, it would not be unexpected that the opposite party
would use foul means for the subject employees to withdraw their support.[12]

In the instant case, the affidavits of recantation were executed after the identities of the union members
became public, i.e., after the union filed a petition for certification election on May 23, 2005, since the names of
the members were attached to the petition. The purported withdrawal of support for the registration of the union
was made after the documents were submitted to the DOLE, Region IV-A. The logical conclusion, therefore,
following jurisprudence, is that the employees were not totally free from the employers pressure, and so the
voluntariness of the employees execution of the affidavits becomes suspect.

It is likewise notable that the first batch of 25 pro forma affidavits shows that the affidavits were executed by
the individual affiants on different dates from May 26, 2005 untilJune 3, 2005, but they were all sworn before a
notary public on June 8, 2005.

There was also a second set of standardized affidavits executed on different dates from May 26,
2005 until July 6, 2005. While these 77 affidavits were notarized on different dates, 56 of these were notarized
on June 8, 2005, the very same date when the first set of 25 was notarized.

Considering that the first set of 25 affidavits was submitted to the DOLE on June 14, 2005, it is
surprising why petitioner was able to submit the second set of affidavits only on July 12, 2005.

Accordingly, we cannot give full credence to these affidavits, which were executed under suspicious
circumstances, and which contain allegations unsupported by evidence. At best, these affidavits are self-
serving. They possess no probative value.

A retraction does not necessarily negate an earlier declaration. For this reason, retractions are looked upon
with disfavor and do not automatically exclude the original statement or declaration based solely on the
recantation. It is imperative that a determination be first made as to which between the original and the new
statements should be given weight or accorded belief, applying the general rules on evidence. In this case,
inasmuch as they remain bare allegations, the purported recantations should not be upheld.[13]

Nevertheless, even assuming the veracity of the affidavits of recantation, the legitimacy of respondent as a
labor organization must be affirmed. While it is true that the withdrawal of support may be considered as a
resignation from the union, the fact remains that at the time of the unions application for registration, the
affiants were members of respondent and they comprised more than the required 20% membership for

16
purposes of registration as a labor union. Article 234 of the Labor Code merely requires a 20% minimum
membership during the application for union registration. It does not mandate that a union must maintain the
20% minimum membership requirement all throughout its existence.[14]

Respondent asserts that it had a total of 173 union members at the time it applied for registration. Two names
were repeated in respondents list and had to be deducted, but the total would still be 171 union
members. Further, out of the four names alleged to be no longer connected with petitioner, only two names
should be deleted from the list since Diana Motilla and T.W. Amutan resigned from petitioner only on May 10,
2005 and May 17, 2005, respectively, or after respondents registration had already been granted. Thus, the
total union membership at the time of registration was 169. Since the total number of rank-and-file employees
at that time was 528, 169 employees would be equivalent to 32% of the total rank-and-file workers
complement, still very much above the minimum required by law.

For the purpose of de-certifying a union such as respondent, it must be shown that there was
misrepresentation, false statement or fraud in connection with the adoption or ratification of the constitution and
by-laws or amendments thereto; the minutes of ratification; or, in connection with the election of officers, the
minutes of the election of officers, the list of voters, or failure to submit these documents together with the list
of the newly elected-appointed officers and their postal addresses to the BLR.[15]

The bare fact that two signatures appeared twice on the list of those who participated in the
organizational meeting would not, to our mind, provide a valid reason to cancel respondents certificate of
registration. The cancellation of a unions registration doubtless has an impairing dimension on the right of labor
to self-organization. For fraud and misrepresentation to be grounds for cancellation of union registration under
the Labor Code, the nature of the fraud and misrepresentation must be grave and compelling enough to vitiate
the consent of a majority of union members.

In this case, we agree with the BLR and the CA that respondent could not have possibly committed
misrepresentation, fraud, or false statements. The alleged failure of respondent to indicate with mathematical
precision the total number of employees in the bargaining unit is of no moment, especially as it was able to
comply with the 20% minimum membership requirement. Even if the total number of rank-and-file employees
of petitioner is 528, while respondent declared that it should only be 455, it still cannot be denied that the latter
would have more than complied with the registration requirement.

WHEREFORE, the petition is DENIED. The assailed December 20, 2007 Decision and the June 6,
2008 Resolution of the Court of Appeals are AFFIRMED. Costs against petitioner.

SO ORDERED.

17
 COASTAL SUBIC BAY TERMINAL VS DOLE

THIRD DIVISION

COASTAL SUBIC BAY TERMINAL, INC., G.R. No. 157117

Petitioner,

Present:

QUISUMBING, J., Chairperson,

CARPIO,

- versus - CARPIO MORALES,

TINGA, and

VELASCO, JR., JJ.

DEPARTMENT OF LABOR and

EMPLOYMENT OFFICE OF THE
SECRETARY, COASTAL SUBIC BAY
TERMINAL, INC. SUPERVISORY UNION-
APSOTEU, and COASTAL SUBIC BAY
TERMINAL, INC. RANK-AND-FILE UNION-
ALU-TUCP,
Promulgated:
Respondents.

November 20, 2006

x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION
QUISUMBING, J.:

For review on certiorari is the Court of Appeals Decision[1] dated August 31, 2001, in CA-G.R. SP No. 54128
and the Resolution[2] dated February 5, 2003, denying petitioners motion for reconsideration. The Court of
Appeals had affirmed the Decision[3] dated March 15, 1999 of the Secretary of the Department of Labor and
Employment (DOLE) reversing the Mediator Arbiters dismissal of private respondents petitions for certification
election.

The facts are as follows:

On July 8, 1998, private respondents Coastal Subic Bay Terminal, Inc. Rank-and-File Union (CSBTI-
RFU) and Coastal Subic Bay Terminal, Inc. Supervisory Union (CSBTI-SU) filed separate petitions for

18
certification election before Med-Arbiter Eladio de Jesus of the Regional Office No. III. The rank-and-file union
insists that it is a legitimate labor organization having been issued a charter certificate by the Associated Labor
Union (ALU), and the supervisory union by the Associated Professional, Supervisory, Office and Technical
Employees Union (APSOTEU). Private respondents also alleged that the establishment in which they sought to
operate was unorganized.

Petitioner Coastal Subic Bay Terminal, Inc. (CSBTI) opposed both petitions for certification election
alleging that the rank-and-file union and supervisory union were not legitimate labor organizations, and that the
proposed bargaining units were not particularly described.

Without ruling on the legitimacy of the respondent unions, the Med-Arbiter dismissed, without prejudice
to refiling, both petitions which had been consolidated. The Med-Arbiter held that the ALU and APSOTEU are
one and the same federation having a common set of officers. Thus, the supervisory and the rank-and-file
unions were in effect affiliated with only one federation.[4]

The Med-Arbiter ruled as follows:

Viewed in the light of all the foregoing, this Office finds the simultaneous filing of the
instant petitions to be invalid and unwarranted. Consequently, this Office has no recourse but to
dismiss both petitions without prejudice to the refiling of either.

WHEREFORE, PREMISES CONSIDERED, let the instant petitions be, as they are
hereby DISMISSED.

SO ORDERED.[5]

Both parties appealed to the Secretary of Labor and Employment, who reversed the decision of the
Med-Arbiter. The Secretary thru Undersecretary R. Baldoz, ruled that CSBTI-SU and CSBTI-RFU have
separate legal personalities to file their separate petitions for certification election. The Secretary held that
APSOTEU is a legitimate labor organization because it was properly registered pursuant to the 1989 Revised
Rules and Regulations implementing Republic Act No. 6715, the rule applicable at the time of its registration. It
further ruled that ALU and APSOTEU are separate and distinct labor unions having separate certificates of
registration from the DOLE. They also have different sets of locals. The Secretary declared CSBTI-RFU and
CSBTI-SU as legitimate labor organizations having been chartered respectively by ALU and APSOTEU after
submitting all the requirements with the Bureau of Labor Relations (BLR). Accordingly, the Secretary ordered
the holding of separate certification election, viz:

WHEREFORE, the decision of the Med-Arbiter, Regional Office No. III is hereby
REVERSED. Let separate certification elections be conducted immediately among the
appropriate employees of CSBTI, after the usual pre-election conference, with the following
choices:

I. For all rank and file employees of CSBTI:

1. COASTAL SUBIC BAY TERMINAL, INC. RANK-AND-FILE UNION-ALU-TUCP;

and

2. NO UNION.
19
 II. For all supervisory employees of CSBTI:

1. COASTAL SUBIC BAY TERMINAL, INC. SUPERVISORY EMPLOYEES UNION-

APSOTEU; and

2. NO UNION.

The latest payroll of the employer, including its payrolls for the last three months
immediately preceding the issuance of this decision, shall be the basis for determining the
qualified list of voters.

SO DECIDED.[6]

The motion for reconsideration was also denied.[7]

On appeal, the Court of Appeals affirmed the decision of the Secretary.[8] It held that there was no
grave abuse of discretion on the part of the Secretary; its findings are supported by evidence on record; and
thus should be accorded with respect and finality.[9]

The motion for reconsideration was likewise denied.[10] Hence, the instant petition by the company
anchored on the following grounds:

THE HONORABLE COURT OF APPEALS ERRED IN RELYING ON THE 1989

REVISED RULES AND REGULATIONS IMPLEMENTING RA 6715 AS BASIS TO
RECOGNIZE PRIVATE RESPONDENT APSOTEUS REGISTRATION BY THE DOLE
REGIONAL DIRECTOR.

II

THE HONORABLE COURT OF APPEALS ERRED WHEN IT AFFIRMED PUBLIC

RESPONDENTS APPLICATION OF THE PRINCIPLE OF STARE DECISIS TO HASTILY
DISPOSE OF THE LEGAL PERSONALITY ISSUE OF APSOTEU.

III

THE HONORABLE COURT OF APPEALS DID NOT DECIDE IN ACCORD WITH LAW
AND JURISPRUDENCE WHEN IT AFFIRMED PUBLIC RESPONDENTS APPLICATION OF
THE UNION AUTONOMY THEORY.

IV

IN AFFIRMING PUBLIC RESPONDENTS FINDING THAT PRIVATE RESPONDENTS

ARE SEPARATE FEDERATIONS, THE HONORABLE COURT OF APPEALS:

(1) IGNORED JURISPRUDENCE RECOGNIZING THE BINDING NATURE OF A MED-

ARBITERS FACTUAL FINDINGS; AND

(2) DISREGARDED EVIDENCE ON RECORD OF ILLEGAL COMMINGLING.[11]

20
Plainly, the issues are (1) Can the supervisory and the rank-and-file unions file separate petitions for
certification election?; (2) Was the Secretarys decision based on stare decisiscorrect?; and (3) Were private
respondents engaged in commingling?

The issue on the status of the supervisory union CSBTI-SU depends on the status of APSOTEU, its mother
federation.

Petitioner argues that APSOTEU improperly secured its registration from the DOLE Regional Director
and not from the BLR; that it is the BLR that is authorized to process applications and issue certificates of
registration in accordance with our ruling in Phil. Association of Free Labor Unions v. Secretary of
Labor;[12] that the certificates of registration issued by the DOLE Regional Director pursuant to the rules are
questionable, and possibly even void ab initio for being ultra vires; and that the Court of Appeals erred when it
ruled that the law applicable at the time of APSOTEUs registration was the 1989 Revised Implementing Rules
and Regulations of Rep. Act No. 6715.

Petitioner insists that APSOTEU lacks legal personality, and its chartered affiliate CSBTI-SU cannot
attain the status of a legitimate labor organization to file a petition for certification election. It relies
on Villar v. Inciong,[13] where we held therein that Amigo Employees Union was not a duly registered
independent union absent any record of its registration with the Bureau.

Pertinent is Article 235[14] of the Labor Code which provides that applications for registration shall be
acted upon by the Bureau. Bureau as defined under the Labor Code means the BLR and/or the Labor
Relations Division in the Regional Offices of the Department of Labor. [15] Further, Section 2, Rule II, Book V of
the 1989 Revised Implementing Rules of the Labor Code (Implementing Rules) provides that:

Section 2. Where to file application; procedure Any national labor organization or labor
federation or local union may file an application for registration with the Bureau or the Regional
Office where the applicants principal offices is located. The Bureau or the Regional Office shall
immediately process and approve or deny the application. In case of approval, the Bureau or
the Regional Office shall issue the registration certificate within thirty (30) calendar days from
receipt of the application, together with all the requirements for registration as hereinafter
provided.[16]

The Implementing Rules specifically Section 1, Rule III of Book V, as amended by Department Order
No. 9, thus:

SECTION 1. Where to file applications. The application for registration of any

federation, national or industry union or trade union center shall be filed with the Bureau. Where
the application is filed with the Regional Office, the same shall be immediately forwarded to the
Bureau within forty-eight (48) hours from filing thereof, together with all the documents
supporting the registration.

The applications for registration of an independent union shall be filed with and acted
upon by the Regional Office where the applicants principal office is located .

xxxx

21
 The DOLE issued Department Order No. 40-03, which took effect on March 15, 2003, further amending
Book V of the above implementing rules. The new implementing rules explicitly provide that applications for
registration of labor organizations shall be filed either with the Regional Office or with the BLR.[17]

Even after the amendments, the rules did not divest the Regional Office and the BLR of their jurisdiction
over applications for registration by labor organizations. The amendments to the implementing rules merely
specified that when the application was filed with the Regional Office, the application would be acted upon by
the BLR.

The records in this case showed that APSOTEU was registered on March 1, 1991. Accordingly, the law
applicable at that time was Section 2, Rule II, Book V of the Implementing Rules, and not Department Order
No. 9 which took effect only on June 21, 1997. Thus, considering further that APSOTEUs principal office is
located in Diliman,Quezon City, and its registration was filed with the NCR Regional Office, the certificate of
registration is valid.

The petitioner misapplied Villar v. Inciong.[18] In said case, there was no record in the BLR that Amigo
Employees Union was registered.[19]

Did the Court of Appeals err in its application of stare decisis when it upheld the Secretarys ruling that
APSOTEU is a legitimate labor organization and its personality cannot be assailed unless in an independent
action for cancellation of registration certificate?[20]

We think not.

Section 5, Rule V, Book V of the Implementing Rules states:

Section 5. Effect of registration The labor organization or workers association shall be

deemed registered and vested with legal personality on the date of issuance of its certificate of
registration. Such legal personality cannot thereafter be subject to collateral attack, but maybe
questioned only in an independent petition for cancellation in accordance with these Rules.[21]

Thus, APSOTEU is a legitimate labor organization and has authority to issue charter to its
affiliates.[22] It may issue a local charter certificate to CSBTI-SU and correspondingly, CSBTI-SU is legitimate.

Are ALU, a rank-and-file union and APSOTEU, a supervisory union one and the same because of the
commonalities between them? Are they commingled?

The petitioner contends that applying by analogy, the doctrine of piercing the veil of corporate fiction,
APSOTEU and ALU are the same federation. Private respondents disagree.

22
 First, as earlier discoursed, once a labor union attains the status of a legitimate labor organization, it
continues as such until its certificate of registration is cancelled or revoked in an independent action for
cancellation.[23] In addition, the legal personality of a labor organization cannot be collaterally
attacked.[24] Thus, when the personality of the labor organization is questioned in the same manner the veil of
corporate fiction is pierced, the action partakes the nature of a collateral attack. Hence, in the absence of any
independent action for cancellation of registration against either APSOTEU or ALU, and unless and until their
registrations are cancelled, each continues to possess a separate legal personality. The CSBTI-RFU and
CSBTI-SU are therefore affiliated with distinct and separate federations, despite the commonalities of
APSOTEU and ALU.

Under the rules implementing the Labor Code, a chartered local union acquires legal personality
through the charter certificate issued by a duly registered federation or national union, and reported to the
Regional Office in accordance with the rules implementing the Labor Code.[25] A local union does not owe its
existence to the federation with which it is affiliated. It is a separate and distinct voluntary association owing its
creation to the will of its members. Mere affiliation does not divest the local union of its own personality, neither
does it give the mother federation the license to act independently of the local union. It only gives rise to a
contract of agency, where the former acts in representation of the latter. [26] Hence, local unions are considered
principals while the federation is deemed to be merely their agent.[27] As such principals, the unions are entitled
to exercise the rights and privileges of a legitimate labor organization, including the right to seek certification as
the sole and exclusive bargaining agent in the appropriate employer unit.

A word of caution though, under Article 245 of the Labor Code,[28] supervisory employees are not
eligible for membership in a labor union of rank-and-file employees. The supervisory employees are allowed to
form their own union but they are not allowed to join the rank-and-file union because of potential conflicts of
interest.[29] Further, to avoid a situation where supervisors would merge with the rank-and-file or where the
supervisors labor union would represent conflicting interests, a local supervisors union should not be allowed
to affiliate with the national federation of unions of rank-and-file employees where that federation actively
participates in the union activity within the company.[30] Thus, the limitation is not confined to a case of
supervisors wanting to join a rank-and-file union. The prohibition extends to a supervisors local union applying
for membership in a national federation the members of which include local unions of rank-and-file
employees.[31] In De La Salle University Medical Center and College of Medicine v. Laguesma, we reiterated
the rule that for the prohibition to apply, it is not enough that the supervisory union and the rank-and-file union
are affiliated with a single federation. In addition, the supervisors must have direct authority over the rank-and-
file employees.[32]

In the instant case, the national federations that exist as separate entities to which the rank-and-file and
supervisory unions are separately affiliated with, do have a common set of officers. In addition, APSOTEU, the
supervisory federation, actively participates in the CSBTI-SU while ALU, the rank-and-file federation, actively
participates in the CSBTI-RFU, giving occasion to possible conflicts of interest among the common officers of
the federation of rank-and-file and the federation of supervisory unions. For as long as they are affiliated with
the APSOTEU and ALU, the supervisory and rank-and-file unions both do not meet the criteria to attain the
status of legitimate labor organizations, and thus could not separately petition for certification elections.

23
 The purpose of affiliation of the local unions into a common enterprise is to increase the collective
bargaining power in respect of the terms and conditions of labor.[33]When there is commingling of officers of a
rank-and-file union with a supervisory union, the constitutional policy on labor is circumvented. Labor
organizations should ensure the freedom of employees to organize themselves for the purpose of leveling the
bargaining process but also to ensure the freedom of workingmen and to keep open the corridor of opportunity
to enable them to do it for themselves.

WHEREFORE, the petition is GRANTED. The Court of Appeals Decision dated August 31, 2001, in CA-G.R.
SP No. 54128 and the Resolution dated February 5, 2003 areSET ASIDE. The decision of the Med-Arbiter is
hereby AFFIRMED.

SO ORDERED.

24
PROGRESSIVE DEVELOPMENT CORP VS LAGUESMA

Republic of the Philippines

SUPREME COURT
Baguio City

FIRST DIVISION

G.R. No. 115077 April 18, 1997

PROGRESSIVE DEVELOPMENT CORPORATION-PIZZA HUT, petitioner,

vs.
HON. BIENVENIDO LAGUESMA, in his capacity as Undersecretary of Labor, and NAGKAKAISANG
LAKAS NG MANGGAGAWA (NLM)-KATIPUNAN, respondents.

KAPUNAN, J.:

On July 9, 1993, Nagkakaisang Lakas ng Manggagawa (NLM)-Katipunan (respondent Union) filed a petition
for certification election with the Department of Labor (National Capital Region) in behalf of the rank and file
employees of the Progressive Development Corporation (Pizza Hut) docketed as NCR Case No. NCR-OD-M-
9307-020. 1

Petitioner filed on August 20, 1993, a verified Motion to Dismiss the petition alleging fraud, falsification and
misrepresentation in the respondent. Union's registration making it void and invalid. The motion specifically
alleged that: a) respondent Union's registration was tainted with false, forged, double or multiple signatures of
those who allegedly took part in the ratification of the respondent Union's constitution and by-laws and in the
election of its officers that there were two sets of supposed attendees to the alleged organizational meeting
that was alleged to have taken place on June 26, 1993; that the alleged chapter is claimed to have been
supported by 318 members when in fact the persons who actually signed their names were much less; and b)
while the application for registration of the charter was supposed to have been approved in the organizational
meeting held on June 27, 1993, the charter certification issued by the federation KATIPUNAN was dated June
26, 1993 or one (1) day prior to the formation of the chapter, thus, there were serious falsities in the dates of
the issuance of the charter certification and the organization meeting of the alleged chapter.

Citing other instances of misrepresentation and fraud, petitioner, on August 29, 1993, filed a Supplement to its
Motion to Dismiss, 2 claiming that:

1) Respondent Union alleged that the election of its officers was held on June 27, 1993;
however, it appears from the documents submitted by respondent union to the BIR-DOLE that
the Union's constitution and by-laws were adopted only on July 7, 1993, hence, there was no
bases for the supposed election of officers on June 27, 1993 because as of this date, there
existed no positions to which the officers could be validly elected;

2) Voting was not conducted by secret ballot in violation of Article 241, section (c) of the Labor
Code;

3) The Constitution and by Laws submitted in support of its petition were not properly
acknowledged and notarized. 3

On August 30, 1993, petitioner filed a Petition 4 seeking the cancellation of the Union's registration on the
grounds of fraud and falsification, docketed as BIR Case No. 8-21-83. 5 Motion was likewise filed by petitioner
with the Med-Arbiter requesting suspension of proceedings in the certification election case until after the
prejudicial question of the Union's legal personality is determined in the proceedings for cancellation of
registration.

However, in an Order dated September 29, 1993, 6 Med-Arbiter Rasidali C. Abdullah directed the holding of a
certification election among petitioner's rank and file employees. The Order explained:

25
 . . . Sumasaklaw sa Manggagawa ng Pizza Hut is a legitimate labor organization in
contemplation of law and shall remain as such until its very charter certificate is canceled or
otherwise revoked by competent authority. The alleged misrepresentation, fraud and false
statement in connection with the issuance of the charter certificate are collateral issues which
could be properly ventilated in the cancellation proceedings. 7

On appeal to the office of the Secretary of Labor, Labor Undersecretary Bienvenido E. Laguesma in a
Resolution dated December 29, 1993 8 denied the same.

A motion for reconsideration of the public respondent's resolution was denied in his Order 9 dated January 27,
1994, hence, this special civil action for certiorari under Rule 65 of the Revised Rules of Court where the
principal issue raised is whether or not the public respondent committed grave abuse of discretion in affirming
the Med-Arbiter's order to conduct a certification election among petitioner's rank and file employees,
considering that: (1) respondent Union's legal personality was squarely put in issue; (2) allegations of fraud
and falsification, supported by documentary evidence were made; and (3) a petition to cancel respondent
Union's registration is pending with the regional office of the Department of Labor and Employment. 10

We grant the petition.

In the public respondent's assailed Resolution dated December 29, 1993, the suggestion is made that once a
labor organization has filed the necessary documents and papers and the same have been certified under oath
and attested to, said organization necessarily becomes clothed with the character of a legitimate labor
organization. The resolution declares:

Records show that at the time of the filing of the subject petition on 9 July 1993 by the petitioner
NLM-KATIPUNAN, for and in behalf of its local affiliate Sumasaklaw sa Manggagawa ng Pizza
Hut, the latter has been clothed with the status and/or character of a legitimate labor
organization. This is so, because on 8 July 1993, petitioner submitted to the Bureau of Labor
Relations (BLR), this Department, the following documents: Charter Certificate, Minutes of the
Organizational Meeting, List of Officers, and their respective addresses, financial statement,
Constitution and By-Laws (CBL, and the minutes of the ratification of the CBL). Said documents
(except the charter certificate) are certified under oath and attested to by the local union's
Secretary/Treasurer and President, respectively.

As to the contention that the certification election proceedings should be suspended in view of
the pending case for the cancellation of the petitioner's certificate of registration, let it be
stressed that the pendency of a cancellation case is not a ground for the dismissal or
suspension of a representation proceedings considering that a registered labor organization
continues to be a legitimate one entitled to all the rights appurtenant thereto until a final valid
order is issued canceling such registration. 11

In essence, therefore, the real controversy in this case centers on the question of whether or not, after the
necessary papers and documents have been filed by a labor organization, recognition by the Bureau of Labor
Relations merely becomes a ministerial function.

We do not agree.

In the first place, the public respondent's views as expressed in his December 29, 1993 Resolution miss the
entire point behind the nature and purpose of proceedings leading to the recognition of unions as legitimate
labor organizations. Article 234 of the Labor Code provides:

Art. 234. Requirements of registration. Any applicant labor organization, association or group
of unions or workers shall acquire legal personality and shall be entitled to the rights and
privileges granted by law to legitimate labor organizations upon issuance of the certificate of
registration based on the following requirements:

(a) Fifty pesos (P50.00) registration fee;

(b) The names of its officers, their addresses, the principal address of the labor organization, the
minutes of the organizational meetings and the list of the workers who participated in such
meetings;

(c) The names of all its members comprising at least twenty percent (20%) of all the employees
in the bargaining unit where it seeks to operate;

26
 (d) If the applicant union has been in existence for one or more years, copies of its annual
financial reports; and

(e) Four (4) copies of the constitution and by-laws of the applicant union, minutes of its adoption
or ratification, and the list of the members who participated in it.

A more than cursory reading of the aforecited provisions clearly indicates that the requirements embodied
therein are intended as preventive measures against the commission of fraud. After a labor organization has
filed the necessary papers and documents for registration, it becomes mandatory for the Bureau of Labor
Relations to check if the requirements under Article 234 have been sedulously complied with. If its application
for registration is vitiated by falsification and serious irregularities, especially those appearing on the face of the
application and the supporting documents, a labor organization should be denied recognition as a legitimate
labor organization. And if a certificate of recognition has been issued, the propriety of the labor organization's
registration could be assailed directly through cancellation of registration proceedings in accordance with
Articles 238 and 239 of the Labor Code, or indirectly, by challenging its petition for the issuance of an order for
certification election.

These measures are necessary and may be undertaken simultaneously if the spirit behind the Labor
Code's requirements for registration are to be given flesh and blood. Registration requirements specifically
afford a measure of protection to unsuspecting employees who may be lured into joining unscrupulous or fly-
by-night unions whose sole purpose is to control union funds or use the labor organization for illegitimate
ends. 12 Such requirements are a valid exercise of the police power, because the activities in which labor
organizations, associations and unions of workers are engaged directly affect the public interest and should be
protected. 13

Thus, in Progressive Development Corporation vs. Secretary of Labor and Employment, 14 we held:

The controversy in this case centers on the requirements before a local or chapter of a
federation may file a petition for certification election and be certified as the sole and exclusive
bargaining agent of the petitioner's employees.

xxx xxx xxx

But while Article 257 cited by the Solicitor General directs the automatic conduct of a
certification election in an unorganized establishment, it also requires that the petition for
certification election must be filed by a legitimate labor organization . . .

xxx xxx xxx

. . . The employer naturally needs assurance that the union it is dealing with is a bona-fide
organization, one which has not submitted false statements or misrepresentations to the
Bureau. The inclusion of the certification and attestation requirements will in a marked degree
allay these apprehensions of management. Not only is the issuance of any false statement and
misrepresentation or ground for cancellation of registration (see Article 239 (a), (c) and (d)); it is
also a ground for a criminal charge of perjury.

The certification and attestation requirements are preventive measures against the commission
of fraud. They likewise afford a measure of protection to unsuspecting employees who may be
lured into joining unscrupulous or fly-by-night unions whose sole purpose is to control union
funds or to use the union for dubious ends.

xxx xxx xxx

. . . It is not this Court's function to augment the requirements prescribed by law in order to make
them wiser or to allow greater protection to the workers and even their employer. Our only
recourse is, as earlier discussed, to exact strict compliance with what the law provides as
requisites for local or chapter formation.

xxx xxx xxx

The Court's conclusion should not be misconstrued as impairing the local union's right to be
certified as the employees' bargaining agent in the petitioner's establishment. We are merely
saying that the local union must first comply with the statutory requirements in order to exercise
this right. Big federations and national unions of workers should take the lead in requiring their
27
 locals and chapters to faithfully comply with the law and the rules instead of merely snapping
union after union into their folds in a furious bid with rival federations to get the most number of
members

Furthermore, the Labor Code itself grants the Bureau of Labor Relations a period of thirty (30) days within
which to review all applications for registration. Article 235 provides:

Art. 235. Action on application. The Bureau shall act on all applications for registration within
thirty (30) days from filing.

All requisite documents and papers shall be certified under oath by the secretary or the
treasurer of the organization, as the case may be, and attested to by its president.

The thirty-day period in the aforecited provision ensures that any action taken by the Bureau of Labor Relations
is made in consonance with the mandate of the Labor Code, which, it bears emphasis, specifically requires
that the basis for the issuance of a certificate of registration should be compliance with the requirements for
recognition under Article 234. Since, obviously, recognition of a labor union or labor organization is not merely
a ministerial function, the question now arises as to whether or not the public respondent committed grave
abuse of discretion in affirming the Med-Arbiter's order in spite of the fact that the question of the Union's
legitimacy was squarely put in issue and that the allegations of fraud and falsification were adequately
supported by documentary evidence.

The Labor Code requires that in organized and unorganized 15 establishments, a petition for certification
election must be filed by a legitimate labor organization. The acquisition of rights by any union or labor
organization, particularly the right to file a petition for certification election, first and foremost, depends on
whether or not the labor organization has attained the status of a legitimate labor organization.

In the case before us, the Med-Arbiter summarily disregarded the petitioner's prayer that the former look into
the legitimacy of the respondent. Union by a sweeping declaration that the union was in the possession of a
charter certificate so that "for all intents and purposes, Sumasaklaw sa Manggagawa sa Pizza Hut (was) a
legitimate labor organization." 16 Glossing over the transcendental issue of fraud and misrepresentation raised
by herein petitioner, Med-Arbiter Rasidali Abdullah held that:

The alleged misrepresentation, fraud and false statement in connection with the issuance of the
charter certificate are collateral issues which could be ventilated in the cancellation
proceedings. 17

It cannot be denied that the grounds invoked by petitioner for the cancellation of respondent Union's
registration fall under paragraph (a) and (c) of Article 239 of the Labor Code, to wit:

(a) Misrepresentation, false statement or fraud in connection with the adoption or ratification of
the constitution and by-laws or amendments thereto, the minutes of ratification, the list of
members who took part in the ratification of the constitution and by-laws or amendments
thereto, the minutes of ratification, the list of members who took part in the ratification;

xxx xxx xxx

(c) Misrepresentation, false statements or fraud in connection with the election of officers,
minutes of the election of officers, the list of voters, or failure to submit these documents
together with the list of the newly elected-appointed officers and their postal addresses within
thirty (30) days from election.

xxx xxx xxx

The grounds ventilated in cancellation proceedings in accordance with Article 239 of the Labor Code constitute
a grave challenge to the right of respondent Union to ask for certification election. The Med-Arbiter should have
looked into the merits of the petition for cancellation before issuing an order calling for certification election.
Registration based on false and fraudulent statements and documents confer no legitimacy upon a labor
organization irregularly recognized, which, at best, holds on to a mere scrap of paper. Under such
circumstances, the labor organization, not being a legitimate labor organization, acquires no rights, particularly
the right to ask for certification election in a bargaining unit.

As we laid emphasis in Progressive Development Corporation Labor, 18 "[t]he employer needs the assurance
that the union it is dealing with is a bona fide organization, one which has not submitted false statements or
28
misrepresentations to the Bureau." Clearly, fraud, falsification and misrepresentation in obtaining recognition
as a legitimate labor organization are contrary to the Med-Arbiter's conclusion not merely collateral issues. The
invalidity of respondent Union's registration would negate its legal personality to participate in certification
election.

Once a labor organization attains the status of a legitimate labor organization it begins to possess all of the
rights and privileges granted by law to such organizations. As such rights and privileges ultimately affect areas
which are constitutionally protected, the activities in which labor organizations, associations and unions are
engaged directly affect the public interest and should be zealously protected. A strict enforcement of the Labor
Code's requirements for the acquisition of the status of a legitimate labor organization is in order.

Inasmuch as the legal personality of respondent Union had been seriously challenged, it would have been
more prudent for the Med-Arbiter and public respondent to have granted petitioner's request for the suspension
of proceedings in the certification election case, until the issue of the legality of the Union's registration shall
have been resolved. Failure of the Med-Arbiter and public respondent to heed the request constituted a grave
abuse of discretion.

WHEREFORE, PREMISES CONSIDERED, the instant petition is GRANTED and the Resolution and Order of
the public respondent dated December 29, 1993 and January 24, 1994, respectively, are hereby SET ASIDE.

The case is REMANDED to the Med-Arbiter to resolve with reasonable dispatch petitioner's petition for
cancellation of respondent Union's registration.

SO ORDERED.

29
SMC MANDAUE PACKAGING PRODUCTS VS MANDAUE PACKING PRODUCTS

SECOND DIVISION

[G.R. No. 152356. August 16, 2005]

SAN MIGUEL CORPORATION (MANDAUE PACKAGING PRODUCTS PLANTS), petitioner,

vs. MANDAUE PACKING PRODUCTS PLANTS-SAN PACKAGING PRODUCTS SAN MIGUEL
CORPORATION MONTHLIES RANK-AND-FILE UNION FFW (MPPP-SMPP-SMAMRFU-
FFW), respondent.

DECISION
TINGA, J.:

The central question in this Petition for Review is on what date did respondent Mandaue Packing Products
Plants-San Miguel Packaging ProductsSan Miguel Corporation Monthlies Rank-And-File UnionFFW acquire
legal personality in accordance with the Implementing Rules of the Labor Code. The matter is crucial since
respondent filed a petition for certification election at a date when, it is argued, it had yet to acquire the
requisite legal personality. The Department of Labor and Employment (DOLE) and the Court of Appeals both
ruled that respondent had acquired legal personality on the same day it filed the petition for certification
election. The procedure employed by the respondent did not strictly conform with the relevant provisions of
law. But rather than insist on an overly literal reading of the law that senselessly suffocates the constitutionally
guaranteed right to self-organization, we uphold the assailed decisions and the liberal spirit that animates
them.

Antecedent Facts

The present petition assailed the Decision dated 7 June 2001 rendered by the Court of Appeals Eighth
Division[1] which in turn affirmed a Decision dated 22 Feburary 1999 by the DOLE Undersecretary for Labor
Relations, Rosalinda Dimapilis-Baldoz, ordering the immediate conduct of a certification election among the
petitioners rank-and-file employees, as prayed for by respondent. The following facts are culled from the
records.
On 15 June 1998, respondent, identifying itself as an affiliate of Federation of Free Workers (FFW), filed a
petition for certification election with the DOLE Regional Office No. VII. In the petition, respondent stated that it
sought to be certified and to represent the permanent rank-and-file monthly paid employees of the
petitioner.[2] The following documents were attached to the petition: (1) a Charter Certificate issued by FFW on
5 June 1998 certifying that respondent as of that date was duly certified as a local or chapter of FFW; (2) a
copy of the constitution of respondent prepared by its Secretary, Noel T. Bathan and attested by its President,
Wilfred V. Sagun; (3) a list of respondents officers and their respective addresses, again prepared by Bathan
and attested by Sagun; (4) a certification signifying that respondent had just been organized and no amount
had yet been collected from its members, signed by respondents treasurer Chita D. Rodriguez and attested by
Sagun; and (5) a list of all the rank-and-file monthly paid employees of the Mandaue Packaging Products
Plants and Mandaue Glass Plant prepared by Bathan and attested by Sagun.[3]
The petition was assigned to Mediator-Arbiter Achilles V. Manit of the DOLE Regional Office No. VII, and
docketed as Case No. R0700-9806-RU-013.[4]
On 27 July 1998, petitioner filed a motion to dismiss the petition for certification election on the sole
ground that herein respondent is not listed or included in the roster of legitimate labor organizations based on
the certification issued by the Officer-In-Charge, Regional Director of the DOLE Regional Office No. VII, Atty.
Jesus B. Gabor, on 24 July 1998.
On 29 July 1998, respondent submitted to the Bureau of Labor Relations the same documents earlier
attached to its petition for certification. The accompanying letter, signed by respondents president Sagun,
stated that such documents were submitted in compliance with the requirements for the creation of a
local/chapter pursuant to the Labor Code and its Implementing Rules; and it was hoped that the submissions
would facilitate the listing of respondent under the roster of legitimate labor organizations.[5] On 3 August 1998,
the Chief of Labor Relations Division of DOLE Regional Office No. VII issued a Certificate of Creation of

30
Local/Chapter No. ITD. I-ARFBT-058/98, certifying that from 30 July 1998, respondent has acquired legal
personality as a labor organization/workers association, it having submitted all the required documents. [6]
Opting not to file a comment on the Motion to Dismiss,[7] respondent instead filed a Position Paper wherein
it asserted that it had complied with all the necessary requirements for the conduct of a certification election,
and that the ground relied upon in the Motion to Dismiss was a mere technicality.[8]
In turn, petitioner filed a Comment, wherein it reiterated that respondent was not a legitimate labor
organization at the time of the filing of the petition. Petitioner also propounded that contrary to respondents
objectives of establishing an organization representing rank-and-file employees, two of respondents officers,
namely Vice-President Emannuel L. Rosell and Secretary Bathan, were actually supervisory employees. In
support of this allegation, petitioner attached various documents evidencing the designation of these two
officers in supervisory roles, as well as their exercise of various supervisory functions. [9] Petitioner cited Article
245 of the Labor Code, which provides that supervisory employees shall not be eligible for membership in a
labor organization of the rank-and-file employees.[10]
On 20 August 1998, petitioner filed a petition to cancel the union registration of respondent. However, this
petition was denied, and such denial was subsequently affirmed by the Court of Appeals in a decision that has
since become final.[11]
In the meantime, on 15 September 1998, Med-Arbiter Manit issued an Order dismissing respondents
petition for certification election. The sole ground relied upon for the dismissal was the Med-Arbiters Opinion
that as of the date of filing of the petition on 15 June 1998, respondent did not have the legal personality to file
the said petition for certification election.[12] No discussion was adduced on petitioners claims that some of
respondents officers were actually supervisory employees.
Respondent promptly appealed the 15 September 1998 Order to the DOLE. On 22 February 1999, DOLE
Undersecretary Rosalinda Dimapilis-Baldoz rendered a Decision reversing theOrder. Undersecretary Baldoz
concluded that respondent acquired legal personality as early as 15 June 1998, the date it submitted the
required documents, citing Section 3, Rule VI of the New Rules Implementing the Labor Code (Implementing
Rules) which deems that a local/chapter acquires legal personality from the date of filing of the complete
documentary requirements as mandated in the Implementing Rules. The DOLE also ruled that the contention
that two of respondents officers were actually supervisors can be threshed out in the pre-election conferences
where the list of qualified voters is to be determined. The dispositive portion of the DOLE Decision stated:

WHEREFORE, the appeal is GRANTED. The order dated 15 September 1999 of the Med-Arbiter is
REVERSED and SET ASIDE. Accordingly, let the records of the case be remanded to the office of origin for
the immediate conduct of certification election, subject to the usual pre-election conference, among the
monthly-paid rank-and-file employees of the Mandaue Packaging Products Plant San Miguel Corporation, with
the following choices:

1. MANDAUE PACKAGING PRODUCT PLANT SAN MIGUEL PACKAGING PRODUCTS SAN

MIGUEL CORPORATION MONTHLIES RANK AND FILE UNIONFFW (MPPP-SMPP-
SMCMRFUFFW),
2. NO UNION.

Pursuant to Rule XI, Section 11.1 of the New Implementing Rules, the company is hereby directed to submit to
the office of origin the certified list of current employees in the bargaining unit, along with the payrolls covering
the members of the bargaining unit for the last three months prior to the issuance of this decision.

SO DECIDED.[13]

These two conclusions of the DOLE were affirmed in the assailed Decision of the Court of Appeals. It is
now our task to review whether these conclusions are warranted under law and jurisprudence. First, we shall
discuss the aspect of respondents legal personality in filing the petition for certification election.

First Issue: On the Acquisition of

Legal Personality by Respondent

Statutory Provisions for Registration Of

Local/Chapter of Federation or National Union
Before we proceed to evaluate the particular facts of this case, it would be useful to review the statutory
paradigm that governs the establishment and acquisition of legal personality by a local/chapter of a labor

31
organization. The applicable rules have undergone significant amendments in the last decade, thus a
recapitulation of the framework is in order.
The Labor Code defines a labor organization as any union or association of employees which exists in
whole or in part for the purpose of collective bargaining or of dealing with employers concerning terms and
conditions of employment,[14] and a legitimate labor organization as any labor organization duly registered with
the DOLE, including any branch or local thereof.[15] Only legitimate labor organizations may file a petition for
certification election.[16]
Article 234 of the Labor Code enumerates the requirements for registration of an applicant labor
organization, association, or group of unions or workers in order that such entity could acquire legal personality
and entitlement to the rights and privileges granted by law to legitimate labor organizations. These include a
registration fee of fifty pesos (P50.00); a list of the names of the members and officers, and copies of the
constitution and by-laws of the applicant union.[17]
However, the Labor Code itself does not lay down the procedure for the registration of a local or chapter of
a labor organization. Such has been traditionally provided instead in the Implementing Rules, particularly in
Book V thereof. However, in the last decade or so, significant amendments have been introduced to Book V,
first by Department Order No. 9 which took effect on 21 June 1997, and again by Department Order No. 40
dated 17 February 2003. The differences in the procedures laid down in these various versions are significant.
However, since the instant petition for certification was filed in 1998, the Implementing Rules, as amended by
Department Order No. 9, should govern the resolution of this petition.[18]
Preliminarily, we should note that a less stringent procedure obtains in the registration of a local or chapter
than that of a labor organization. Undoubtedly, the intent of the law in imposing lesser requirements in the case
of a branch or local of a registered federation or national union is to encourage the affiliation of a local union
with a federation or national union in order to increase the local union's bargaining powers respecting terms
and conditions of labor.[19] This policy has remained consistent despite the succeeding amendments to Book V
of the Omnibus Implementing Rules, as contained in Department Orders Nos. 9 and 40.
The case of Progressive Development Corp. v. Secretary of Labor,[20] applying Section 3, Rule II, Book V
of the Implementing Rules, in force before 1997, ruled that "a local or chapter therefore becomes a legitimate
labor organization only upon submission of the following to the BLR: (1) a charter certificate, within thirty (30)
days from its issuance by the labor federation or national union; and (2) The constitution and by-laws, a
statement of the set of officers, and the books of accounts all of which are certified under oath by the secretary
or treasurer, as the case may be, of such local or chapter, and attested to by its president. [21] The submission
by the local/chapter of duly certified books of accounts as a prerequisite for registration of the local/chapter
was dropped in Department Order No. 9,[22] a development noted by the Court in Pagpalain Haulers v. Hon.
Trajano,[23] wherein it was held that the previous doctrines requiring the submission of books of accounts as a
prerequisite for the registration of a local/chapter are already pass and therefore, no longer applicable. [24]
Department Order No. 40, now in effect, has eased the requirements by which a local/chapter may acquire
legal personality. Interestingly, Department Order No. 40 no longer uses the term local/chapter, utilizing
instead chartered local, which is defined as a labor organization in the private sector operating at the enterprise
level that acquired legal personality through the issuance of a charter certificate by a duly registered federation
or national union, and reported to the Regional Office.[25] Clearly under the present rules, the first step to be
undertaken in the creation of a chartered local is the issuance of a charter certificate by the duly registered
federation or national union. Said federation or national union is then obligated to report to the Regional Office
the creation of such chartered local, attaching thereto the charter certificate it had earlier issued. [26]
But as stated earlier, it is Department Order No. 9 that governs in this case. Section 1, Rule VI thereof
prescribes the documentary requirements for the creation of a local/chapter. It states:

Section 1. Chartering and creation of a local chapter A duly registered federation or national union may directly
create a local/chapter by submitting to the Regional Office or to the Bureau two (2) copies of the following:

a) A charter certificate issued by the federation or national union indicating the creation or establishment
of the local/chapter;

(b) The names of the local/chapter's officers, their addresses, and the principal office of the local/chapter;

(c) The local/chapter's constitution and by-laws; provided that where the local/chapter's constitution and
by-laws is the same as that of the federation or national union, this fact shall be indicated
accordingly.

All the foregoing supporting requirements shall be certified under oath by the Secretary or Treasurer of the
local/chapter and attested by its President.

32
 In contrast, an independent union seeking registration is further required under Dept. Order No. 90 to
submit the number and names of the members, and annual financial reports.[27]
Section 3, Rule VI of Department Order No. 9 provides when the local/chapter acquires legal personality.

Section 3. Acquisition of legal personality by local chapter. A local/chapter constituted in accordance with
Section 1 of this Rule shall acquire legal personality from the date of filing of the complete documents
enumerated therein. Upon compliance with all the documentary requirements, the Regional Office or Bureau
shall issue in favor of the local/chapter a certificate indicating that it is included in the roster of legitimate labor
organizations.

It is evident based on this rule that the local/chapter acquires legal personality from the date of the filing of
the complete documentary requirements, and not from the issuance of a certification to such effect by the
Regional Office or Bureau. On the other hand, a labor organization is deemed to have acquired legal
personality only on the date of issuance of its certificate of registration,[28] which takes place only after the
Bureau of Labor Relations or its Regional Offices has undertaken an evaluation process lasting up until thirty
(30) days, within which period it approves or denies the application.[29] In contrast, no such period of evaluation
is provided in Department Order No. 9 for the application of a local/chapter, and more importantly, under it
such local/chapter is deemed to acquire legal personality from the date of filing of the documents enumerated
under Section 1, Rule VI, Book V.
Apart from promoting a policy of affiliation of local unions with national unions,[30] there is a practical
reason for sanctioning a less onerous procedure for the registration of a local/chapter, as compared to the
national union. The local/chapter relies in part on the legal personality of the federation or national union, which
in turn, had already undergone evaluation and approval from the Bureau of Legal Relations or Regional Office.
In fact, a federation or national union is required, upon registration, to establish proof of affiliation of at least ten
(10) locals or chapters which are duly recognized as the collective bargaining agent in the establishment or
industry in which they operate; and the names and addresses of the companies where the locals or chapters
operate and the list of all the members in each of the companies. [31] Once the national union or federation
acquires legal personality upon the issuance of its certificate or registration,[32] its legal personality cannot be
subject to collateral attack.[33]
The fact that the local/chapter acquires legal personality from the moment the complete documentary
requirements are submitted seems to imply that the duty of the Bureau or Regional Office to register the
local/chapter is merely ministerial. However, in Progressive Development Corporation v. Laguesma,[34] the
Court, in ruling against a petition for certification filed by a chapter, held that the mere submission of the
documentary requirements does not render ministerial the function of the Bureau of Labor Relations in
according due recognition to the labor organization.[35] Still, that case was decided before the enactment of
Department Order No. 9, including the aforestated Section 3. Should we consider the said 1997 amendments
as having obviated our characterization in Progressive of the Bureaus duty as non-ministerial?
Notwithstanding the amendments, it still is good policy to maintain that per Department Order No. 9, the
duty of the Bureau of Labor Relations to recognize the local/chapter upon the submission of the documentary
requirements is not ministerial, insofar as the Bureau is obliged to adjudge the authenticity of the documents
required to be submitted. For example, the Bureau is not mandated to accept just any purported charter
certificate matter how spurious it is in appearance. It is empowered to ascertain whether the submitted charter
certificate is genuine, and if finding that said certificate is fake, deny recognition to the local/chapter.
However, in ascertaining whether or not to recognize and register the local/chapter, the Bureau or
Regional Office should not look beyond the authenticity and due execution of the documentary requirements
for the creation of the local/chapter as enumerated under Section 1, Rule VI, Book V of Department Order No.
9. Since the proper submission of these documentary requirements is all that is necessary to recognize a
local/chapter, it is beyond the province of the Bureau or Regional Offices to resort to other grounds as basis for
denying legal recognition of the local/chapter. For example, Department Order No. 9 does not require the
local/chapter to submit the names of its members as a condition precedent to its registration. [36] It therefore
would be improper to deny legal recognition to a local/chapter owing to questions pertaining to its individual
members since the local/chapter is not even obliged to submit the names of its individual members prior to
registration.
Certainly, when a local/chapter applies for registration, matters raised against the personality of the
federation or national union itself should not be acted upon by the Bureau or Regional Office, owing to the
preclusion of collateral attack. Instead, the proper matter for evaluation by the Bureau or Regional Office
should be limited to whether the local/chapter is indeed a duly created affiliate of the national union or
federation.
Parenthetically, under the present Implementing Rules as amended by Department Order No. 40, it
appears that the local/chapter (or now, chartered local) acquires legal personality upon the issuance of the
charter certificate by the duly registered federation or national union.[37] This might signify that the creation of

33
the chartered local is within the sole discretion of the federation or national union and thus beyond the review
or interference of the Bureau of Labor Relations or its Regional Offices. However, Department Order No. 40
also requires that the federation or national union report the creation of the chartered local to the Regional
Office.

Acquisition by Respondent of Legal Personality

We now proceed to determine if and when the respondent acquired legal personality under the procedure
laid down by the rules then in effect, Department Order No. 9, that is.
At the onset, the arguments raised by petitioner on this point are plainly erroneous. Petitioner cites the
case of Toyota Motor Philippines v. Toyota Motor Philippines Corporation Labor Union,[38] and the purported
holding therein that [if] it is true that at the time of the filing of the petition, the said registration certificate has
not been approved yet, then, petitioner lacks the legal personality to file the petition. [39] However, an
examination of the case actually reveals that the cited portion was lifted from one of the antecedent rulings of
the Med-Arbiter in that case which had not even been affirmed or reinstated by the Court on
review.[40] Moreover, such pronouncement made prior to the enactment of Department Order No. 9 squarely
contradicts Section 3, Rule VI thereof, which provides that legal personality of the local/chapter is vested upon
the submission of the complete documentary requirements.
It is also worth noting that petitioner union in Toyota was an independent labor union, and not a
local/chapter, and under Department Order No. 9, independent labor unions, unlike local/chapters, acquire
legal personality only upon issuance of the certificate of registration by the Bureau or Regional Office. Still,
petitioner cites in its favor Section 5, Rule V of Dept. Order No. 9, which states that the labor organization or
workers association shall be deemed registered and vested with legal personality on the date of issuance of its
certificate of registration. Again, the citation is obviously misplaced, as respondent herein is a local/chapter, the
acquisition of its legal personality being governed instead by Section 3, Rule VI.
It is thus very clear that the issuance of the certificate of registration by the Bureau or Regional Office is
not the operative act that vests legal personality upon a local/chapter under Department Order No. 9. Such
legal personality is acquired from the filing of the complete documentary requirements enumerated in Section
1, Rule VI. Admittedly, the manner by which respondent was deemed to have acquired legal personality by the
DOLE and the Court of Appeals was not in strict conformity with the provisions of Department Order No. 9.
Nonetheless, are the deviations significant enough for the Court to achieve a different conclusion from that
made by the DOLE and the Court of Appeals?
In regular order, it is the federation or national union, already in possession of legal personality, which
initiates the creation of the local/chapter. It issues a charter certificate indicating the creation or establishment
of the local/chapter. It then submits this charter certificate, along with the names of the local/chapters officers,
constitution and by-laws to the Regional Office or Bureau. It is the submission of these documents, certified
under oath by the Secretary or Treasurer of the local/chapter and attested by the President, which vests legal
personality in the local/chapter, which is then free to file on its own a petition for certification election.
In this case, the federation in question, the FFW, did not submit any of these documentary requirements to
the Regional Office or Bureau. It did however issue a charter certificate to the putative local/chapter (herein
respondent). Respondent then submitted the charter certificate along with the other documentary requirements
to the Regional Office, but not for the specific purpose of creating the local/chapter, but for filing the petition for
certification election.
It could be properly said that at the exact moment respondent was filing the petition for certification, it did
not yet possess any legal personality, since the requisites for acquisition of legal personality under Section 3,
Rule VI of Department Order No. 9 had not yet been complied with. It could also be discerned that the intention
of the Labor Code and its Implementing Rules that only those labor organizations that have acquired legal
personality are capacitated to file petitions for certification elections. Such is the general rule.
Yet there are peculiar circumstances in this case that allow the Court to rule that respondent acquired the
requisite legal personality at the same time it filed the petition for certification election. In doing so, the Court
acknowledges that the strict letter of the procedural rule was not complied with. However, labor laws are
generally construed liberally in favor of labor, especially if doing so affirms the constitutionally guaranteed right
to self-organization.
True enough, there was no attempt made by the national federation, or the local/chapter for that matter, to
submit the enumerated documentary requirements to the Regional Office or Bureau for the specific purpose of
creating the local/chapter. However, these same documents were submitted by the local/chapter to the
Regional Office as attachments to its petition for certification election. Under Section 3, Rule VI of Department
Order No. 9, it is the submission of these same documents to the Regional Office or Bureau that operates to
vest legal personality on the local/chapter.
34
 Thus, in order to ascertain when respondent acquired legal personality, we only need to determine on
what date the Regional Office or Bureau received the complete documentary requirements enumerated under
Section 1, Rule VI of Department Order No. 9. There is no doubt that on 15 June 1998, or the date respondent
filed its petition for certification election, attached thereto were respondents constitution, the names and
addresses of its officers, and the charter certificate issued by the national union FFW. The first two of these
documents were duly certified under oath by respondents secretary Bathan and attested to by president
Sagun.[41]
It may be noted though that respondent never submitted a separate by-laws, nor does it appear that
respondent ever intended to prepare a set thereof. Section 1(c), Rule VI, Book V of Department Order No. 9
provides that the submission of both a constitution and a set of by-laws is required, or at least an indication that
the local/chapter is adopting the constitution and by-laws of the federation or national union. A literal reading of
the provision might indicate that the failure to submit a specific set of by-laws is fatal to the recognition of the
local/chapter. A more critical analysis of this requirement though is in order, especially as it should apply to this
petition.
By-laws has traditionally been defined as regulations, ordinances, rules or laws adopted by an association
or corporation or the like for its internal governance, including rules for routine matters such as calling meetings
and the like.[42] The importance of by-laws to a labor organization cannot be gainsaid. Without such provisions
governing the internal governance of the organization, such as rules on meetings and quorum requirements,
there would be no apparent basis on how the union could operate. Without a set of by-laws which provides
how the local/chapter arrives at its decisions or otherwise wields its attributes of legal personality, then every
action of the local/chapter may be put into legal controversy.
However, if those key by-law provisions on matters such as quorum requirements, meetings, or on the
internal governance of the local/chapter are themselves already provided for in the constitution, then it would
be feasible to overlook the requirement for by-laws. Indeed in such an event, to insist on the submission of a
separate document denominated as By-Laws would be an undue technicality, as well as a redundancy.
An examination of respondents constitution reveals it sufficiently comprehensive in establishing the
necessary rules for its operation. Article IV establishes the requisites for membership in the local/chapter.
Articles V and VI name the various officers and what their respective functions are. The procedure for election
of these officers, including the necessary vote requirements, is provided for in Article IX, while Article XV
delineates the procedure for the impeachment of these officers. Article VII establishes the standing committees
of the local/chapter and how their members are appointed. Article VIII lays down the rules for meetings of the
union, including the notice and quorum requirements thereof. Article X enumerates with particularity the rules
for union dues, special assessments, fines, and other payments. Article XII provides the general rule for
quorum in meetings of the Board of Directors and of the members of the local/chapter, and cites the
applicability of the Roberts Rules of Order[43] in its meetings. And finally, Article XVI governs and institutes the
requisites for the amendment of the constitution.
Indeed, it is difficult to see in this case what a set of by-laws separate from the constitution for respondent
could provide that is not already provided for by the Constitution. These premises considered, there is clearly
no need for a separate set of by-laws to be submitted by respondent.
The Court likewise sees no impediment in deeming respondent as having acquired legal personality as of
15 June 1998, the fact that it was the local/chapter itself, and not the FFW, which submitted the documents
required under Section 1, Rule VI of Department Order No. 9. The evident rationale why the rule states that it
is the federation or national union that submits said documents to the Bureau or Regional Office is that the
creation of the local/chapter is the sole prerogative of the federation or national union, and not of any other
entity. Certainly, a putative local/chapter cannot, without the imprimatur of the federation or national union,
claim affiliation with the larger unit or source its legal personality therefrom.
In the ordinary course, it should have been FFW, and not respondent, which should have submitted the
subject documents to the Regional Office. Nonetheless, there is no good reason to deny legal personality or
defer its conferral to the local/chapter if it is evident at the onset that the federation or national union itself has
already through its own means established the local/chapter. In this case, such is evidenced by the Charter
Certificate dated 9 June 1998, issued by FFW, and attached to the petition for certification election. The
Charter Certificate expressly states that respondent has been issued the said certificate to operate as a local
or chapter of the [FFW]. The Charter Certificate expressly acknowledges FFWs intent to establish respondent
as of 9 June 1998.[44] This being the case, we consider it permissible for respondent to have submitted the
required documents itself to the Regional Office, and proper that respondents legal personality be deemed
existent as of 15 June 1998, the date the complete documents were submitted.

Second Issue: On the Alleged Presence

Of Supervisory Employees as
Officers of the Respondent

35
 The second issue hinges on a point of some controversy and frequent discussion in recent years.
Petitioner claims error in the common pronouncement in the assailed decisions that the matter concerning the
two officers who are allegedly supervisory employees may be threshed out during pre-election conferences.
Petitioner cites the cases of Toyota Motors andProgressive Development Corporation-Pizza Hut v.
Ledesma[45] wherein the Court ruled that the question of prohibited membership of both supervisory and rank-
and-file employees in the same union must be inquired into anterior to the granting of an order allowing a
certification election; and that a union composed of both of these kinds of employees does not possess the
requisite personality to file for recognition as a legitimate labor organization. It should be noted though that in
the more recent case of Tagaytay Highlands International Golf Club v. Tagaytay Highlands Employees
Union,[46] the Court, notwithstanding Toyota and Progressive, ruled that after a certificate of registration is
issued to a union, its legal personality cannot be subject to collateral attack, but questioned only in an
independent petition for cancellation.[47]
There is no need to apply any of the above cases at present because the question raised by petitioner on
this point is already settled law, as a result of the denial of the independent petition for cancellation filed by
petitioner against respondent on 20 August 1998. The ground relied upon therein was the alleged fraud,
misrepresentation and false statement in describing itself as a union of rank and file employees when in fact,
two of its officers, Emmanuel Rosell and Noel Bathan, were occupying supervisory positions.[48] Said petition
was denied by the Regional Director, this action was affirmed by the DOLE, the Court of Appeals, and the
Supreme Court.[49] The denial made by the Court of Appeals and the Supreme Court may have been based on
procedural grounds,[50] but the prior decisions of the Regional Director and the DOLE ruled squarely on the
same issue now raised by the petitioner. We quote from theResolution of the DOLE dated 29 December 1998:

. . . . [The] substantive issue that is now before us is whether or not the inclusion of the two alleged supervisory
employees in appellee unions membership amounts to fraud, misrepresentation, or false statement within the
meaning of Article 239(a) and (c) of the Labor Code.

We rule in the negative.

Under the law, a managerial employee is one who is vested with powers or prerogatives to lay down and
execute management policies and/or to hire, transfer, suspend, layoff, recall, discharge, assign or discipline
employees. A supervisory employee is one who, in the interest of the employer, effectively recommends
managerial actions if the exercise of such recommendatory authority is not merely routinary or clerical in nature
but requires the use of independent judgment. Finally, all employees not falling within the definition of
managerial or supervisory employee are considered rank-and-file employees. It is also well-settled that the
actual functions of an employee, not merely his job title, are determinative in classifying such employee as
managerial, supervisory or rank and file.

In the case of Emmanuel Rossell, appellants evidence shows that he undertakes the filling out of evaluation
reports on the performance of mechanics, which in turn are used as basis for reclassification. Given a ready
and standard form to accomplish, coupled with the nature of the evaluation, it would appear that his functions
are more routinary than recommendatory and hardly leave room for independent judgment. In the case of Noel
Bathan, appellants evidence does not show his job title although it shows that his recommendations on
disciplinary actions appear to have carried some weight on higher management. On this limited point, he may
qualify as a supervisory employee within the meaning of the law. This may, however, be outweighed by his
other functions which are not specified in the evidence.

Assuming that Bathan is a supervisory employee, this does not prove the existence of fraud, false statement or
misrepresentation. Because good faith is presumed in all representations, an essential element of fraud, false
statement and misrepresentation in order for these to be actionable is intent to mislead by the party making the
representation. In this case, there is no proof to show that Bathan, or appellee union for that matter, intended
to mislead anyone. If this was appellee unions intention, it would have refrained from using a more precise
description of the organization instead of declaring that the organization is composed of rank and file
monthlies. Hence, the charge of fraud, false statement or misrepresentation cannot be sustained.

Appellants reliance on the Toyota case must be tempered by the peculiar circumstances of the case. Even
assuming that Bathan, or Rossel for that matter, are supervisory employees, the Toyota case cannot certainly
be given an interpretation that emasculates the right to self-organization and the promotion of free trade
unionism. We take administrative notice of the realities in union organizing, during which the organizers must
take their chances, oftentimes unaware of the fine distinctions between managerial, supervisory and rank and
file employees. The grounds for cancellation of union registration are not meant to be applied automatically,
but indeed with utmost discretion. Where a remedy short of cancellation is available, that remedy should be
preferred. In this case, no party will be prejudiced if Bathan were to be excluded from membership in the union.
The vacancy he will thus create can then be easily filled up through the succession provision of appellee
unions constitution and by-laws. What is important is that there is an unmistakeable intent of the members of

36
appellee union to exercise their right to organize. We cannot impose rigorous restraints on such right if we are
to give meaning to the protection to labor and social justice clauses of the Constitution.[51]

The above-cited pronouncement by Bureau of Labor Relations Director Benedicto Ernesto R. Bitonio, Jr.
in BLR-A-C-41-11-11-98 was affirmed by the Court of Appeals and the Supreme Court. Hence, its
pronouncement affirming, notwithstanding the questions on the employment status of Rossell and Bathan, the
legitimacy of the respondent, stands as a final ruling beyond the ambit of review, thus warranting the Courts
respect. There may be a difference between this case, which involves a petition for certification election, and
the other case, which concerns a petition for cancellation. However, petitioner opposes the petition for
certification election on the ground of the illegitimacy of respondent, owing to the alleged supervisory nature of
the duties of Rossell and Bathan. That matter has already been settled in the final disposition of the petition for
cancellation, and thus cannot be unsettled by reason of this present petition.

Effect of Respondents Manifestation

Of Subsequent Developments

A final note. In its Memorandum, petitioner alleges that the bargaining unit that respondent sought to
represent is no longer the same because of the dynamic nature of petitioners business, a lot of changes having
occurred in the work environment, and that four of respondents officers are no longer connected with
petitioner.[52] Assuming that these manifestations are true, they have no effect on the Courts ruling that a
certification election should be immediately conducted with respondent as one of the available choices.
Petitioners bare manifestations adduce no reason why the certification election should not be conducted
forthwith. If there are matters that have arisen since the filing of the petition that serve to delay or cancel the
election, these can be threshed out during the pre-election conferences. Neither is the fact that some of
respondents officers have since resigned from petitioner of any moment. The local/chapter retains a separate
legal personality from that of its officers or members that remains viable notwithstanding any turnover in its
officers or members.
WHEREFORE, the Petition is DENIED. Costs against petitioner.
SO ORDERED.

37
SAN MIGUEL FOODS VS LAGUESMA

FIRST DIVISION

[G.R. No. 116172. October 10, 1996]

SAN MIGUEL FOODS, INC.-CEBU B-MEG FEED PLANT, petitioner, vs. HON. BIENVENIDO E.
LAGUESMA, Undersecretary of DOLE and ILAW AT BUKLOD NG MANGGAGAWA
(IBM), respondents.

DECISION
HERMOSISIMA, JR., J.:

This is a petition for certiorari under Rule 65 to review and set aside two Resolutions of Mediator-Arbiter
Achilles V. Manit, dated January 5, 1994 and April 6, 1994, and the affirmation Order on appeal of the public
respondent, Undersecretary Bienvenido E. Laguesma of the Department of Labor and Employment. The
petition below was entitled: In Re: Petition for Direct Certification as the Sole and Exclusive Bargaining Agent
of All Monthly Paid Employees of SMFI-Cebu B-Meg Feeds Plant, docketed as OS-MA-A-3-51-94 (RO700-
9309-RU-036).
The essential facts are not disputed.
On September 24, 1993, a petition for certification election among the monthly-paid employees of the San
Miguel Foods, Inc.-Cebu B-Meg Feeds Plant was filed by private respondent labor federation Ilaw at Buklod ng
Manggagawa (IBM, for brevity) before Med-Arbiter Achilles V. Manit, alleging, inter alia, that it is a legitimate
labor organization duly registered with the Department of labor and Employment (DOLE) under the
Registration Certificate No. 5369-IP. SMFI-Cebu B-Meg Feeds Plant (SMFI, for brevity), herein petitioner, is a
business entity duly organized and existing under the laws of the Philippines which employs roughly seventy-
five (75) monthly paid employees, almost all of whom support the present petition. It was submitted in said
petition that there has been no certification election conducted in SMFI to determine the sole and exclusive
bargaining agent thereat for the past two years and that the proposed bargaining unit, which is SMFIs monthly
paid employees, is an unorganized one. It was also stated therein that petitioner IBM (herein private
respondent) has already complied with the mandatory requirements for the creation of its local or affiliate in
SMFIs establishment.
On October 25, 1993, herein petitioner SMFI filed a Motion to Dismiss the aforementioned petition
dated September 24, 1993 on the ground that a similar petition remains pending between the same parties for
the same cause of action before Med-Arbiter Achilles V. Manit.
SMFI was referring to an evidently earlier petition, docketed as CE CASE NO R0700-9304-RU-016, filed
on April 28, 1993 before the office of Med-Arbiter Manit. Indeed, both petitions involved the same parties,
cause of action and relief being prayed for, which is the issuance of an order by the Med-Arbiter allowing the
conduct of a certification election in SMFIs establishment. The contention is that the judgment that may be
rendered in the first petition would be determinative of the outcome of the second petition, dated September
24, 1993.
On December 2, 1993, private respondent IBM filed its Opposition to SMFIs Motion to Dismiss contending,
among others, that the case referred to by SMFI had already been resolved by Med-Arbiter Manit in his
Resolution and Order date July 26, 1993[1] and September 2, 1993,[2] respectively, wherein IBMs first petition
for certification election was denied mainly due to IBMs failure to comply with certain mandatory requirements
of the law. This denial was affirmed by the Med-Arbiter in another Order dated November 12, 1993[3] wherein
the Resolutions dated July 26, 1993 and September 2, 1993 were made to stand. Thus, IBM argues that there
having been no similar petition pending before Med-Arbiter Manit, another petition for certification election may
be refiled as soon as the said requirements are met. These requirements were finally satisfied before the
second petition for certification election was brought onSeptember 24, 1993.
On January 5, 1994, Med-Arbiter Manit, this time, granted the second petition for certification election of
private respondent IBM in this wise:
Let, therefore, a certification election be conducted among the monthly paid rank and file employees
of SMFI-CEBU B-MEG FEEDS PLANT at Lo-oc, Mandaue City. The choices shall be: YES-for IBM
AT SMFI-CEBU B-MEG; and NO-for No Union.

38
 The parties are hereby notified of the pre-election conference which will take place on January 17,
1994 at 3:00 oclock in the afternoon to set the date and time of the election and to thresh out the
mechanics thereof. On said date and time the respondent is directed to submit the payroll of its
monthly paid rank and file employees for the month of June 1993 which shall be the basis for the list
of the eligible voters. The petitioner is directed to be ready to submit a list of the monthly paid rank
and file employees of SMFI-CEBU B-MEG FEEDS PLANT when the respondent fails to submit the
required payroll.
SO ORDERED.[4]
Petitioner SMFI appealed the foregoing Order to the Secretary of Labor and Employment alleging that the
Med-Arbiter erred in directing the conduct of certification election considering that the local or chapter of IBM at
SMFI is still not a legitimate labor organization with a right to be certified as the exclusive bargaining agent in
petitioners establishment based on two grounds: (1) the authenticity and due execution of the Charter
Certificate submitted by IBM in favor of its local at SMFI cannot yet be ascertained as it is still now known who
is the legitimate and authorized representative of the IBM Federation who may validly issue said Charter
Certificate; and (2) a group of workers or a local union shall acquire legal personality only upon the issuance of
a Certificate of Registration by the Bureau of Labor Relations under Article 234 of the Labor Code, which IBM
at SMFI did not possess.
In a resolution dated April 6, 1994, public respondent Undersecretary Bienvenido Laguesma, by authority
of the Secretary of Labor and Employment, denied petitioners appeal, viz.:
WHEREFORE, the appeal is hereby denied for lack of merit and the Order of the Med-Arbiter is
hereby affirmed.
Let the records of this case be forwarded to the Regional Office of origin for the immediate conduct of
certification election subject to the usual pre-election conference.
SO RESOLVED.[5]
Thereafter, a Motion for Reconsideration was filed which was also denied by the public respondent in his
Order dated May 24, 1994.[6]
Hence, the instant petition interposing the following justifications:
1) THE HONORABLE UNDERSECRETARY BIENVENIDO E. LAGUESMA GRAVELY ABUSED
HIS DISCRETION WHEN HE ARBITRARILY RULED THAT A LOCAL OR CHAPTER OF A
LABOR FEDERATION, LIKE RESPONDENT IBM, NEED NOT OBTAIN A CERTIFICATE
OF REGISTRATION FROM THE BUREAU OF LABOR RELATIONS TO ACQUIRE LEGAL
PERSONALITY, WHEN ARTICLE 234 OF THE LABOR CODE OF THE PHILIPPINES AND
SECTION 3 OF RULE II OF BOOK V OF THE RULES IMPLEMENTING THE LABOR
CODE, AS AMENDED, CLEARLY PROVIDES THAT A GROUP OF WORKERS OR A
LOCAL UNION SHALL ACQUIRE LEGAL PERSONALITY ONLY UPON THE ISSUANCE
OF THE CERTIFICATE OF REGISTRATION BY THE BUREAU OF LABOR
RELATIONS. AND,
2) THE HONORABLE UNDERSECRETARY BIENVENIDO E. LAGUESMA GRAVELY ABUSED
HIS DISCRETION WHEN HE PREMATURELY AND ARBITRARILY RULED THAT
RESPONDENT IBM IS A LEGITIMATE LABOR ORGANIZATION WHEN THE
AUTHENTICITY AND DUE EXECUTION OF THE CHARTER CERTIFICATE SUBMITTED
BY RESPONDENT IBM CANNOT YET BE ASCERTAINED BECAUSE IT IS STILL NOT
KNOWN WHO ARE THE LEGITIMATE OFFICERS OF THE IBM FEDERATION WHO MAY
VALIDLY ISSUE SAID CHARTER CERTIFICATE AS THE CASE FILED TO RESOLVE
THE ISSUE ON WHO ARE THE LEGITIMATE OFFICERS OF THE IBM FEDERATION IS
STILL PENDING RESOLUTION BEFORE THIS HONORABLE SUPREME COURT.[7]
The petition has no merit.
Petitioner asserts that IBM at SMFI is not a legitimate labor organization notwithstanding the fact that it is
a local or chapter of the IBM Federation. This is so because under Article 234 of the Labor Code, any labor
organization shall acquire legal personality upon the issuance of the Certificate of Registration by the Bureau
of Labor Relations.
We do not agree.
I
Article 212(h) of the Labor Code defines a legitimate labor organization as any labor organization duly
registered with the Department of Labor and Employment, and includes any branch or local thereof.
It is important to determine whether or not a particular labor organization is legitimate since legitimate
labor organizations have exclusive rights under the law which cannot be exercised by non-legitimate unions,
39
one of which is the right to be certified as the exclusive representative of all the employees in an appropriate
collective bargaining unit for purposes of collective bargaining. These rights are found under Article 242 of the
Labor Code, to wit:

ART. 242. Rights of legitimate organizations.--A legitimate labor organization shall have the right:

(a) To act as the representative of its members for the purpose of collective bargaining;

(b) To be certiified as the exclusive representative of all the employees in an appropriate collective bargaining
unit for purposes of collective bargaining;

(c) To be furnished by the employer, upon written request, with his annual audited financial statements,
including the balance sheet and the profit and loss statement, within thirty (30) calendar days from the date of
receipt of the request, after the union has been duly recognized by the employer or certified as the sole and
exclusive bargaining representative of the employees in the bargaining unit, or within sixty (60) calendar days
before the expiration of the existing collective bargaining agreement, or during the collective bargaining
negotiation;

(d) To own property, real or personal, for the use and benefit of the labor organization and its members;

(e) To sue and be sued in its registered name; and

(f) To undertake all other activities designed to benefit the organization and its members, including cooperative,
housing welfare and other projects not contrary to law.

x x x x x x x x x."
The pertinent question, therefore, must be asked: When does a labor organization acquire legitimacy?
Ordinarily, a labor organization attains the status of legitamacy only upon the issuance in its name of a
Certificate of Registration by the Bureau of Labor Relations pursuant to Articles 234 and 235 of the Labor
Code, viz.:
ART. 234. Requirements of registration.--Any applicant labor organization, association or group of
unions or workers shall acquire legal personality and shall be entitled to the rights and privileges
granted by law to legitimate labor organizations upon issuance of the certificate of registration based
on the following requirements:

(a) Fifty pesos (P50.00) registration fee;

(b) The names of its officers, their addresses, the principal address of the labor organization, the minutes of the
organizational meetings and the list of the workers who participated in such meetings;

(c) The names of all its members comprising at least twenty percent (20%) of all the employees in the
bargaining unit where it seeks to operate;

(d) If the applicant union has been in existence for one or more years, copies of its annual financial reports;
and

(e) Four (4) copies of the constitution and by-laws of the applicant union, minutes of its adoption or ratification,
and the list of the members who participated in it.

ART. 235. Action on application. -- The Bureau shall act on all applications for registration within thirty
(30) days from filing.
All requisite documents and papers shall be certified under oath by the secretary or the treasurer of
the organization, as the case may be, and attested to by its president.
The foregoing procedure is not the only way by which a labor union may become legitimate,
however. When an unregistered union becomes a branch, local or chapter of a federation, some of the
aforementioned requirements for registration are no longer required. [8] Section 3, Rule II, Book V of the
Implementing Rules of the Labor Code governs the procedure for union affiliation, the relevant portions of
which provide:
Sec. 3. Union Affiliation: Direct Membership with National Union. An affiliate of a labor federation or
national union may be a local or chapter thereof or an independently registered union.

40
 (a) The labor federation or national union concerned shall issue a chapter certificate indicating the
creation or establishment of a local or chapter, copy of which shall be submitted to the Bureau of
Labor Relations within thirty (30) days from issuance of such charter certificate.
(b) An independently registered union shall be considered an affiliate of a labor federation or national
union after submission to the Bureau of the contract or agreement of affiliation within thirty (30) days
after its execution.
xxxxxxxxx
(e) The local or chapter of a labor federation or national union shall have and maintain a constitution
and by-laws, set of officers and book of accounts. For reporting purposes, the procedure governing
the reporting of independently registered unions, federations or national unions shall be observed.
Paragraph (a) refers to a local or chapter of a federation which did not undergo the rudiments of
registration while paragraph (b) refers to an independently registered union which affiliated with a
federation. Implicit in the foregoing differentiation is the fact that a local or chapter need not be independently
registered. By force of law (in this case, Article 212 [h]), such local or chapter becomes a legitimate labor
organization upon compliance with the aforementioned provisions of Section 3[9] (a) and (e), without having to
be issued a Certificate of Registration in its favor by the BLR.
The cases of Lopez Sugar Corporation v. Secretary of Labor and Employment,[10] Phoenix Iron and Steel
Corporation v. Secretary of Labor and Employment,[11] and Protection Technology, Inc. v. Secretary,
Department of Labor and Employment,[12] all going back to our landmark holding in Progressive Development
Corporation v. Secretary, Department of Labor and Employment,[13] unequivocably laid down the rule, thus:
A local or chapter therefore becomes a legitimate labor organization only upon submission of the
following to the BLR:
1) A charter certificate, within 30 days from its issuance by the labor federation or national
union, and
2) The constitution and by-laws, a statement on the set of officers, and the books of accounts
all of which are certified under oath by the secretary or treasurer, as the case may be, of
such local or chapter, and attested to by its president.
Absent compliance with these mandatory requirements, the local or chapter does not become a
legitimate labor organization.
Corollarily, the satisfaction of all these requirements by the local or chapter shall vest upon it the status of
legitimacy with all its concomitant statutory privileges, one of which is the right to be certified as the exclusive
representative of all the employees in an appropriate bargaining unit.
In the case at bench, public respondent Bienvenido E. Laguesma, in affirming the finding of the Med-
Arbiter that IBM at SMFI is a legitimate labor organization,[14] made the following material pronouncements
amply supported by the records:
[t]he resolution of the issue raised by the respondent on whether or not petitioner is a legitimate labor
organization will depend on the documents submitted by the petitioner in the second petition.
A close scrutiny of the records shows that at the time of the filing of the subject petition on 24
September 1993 by the petitioner Ilaw at Buklod ng Manggagawa, for and in behalf of its local affiliate
IBM at SMFI-CEBU B-MEG, the latter has been clothed with the status and/or character of a
legitimate labor organization. This is so, because on 19 July 1993, petitioner submitted to the Bureau
of Labor Relations (BLR), this Department, the following documents: charter certificate, constitution
and by-laws, names and addresses of the union officers and a certification of the unions secretary on
the non-availability of the unions Books of Accounts. Said documents (except the charter certificate)
are certified under oath and attested to by the local unions secretary and President, respectively.[15]
Petitioner SMFI does not dispute the fact that IBM at SMFI has complied with the second set of
requirements, i.e., constitution, by-laws, et. al. What is controverted is the non-compliance with the requirement
as to the charter certificate which must be submitted to the BLR within thirty (30) days from its issuance by the
labor federation. While the presence of a charter certificate is conceded, petitioner maintains that the validity
and authenticity of the same cannot yet be ascertained as it is still not known who is the legitimate and
authorized representative of the IBM Federation who may validly issue said charter certificate in favor of its
local, IBM at SMFI. According to petitioner, there are two (2) contending sets of officers of the IBM Federation
at the time the charter certificate was issued in favor of IBM at SMFI, the faction of Mr. Severino O. Meron and
that of Mr. Edilberto B. Galvez.
On this point, public respondent, in upholding the legitimate status of IBM at SMFI, backed up by the
Solicitor General, had this to say:

41
 The contention of the respondent that unless and until the issue on who is the legitimate national
president, of the Ilaw at Buklod ng Manggagawa is resolved, the petitioner cannot claim that it has a
valid charter certificate necessary for it to acquire legal personality is untenable. We wish to stress
that the resolution of the said issue will not in any way affect the validity of the charter certificate
issued by the IBM in favor of the local union. It must be borne in mind that the said charter certificate
was issued by the IBM in its capacity as a labor organization, a juridical entity which has a separate
and distinct legal personality from its members. When as in this case, there is no showing that the
Federation acting as a separate entity is questioning the legality of the issuance of the said charter
certificate, the legality of the issuance of the same in favor of the local union is presumed. This,
notwithstanding the alleged controversy on the leadership of the federation.[16]
We agree with this position of the public respondent and the Solicitor General. In addition, private
respondents Comment to this petition indicates that in the election of officers held to determine the
representatives of IBM, the faction of Mr. Meron lost to the group of Mr. Edilberto Galvez, and the latter was
acknowledged as the duly elected IBM National President.[17]Thus, the authority of Mr. Galvez to sign the
charter certificate of IBM at SMFI, as President of the IBM Federation, [18] can no longer be successfully
questioned. A punctilious examination of the records presents no evidence to the contrary and petitioner,
instead of squarely refuting this point, skirted the issue by insisting that the mere presence of two contending
factions in the IBM prevents the issuance of a valid and authentic charter certificate in favor of IBM at
SMFI. This averment of petitioner simply does not deserve any merit.
II
In any case, this Court notes that it is petitioner, the employer, which has offered the most tenacious
resistance to the holding of a certification election among its monthly-paid rank-and-file employees. This must
not be so, for the choice of a collective bargaining agent is the sole concern of the employees. [19] The only
exception to this rule is where the employer has to file the petition for certification election pursuant to Article
258[20] of the Labor Code because it was requested to bargain collectively,[21] which exception finds no
application in the case before us. Its role in a certification election has aptly been described in Trade Unions of
the Philippines and Allied Services (TUPAS) v. Trajano,[22] as that of a mere by-stander. It has no legal
standing in a certification election as it cannot oppose the petition or appeal the Med-Arbiters orders related
thereto. An employer that involves itself in a certification election lends suspicion to the fact that it wants to
create a company union.[23] This Court should be the last agency to lend support to such an attempt at
interference with a purely internal affair of labor.[24]
While employers may rightfully be notified or informed of petitions of such nature, they should not,
however, be considered parties thereto with the concomitant right to oppose it. Sound policy dictates that they
should maintain a strictly hands-off policy.[25]
It bears stressing that no obstacle must be placed to the holding of certification elections,[26] for it is a
statutory policy that should not be circumvented.[27] The certification election is the most democratic and
expeditious method by which the laborers can freely determine the union that shall act as their representative
in their dealings with the establishment where they are working.[28] It is the appropriate means whereby
controversies and disputes on representation may be laid to rest, by the unequivocal vote of the employees
themselves.[29] Indeed, it is the keystone of industrial democracy.[30]
III
Petitioner next asseverates that the Charter Certificate submitted by the private respondent was defective
in that it was not certified under oath and attested to by the organizations secretary and President.
Petitioner is grasping at straws. Under our ruling in the Progressive Development Corporation[31] case,
what is required to be certified under oath by the secretary or treasurer and attested to by the locals president
are the constitution and by-laws, a statement on the set of officers, and the books of accounts of the
organization. The charter certificate issued by the mother union need not be certified under oath by the
secretary or treasurer and attested to by the locals president.
IV
Petitioner, in its Reply to public respondents Comment, nevertheless calls the attention of this court to the
fact that, contrary to the assertion of private respondent IBM that it is a legitimate labor federation and
therefore has the capacity and authority to create a local or chapter at SMFI, the Chief of the Labor
Organizations Division of the Bureau of Labor Relations Manila had allegedly issued a certification last January
17, 1995 to the effect that private respondent is not a legitimate labor federation. [32]
This is a factual issue which petitioner should have raised before the Med-Arbiter so as to allow the private
respondent ample opportunity to present evidence to the contrary. This Court is definitely not the proper venue
to consider this matter for it is not a trier of facts. It is noteworthy that petitioner did not challenge the legal
personality of the federation in the proceedings before the Med-Arbiter. Nor was this issue raised in petitioners
appeal to the Office of the Secretary of Labor and Employment. This matter is being raised for the first time in

42
this petition. An issue which was neither alleged in the pleadings nor raised during the proceedings below
cannot be ventilated for the first time before this Court. It would be offensive to the basic rule of fair play, justice
and due process.[33] Certiorari is a remedy narrow in its scope and inflexible in character. It is not a general
utility tool in the legal workshop.[34] Factual issues are not a proper subject for certiorari, as the power of the
Supreme Court to review labor cases is limited to the issue of jurisdiction and grave abuse of discretion. [35] It is
simply unthinkable for the public respondent Undersecretary of Labor to have committed grave abuse of
discretion in this regard when the issue as to the legal personality of the private respondent IBM Federation
was never interposed in the appeal before said forum.
V
Finally, the certification election sought to be stopped by petitioner is, as of now, fait accompli. The
monthly paid rank-and-file employees of SMFI have already articulated their choice as to who their collective
bargaining agent should be. In the certification election held on August 20, 1994,[36] the SMFI workers chose
IBM at SMFI to be their sole and exclusive bargaining agent. This democratic decision deserves utmost
respect. Again, it bears stressing that labor legislation seeks in the main to protect the interest of the members
of the working class. It should never be used to subvert their will.[37]
WHEREFORE, the petition is DENIED. Costs against petitioner.
SO ORDERED.

43
ACEDERA VS INTERNATIONAL CONTAINER

THIRD DIVISION

[G.R. No. 146073. January 13, 2003]

JERRY E. ACEDERA, ANTONIO PARILLA, AND OTHERS LISTED IN ANNEX A, [1] petitioners-appellants,
vs. INTERNATIONAL CONTAINER TERMINAL SERVICES, INC. (ICTSI), NATIONAL LABOR
RELATIONS COMMISSION and HON. COURT OF APPEALS, respondents-appellees.

DECISION
CARPIO-MORALES, J.:

For consideration is the petition for review on certiorari assailing the decision of the Court of Appeals
affirming that of the National Labor Relations Commission (NLRC) which affirmed the decision of the Labor
Arbiter denying herein petitioners-appellants Complaint-in-Intervention with Motion for Intervention.
The antecedent facts are as follows:
Petitioners-appellants Jerry Acedera, et al. are employees of herein private respondent International
Container Terminal Services, Inc. (ICTSI) and are officers/members of Associated Port Checkers & Workers
Union-International Container Terminal Services, Inc. Local Chapter (APCWU-ICTSI), a labor organization duly
registered as a local affiliate of the Associated Port Checkers & Workers Union (APCWU).
When ICTSI started its operations in 1988, it determined the rate of pay of its employees by using 304
days, the number of days of work of the employees in a year, as divisor.[2]
On September 28, 1990, ICTSI entered into its first Collective Bargaining Agreement (CBA) with APCWU
with a term of five years effective until September 28, 1995. [3] The CBA was renegotiated and thereafter
renewed through a second CBA that took effect on September 29, 1995, effective for another five years. [4] Both
CBAs contained an identically-worded provision on hours and days of work reading:

Article IX

Regular Hours of Work and Days of Labor

Section 1. The regular working days in a week shall be five (5) days on any day from Monday to Sunday, as
may be scheduled by the COMPANY, upon seven (7) days prior notice unless any of this day is declared a
special holiday.[5] (Underscoring omitted)

In accordance with the above-quoted provision of the CBA, the employees work week was reduced to five
days or a total of 250 days a year. ICTSI, however, continued using the 304-day divisor in computing the
wages of the employees.[6]
On November 10, 1990, the Regional Tripartite Wage and Productivity Board (RTWPB) in the National
Capital Region decreed a P17.00 daily wage increase for all workers and employees receiving P125.00 per
day or lower in the National Capital Region.[7] The then president of APCWU, together with some union
members, thus requested the ICTSIs Human Resource Department/Personnel Manager to compute the actual
monthly increase in the employees wages by multiplying the RTWPB mandated increase by 365 days and
dividing the product by 12 months.[8]
Heeding the proposal and following the implementation of the new wage order, ICTSI stopped using 304
days as divisor and started using 365 days in determining the daily wage of its employees and other
consequential compensation, even if the employees work week consisted of only five days as agreed upon in
the CBA.[9]
In early 1997, ICTSI went on a retrenchment program and laid off its on-call employees.[10] This prompted
the APCWU-ICTSI to file a notice of strike which included as cause of action not only the retrenchment of the
employees but also ICTSIs use of 365 days as divisor in the computation of wages. [11] The dispute respecting
the retrenchment was resolved by a compromise settlement[12] while that respecting the computation of wages
was referred to the Labor Arbiter.[13]

44
 On February 26, 1997, APCWU, on behalf of its members and other employees similarly situated, filed
with the Labor Arbiter a complaint against ICTSI which was dismissed for APCWUs failure to file its position
paper.[14] Upon the demand of herein petitioners-appellants, APCWU filed a motion to revive the case which
was granted. APCWU thereupon filed its position paper on August 22, 1997.[15]
On December 8, 1997, petitioners-appellants filed with the Labor Arbiter a Complaint-in-Intervention with
Motion to Intervene.[16] In the petition at bar, they justified their move to intervene in this wise:

[S]hould the union succeed in prosecuting the case and in getting a favorable reward it is actually they that
would benefit from the decision. On the other hand, should the union fail to prove its case, or to prosecute the
case diligently, the individual workers or members of the union would suffer great and immeasurable loss.
[t]hey wanted to insure by their intervention that the case would thereafter be prosecuted with all due diligence
and would not again be dismissed for lack of interest to prosecute on the part of the union. [17]

The Labor Arbiter rendered a decision, the dispositive portion of which reads:

WHEREFORE, decision is hereby rendered declaring that the correct divisor in computing the daily wage and
other labor standard benefits of the employees of respondent ICTSI who are members of complainant Union
as well as the other employees similarly situated is two hundred fifty (250) days such that said respondent is
hereby ordered to pay the employees concerned the differentials representing the underpayment of said
salaries and other benefits reckoned three (3) years back from February 26, 1997, the date of filing of this
complaint or computed from February 27 1994 until paid, but for purposes of appeal, the salary differentials are
temporarily computed for one year in the amount of Four Hundred Sixty Eight Thousand Forty Pesos
(P468,040.00).[18]

In the same decision, the Labor Arbiter denied petitioners-appellants Complaint-in-Intervention with Motion
for Intervention upon a finding that they are already well represented by APCWU.[19]
On appeal, the NLRC reversed the decision of the Labor Arbiter and dismissed APCWUs complaint for
lack of merit.[20] The denial of petitioners-appellants intervention was, however, affirmed.[21]
Unsatisfied with the decision of the NLRC, APCWU filed a petition for certiorari with the Court of Appeals
while petitioners-appellants filed theirs with this Court which referred the petition[22] to the Court of Appeals.
The Court of Appeals dismissed APCWUs petition on the following grounds: failure to allege when its
motion for reconsideration of the NLRC decision was filed, failure to attach the necessary appendices to the
petition, and failure to file its motion for extension to file its petition within the reglementary period.[23]
As for petitioners-appellants petition for certiorari, it was dismissed by the Court of Appeals in this wise:

It is clear from the records that herein petitioners, claiming to be employees of respondent ICTSI, are already
well represented by its employees union, APCWU, in the petition before this Court (CA-G.R. SP. No.
53266) although the same has been dismissed. The present petition is, therefore a superfluity that deserves to
be dismissed. Furthermore, only Acedera signed the Certificate of non-forum shopping. On this score
alone, this petition should likewise be dismissed. We find that the same has no merit considering that herein
petitioners have not presented any meritorious argument that would justify the reversal of the Decision of the
NLRC.

Article IX of the CBA provides:

REGULAR HOURS OF WORK AND DAYS OF LABOR

Section 1. The regular working days in a week shall be five (5) days on any day from Monday to Sunday, as
may be scheduled by the COMPANY, upon seven (7) days prior notice unless any of this day is declared a
special holiday.

This provision categorically states the required number of working days an employee is expected to work for a
week. It does not, however, indicate the manner in which an employees salary is to be computed. In fact,
nothing in the CBA makes any referral to any divisor which should be the basis for determining the salary. The
NLRC, therefore, correctly ruled that xxx the absence of any express or specific provision in the CBA that 250
days should be used as divisor altogether makes the position of the Union untenable.

xxx

Considering that herein petitioners themselves requested that 365 days be used as the divisor in computing
their wage increase and later did not raise or object to the same during the negotiations of the new CBA, they
are clearly estopped to now complain of such computation only because they no longer benefit from it. Indeed,
45
the 365 divisor for the past seven (7) years has already become practice and law between the company and its
employees.[24] (Emphasis supplied)

xxx

Hence, the present petition of petitioners-appellants who fault the Court of Appeals as follows:
I

. . . IN REJECTING THE CBA OF THE PARTIES AS THE SOURCE OF THE DIVISOR TO DETERMINE THE
WORKERS DAILY RATE TOTALLY DISREGARDED THE APPLICABLE LANDMARK DECISIONS OF THE
HONORABLE SUPREME COURT ON THE MATTER.

II

. . . [IN] DISREGARD[ING] APPLICABLE DECISIONS OF THIS HONORABLE COURT WHEN IT RULED

THAT THE PETITIONERS-APPELLANTS ARE ALREADY IN ESTOPPEL.

III

. . . IN RULING THAT THE PETITIONERS-APPELLANTS HAVE NO LEGAL RIGHT TO INTERVENE IN AND

PURSUE THIS CASE AND THAT THEIR INTERVENTION IS A SUPERFLUITY.

IV

. . . IN HOLDING, ALTHOUGH MERELY AS AN OBITER DICTUM, THAT ONLY PETITIONER JERRY

ACEDERA SIGNED THE CERTIFICATE OF NON-FORUM SHOPPING.[25]

The third assigned error respecting petitioners-appellants right to intervene shall first be passed upon, it
being determinative of their right to raise the other assigned errors.
Petitioners-appellants anchor their right to intervene on Rule 19 of the 1997 Rules of Civil Procedure,
Section 1 of which reads:

Section 1. Who may intervene.- A person who has legal interest in the matter in litigation, or in the success of
either of the parties, or an interest against both, or is so situated to be adversely affected by a distribution or
other disposition of property in the custody of the court or of an officer thereof may, with leave of court, be
allowed to intervene in the action. The court shall consider whether or not the intervention will unduly delay or
prejudice the adjudication of the rights of the original parties, and whether or not the intervenors right may be
fully protected in a separate proceeding.

They stress that they have complied with the requisites for intervention because (1) they are the ones who
stand to gain or lose by the direct legal operation and effect of any judgment that may be rendered in this case,
(2) no undue delay or prejudice would result from their intervention since their Complaint-in-Intervention with
Motion for Intervention was filed while the Labor Arbiter was still hearing the case and before any decision
thereon was rendered, and (3) it was not possible for them to file a separate case as they would be guilty of
forum shopping because the only forum available for them was the Labor Arbiter.[26]
Petitioners-appellants, however, failed to consider, in addition to the rule on intervention, the rule on
representation, thusly:

Sec. 3. Representatives as parties.- Where the action is allowed to be prosecuted or defended by a

representative or someone acting in a fiduciary capacity, the beneficiary shall be included in the title of the
case and shall be deemed to be the real party in interest. A representative may be a trustee of an express
trust, a guardian, an executor or administrator, or a party authorized by law or these Rules. . . [27](Emphasis
supplied)

A labor union is one such party authorized to represent its members under Article 242(a) of the Labor
Code which provides that a union may act as the representative of its members for the purpose of collective
bargaining. This authority includes the power to represent its members for the purpose of enforcing the
provisions of the CBA. That APCWU acted in a representative capacity for and in behalf of its Union members
and other employees similarly situated, the title of the case filed by it at the Labor Arbiters Office so expressly
states.
While a party acting in a representative capacity, such as a union, may be permitted to intervene in a
case, ordinarily, a person whose interests are already represented will not be permitted to do the
46
same[28] except when there is a suggestion of fraud or collusion or that the representative will not act in good
faith for the protection of all interests represented by him.[29]
Petitioners-appellants cite the dismissal of the case filed by ICTSI, first by the Labor Arbiter, and later by
the Court of Appeals.[30] The dismissal of the case does not, however, by itself show the existence of fraud or
collusion or a lack of good faith on the part of APCWU. There must be clear and convincing evidence of fraud
or collusion or lack of good faith independently of the dismissal. This, petitioners-appellants failed to proffer.
Petitioners-appellants likewise express their fear that APCWU would not prosecute the case diligently
because of its sweetheart relationship with ICTSI.[31] There is nothing on record, however, to support this
alleged relationship which allegation surfaces as a mere afterthought because it was never raised early on. It
was raised only in petitioners-appellants reply to ICTSIs comment in the petition at bar, the last pleading
submitted to this Court, which was filed on June 20, 2001 or more than 42 months after petitioners-appellants
filed their Complaint-in-Intervention with Motion to Intervene with the Labor Arbiter.
To reiterate, for a member of a class to be permitted to intervene in a representative action, fraud or
collusion or lack of good faith on the part of the representative must be proven. It must be based on facts borne
on record. Mere assertions, as what petitioners-appellants proffer, do not suffice.
The foregoing discussion leaves it unnecessary to discuss the other assigned errors.
WHEREFORE, the present petition is hereby DENIED.
SO ORDERED.

47
MINETTE BAPTISTA ET AL VS ROSARIO VILLANUEVA

Republic of the Philippines

SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 194709 July 31, 2013

MINETTE BAPTISTA, BANNIE EDSEL SAN MIGUEL, and MA. FEDAYON, Petitioners,
vs.
ROSARIO VILLANUEVA, JANETTE ROLDAN, DANILO OLAYVAR, ONOFRE ESTRELLA, CATALINO
LEDDA, MANOLO GUBANGCO, GILBERT ORIBIANA, CONSTANCIO SANTIAGO, RUTH BAYQUEN,
RUBY CASTANEDA, ALFRED LANDAS, JR., ROSELYN GARCES, EUGENE CRUZ, MENANDRO
SAMSON, FEDERICO MUNOZ and SALVADOR DIWA, Respondents.

DECISION

MENDOZA, J.:

This Petition for Review on Certiorari1 under Rule 45 of the 1997 Rules of Civil Procedure filed by Minette
Baptista, Bannie Edsel San Miguel and Ma. Fe Dayon (petitioners) assails the March 9, 2010 Decision 2 and
the December 1, 2010 Resolution3 of the Court of Appeals (CA) in CA-G.R. SP No. 105027, which affirmed the
March 31, 2008 Decision4 of the National Labor Relations Commission (NLRC) dismissing the complaint for
Unfair Labor Practice (ULP) filed against the named respondents.

The Facts

Petitioners were former union members of Radio Philippines Network Employees Union (RPNEU), a legitimate
labor organization and the sole and exclusive bargaining agent of the rank and file employees of Radio
Philippines Network (RPN), a government-sequestered corporation involved in commercial radio and television
broadcasting affairs, while the respondents were the unions elected officers and members.

On April 26, 2005, on suspicion of union mismanagement, petitioners, together with some other union
members, filed a complaint for impeachment of their union president, Reynato Siozon, before the executive
board of RPN, which was eventually abandoned. They later re-lodged the impeachment complaint, this time,
against all the union officers and members of RPNEU before the Department of Labor and Employment
(DOLE). They likewise filed various petitions for audit covering the period from 2000 to 2004. 5

Thereafter, two (2) written complaints, dated May 26, 2005 and May 27, 2005, were filed against petitioners
and several others for alleged violation of the unions Constitution and By-Laws.6 Months later, on September
19, 2005, a different group of union members filed a third complaint against petitioners and 12 others, 7 before
the Chairman of RPNEUs Committee on Grievance and Investigation (the Committee) citing as grounds the
"commission of an act which violates RPNEU Constitution and By-Laws, specifically, Article IX, Section 2.2 for
joining or forming a union outside the sixty (60) days period and Article IX, Section 2.5 for urging or advocating
that a member start an action in any court of justice or external investigative body against the Union or its
officer without first exhausting all internal remedies open to him or available in accordance with the
CBL."8 These complaints were, later on, consolidated.9

Thereafter, petitioners received a memorandum notice from Jeric Salinas, Chairman of the Committee,
requesting them to answer the complaint and attend a hearing scheduled on October 3, 2005.10 Petitioners and
their group, through an exchange of communications with the Committee, denied the charges imputed against
them and contested the procedure adopted by the Committee in its investigation. On November 9, 2005, the
Committee submitted their recommendation of expulsion from the union to RPNEUs Board of Directors. 11 On
December 21, 2005, the RPNEUs Board of Directors affirmed the recommendation of expulsion of petitioners
and the 12 others from union membership in a Board Resolution No. 018-2005.12 Through a
Memorandum,13 dated December 27, 2005, petitioners were served an expulsion notice from the union, which
was set to take effect on December 29, 2005. On January 2, 2006, petitioners with the 12 others wrote to
RPNEUs President and Board of Directors that their expulsion from the union was an ultra vires act because
the Committee failed to observe the basic elements of due process because they were not given the chance to
physically confront and examine their complainants.14

48
In a letter, dated January 24, 2006, RPNEUs officers informed their company of the expulsion of petitioners
and the 12 others from the union and requested the management to serve them notices of termination from
employment in compliance with their CBAs union security clause.15 On February 17, 2006, RPN HRD
Manager, Lourdes Angeles, informed petitioners and the 12 others of the termination of their employment
effective March 20, 2006, enforcing Article II, Section 216 also known as the union security clause of their
current CBA.17

Aggrieved, petitioners filed three (3) separate complaints for ULP against the respondents, which were later
consolidated,18 questioning legality of their expulsion from the union and their subsequent termination from
employment.

In a decision,19 dated April 30, 2007, the Labor Arbiter (LA) ruled in favor of the petitioners and adjudged the
respondents guilty of ULP pursuant to Article 249 (a) and (b) of the Labor Code. The LA clarified that only the
union officers of RPNEU could be held responsible for ULP, so they exonerated six (6) of the original
defendants who were mere union members. The LA also ordered the reinstatement of petitioners as bonafide
members of RPNEU. The decretal portion reads:

WHEREFORE, premises above considered, a decision is being issued declaring union officers Ruth Bayquen,
Ruby Castaeda, Alfred Landas, Roce Garces, Board of Directors Federico Muoz, Janette Roldan, Rosario
Villanueva, Menandro Samson, Salvador Diwa and Eugene Cruz guilty of unfair labor practice for violating
Article 249, paragraph A and B of the Labor Code. Respondents are also ordered to cease and desist from
further committing unfair labor practice and order the reinstatement of the complainants as bonafide members
of the union.

The other claims are hereby denied for lack of factual and legal basis.

SO ORDERED.20

Undaunted, the respondents appealed the LA decision to the NLRC.

In its Decision,21 dated March 31, 2008, the NLRC vacated and set aside the LA decision and dismissed the
complaint for ULP for lack of merit. The NLRC found that petitioners filed a suit calling for the impeachment of
the officers and members of the Executive Board of RPNEU without first resorting to internal remedies
available under its own Constitution and By-Laws. The NLRC likewise decreed that the LAs order of
reinstatement was improper because the legality of the membership expulsion was not raised in the
proceedings and, hence, beyond the jurisdiction of the LA.22 The fallo of the NLRC decision reads:

WHEREFORE, the partial appeal filed by the respondents is GRANTED. The decision, dated 30 April 2007 is
VACATED and SET ASIDE. The complaint is dismissed for lack of merit.

SO ORDERED.23

Petitioners filed for a motion for reconsideration, but the NLRC denied it in its Resolution,24 dated May 30,
2008.

The CA, in its March 9, 2010 Decision, sustained the NLRC decision. The CA stated that the termination of
employment by virtue of a union security clause was recognized in our jurisdiction. It explained that the said
practice fortified the union and averted disunity in the bargaining unit within the duration of the CBA. The CA
declared that petitioners were accorded due process before they were removed from office. In fact, petitioners
were given the opportunity to explain their case and they actually availed of said opportunity by submitting
letters containing their arguments.25

Petitioners moved for reconsideration, but the CA likewise denied the same in its December 1, 2010
Resolution,26The CA expounded:

Anent petitioners charge of ULP against respondents, the records are barren of proof to sustain such charge.
What remains apparent is that petitioners were expelled from the union due to their violation of Section 2.5 of
Article IX of the CBL which punishes the act of "urging or advocating that a member start an action in any court
of justice or external investigative body against the Union or any of its officer, without first exhausting all
internal remedies open to him or available in accordance with the Constitution and By-Laws of Union." As
petitioners expulsion was pursuant to the unions CBL, We absolve respondents of the charges of ULP absent
any substantial evidence to sustain it.

49
The importance of a unions constitution and bylaws cannot be overemphasized. They embody a covenant
between a union and its members and constitute the fundamental law governing the members rights and
obligations. As such, the unions constitution and bylaws should be upheld, as long as they are not contrary to
law, good morals or public policy. In Diamonon v. Department of Labor and Employment, the High Court
affirmed the validity and importance of the provision in the CBL of exhaustion of administrative remedies, viz:

When the Constitution and by-laws of both unions dictated the remedy for intra-union dispute, such as
petitioners complaint against private respondents for unauthorized or illegal disbursement of union funds, this
should be resorted to before recourse can be made to the appropriate administrative or judicial body, not only
to give the grievance machinery or appeals body of the union the opportunity to decide the matter by itself, but
also to prevent unnecessary and premature resort to administrative or judicial bodies. Thus, a party with an
administrative remedy must not merely initiate the prescribed administrative procedure to obtain relief, but also
pursue it to its appropriate conclusion before seeking judicial intervention.27

Thus, petitioners advance the following

GROUNDS/ARGUMENTS IN SUPPORT OF THE PETITION

1. WITH DUE RESPECT, THE HONORABLE COURT OF APPEALS MISERABLY FAILED TO

APPRECIATE THE REAL ISSUE IN THIS CASE.

2. WITH DUE RESPECT, THE DECISION AND RESOLUTION ARRIVED AT BY THE HONORABLE
COURT OF APPEALS ARE NOT IN ACCORD WITH LAW AND APPLICABLE JURISPRUDENCE,
THEREBY GRAVELY ABUSING ITS DISCRETION AMOUNTING TO LACK OR IN EXCESS OF
JURISDICTION.28

Petitioners submit that the respondents committed ULP under Article 289 (a) and (b) of the Labor Code.29 They
insist that they were denied substantive and procedural due process of law when they were expelled from the
RPNEU.

The petition is bereft of merit.

The primary concept of ULP is embodied in Article 247 of the Labor Code, which provides:

Article 247. 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.

In essence, ULP relates to the commission of acts that transgress the workers right to organize. As specified
in Articles 248 and 249 of the Labor Code, the prohibited acts must necessarily relate to the workers' right to
self-organization and to the observance of a CBA.30 Absent the said vital elements, the acts complained,
although seemingly unjust, would not constitute ULP.31

In the case at bench, petitioners claim that the respondents, as union officers, are guilty of ULP for violating
paragraphs (a) and (b) of Article 249 of the Labor Code, to wit:

ART. 249. UNFAIR LABOR PRACTICES OF LABOR ORGANIZATIONS.- It shall be unfair labor practice for a
labor organization, its officers, agents or representatives:

(a) To restrain or coerce employees in the exercise of their rights to self-organization. However, a labor
organization shall have the right to prescribe its own rules with respect to the acquisition or retention of
membership:

(b) To cause or attempt to cause an employer to discriminate against an employee, including

discrimination against an employee with respect to whom membership in such organization has been
denied or to terminate an employee on any ground other than the usual terms and conditions under
which membership or continuation of membership is made available to other members;

Petitioners posit that the procedure that should have been followed by the respondents in resolving the
charges against them was Article XVII, Settlement of Internal Disputes of their Constitution and By-Laws,
specifically, Section 232 thereof, requiring members to put their grievance in writing to be submitted to their

50
union president, who shall strive to have the parties settle their differences amicably. Petitioners maintain that
any form of grievance would be referred only to the committee upon failure of the parties to settle amicably. 33

The Court is not persuaded.

Based on RPNEUs Constitution and By-Laws, the charges against petitioners were not mere internal
squabbles, but violations that demand proper investigation because, if proven, would constitute grounds for
their expulsion from the union. As such, Article X, Investigation Procedures and Appeal Process of RPNEUs
Constitution and By-Laws, which reads

SECTION 1. Charge against any member or officer of the Union shall be submitted to the Board of Directors
(BOD) in writing, which shall refer the same, if necessary, to the committee on Grievance and Investigation.
The Committee shall hear any charge and subsequently, forward its finding and recommendation to the BOD.
The BOD has the power to approve or nullify the recommendation of the Committee on Grievance and
Investigation based on the merit of the appeal.

was correctly applied under the circumstances.

Besides, any supposed procedural flaw in the proceedings before the Committee was deemed cured when
petitioners were given the opportunity to be heard. Due process, as a constitutional precept, is satisfied when a
person was notified of the charge against him and was given an opportunity to explain or defend himself. In
administrative proceedings, the filing of charges and giving reasonable opportunity for the person so charged
to answer the accusations against him constitute the minimum requirements of due process. 34 The essence of
due process is simply to be heard, or as applied to administrative proceedings, an opportunity to explain ones
side, or an opportunity to seek a reconsideration of the action or ruling complained of. 35 It cannot be denied
that petitioners were properly notified of the charges filed against them and were equally afforded the
opportunity to present their side.

Next, petitioners point out that they were not given the opportunity to personally face and confront their
accusers, which were violative of their right to examine the complainants and the supposed charges against
them.36

Petitioners contention is without merit. Mere absence of a one-onone confrontation between the petitioners
and their complainants does not automatically affect the validity of the proceedings before the Committee. Not
all cases necessitate a trial-type hearing.37 As in this case, what is indispensable is that a party be given the
right to explain ones side, which was adequately afforded to the petitioners.

It is well-settled that workers and employers organizations shall have the right to draw up their constitutions
and rules to elect their representatives in full freedom, to organize their administration and activities and to
formulate their programs.38 In this case, RPNEUs Constitution and By-Laws expressly mandate that before a
party is allowed to seek the intervention of the court, it is a pre-condition that he should have availed of all the
internal remedies within the organization. Petitioners were found to have violated the provisions of the unions
Constitution and By-Laws when they filed petitions for impeachment against their union officers and for audit
before the DOLE without first exhausting all internal remedies available within their organization. This act is a
ground for expulsion from union membership. Thus, petitioners expulsion from the union was not a deliberate
attempt to curtail or restrict their right to organize, but was triggered by the commission of an act, expressly
sanctioned by Section 2.5 of Article IX of the unions Constitution and By-Laws.1wphi1

For a charge of ULP against a labor organization to prosper, the onus probandi rests upon the party alleging it
to prove or substantiate such claims by the requisite quantum of evidence. 39 In labor cases, as in other
administrative proceedings, substantial evidence or such relevant evidence as a reasonable mind might accept
as sufficient to support a conclusion is required.40 Moreover, it is indubitable that all the prohibited acts
constituting unfair labor practice should materially relate to the workers' right to self-organization.41

Unfortunately, petitioners failed to discharge the burden required to prove the charge of ULP against the
respondents. Aside from their self-serving allegations, petitioners were not able to establish how they were
restrained or coerced by their union in a way that curtailed their right to self-organization. The records likewise
failed to sufficiently show that the respondents unduly persuaded management into discriminating against
petitioners. other than to bring to its attention their expulsion from the union, which in turn, resulted in the
implementation of their CBA' s union security clause. As earlier stated, petitioners had the burden of adducing
substantial evidence to support its allegations of ULP,42 which burden they failed to discharge. In fact, both the
NLRC and the CA found that petitioners were unable to prove their charge of ULP against the respondents.

51
It is axiomatic that absent any clear showing of abuse, arbitrariness or capriciousness, the findings of fact by
the NLRC, especially when affirmed by the CA, as in this case, are binding and conclusive upon the
Court.43 Having found none, the Court finds no cogent reason to deviate from the challenged decision.

WHEREFORE, the petition is DENIED. The March 9, 2010 Decision and the December 1, 2010 Resolution of
the Court of Appeals in CA-G.R. SP No. 105027 are AFFIRMED.

SO ORDERED.

52
EDEN GLADS ABARIA VS NLRC

FIRST DIVISION

EDEN GLADYS ABARIA, ROMULO G.R. No. 154113

ALFORQUE, ELENA ALLA, EVELYN
APOSTOL, AMELIA ARAGON, BEATRIZ
ALBASTRO, GLORIA ARDULLES,
GLENDA BANTILAN, VIRGILIE
BORINAGA, ROLDAN CALDERON,
ILDEBRANDO CUTA, ROMEO
EMPUERTO,
LANNIE FERNANDEZ, LUCINELL
GABAYERON,
JESUSA GERONA, JOSE GONZAGA,
TEOFILO HINAMPAS, JOSEFINA
IBUNA, MARLYN LABRA, MARIA
CARMENCITA LAO, ERA CANEN,
RODNEY REX
LERIAS, ERNIE MANLIGAS,
JOHANNE DEL MAR, RUBY
ORIMACO, CONSTANCIO
PAGADOR, MARVELOUS
PANAL, NOLAN PANAL, LILLAN
PETALLAR, GERNA PATIGDAS,
MELODIA PAULIN, SHIRLEY ROSE
REYES, JOSEFINA REYES, OSCAR DE
LOS SANTOS, SOLOMON DE LOS
SANTOS, RAMON TAGNIPIS,
BERNADETTE TIBAY, RONALD
TUMULAK, LEONCIO VALLINAS,
EDELBERTO VILLA and the
NAGKAHIUSANG MAMUMUO SA METRO
CEBU COMMUNITY HOSPITAL,
Petitioners,

- versus -

NATIONAL LABOR RELATIONS

COMMISSION, METRO CEBU
COMMUNITY HOSPITAL, INC.,
ITS BOARD OF TRUSTEES, REV.
GREGORIO IYOY, SHIELA BUOT, REV.
LORENZO GENOTIVA, RUBEN
CARABAN, RUBEN ESTOYE, LILIA
SAURO, REV. ELIZER BERTOLDO,
RIZALINA VILLAGANTE, DRA. LUCIA
FLORENDO, CONCEPCION VILLEGAS,
REV. OLIVER CANEN, DRA. CYD
RAGAS, REV. MIKE CAMBA, AVEDNIGO
VALIENTE, RIZALINO TAGANAS,
CIRIACO PONGASI, ISIAS WAGAS, REV.
ESTER GELOAGAN, REV. LEON
MANIWAN, CRESENTE BAOAS,
WINEFREDA BARLOSO, REV. RUEL
MARIGA AND THE UNITED CHURCH OF
CHRIST IN THEPHILIPPINES, REV.
HILARIO GOMEZ, REV. ELMER
BOLOCON, THE NATIONAL FEDERATION
OF LABOR AND ARMAND ALFORQUE,
Respondents.
x- - - - - - - - - - - - - - - - - - - - - - - -x

PERLA NAVA, DANIELA YOSORES, G.R. No. 187778

AGUSTIN ALFORNON, AILEEN
CATACUTAN, ROLANDO REDILOSA,
53
CORNELIO MARIBOJO, VIRGENCITA
CASAS, CRISANTA GENEGABOAS,
EMILIO LAO, RICO GASCON, ALBINA
BAEZ, PEDRO CABATINGAN,PROCOMIO
SALUPAN, ELIZABETH RAMON,
DIOSCORO GABUNADA, ROY
MALAZARTE, FELICIANITA
MALAZARTE, NORBERTA CACA,
MILAGROS CASTILLO, EDNA ALBO,
BERNABE LUMAPGUID, CELIA SABAS,
SILVERIO LAO, DARIO LABRADOR,
ERNESTO CANEN, JR., ELSA BUCAO,
HANNAH BONGCARAS, NEMA
BELOCURA, PEPITO
LLAGAS,GUILLERMA REMOCALDO,
ROGELIO DABATOS, ROBERTO JAYMA,
RAYMUNDODELATADO, MERLYN
NODADO, NOEL HORTELANO,
HERMELO DELA TORRE, LOURDES
OLARTE,
DANILO ZAMORA, LUZCABASE,
CATALINA ALSADO, RUTH BANZON
AND THE NAGKAHIUSANG
MAMUMUO SAMETRO CEBU
COMMUNITY HOSPITAL,
Petitioners,

- versus -

NATIONAL LABOR RELATIONS

COMMISSION (FOURTH DIVISION),
METRO CEBU COMMUNITY HOSPITAL,
INC., BOARD OF TRUSTEES, REV.
GREGORIO IYOY, SHIELA BUOT, REV.
LORENZO GENOTIVA, RUBEN
CABABAN, ROSENDO ESTOYE, LILIA
SAURO, REV. ELIZER BERTOLDO,
RIZALINA VILLAGANTE, DRA. LUCIA
FLORENDO, CONCEPCION
VILLEGAS, REV. OLIVER CANEN,
DRA. CYD RAAGAS, REV. MIKE CAMBA,
AVIDNIGO VALIENTE, RIZALINO
TAGANAS,CIRIACO
PONGASI, ISIAS WAGAS, REV. ESTER
GELOAGAN, REV. LEON MANIWAN,
CRESENTE BAOAS, WINIFREDA
BARLOSO, REV. RUEL MARIGA, THE
UNITEDCHURCH
OF CHRIST IN THEPHILIPPINES, REV.
HILARIOGOMEZ, REV. ELMER
BOLOCON, THE NATIONAL
FEDERATION OF LABOR AND
ARMANDO ALFORQUE,
Respondents.
x- - - - - - - - - - - - - - - - - - - - - - - -x

METRO CEBU COMMUNITY HOSPITAL, G.R. No. 187861

presently known as Visayas Community
Medical Center (VCMC),
Petitioner,

- versus -

PERLA NAVA, DANIELA YOSORES,

AGUSTIN ALFORNON, AILEEN
CATACUTAN, ROLANDO REDILOSA,
54
CORNELIO MARIBOJO, VIRGENCITA
CASAS, CRISANTA GENEGABOAS,
EMILIO LAO, RICO GASCON, ALBINA
BANEZ, PEDRO CABATINGAN,
PROCOMIO SALUPAN, ELIZABETH
RAMON, DIOSCORO GABUNADA, ROY
MALAZARTE, FELICIANITA
MALAZARTE, NORBERTA CACA,
MILAGROS CASTILLO, EDNA ALBO,
BERNABE LUMABGUID, CELIA SABAS,
SILVERIO LAO, DARIOLABRADOR,
ERNESTO CANEN, JR., ELSA BUCAO,
HANNAH BONGCARAS, NEMA
BELOCURA, PEPITO LLAGAS,
GUILLERMA REMOCALDO, ROGELIO
DABATOS, ROBERTO JAYMA,
RAYMUNDO DELATADO, NOEL
HORTELANO, HERMELO DE LA TORRE,
LOURDES OLARTE, DANILOZAMORA,
LUZ CABASE, CATALINA ALSADO AND
RUTH BANZON,
Respondents.
x- - - - - - - - - - - - - - - - - - - - - - - -x

VISAYAS COMMUNITY MEDICAL G.R. No. 196156

CENTER (VCMC) formerly known as
METRO CEBU COMMUNITY HOSPITAL Present:
(MCCH),
Petitioner, CORONA, C.J.,
Chairperson,
LEONARDO-DE CASTRO,
- versus - BERSAMIN,
DEL CASTILLO, and
VILLARAMA, JR., JJ.
ERMA YBALLE, NELIA ANGEL,
ELEUTERIA CORTEZ and EVELYN Promulgated:
ONG,
Respondents. December 7, 2011
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

VILLARAMA, JR., J.:

The consolidated petitions before us involve the legality of mass termination of hospital employees who
participated in strike and picketing activities.

The factual antecedents:

Metro Cebu Community Hospital, Inc. (MCCHI), presently known as the Visayas Community Medical Center
(VCMC), is a non-stock, non-profit corporation organized under the laws of the Republic of the Philippines. It
operates the Metro Cebu Community Hospital (MCCH), a tertiary medical institution located at Osmea
Boulevard, Cebu City.MCCH is owned by the United Church of Christ in the Philippines (UCCP) and Rev.
Gregorio P. Iyoy is the Hospital Administrator.

The National Federation of Labor (NFL) is the exclusive bargaining representative of the rank-and-file
employees of MCCHI. Under the 1987 and 1991 Collective Bargaining Agreements (CBAs), the signatories
were Ciriaco B. Pongasi, Sr. for MCCHI, and Atty. Armando M. Alforque (NFL Legal Counsel) and Paterno A.

55
Lumapguid as President of NFL-MCCH Chapter. In the CBA effective from January 1994 until December 31,
1995, the signatories were Sheila E. Buot as Board of Trustees Chairman, Rev. Iyoy as MCCH Administrator
and Atty. Fernando Yu as Legal Counsel of NFL, while Perla Nava, President of Nagkahiusang Mamumuo sa
MCCH (NAMA-MCCH-NFL) signed the Proof of Posting.[1]

On December 6, 1995, Nava wrote Rev. Iyoy expressing the unions desire to renew the CBA, attaching to her
letter a statement of proposals signed/endorsed by 153 union members. Nava subsequently requested that the
following employees be allowed to avail of one-day union leave with pay on December 19, 1995: Celia Sabas,
Jesusa Gerona, Albina Baez, Eddie Villa, Roy Malazarte, Ernesto Canen, Jr., Guillerma Remocaldo, Catalina
Alsado, Evelyn Ong, Melodia Paulin, Sofia Bautista, Hannah Bongcaras, Ester Villarin, Iluminada Wenceslao
and Perla Nava. However, MCCHI returned the CBA proposal for Nava to secure first the endorsement of the
legal counsel of NFL as the official bargaining representative of MCCHI employees.[2]

Meanwhile, Atty. Alforque informed MCCHI that the proposed CBA submitted by Nava was never referred to
NFL and that NFL has not authorized any other legal counsel or any person for collective bargaining
negotiations. By January 1996, the collection of union fees (check-off) was temporarily suspended by MCCHI
in view of the existing conflict between the federation and its local affiliate. Thereafter, MCCHI attempted to
take over the room being used as union office but was prevented to do so by Nava and her group who
protested these actions and insisted that management directly negotiate with them for a new CBA. MCCHI
referred the matter to Atty. Alforque, NFLs Regional Director, and advised Nava that their group is not
recognized by NFL.[3]

In his letter dated February 24, 1996 addressed to Nava, Ernesto Canen, Jr., Jesusa Gerona, Hannah
Bongcaras, Emma Remocaldo, Catalina Alsado and Albina Baez, Atty. Alforque suspended their union
membership for serious violation of the Constitution and By-Laws. Said letter states:

During the last General Membership Meeting of the union on February 20, 1996, you
openly declared that you recognized the officers of the KMU not those of the NFL, that you
submit to the stuctures [sic] and authority of the KMU not of the NFL, and that you are loyal only
to the KMU not to the NFL.

Also, in the same meeting, you admitted having sent a proposal for a renewed collective
bargaining agreement to the management without any consultation with the NFL. In fact, in your
letter dated February 21, 1996 addressed to Rev. Gregorio Iyoy, the Administrator of the
hospital, you categorically stated as follows: We do not need any endorsement from NFL, more
particularly from Atty. Armando Alforque to negotiate our CBA with MCCH. You did not only
ignore the authority of the undersigned as Regional Director but you maliciously prevented and
bluntly refused my request to join the union negotiating panel in the CBA negotiations.

Your above flagrant actuations, made in the presence of the union membership,
constitute the following offenses:

1. Willful violation of the Constitution and By-Laws of the Federation and the orders and
decisions of duly constituted authorities of the same (Section 4 (b), Article III), namely:

a) Defying the decision of the organization disaffiliating from the KMU; and

b) Section 9 (b), Article IX which pertains to the powers and responsibilities of the
Regional Director, particularly, to negotiate and sign collective bargaining agreement together
with the local negotiating panel subject to prior ratification by the general membership;

2. Joining or assisting another labor organization or helping in the formation of a new

labor organization that seeks or tends to defeat the purpose of the Federation (Section 4 (d),
Article III) in relation to the National Executive Boards Resolution No. 8, September 26-27,
1994, to wit:

56
 Pursuant to the NEB Resolution disaffiliating from the KMU
dated September 11, 1993, the NEB in session hereby declare that KMU is
deemed an organization that seeks to defeat the objective of establishing
independent and democratic unions and seeks to replace the Federation as
exclusive representative of its members.

Committing acts that tend to alienate the loyalty of the members to the
Federation, subvert its duly constituted authorities, and divide the organization in
any level with the objective of establishing a pro-KMU faction or independent
union loyal to the KMU shall be subject to disciplinary action, suspension or
expulsion from union membership, office or position in accordance with
paragraph[s] d and f of Section 4, Article III, and paragraph h, Section 6, Article
VI, paragraph d, Section 9, Article IX.

You are, therefore, directed to submit written explanation on the above charges within
five (5) days from receipt hereof. Failure on your part shall be considered a waiver of your right
to be heard and the Federation will act accordingly.

Considering the gravity of the charges against you, the critical nature of the undertaking
to renew the collective bargaining agreement, and the serious threat you posed to the
organization, you are hereby placed under temporary suspension from your office and
membership in the union immediately upon receipt hereof pending investigation and final
disposition of your case in accordance with the unions constitution and by-laws.

For your guidance and compliance.[4]

On February 26, 1996, upon the request of Atty. Alforque, MCCHI granted one-day union leave with pay for 12
union members.[5] The next day, several union members led by Nava and her group launched a series of mass
actions such as wearing black and red armbands/headbands, marching around the hospital premises and
putting up placards, posters and streamers. Atty. Alforque immediately disowned the concerted activities being
carried out by union members which are not sanctioned by NFL. MCCHI directed the union officers led by
Nava to submit within 48 hours a written explanation why they should not be terminated for having engaged in
illegal concerted activities amounting to strike, and placed them under immediate preventive
suspension. Responding to this directive, Nava and her group denied there was a temporary stoppage of work,
explaining that employees wore their armbands only as a sign of protest and reiterating their demand for
MCCHI to comply with its duty to bargain collectively. Rev. Iyoy, having been informed that Nava and her
group have also been suspended by NFL, directed said officers to appear before his office for investigation in
connection with the illegal strike wherein they reportedly uttered slanderous and scurrilous words against the
officers of the hospital, threatening other workers and forcing them to join the strike. Said union officers,
however, invoked the grievance procedure provided in the CBA to settle the dispute between management and
the union.[6]

On March 13 and 19, 1996, the Department of Labor and Employment (DOLE) Regional Office No. 7 issued
certifications stating that there is nothing in their records which shows that NAMA-MCCH-NFL is a registered
labor organization, and that said union submitted only a copy of its Charter Certificate on January 31,
1995.[7] MCCHI then sent individual notices to all union members asking them to submit within 72 hours a
written explanation why they should not be terminated for having supported the illegal concerted activities of
NAMA-MCCH-NFL which has no legal personality as per DOLE records. In their collective response/statement
dated March 18, 1996, it was explained that the picketing employees wore armbands to protest MCCHIs
refusal to bargain; it was also contended that MCCHI cannot question the legal personality of the union which
had actively assisted in CBA negotiations and implementation.[8]

57
On March 13, 1996, NAMA-MCCH-NFL filed a Notice of Strike but the same was deemed not filed for want of
legal personality on the part of the filer. The National Conciliation and Mediation Board (NCMB) Region 7 office
likewise denied their motion for reconsideration on March 25, 1996. Despite such rebuff, Nava and her group
still conducted a strike vote on April 2, 1996 during which an overwhelming majority of union members
approved the strike.[9]

Meanwhile, the scheduled investigations did not push through because the striking union members insisted on
attending the same only as a group. MCCHI again sent notices informing them that their refusal to submit to
investigation is deemed a waiver of their right to explain their side and management shall proceed to impose
proper disciplinary action under the circumstances. On March 30, 1996, MCCHI sent termination letters to
union leaders and other members who participated in the strike and picketing activities.On April 8, 1996, it also
issued a cease-and-desist order to the rest of the striking employees stressing that the wildcat concerted
activities spearheaded by the Nava group is illegal without a valid Notice of Strike and warning them that non-
compliance will compel management to impose disciplinary actions against them. For their continued picketing
activities despite the said warning, more than 100 striking employees were dismissed effective April 12 and 19,
1996.

Unfazed, the striking union members held more mass actions. The means of ingress to and egress from the
hospital were blocked so that vehicles carrying patients and employees were barred from entering the
premises. Placards were placed at the hospitals entrance gate stating: Please proceed to another hospital and
we are on protest. Employees and patients reported acts of intimidation and harassment perpetrated by union
leaders and members. With the intensified atmosphere of violence and animosity within the hospital premises
as a result of continued protest activities by union members, MCCHI suffered heavy losses due to low patient
admission rates. The hospitals suppliers also refused to make further deliveries on credit.

With the volatile situation adversely affecting hospital operations and the condition of confined patients, MCCHI
filed a petition for injunction in the NLRC (Cebu City) on July 9, 1996 (Injunction Case No. V-0006-96). A
temporary restraining order (TRO) was issued on July 16, 1996. MCCHI presented 12 witnesses (hospital
employees and patients), including a security guard who was stabbed by an identified sympathizer while in the
company of Navas group. MCCHIs petition was granted and a permanent injunction was issued on September
18, 1996 enjoining the Nava group from committing illegal acts mentioned in Art. 264 of the Labor Code.[10]

On August 27, 1996, the City Government of Cebu ordered the demolition of the structures and obstructions
put up by the picketing employees of MCCHI along the sidewalk, having determined the same as a public
nuisance or nuisance per se.[11]

Thereafter, several complaints for illegal dismissal and unfair labor practice were filed by the terminated
employees against MCCHI, Rev. Iyoy, UCCP and members of the Board of Trustees of MCCHI.

On August 4, 1999, Executive Labor Arbiter Reynoso A. Belarmino rendered his decision[12] dismissing
the complaints for unfair labor practice in NLRC Case Nos. RAB-VII-02-0309-98, RAB-VII-02-0394-98 and
RAB-VII-03-0596-98 filed by Nava and 90 other complainants. Executive Labor Arbiter Belarmino found no
basis for the charge of unfair labor practice and declared the strike and picketing activities illegal having been
conducted by NAMA-MCCH-NFL which is not a legitimate labor organization. The termination of union leaders
Nava, Alsado, Baez, Bongcaras, Canen, Gerona and Remocaldo were upheld as valid but MCCHI was

58
directed to grant separation pay equivalent to one-half month for every year of service, in the total amount
of P3,085,897.40 for the 84 complainants.[13]

Complainants appealed to the Commission. On March 14, 2001, the NLRCs Fourth Division rendered
its Decision,[14] the dispositive portion of which reads:

WHEREFORE, premises considered, the decision of the Executive Labor Arbiter

dismissing the complaint for unfair labor practice and illegal dismissal is AFFIRMED with
MODIFICATIONS declaring the dismissal of all the complainants in RAB Case No. 07-02-0394-
98 and RAB Case No. 07-03-0596-98 valid and legal. Necessarily, the award of separation pay
and attorneys fees are hereby Deleted.

Resolution on RAB Case No. 07-02-0309-98 is hereby Deferred upon Joint Motion of the
parties.

SO ORDERED.[15]

In its Resolution dated July 2, 2001, the NLRC denied complainants motion for reconsideration.[16]

Complainants elevated the case to the Court of Appeals (CA) (Cebu Station) via a petition for certiorari,
docketed as CA-G.R. SP No. 66540.[17]

In its Resolution dated November 14, 2001, the CAs Eighth Division dismissed the petition on the ground that
out of 88 petitioners only 47 have signed the certification against forum shopping. [18] Petitioners moved to
reconsider the said dismissal arguing that the 47 signatories more than constitute the principal parties as the
petition involves a matter of common concern to all the petitioning employees.[19] By Resolution[20] dated May
28, 2002, the CA reinstated the case only insofar as the 47 petitioners who signed the petition are concerned.

Petitioners challenged the validity of the November 14, 2001 and May 28, 2002 resolutions before this Court in
a petition for review on certiorari, docketed as G.R. No. 154113.

Meanwhile, the NLRCs Fourth Division (Cebu City) rendered its Decision[21] dated March 12, 2003 in RAB
Case Nos. 07-02-0309-98 (NLRC Case No. V-001042-99) pertaining to complainants Erma Yballe, Evelyn
Ong, Nelia Angel and Eleuteria Cortez as follows:

WHEREFORE, premises considered, the decision of the Executive Labor Arbiter dismissing the
complaint for unfair labor practice and illegal dismissal is AFFIRMED with MODIFICATIONS
declaring all complainants to have been validly dismissed. Necessarily, the award of separation
pay and attorneys fees are hereby Deleted.

SO ORDERED.[22]

The NLRC likewise denied the motion for reconsideration filed by complainants Yballe, et al. in its Resolution
dated April 13, 2004.[23]

On October 17, 2008, the CA rendered its Decision[24] in CA-G.R. SP No. 66540, the dispositive portion of
which states:

WHEREFORE, premises considered, judgment is hereby rendered AFFIRMING the

Decision of the National Labor Relations Commission (NLRC) Fourth Division dated March 14,
2001 in NLRC Case No. V-001042-99, WITH MODIFICATIONS to the effect that (1) the
petitioners, except the union officers, shall be awarded separation pay equivalent to one-half

59
 (1/2) month pay for every year of service, and (2) petitioner Cecilia Sabas shall be awarded
overtime pay amounting to sixty-three (63) hours.

SO ORDERED.[25]

Petitioners filed a motion for reconsideration while private respondents filed a motion for partial reconsideration
questioning the award of separation pay. The former also invoked the decision of this Court in Bascon v. Court
of Appeals,[26] while the latter argued for the application of the ruling in decision rendered by the CA
(Cebu City) inMiculob v. NLRC, et al. (CA-G.R. SP No. 84538),[27] both involving similar complaints filed by
dismissed employees of MCCHI.

By Resolution[28] dated April 17, 2009, the CA denied both motions:

WHEREFORE, the petitioners Motion for Reconsideration and the private respondent[s]
Motion for Partial Reconsideration of the October 17, 2008 Decision are both DENIED for lack
of merit.

The Motions for Substitution of Counsel and Compromise Agreements submitted by

petitioners Bernardito Lawas, Avelina Bangalao, Dailenda Hinampas and Daylinda Tigo are
hereby approved. Consequently, said petitioners are ordered dropped from the list of petitioners
and the case is deemed dismissed as to them.

SO ORDERED.[29]

Complainants Yballe, et al. also challenged before the CA the March 12, 2003 Decision and April 13,
2004 Resolution of the NLRC in a petition for certiorari, docketed as CA-G.R. SP No. 84998 (Cebu City). By
Decision[30] dated November 7, 2008, the CA granted their petition, as follows:

WHEREFORE, the challenged Decision of public respondent dated March 12, 2003 and its
Resolution dated April 13, 2004 are hereby REVERSED AND SET ASIDE. Private
respondentMetro Cebu Community Hospital is ordered to reinstate petitioners Erma Yballe,
Eleuteria Cortes, Nelia Angel and Evelyn Ong without loss of seniority rights and other
privileges; to pay them their full backwages inclusive of their allowances and other benefits
computed from the time of their dismissal up to the time of their actual reinstatement.

No pronouncement as to costs.

SO ORDERED.[31]

Private respondents (MCCHI, et al.) moved to reconsider the above decision but the CA denied their motion
on February 22, 2011.[32]

Both petitioners and private respondents in CA-G.R. SP No. 66540 appealed to this Court. Private respondent
MCCHI in CA-G.R. SP No. 84998, under its new name Visayas Community Medical Center (VCMC), filed a
petition for certiorari in this Court.

In G.R. No. 187778, petitioners Nava, et al. prayed that the CA decision be set aside and a new judgment be
entered by this Court (1) declaring private respondents guilty of unfair labor practice and union busting; (2)
directing private respondents to cease and desist from further committing unfair labor practices against the
petitioners; (3) imposing upon MCCH the proposed CBA or, in the alternative, directing the hospital and its
officers to bargain with the local union; (4) declaring private respondents guilty of unlawfully suspending and
illegally dismissing the individual petitioners-employees; (5) directing private respondents to reinstate
petitioners-employees to their former positions, or their equivalent, without loss of seniority rights with full
60
backwages and benefits until reinstatement; and (6) ordering private respondents to pay the petitioners moral
damages, exemplary damages, legal interests, and attorneys fees.[33]

On the other hand, petitioner MCCHI in G.R. No. 187861 prayed for the modification of the CA decision by
deleting the award of separation pay and reinstating the March 14, 2001 decision of the NLRC.[34]

In G.R. No. 196156, MCCHI/VCMC prayed for the annulment of the November 7, 2008 Decision and February
22, 2011 Resolution of the CA, for this Court to declare the dismissal of respondents Yballe, et al. as valid and
legal and to reinstate the March 12, 2003 Decision and April 13, 2004 Resolution of the NLRC.

G.R. No. 187861 was consolidated with G.R. Nos. 154113 and 187778 as they involve similar factual
circumstances and identical or related issues. G.R. No. 196156 was later also consolidated with the aforesaid
cases.

The issues are: (1) whether the CA erred in dismissing the petition for certiorari (CA-G.R. SP No. 66540) with
respect to the petitioners in G.R. No. 154113 for their failure to sign the certification against forum shopping;
(2) whether MCCHI is guilty of unfair labor practice; (3) whether petitioning employees were illegally dismissed;
and (4) if their termination was illegal, whether petitioning employees are entitled to separation pay,
backwages, damages and attorneys fees.

Dropping of petitioners who did not sign the certification

against forum shopping improper

The Court has laid down the rule in Altres v. Empleo[35] as culled from jurisprudential pronouncements, that
the certification against forum shopping must be signed by all the plaintiffs or petitioners in a case; otherwise,
those who did not sign will be dropped as parties to the case. Under reasonable or justifiable circumstances,
however, as when all the plaintiffs or petitioners share a common interest and invoke a common cause of
action or defense, the signature of only one of them in the certification against forum shopping substantially
complies with the Rule.

In the case at bar, the signatures of 47 out of 88 petitioning employees in the certification against forum
shopping constitute substantial compliance with the rule. There is no question that they shared a common
interest and invoked a common cause of action when they filed suit before the Labor Arbiter and NLRC
questioning the validity of their termination and charging MCCHI with unfair labor practice. Thus, when they
appealed their case to the CA, they pursued the same as a collective body, raising only one argument in
support of their cause of action, i.e., the illegal dismissal allegedly committed by MCCHI when union members
resorted to strike and mass actions due to MCCHIs refusal to bargain with officers of the local chapter. There is
sufficient basis, therefore, for the 47 signatories to the petition, to speak for and in behalf of their co-petitioners
and to file the Petition for Certiorari in the appellate court.[36] Clearly, the CA erred in dropping as parties-
petitioners those who did not sign the certification against forum shopping.

However, instead of remanding the case to the CA for it to resolve the petition with respect to the herein
petitioners in G.R. No. 154113, and as prayed for, the Court shall consider them parties-petitioners in CA-G.R.
SP No. 66540,which case has already been decided and now subject of appeal in G.R. No. 187778.

MCCHI not guilty of unfair labor practice

61
Art. 248 (g) of the Labor Code, as amended, makes it an unfair labor practice for an employer [t]o violate the
duty to bargain collectively as prescribed by the Code. The applicable provision in this case is Art. 253 which
provides:
ART. 253. Duty to bargain collectively when there exists a collective bargaining
agreement. When there is a collective bargaining agreement, the duty to bargain collectively
shall also mean that neither party shall terminate nor modify such agreement during its
lifetime. However, either party can serve a written notice to terminate or modify the agreement
at least sixty (60) days prior to its expiration date. It shall be the duty of both parties to keep the
status quo and to continue in full force and effect the terms and conditions of the existing
agreement during the 60-day period and/or until a new agreement is reached by the parties.

NAMA-MCCH-NFL charged MCCHI with refusal to bargain collectively when the latter refused to meet and
convene for purposes of collective bargaining, or at least give a counter-proposal to the proposed CBA the
union had submitted and which was ratified by a majority of the union membership. MCCHI, on its part,
deferred any negotiations until the local unions dispute with the national union federation (NFL) is resolved
considering that the latter is the exclusive bargaining agent which represented the rank-and-file hospital
employees in CBA negotiations since 1987.

We rule for MCCHI.

Records of the NCMB and DOLE Region 7 confirmed that NAMA-MCCH-NFL had not registered as a labor
organization, having submitted only its charter certificate as an affiliate or local chapter of NFL. [37] Not being a
legitimate labor organization, NAMA-MCCH-NFL is not entitled to those rights granted to a legitimate labor
organization under Art. 242, specifically:

(a) To act as the representative of its members for the purpose of collective bargaining;

(b) To be certified as the exclusive representative of all the employees in an appropriate

collective bargaining unit for purposes of collective bargaining;

xxxx

Aside from the registration requirement, it is only the labor organization designated or selected by the majority
of the employees in an appropriate collective bargaining unit which is the exclusive representative of the
employees in such unit for the purpose of collective bargaining, as provided in Art. 255.[38] NAMA-MCCH-NFL
is not the labor organization certified or designated by the majority of the rank-and-file hospital employees to
represent them in the CBA negotiations but the NFL, as evidenced by CBAs concluded in 1987, 1991 and
1994. While it is true that a local union has the right to disaffiliate from the national federation, NAMA-MCCH-
NFL has not done so as there was no any effort on its part to comply with the legal requisites for a valid
disaffiliation during the freedom period[39] or the last 60 days of the last year of the CBA, through a majority
vote in a secret balloting in accordance with Art. 241 (d).[40] Nava and her group simply demanded that MCCHI
directly negotiate with the local union which has not even registered as one.

To prove majority support of the employees, NAMA-MCCH-NFL presented the CBA proposal allegedly signed
by 153 union members. However, the petition signed by said members showed that the signatories endorsed
the proposed terms and conditions without stating that they were likewise voting for or designating the NAMA-
MCCH-NFL as their exclusive bargaining representative. In any case, NAMA-MCCH-NFL at the time of
submission of said proposals was not a duly registered labor organization, hence it cannot legally represent
62
MCCHIs rank-and-file employees for purposes of collective bargaining. Hence, even assuming that NAMA-
MCCH-NFL had validly disaffiliated from its mother union, NFL, it still did not possess the legal personality to
enter into CBA negotiations. A local union which is not independently registered cannot, upon disaffiliation from
the federation, exercise the rights and privileges granted by law to legitimate labor organizations; thus, it
cannot file a petition for certification election.[41] Besides, the NFL as the mother union has the right to
investigate members of its local chapter under the federations Constitution and By-Laws, and if found guilty to
expel such members.[42]MCCHI therefore cannot be faulted for deferring action on the CBA proposal submitted
by NAMA-MCCH-NFL in view of the union leaderships conflict with the national federation. We have held that
the issue of disaffiliation is an intra-union dispute[43] which must be resolved in a different forum in an action at
the instance of either or both the federation and the local union or a rival labor organization, not the
employer.[44]

Not being a legitimate labor organization nor the certified exclusive bargaining representative of MCCHIs rank-
and-file employees, NAMA-MCCH-NFL cannot demand from MCCHI the right to bargain collectively in their
behalf.[45] Hence, MCCHIs refusal to bargain then with NAMA-MCCH-NFL cannot be considered an unfair
labor practice to justify the staging of the strike.[46]

Strike and picketing activities conducted by union officers

and members were illegal

Art. 263 (b) of the Labor Code, as amended, provides:

ART. 263. Strikes, picketing and lockouts. x x x

(b) Workers shall have the right to engage in concerted activities for purposes of
collective bargaining or for their mutual benefit and protection. The right of legitimate labor
organizations to strike and picket and of employers to lockout, consistent with the national
interest, shall continue to be recognized and respected. However, no labor union may strike and
no employer may declare a lockout on grounds involving inter-union and intra-union disputes.

x x x x (Emphasis supplied.)

As borne by the records, NAMA-MCCH-NFL was not a duly registered or an independently registered
union at the time it filed the notice of strike on March 13, 1996 and when it conducted the strike vote on April 2,
1996. It could not then legally represent the union members. Consequently, the mandatory notice of strike and
the conduct of the strike vote report were ineffective for having been filed and conducted by NAMA-MCCH-NFL
which has no legal personality as a legitimate labor organization, in violation of Art. 263 (c), (d) and (f) of the
Labor Code and Rule XXII, Book V of the Omnibus Rules Implementing the Labor Code.[47]

Art. 263 of the Labor Code provides:

ART. 263. Strikes, picketing and lockouts. (a) x x x

xxxx

(c) In cases of bargaining deadlocks, the duly certified or recognized bargaining

agent may file a notice of strike or the employer may file a notice of lockout with the Department
at least 30 days before the intended date thereof. In cases of unfair labor practice, the period of
notice shall be 15 days and in the absence of a duly certified or recognized bargaining
agent, the notice of strike may be filed by any legitimate labor organization in behalf of
its members. However, in case of dismissal from employment of union officers duly elected in
accordance with the union constitution and by-laws, which may constitute union busting, where
the existence of the union is threatened, the 15-day cooling-off period shall not apply and the
63
 union may take action immediately. (As amended by Executive Order No. 111, December 24,
1986.)

(d) The notice must be in accordance with such implementing rules and regulations as
the Department of Labor and Employment may promulgate.

xxxx

(f) A decision to declare a strike must be approved by a majority of the total union
membership in the bargaining unit concerned, obtained by secret ballot in meetings or referenda
called for that purpose. A decision to declare a lockout must be approved by a majority of the
board of directors of the corporation or association or of the partners in a partnership, obtained
by secret ballot in a meeting called for that purpose. The decision shall be valid for the duration
of the dispute based on substantially the same grounds considered when the strike or lockout
vote was taken. The Department may, at its own initiative or upon the request of any affected
party, supervise the conduct of the secret balloting. In every case, the union or the employer
shall furnish the Ministry the voting at least seven days before the intended strike or lockout,
subject to the cooling-off period herein provided. (As amended by Batas Pambansa Bilang 130,
August 21, 1981 and further amended by Executive Order No. 111, December 24, 1986.)
(Emphasis supplied.)

Rule XXII, Book V of the Omnibus Rules Implementing the Labor Code reads:

RULE XXII

CONCILIATION, STRIKES AND LOCKOUTS

xxxx

SEC. 6. Who may declare a strike or lockout. Any certified or duly recognized bargaining
representative may declare a strike in cases of bargaining deadlocks and unfair labor
practices.The employer may declare a lockout in the same cases. In the absence of a certified
or duly recognized bargaining representative, any legitimate labor organization in the
establishment may declare a strike but only on grounds of unfair labor practice. (Emphasis
supplied.)

Furthermore, the strike was illegal due to the commission of the following prohibited activities [48]: (1) violence,
coercion, intimidation and harassment against non-participating employees; and (2) blocking of free ingress
to and egress from the hospital, including preventing patients and their vehicles from entering the hospital
and other employees from reporting to work, the putting up of placards with a statement advising incoming
patients to proceed to another hospital because MCCHI employees are on strike/protest. As shown by
photographs[49] submitted by MCCHI, as well as the findings of the NCMB and Cebu City Government, the
hospital premises and sidewalk within its vicinity were full of placards, streamers and makeshift structures that
obstructed its use by the public who were likewise barraged by the noise coming from strikers using
megaphones.[50] On the other hand, the affidavits[51] executed by several hospital employees and patients
narrated in detail the incidents of harassment, intimidation, violence and coercion, some of these witnesses
have positively identified the perpetrators. The prolonged work stoppage and picketing activities of the striking
employees severely disrupted hospital operations that MCCHI suffered heavy financial losses.

The findings of the Executive Labor Arbiter and NLRC, as sustained by the appellate court, clearly
established that the striking union members created so much noise, disturbance and obstruction that the local
government authorities eventually ordered their removal for being a public nuisance. This was followed by an
injunction from the NCMB enjoining the union leaders from further blocking the free ingress to and egress from
the hospital, and from committing threats, coercion and intimidation against non-striking employees and

64
patients/vehicles desiring to enter for the purpose of seeking medical treatment/confinement. By then, the
illegal strike had lasted for almost five months.

Consequences of illegal strike to union officers and

members

Art. 264 (a) of the Labor Code, as amended, provides for the consequences of an illegal strike to the
participating workers:

x x x Any union officer who knowingly participates in illegal strike and any worker or union officer
who knowingly participates in the commission of illegal acts during a strike may be declared to
have lost his employment status: Provided, That mere participation of a worker in a lawful strike
shall not constitute sufficient ground for termination of his employment, even if a replacement
had been hired by the employer during such lawful strike.

The above provision makes a distinction between workers and union officers who participate in an illegal strike:
an ordinary striking worker cannot be terminated for mere participation in an illegal strike. There must be proof
that he or she committed illegal acts during a strike. A union officer, on the other hand, may be terminated from
work when he knowingly participates in an illegal strike, and like other workers, when he commits an illegal act
during a strike.[52]

Considering their persistence in holding picketing activities despite the declaration by the NCMB that
their union was not duly registered as a legitimate labor organization and the letter from NFLs legal counsel
informing that their acts constitute disloyalty to the national federation, and their filing of the notice of strike and
conducting a strike vote notwithstanding that their union has no legal personality to negotiate with MCCHI for
collective bargaining purposes, there is no question that NAMA-MCCH-NFL officersknowingly participated in
the illegal strike. The CA therefore did not err in ruling that the termination of union officers Perla Nava,
Catalina Alsado, Albina Baez, Hannah Bongcaras, Ernesto Canen, Jesusa Gerona and Guillerma Remocaldo
was valid and justified.

With respect to the dismissed union members, although MCCHI submitted photographs taken at the picket
line, it did not individually name those striking employees and specify the illegal act committed by each of
them. As to the affidavits executed by non-striking employees, they identified mostly union officers as the
persons who blocked the hospital entrance, harassed hospital employees and patients whose vehicles were
prevented from entering the premises. Only some of these witnesses actually named a few union members
who committed similar acts of harassment and coercion. Consequently, we find no error committed by the CA
in CA-G.R. SP No. 66540 when it modified the decision of the NLRC and ruled that the dismissal of union
members who merely participated in the illegal strike was illegal. On the other hand, in CA-G.R. SP No. 84998,
the CA did not err in ruling that the dismissal of Yballe, et al. was illegal; however, it also ordered their
reinstatement with full back wages.

Dismissed union members not entitled to backwages

but should be awarded separation pay in lieu of
reinstatement

Since there is no clear proof that union members actually participated in the commission of illegal acts during
the strike, they are not deemed to have lost their employment status as a consequence of a declaration of
illegality of the strike.

65
Petitioners in G.R. Nos. 154113 and 187778 assail the CA in not ordering their reinstatement with back
wages. Invoking stare decisis, they cited the case of Bascon v. Court of Appeals[53] decided by this Court in
2004 and which involved two former hospital employees who likewise sued MCCHI after the latter terminated
their employment due to their participation in the same illegal strike led by NAMA-MCCH-NFL. In said case we
ruled that petitioners Cole and Bascon were illegally dismissed because MCCHI failed to prove that they
committed illegal acts during the strike. We thus ordered the reinstatement of petitioners Bascon and Cole
without loss of seniority rights and other privileges and payment of their back wages inclusive of allowances,
and other benefits computed from the time they were dismissed up to the time of their actual
reinstatement. Bascon was also the basis of the award of back wages in CA-G.R. SP No. 84998.

Stare decisis et non quieta movere. Stand by the decision and disturb not what is settled. Under the doctrine
of stare decisis, once a court has laid down a principle of law as applicable to a certain state of facts, it will
adhere to that principle and apply it to all future cases where the facts are substantially the same,[54] even
though the parties may be different. It proceeds from the first principle of justice that, absent any powerful
countervailing considerations, like cases ought to be decided alike. Thus, where the same questions relating to
the same event have been put forward by parties similarly situated as in a previous case litigated and decided
by a competent court, the rule of stare decisis is a bar to any attempt to relitigate the same issue.[55]

The doctrine though is not cast in stone for upon a showing that circumstances attendant in a particular case
override the great benefits derived by our judicial system from the doctrine of stare decisis, the Court is justified
in setting it aside.[56] For the Court, as the highest court of the land, may be guided but is not controlled by
precedent. Thus, the Court, especially with a new membership, is not obliged to follow blindly a particular
decision that it determines, after re-examination, to call for a rectification.[57]

Although the Bascon case involved the very same illegal strike in MCCHI which led to the termination of
herein petitioners, its clearly erroneous application of the law insofar only as the award of back wages warrants
setting aside the doctrine. Indeed, the doctrine of stare decisis notwithstanding, the Court has abandoned or
overruled precedents whenever it realized that the Court erred in the prior decisions. Afterall, more important
than anything else is that this Court should be right.[58]

In G & S Transport Corporation v. Infante,[59] the Court explained the rationale for its recent rulings
deleting back wages awarded to the dismissed workers if the strike was found to be illegal. Considering that
they did not render work for the employer during the strike, they are entitled only to reinstatement.

With respect to backwages, the principle of a fair days wage for a fair days labor
remains as the basic factor in determining the award thereof. If there is no work performed
by the employee there can be no wage or pay unless, of course, the laborer was able, willing
and ready to work but was illegally locked out, suspended or dismissed or otherwise illegally
prevented from working. While it was found that respondents expressed their intention to report
back to work, the latter exception cannot apply in this case. In Philippine Marine Officers Guild
v. Compaia Maritima, as affirmed in Philippine Diamond Hotel and Resort v. Manila Diamond
Hotel Employees Union, the Court stressed that for this exception to apply, it is required that
the strike be legal, a situation that does not obtain in the case at bar.

Under the circumstances, respondents reinstatement without backwages suffices for the
appropriate relief. If reinstatement is no longer possible, given the lapse of considerable time
from the occurrence of the strike, the award of separation pay of one (1) month salary for each
year of service, in lieu of reinstatement, is in order.[60] (Emphasis supplied.)

66
 The CA decision in CA-G.R. SP No. 66540 ordering the payment of separation pay in lieu of
reinstatement without back wages is thus in order, to conform to the policy ofa fair days wage for a fair days
labor. The amount of separation pay is increased to one month pay for every year of service, consistent with
jurisprudence. Accordingly, the decision in CA-G.R. SP No. 84998 is modified by deleting the award of back
wages and granting separation pay in lieu of reinstatement.

It is to be noted that as early as April 8, 1996, union members who took part in the concerted activities
have been warned by management that NAMA-MCCH-NFL is not a legitimate labor organization and its notice
of strike was denied by the NCMB, and directed to desist from further participating in such illegal activities.
Despite such warning, they continued with their picketing activities and held more mass actions after
management sent them termination notices. The prolonged work stoppage seriously disrupted hospital
operations, which could have eventually brought MCCHI into bankruptcy had the City Government of Cebu not
issued a demolition order and the NLRC Region 7 not formally enjoined the prohibited picketing activities. Also,
the illegal dismissal complaints subsequently filed by the terminated employees did not obliterate the fact that
they did not suffer loss of earnings by reason of the employers unjustified acts, there being no unfair labor
practice committed by MCCHI. Hence, fairness and justice dictate that back wages be denied the said
employees who participated in the illegal concerted activities to the great detriment of the employer.

Separation pay is made an alternative relief in lieu of reinstatement in certain circumstances, like: (a)
when reinstatement can no longer be effected in view of the passage of a long period of time or because of the
realities of the situation; (b) reinstatement is inimical to the employers interest; (c) reinstatement is no longer
feasible; (d) reinstatement does not serve the best interests of the parties involved; (e) the employer is
prejudiced by the workers continued employment; (f) facts that make execution unjust or inequitable have
supervened; or (g) strained relations between the employer and employee.[61]

Considering that 15 years had lapsed from the onset of this labor dispute, and in view of strained
relations that ensued, in addition to the reality of replacements already hired by the hospital which had
apparently recovered from its huge losses, and with many of the petitioners either employed elsewhere,
already old and sickly, or otherwise incapacitated, separation pay without back wages is the appropriate
relief. We note that during the pendency of the cases in this Court, some of the petitioners have entered into
compromise agreements with MCCHI, all of which were duly approved by this Court. Thus, excluded from the
herein monetary awards are the following petitioners whose compromise agreements have been approved by
this Court and judgment having been entered therein: Gloria Arguilles, Romulo Alforque, Gerna Patigdas-
Barte, Daylinda Tigo Merlyn Nodado, Ramon Tagnipis, Bernabe Lumapguid, Romeo Empuerto, Marylen
Labra, Milagros Castillo Bernadette Pontillas-Tibay, Constancio Pagador, Nolan Alvin Panal, Edilberto Villa,
Roy Malazarte, Felecianita Malazarte and Noel Hortelano.

Attorneys fees

The dismissed employees having been compelled to litigate in order to seek redress and protect their rights,
they are entitled to reasonable attorneys fees pursuant to Art. 2208 (2) of the Civil Code. In view of the
attendant circumstances of this case, we hold that attorneys fees in the amount of P50,000.00 is reasonable
and justified. However, the respondents in G.R. No. 196156 are not entitled to the same relief since they did
not appeal from the CA decision which did not include the award of attorneys fees.

67
 WHEREFORE, the petition for review on certiorari in G.R. No. 187861 is DENIED while the petitions in
G.R. Nos. 154113, 187778 and 196156 are PARTLY GRANTED. The Decision dated October 17, 2008 of the
Court of Appeals in CA-G.R. SP No. 66540 is hereby AFFIRMED with MODIFICATIONS in that MCCHI is
ordered to pay the petitioners in G.R. Nos. 154113 and 187778, except the petitioners who are union officers,
separation pay equivalent to one month pay for every year of service, and reasonable attorneys fees in the
amount of P50,000.00. The Decision dated November 7, 2008 is
likewise AFFIRMED with MODIFICATIONS in that MCCHI is ordered to pay the private respondents in G.R.
No. 196156 separation pay equivalent to one month pay for every year of service, and that the award of back
wages is DELETED.

The case is hereby remanded to the Executive Labor Arbiter for the recomputation of separation pay
due to each of the petitioners union members in G.R. Nos. 154113, 187778 and 196156 except those who
have executed compromise agreements approved by this Court.

No pronouncement as to costs.

SO ORDERED.

68
HERITAGE HOTEL MANILA VS PINAG-ISANG GLAING AT LAKAS

SECOND DIVISION

THE HERITAGE HOTEL MANILA G.R. No. 177024

(OWNED AND OPERATED BY

GRAND PLAZA HOTEL
CORPORATION)
Petitioner, Present:
Quisumbing, J., Chairperson,
- versus - Carpio,*

Chico-Nazario,**

Brion, and

Abad, JJ.

PINAG-ISANG GALING AT LAKAS

NG MGA MANGGAGAWA SA

HERITAGE MANILA Promulgated:

(PIGLAS-HERITAGE),

Respondent. October 30, 2009

x ---------------------------------------------------------------------------------------- x

DECISION

ABAD, J.:

This case is about a companys objections to the registration of its rank and file union for non-
compliance with the requirements of its registration.

The Facts and the Case

Sometime in 2000, certain rank and file employees of petitioner Heritage Hotel Manila (petitioner company)
formed the Heritage Hotel Employees Union (the HHE union). The Department of Labor and Employment-
National Capital Region (DOLE-NCR) later issued a certificate of registration[1] to this union.

Subsequently, the HHE union filed a petition for certification election[2] that petitioner company opposed. The
company alleged that the HHE union misrepresented itself to be an independent union, when it was, in truth, a

69
local chapter of the National Union of Workers in Hotel and Restaurant and Allied Industries
(NUWHRAIN). The company claimed that the HHE union intentionally omitted disclosure of its affiliation with
NUWHRAIN because the companys supervisors union was already affiliated with it. [3] Thus, the company also
filed a petition for the cancellation of the HHE unions registration certificate.[4]

Meanwhile, the Med-Arbiter granted the HHE unions petition for certification election.[5] Petitioner company
appealed the decision to the Secretary of Labor but the latter denied the appeal.[6] The Secretary also denied
petitioners motion for reconsideration, prompting the company to file a petition for certiorari[7] with the Court of
Appeals.

On October 12, 2001 the Court of Appeals issued a writ of injunction against the holding of the HHE unions
certification election, effective until the petition for cancellation of that unions registration shall have been
resolved with finality.[8] The decision of the Court of Appeals became final when the HHE union withdrew the
petition for review that it filed with this Court.[9]

On December 10, 2003 certain rank and file employees of petitioner company held a meeting and formed
another union, the respondent Pinag-Isang Galing at Lakas ng mga Manggagawa sa Heritage Manila (the
PIGLAS union). This union applied for registration with the DOLE-NCR[10] and got its registration certificate on
February 9, 2004. Two months later, the members of the first union, the HHE union, adopted a resolution for its
dissolution. The HHE union then filed a petition for cancellation of its union registration.[11]

On September 4, 2004 respondent PIGLAS union filed a petition for certification election[12] that petitioner
company also opposed, alleging that the new unions officers and members were also those who comprised the
old union. According to the company, the employees involved formed the PIGLAS union to circumvent the
Court of Appeals injunction against the holding of the certification election sought by the former union. Despite
the companys opposition, however, the Med-Arbiter granted the petition for certification election.[13]

On December 6, 2004 petitioner company filed a petition to cancel the union registration of respondent
PIGLAS union.[14] The company claimed that the documents submitted with the unions application for
registration bore the following false information:

(a) The List of Members showed that the PIGLAS union had 100 union members;[15]

(b) The Organizational Minutes said that 90 employees attended the meeting on
December 10, 2003;[16]

(c) The Attendance Sheet of the meeting of December 10, 2003 bore the signature of
127 members who ratified the unions Constitution and By-Laws;[17] and

(d) The Signature Sheet bore 128 signatures of those who attended that meeting.[18]

70
Petitioner company alleged that the misrepresentation was evidenced by the discrepancy in the number of
union members appearing in the application and the list as well as in the number of signatories to the
attendance and signature sheets. The minutes reported that only 90 employees attended the meeting. The
company further alleged that 33 members of respondent PIGLAS union were members of the defunct HHE
union. This, according to the company, violated the policy against dual unionism and showed that the new
union was merely an alter ego of the old.

On February 22, 2005 the DOLE-NCR denied the companys petition to cancel respondent PIGLAS unions
registration for the reason that the discrepancies in the number of members stated in the applications
supporting documents were not material and did not constitute misrepresentation. As for the charge of dual
unionism, the same is not a ground for canceling registration. It merely exposed a union member to a possible
charge of disloyalty, an internal matter. Here, the members of the former union simply exercised their right to
self-organization and to the freedom of association when they subsequently joined the PIGLAS union.[19]

On appeal, the Bureau of Labor Relation (BLR) affirmed the ruling of the DOLE-NCR. It reasoned that
respondent PIGLAS unions organization meeting lasted for 12 hours. It was possible for the number of
attendees to have increased from 90 to 128 as the meeting progressed. Besides, with a total of 250 employees
in the bargaining unit, the union needed only 50 members to comply with the 20 percent membership
requirement. Thus, the union could not be accused of misrepresentation since it did not pad its membership to
secure registration.

As for the issue of dual unionism, it has become moot and academic, said the BLR, because of the dissolution
of the old union and the cancellation of its certificate of registration.[20]

Petitioner company filed a petition for certiorari with the Court of Appeals,[21] assailing the order of the BLR. But
the latter court dismissed the petition, not being accompanied by material documents and portions of the
record.[22] The company filed a motion for reconsideration, attaching parts of the record that were deemed
indispensable but the court denied it for lack of merit.[23] Hence, the company filed this petition for review under
Rule 45.

Issues Presented

The petition presents the following issues:

1. Whether or not the Court of Appeals erred in dismissing the petition for certiorari before it for
failure of petitioner company to attach certain material portions of the record;

71
2. Whether or not the union made fatal misrepresentation in its application for union registration;
and

3. Whether or not dual unionism is a ground for canceling a unions registration.

72
 The Rulings of the Court

First. While the Court of Appeals correctly dismissed the companys petition initially for failure to attach material
portions of the record, the court should have bended back a little when petitioner company subsequently
attached those missing materials to its motion for reconsideration. As a general rule, petitions for certiorari that
lack copies of essential pleadings and portions of the record may be dismissed but this rule has not been
regarded as absolute. The omission may be cured.[24]

The Court of Appeals has three courses of action when the annexes to the petition are insufficient. It may
dismiss the petition,[25] require the submission of the relevant documents, or order the filing of an amended
petition with the required pleadings or documents. A petition lacking in essential pleadings or portions of the
record may still be given due course, or reinstated if earlier dismissed, upon subsequent submission of the
necessary documents or to serve the higher interest of justice.[26]

Second. Since a remand of the case to the Court of Appeals for a determination of the substantive issues will
only result in more delays and since these issues have been amply argued by the opposing sides in the
various pleadings and documents they submitted to this Court, the case may now be resolved on the merits.

Did respondent PIGLAS union commit fraud and misrepresentation in its application for union registration? We
agree with the DOLE-NCR and the BLR that it did not. Except for the evident discrepancies as to the number
of union members involved as these appeared on the documents that supported the unions application for
registration, petitioner company has no other evidence of the alleged misrepresentation. But those
discrepancies alone cannot be taken as an indication that respondent misrepresented the information
contained in these documents.

The charge that a labor organization committed fraud and misrepresentation in securing its registration is a
serious charge and deserves close scrutiny. It is serious because once such charge is proved, the labor union
acquires none of the rights accorded to registered organizations. Consequently, charges of this nature should
be clearly established by evidence and the surrounding circumstances.[27]

Here, the discrepancies in the number of union members or employees stated in the various supporting
documents that respondent PIGLAS union submitted to labor authorities can be explained. While it appears in
the minutes of the December 10, 2003 organizational meeting that only 90 employees responded to the roll call
at the beginning, it cannot be assumed that such number could not grow to 128 as reflected on the signature
sheet for attendance. The meeting lasted 12 hours from 11:00 a.m. to 11:00 p.m. There is no evidence that the
meeting hall was locked up to exclude late attendees.

73
There is also nothing essentially mysterious or irregular about the fact that only 127 members ratified the
unions constitution and by-laws when 128 signed the attendance sheet.It cannot be assumed that all those
who attended approved of the constitution and by-laws. Any member had the right to hold out and refrain from
ratifying those documents or to simply ignore the process.

At any rate, the Labor Code[28] and its implementing rules[29] do not require that the number of members
appearing on the documents in question should completely dovetail.For as long as the documents and
signatures are shown to be genuine and regular and the constitution and by-laws democratically ratified, the
union is deemed to have complied with registration requirements.

Petitioner company claims that respondent PIGLAS union was required to submit the names of all its members
comprising at least 20 percent of the employees in the bargaining unit. Yet the list it submitted named only 100
members notwithstanding that the signature and attendance sheets reflected a membership of 127 or 128
employees. This omission, said the company, amounted to material misrepresentation that warranted the
cancellation of the unions registration.

But, as the labor authorities held, this discrepancy is immaterial. A comparison of the documents shows that,
except for six members, the names found in the subject list are also in the attendance and signature
sheets. Notably, the bargaining unit that respondent PIGLAS union sought to represent consisted of 250
employees. Only 20 percent of this number or 50 employees were required to unionize. Here, the union more
than complied with such requirement.

Labor laws are liberally construed in favor of labor especially if doing so would affirm its constitutionally
guaranteed right to self-organization.[30] Here, the PIGLAS unions supporting documents reveal the
unmistakable yearning of petitioner companys rank and file employees to organize. This yearning should not
be frustrated by inconsequential technicalities.

Third. The fact that some of respondent PIGLAS unions members were also members of the old rank and file
union, the HHE union, is not a ground for canceling the new unions registration. The right of any person to join
an organization also includes the right to leave that organization and join another one. Besides, HHE union is
dead. It had ceased to exist and its certificate of registration had already been cancelled. Thus, petitioners
arguments on this point may also be now regarded as moot and academic.

WHEREFORE, the Court DENIES the petition and AFFIRMS the decision of the Bureau of Labor Relations in
BLR-A-26-3-05 dated May 26, 2006.

SO ORDERED.

74