Labor Review Digests 1
1/15
NATIONAL UNION OF WORKERS IN HOTELS,
RESTAURANTS AND ALLIED INDUSTRIES- MANILA
PAVILION HOTEL CHAPTER vs. SECRETARY OF LABOR
AND EMPLOYMENT, BUREAU OF LABOR RELATIONS,
HOLIDAY INN MANILA PAVILION HOTEL LABOR UNION
AND ACESITE PHILIPPINES HOTEL CORPORATION
FACTS:
A certification election was conducted on June 16, 2006
among the rank-and-file employees of respondent Holiday Inn
Manila Pavilion Hotel (the Hotel) with the following results:
EMPLOYEES IN VOTERS’ LIST = 353
TOTAL VOTES CAST = 346
NUWHRAIN-MPHC = 151
HIMPHLU = 169
NO UNION = 1 selection of the bargaining representative. The Code makes no
SPOILED = 3 distinction as to their employment status as basis for eligibility
SEGREGATED = 22
In view of the significant number of segregated votes,
contending unions, petitioner, NUHWHRAIN-MPHC, and
respondent Holiday Inn Manila Pavillion Hotel Labor Union
(HIMPHLU), referred the case back to Med-Arbiter to decide
which among those votes would be opened and tallied. 11
votes were initially segregated because they were cast
by dismissed employees, albeit the legality of their dismissal
was still pending before the Court of Appeals. Six other votes
were segregated because the employees who cast them
were already occupying supervisory positions at the time of the
election. Still five other votes were segregated on the ground
that they were cast by probationary employees and, pursuant
to the existing Collective Bargaining Agreement (CBA), such
employees cannot vote. It bears noting early on, however, that
the vote of one Jose Gatbonton (Gatbonton), a probationary
employee, was counted.
Med-Arbiter Calabocal ruled for the opening of 17 out of the 22
segregated votes, specially those cast by the 11 dismissed
employees and those cast by the six supposedly supervisory
employees of the Hotel.
Petitioner, which garnered 151 votes, appealed to the
Secretary of Labor and Employment (SOLE), arguing that the
votes of the probationary employees should have been opened
considering that probationary employee Gatbonton’s vote was
tallied. And petitioner averred that respondent HIMPHLU,
which garnered 169 votes, should not be immediately certified
as the bargaining agent, as the opening of the 17 segregated
ballots would push the number of valid votes cast to 338 (151 +
169 + 1 + 17), hence, the 169 votes which HIMPHLU garnered
would be one vote short of the majority which would then
become 169.
Secretary affirmed the decision of the med-arbiter. In fine, the
SOLE concluded that the certification of HIMPHLU as the
exclusive bargaining agent was proper.
ISSUES:
(1) Whether employees on probationary status at the time of
the certification elections should be allowed to vote.
(2) Whether HIMPHLU was able to obtain the required
majority for it to be certified as the exclusive bargaining agent.
HELD:
1. On the first issue, the Court rules in the affirmative.
The inclusion of Gatbonton’s vote was proper not because it
was not questioned but because probationary employees have
the right to vote in a certification election. The votes of the six
other probationary employees should thus also have been
counted. As Airtime Specialists, Inc. v. Ferrer-Calleja holds:
In a certification election, all rank and file employees in the
appropriate bargaining unit, whether probationary or
permanent are entitled to vote. This principle is clearly stated in
Art. 255 of the Labor Code which states that the “labor
organization designated or selected by the majority of the
employees in an appropriate bargaining unit shall be the
exclusive representative of the employees in such unit for
purposes of collective bargaining.” Collective bargaining covers
all aspects of the employment relation and the resultant CBA
negotiated by the certified union binds all employees in the
bargaining unit. Hence, all rank and file employees,
probationary or permanent, have a substantial interest in the
in supporting the petition for certification election. The law
refers to “all” the employees in the bargaining unit. All they
need to be eligible to support the petition is to belong to the
“bargaining unit.” (Emphasis supplied)
For purposes of this section (Rule II, Sec. 2 of Department
Order No. 40-03, series of 2003), any employee, whether
employed for a definite period or not, shall beginning on the
first day of his/her service, be eligible for membership in any
labor organization.
All other workers, including ambulant, intermittent and other
workers, the self-employed, rural workers and those without
any definite employers may form labor organizations for their
mutual aid and protection and other legitimate purposes except
collective bargaining. (Emphasis supplied)
The provision in the CBA disqualifying probationary employees
from voting cannot override the Constitutionally-protected right
of workers to self-organization, as well as the provisions of the
Labor Code and its Implementing Rules on certification
elections and jurisprudence thereon.
A law is read into, and forms part of, a contract. Provisions in a
contract are valid only if they are not contrary to law, morals,
good customs, public order or public policy.
2. As to whether HIMPHLU should be certified as the exclusive
bargaining agent, the Court rules in the negative.
It is well-settled that under the so-called “double majority rule,”
for there to be a valid certification election, majority of the
bargaining unit must have voted AND the winning union must
have garnered majority of the valid votes cast.
Prescinding from the Court’s ruling that all the probationary
employees’ votes should be deemed valid votes while that of
the supervisory employees should be excluded, it follows that
the number of valid votes cast would increase – from 321 to
337. Under Art. 256 of the Labor Code, the union obtaining the
majority of the valid votes cast by the eligible voters shall be
certified as the sole and exclusive bargaining agent of all the
workers in the appropriate bargaining unit. This majority is 50%
+ 1. Hence, 50% of 337 is 168.5 + 1 or at least 170.
HIMPHLU obtained 169 while petitioner received 151 votes.
Clearly, HIMPHLU was not able to obtain a majority vote. The
position of both the SOLE and the appellate court that the
opening of the 17 segregated ballots will not materially affect
the outcome of the certification election as for, so they
contend, even if such member were all in favor of
1

petitioner, still, HIMPHLU would win, is thus untenable.
It bears reiteration that the true importance of ascertaining the
number of valid votes cast is for it to serve as basis for
computing the required majority, and not just to determine
which union won the elections. The opening of the segregated
but valid votes has thus become material.
To be sure, the conduct of a certification election has a two-
fold objective: to determine the appropriate bargaining unit and
to ascertain the majority representation of the bargaining
representative, if the employees desire to be represented at all
by anyone. It is not simply the determination of who between
two or more contending unions won, but whether it effectively
ascertains the will of the members of the bargaining unit as to
whether they want to be represented and which union they
want to represent them.
Having declared that no choice in the certification election
conducted obtained the required majority, it follows that a run-
off election must be held to determine which between
HIMPHLU and petitioner should represent the rank-and-file
employees. PETITION GRANTED. (estella)
2/15
Labor Review Digests 1
San Miguel Corporation Employees Union – Phil.
Transport & General Workers Organization (SMCEU-
PTGWO) v. San Miguel Packaging Products Employees
Union – Pambansang Diwa ng Manggagawang Pilipino
(SMPPEU-PDMP)
GR 171153, 12 Sept 2007
Chico-Nazario, J.
Short Version: SMCEU-PTGWO challenges the legitimacy of
SMPPEU-PDMP, a charter of PDMP, as a labor organization.
The Court held that PDMP cannot create a charter because it
is merely a trade union center. Trade union centers are not
given by the Labor Code or any statute the power to create
locals or charters therefore, SMPPEU-PDMP must comply with
the strict requirements provided for in Art. 234, LC.
Nature: Review on Certiorari under Rule 45 of the Revised
Rules of Court, assailing CA decision affirming the decision of
the petitioner Bureau of Labor Relations (BLR) of DOLE which
upheld the Certificate of Registration of respondent SAN
MIGUEL PACKAGING PRODUCTS EMPLOYEES UNION–
PAMBANSANG DIWA NG MANGGAGAWANG PILIPINO
(SMPPEU–PDMP); and its resolution denying petitioner’s MR
Characters in the case
-Petitioner(s): SMCEU-PTGWO is the incumbent bargaining
agent for the bargaining unit comprised of the regular monthly-
paid rank and file employees of the three divisions of San
Miguel Corporation (SMC), namely, the San Miguel Corporate
Staff Unit (SMCSU), San Miguel Brewing Philippines (SMBP),
and the San Miguel Packaging Products (SMPP), in all offices
and plants of SMC, including the Metal Closure and
Lithography Plant in Laguna. It had been the certified
bargaining agent for 20 years (1987 to 1997).
-Respondent(s): SMPPEU-PDMP is registered as a chapter
PDMP.
Facts
• PDMP issued a charter certificate to respondent on
15 June 1999. In compliance with registration
requirements, respondent submitted the requisite
documents to the BLR for the purpose of acquiring
legal personality.
• Upon submission of its charter certificate and other
documents, respondent was issued Certificate of
Creation of Local or Chapter by the BLR on 6 July
1999.
• Respondent filed with the Med-Arbiter of the DOLE
Regional Officer in NCR (DOLE-NCR), three separate
petitions for certification election to represent SMPP,
SMCSU, and SMBP. All three petitions were
dismissed, on the ground that the separate petitions
fragmented a single bargaining unit.
• 17 August 1999: petitioner filed with the DOLE-NCR a
petition seeking the cancellation of respondent's
registration and its dropping from the rolls of
legitimate labor organizations, accusing respondent of
committing fraud and falsification, and non-
compliance with registration requirements in obtaining
its certificate of registration.
2

o It alleged that respondent violated Articles
239 (a), (b) and (c) and 234 (c) of the Labor
Code. Moreover, petitioner claimed that
PDMP is not a legitimate labor organization,
but a trade union center, hence, it cannot
directly create a local or chapter.
• 14 July 2000: DOLE-NCR Regional Director Maximo
B. Lim issued an Order dismissing the allegations. He
further ruled that respondent is allowed to directly
create a local or chapter. However, he found that
respondent did not comply with the 20% membership
requirement and, thus, ordered the cancellation of its
certificate of registration and removal from the rolls of
legitimate labor organizations.
• Respondent appealed to the BLR who granted the
petition. The BLR ruled that as a chartered local
union, respondent is not required to submit the
number of employees and names of all its members
comprising at least 20% of the employees in the
bargaining unit where it seeks to operate. Thus, the
revocation of its registration based on non-compliance
with the 20% membership requirement does not have
any basis in the rules.
• The BLR also held that although PDMP is considered
as a trade union center, it is a holder of a Registration
Certificate issued by the BLR on 14 February 1991,
which bestowed upon it the status of a legitimate
labor organization with all the rights and privileges to
act as representative of its members for purposes of
collective bargaining agreement. On this basis, PDMP
can charter or create a local, in accordance with the
provisions of Department Order No. 9.
• BLR denied petitioner’s appeal. CA affirmed BLR
decision holding that Department Order No. 9
provides that a registered federation or national union
may directly create a local by submitting to the BLR
copies of the charter certificate, the local's constitution
and by-laws, the principal office address of the local,
and the names of its officers and their addresses.
Upon complying with the documentary requirements,
the local shall be issued a certificate and included in
the roster of legitimate labor organizations. Thus there
is no need for SMPPEU to show a membership of
20% of the employees of the bargaining unit in order
to be recognized as a legitimate labor union.
Issue: WON respondent is a legitimate labor organization even
if it failed to comply with the 20% requirement as provided in
Art. 234, LC. NO.
Dispositive: Petition GRANTED. CA REVERSED AND SET
ASIDE.
Ruling
• A legitimate labor organization is defined as "any
labor organization duly registered with the DOLE, and
includes any branch or local thereof."
• Why does the Labor Code demand strict compliance
with the requirements on registration?
o Registration requirements are intended to
afford a measure of protection to
Labor Review Digests 1
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.
o A legitimate labor organization is entitled to
specific rights under the Labor Code, 21 and
are involved in activities directly affecting
matters of public interest. Legitimate labor
organizations have exclusive rights under
the law which cannot be exercised by non-
legitimate unions, one of which is the right to
be certified as the exclusive representative
of all the employees in an appropriate
collective bargaining unit for purposes of
collective bargaining.
o 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.
• Records show that respondent was chartered by
PDMP. Article 234, LC provides that an independent
labor organization acquires legitimacy only upon its
registration with the BLR. However, the creation of a
branch, local or chapter is treated differently.
o In Progressive Development Corporation v.
Secretary, Department of Labor and
Employment, the Court declared that when
an unregistered union becomes a branch,
local or chapter, some of the aforementioned
requirements for registration are no longer
necessary or compulsory. Whereas an
applicant for registration of an independent
union is mandated to submit, among other
things, the number of employees and names
of all its members comprising at least 20% of
the employees in the bargaining unit where it
seeks to operate, as provided under Article
234 and Sec. 2, Rule III, Book V of the
Implementing Rules, the same is no longer
required of a branch, local or chapter. The
intent of the law in imposing less
requirements in the case of a branch or local
of a registered federation or national union is
to encourage the affiliation of a local union
with a federation or national union in order to
increase the local union's bargaining powers
respecting terms and conditions of labor.
• Petitioners argue that PDMP is not a legitimate labor
organization, thus cannot form a charter. The Court
held that the personality of a labor organization
cannot be attacked collaterally. It may be questioned
only in an independent petition for cancellation in
accordance with Section 5 of Rule V, Book V of the
Implementing Rules.
Here’s the twist: PDMP is a trade union center, THEREFORE
IT CANNOT CREATE LOCALS OR CHARTERS.
• “Trade union center” was never mentioned in the
3

Labor Code. It first appeared only in the Implementing
Rules of Department Order No. 9 which defined a
trade union center as any group of registered national
unions or federations organized for the mutual aid and
protection of its members; for assisting such members
in collective bargaining; or for participating in the
formulation of social and employment policies,
standards, and programs, and is duly registered with
the DOLE in accordance with Rule III, Section 2 of the
Implementing Rules.
• While a "national union" or "federation" is a labor
organization with at least ten locals or chapters or
affiliates, each of which must be a duly certified or
recognized collective bargaining agent, a trade union
center, on the other hand, is composed of a group of
registered national unions or federations.
o The Implementing Rules, as amended by
Department Order No. 9, provide that only "a
duly registered federation or national union"
may directly create a local or chapter.
• DO 9 defines a "chartered local" as a labor
organization in the private sector operating at the
enterprise level that acquired legal personality
through a charter certificate, issued by a duly
registered federation or national union and reported to
the Regional Office in accordance with Rule III,
Section 2-E of these Rules (Sec. 1 (i), Rule 1, Book V
of the Implementing Rules, as amended by DO No. 9)
• RA 9481 or "An Act Strengthening the Workers'
Constitutional Right to Self-Organization, Amending
for the Purpose Presidential Decree No. 442, As
Amended, Otherwise Known as the Labor Code of the
Philippines" lapsed into law on 25 May 2007 and
became effective on 14 June 2007. This law further
amends the Labor Code provisions on Labor
Relations, including trade union centers in Art. 234.
However, it still makes no mention that such
organizations can create a local or a charter.
[Expressio unius est exclusio alterius, the expression
of one thing is the exclusion of another. Expressium
facit cessare tacitum. What is expressed puts an end
to what is implied. Casus omissus pro omisso
habendus est. A person, object or thing omitted must
have been omitted intentionally. ]
o Therefore, since under the pertinent status
and applicable implementing rules, the
power granted to labor organizations to
directly create a chapter or local through
chartering is given to a federation or national
union, then a trade union center is without
authority to charter directly.
o WHY? To prevent circumvention of labor
union requirements. As a legitimate labor
organization is entitled to specific rights
under the Labor Code and involved in
activities directly affecting public interest, it is
necessary that the law afford utmost
protection to the parties affected. (lori)
Labor Review Digests 1
3/15
G.R. No. 177024 October 30, 2009
THE HERITAGE HOTEL MANILA (OWNED AND OPERATED
BY GRAND PLAZA HOTEL CORPORATION) Petitioner,
vs.
PINAG-ISANG GALING AT LAKAS NG MGA
MANGGAGAWA SA HERITAGE MANILA (PIGLAS-
HERITAGE), Respondent.
ABAD, J.:
This case is about a company’s objections to the registration of
its rank and file union for non-compliance with the
requirements of its registration.
FACTS:
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 to this
union.
Subsequently, the HHE union filed a petition for certification
election that petitioner company opposed. The company
alleged that the HHE union misrepresented itself to be an
independent union, when it was, in truth, a 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 company’s supervisors union was
already affiliated with it. Thus, the company also filed a petition
for the cancellation of the HHE union’s registration certificate.
Med-Arbiter granted the HHE union’s petition for certification
election.
Petitioner company appealed the decision to the Secretary of
Labor but the latter denied the appeal and petitioner’s motion
for reconsideration.
On October 12, 2001 the Court of Appeals issued a writ of
injunction against the holding of the HHE union’s certification
election, effective until the petition for cancellation of that
union’s registration shall have been resolved with finality. The
decision of the Court of Appeals became final when the HHE
union withdrew the petition for review that it filed with SC.
On December 10, 2003 certain rank and file employees of
petitioner company 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 and got its registration certificate on
February 9, 2004. Two months later, the members of the first
4

union, the HHE union, adopted a resolution for its
dissolution. The HHE union then filed a petition for
cancellation of its union registration.
On September 4, 2004 respondent PIGLAS union filed a
petition for certification election that petitioner company also
opposed, alleging that the new union’s 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 company’s opposition, however, the Med-Arbiter granted
the petition for certification election.
On December 6, 2004 petitioner company filed a petition to
cancel the union registration of respondent PIGLAS union.
According to the company, the union violated the policy against
dual unionism and showed that the new union was merely an
alter ego of the old.
ISSUE:
Whether or not previous membership with HHE (alleged "dual
unionism") is a ground for cancelling a union’s registration.
HELD:
No. The fact that some of respondent PIGLAS union’s
members were also members of the old rank and file union, the
HHE union, is not a ground for cancelling the new union’s
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,
petitioner’s arguments on this point may also be now regarded
as moot and academic. (bonna)
Labor Review Digests 1
4/15
EAGLE RIDGE GOLF & COUNTRY CLUB vs. COURT OF
APPEALS and EAGLE RIDGE EMPLOYEES UNION (EREU)
FACTS:
Petitioner Eagle Ridge is a corporation engaged in the
business of maintaining golf courses. It had, at the end of CY
2005, around 112 rank-and-file employees. The instant case is
an off-shot of the desire of a number of these employees to
organize themselves as a legitimate labor union and their
employer’s opposition to their aspiration.
Petitioner had 112 rank-and-file employees. On 06 December
2005, at least 20%1 organized themselves into an independent
labor union. After being issued a registration certificate, it filed
a petition for certification election (CE). Petitioner opposed it,
followed by the filing of a petition for cancellation of the
registration certificate. It claimed that EREU declared in its
application for registration that it had 30 members when the
minutes of its organizational meeting only showed 26.
However, only 25 signed the certification that ratified the
constitution and by-laws while 26 signed the document,
thereby making one signature a forgery. Also, petitioner
contended that 5 employees wanted to withdraw from the
union, executing affidavits2 claiming that (1) the meeting was a
drinking spree, (2) they didn’t know the documents they signed
were for the organization of a union, and (3) they wish to
withdraw from it. This withdrawal reduces the membership to
20 to 21 (below minimum). Eagle Ridge’s petition ascribed
misrepresentation, false statement, or fraud to EREU in
connection with the adoption of its constitution and by-laws, the
numerical composition of the Union, and the election of its
officers. Conversely, the union presented duly accomplished
membership forms of 4 additional members dated 08
December 2005.3
ISSUE:
Whether or not EREU misrepresented, gave false statements
and committed fraud in the adoption of its constitution and by-
laws, the numerical composition of the union and the election
of officers for the application for registration.
RULING:
NO. It had 30 members when it applied for registration on 19
December 2005. It has sufficiently explained that the
discrepancy4 was due to the 4 additional members. Admission
of new members is neither prohibited by law nor was it
1 20% of 112 is 22.4
2 Dated 15 February 2006.
3 NOTE: It also presented two sama-samang sinumpaang salaysay and the union
legal counsel’s sworn statement attesting to the orderly and properly proceedings of
the organizational meeting.
4 between those who attended the meeting and the total members
5

concealed in its application. Art 234(b) required submission of
the minutes and list of participants while par (c) merely
required the list of all members. Any seeming infirmity in the
application and admission of membership, especially in
independent unions, must be viewed in favor of valid
membership.5
The 26-25 difference is merely a typographical error and an
insignificant mistake. The affidavits of retraction of 6 6 were not
presented in the hearing and are, therefore, hearsay while
those affidavits presented by the union were duly re-affirmed in
the hearing by the affiants. The employees’ withdrawal from a
labor union made before filing of the petition for CE is
presumed voluntary, while withdrawal after is considered
involuntary. Hence, withdrawal from a union after filing the
Petition for CE does not affect it. The retraction did not
retroact to the time of the application for registration or even to
the organizational meeting. Prior to their withdrawal, they were
bona fide union members. They also never disputed affixing
their signatures.
Well settled is that where the company seeks the cancellation
of a union’s registration during the pendency of a petition for
certification election, the same grounds invoked to cancel
should not be used to bar the certification election. This is
because a CE is the most appropriate procedure for the
desired goal of ascertaining which of the competing
organizations should represent the employees for the purpose
of collective bargaining. (berna)
5 It was alleged by petitioner that the applications for membership did not comply with
(what petitioner called) “sine qua non requirements” in the constitution and by-laws.
6 Facts stated 5 but the ruling stated 6 members.
Labor Review Digests 1
5/15
G.R. No. 169717 March 16, 2011
SAMAHANG MANGGAGAWA SA CHARTER CHEMICAL
SOLIDARITY OF UNIONS IN THE PHILIPPINES FOR
EMPOWERMENT AND REFORMS (SMCC-SUPER),
ZACARRIAS JERRY VICTORIO-Union President vs.
CHARTER CHEMICAL and COATING CORPORATION
Facts: Samahang Manggagawa sa Charter Chemical Solidarity
of Unions in the Philippines for Empowerment and Reforms
(petitioner union) filed a petition for certification election among
the regular rank-and-file employees of Charter Chemical and
Coating Corporation (respondent company) with the Mediation
Arbitration Unit of the DOLE, National Capital Region.
On April 14, 1999, respondent company opposed on the
ground that petitioner union is not a legitimate labor
organization because of (1) failure to comply with the
documentation requirements set by law, and (2) the inclusion
of supervisory employees within petitioner union.5
The Med-Arbiter ruled that petitioner union is not a legitimate
labor organization because the Charter Certificate were not
executed under oath and certified by the union secretary and
attested to by the union president as required by Section 235
of the Labor Code7 in relation to Section 1, Rule VI of
Department Order (D.O.) No. 9, series of 1997. The union
registration was, thus, fatally defective.
The Med-Arbiter further held that the list of membership of
petitioner union consisted of 12 batchman, mill operator and
leadman who performed supervisory functions. As a result, not
being a legitimate labor organization, petitioner union has no
right to file a petition for certification election for the purpose of
collective bargaining.
Petitioner union argues that the lack of verification of its charter
certificate and the alleged illegal composition of its
membership are not grounds for the dismissal of a petition for
certification election under Section 11, Rule XI of D.O. No. 9,
series of 1997, as amended, nor are they grounds for the
cancellation of a union’s registration under Section 3, Rule VIII
of said issuance. It contends that what is required to be
certified under oath by the local union’s secretary or treasurer
and attested to by the local union’s president are limited to the
union’s constitution and by-laws, statement of the set of
officers, and the books of accounts. Petitioner further assets
that the legal personality of petitioner union cannot be
collaterally attacked but may be questioned only in an
independent petition for cancellation pursuant to Section 5,
Rule V, Book IV of the Rules to Implement the Labor Code
Respondent contends that petitioner union is not a legitimate
labor organization because its composition is a mixture of
supervisory and rank-and-file employees in violation of Article
245 of the Labor Code. Respondent company maintains that
6

the ruling in Toyota Motor Philippines vs. Toyota Motor
Philippines Labor Union14 continues to be good case law.
Thus, the illegal composition of petitioner union nullifies its
legal personality to file the subject petition for certification
election and its legal personality may be collaterally attacked in
the proceedings for a petition for certification election as was
done here.
Issue:
1. WON The charter certificate need to be certified
under oath by the local union’s secretary or treasurer
and attested to by its president.
2. WON The mixture of rank-and-file and supervisory
employees in petitioner union does not nullify its legal
personality as a legitimate labor organization.
3. .WON the legal personality of petitioner union cannot
be collaterally attacked by respondent company in the
certification election proceedings.
Held:
1. The charter certificate need to be certified under oath
by the local union’s secretary or treasurer and
attested to by its president.
The then prevailing Section 1, Rule VI of the Implementing
Rules of Book V, as amended by D.O. No. 9, series of 1997,
provides:
Section 1. Chartering and creation of a local chapter — A duly
registered federation or national union may directly create a
local/chapter by submitting to the Regional Office or to the
Bureau two (2) copies of the following:
(a) A charter certificate issued by the federation or
national union indicating the creation or establishment
of the local/chapter;
(b) The names of the local/chapter’s officers, their
addresses, and the principal office of the
local/chapter; and
(c) The local/chapter’s constitution and by-laws
provided that where the local/chapter’s constitution
and by-laws [are] the same as [those] of the
federation or national union, this fact shall be
indicated accordingly.
All the foregoing supporting requirements shall be certified
under oath by the Secretary or the Treasurer of the
local/chapter and attested to by its President.
As readily seen, the Sama-samang Pahayag ng Pagsapi at
Authorization and Listahan ng mga Dumalo sa
Pangkalahatang Pulong at mga Sumang-ayon at Nagratipika
sa Saligang Batas are not among the documents that need to
Labor Review Digests 1
be submitted to the Regional Office or Bureau of Labor
Relations in order to register a labor organization. As to the
charter certificate, the above-quoted rule indicates that it
should be executed under oath. Petitioner union concedes and
the records confirm that its charter certificate was not executed
under oath.
However, in San Miguel Foods-Cebu B-Meg Feed Plant v.
Hon. Laguesma, 331 Phil. 356 (1996), the Court ruled that it
was not necessary for the charter certificate to be certified
and attested by the local/chapter officers. Id. While this ruling
was based on the interpretation of the previous
Implementing Rules provisions which were supplanted by
the 1997 amendments, we believe that the same doctrine
obtains in this case. Considering that the charter certificate is
prepared and issued by the national union and not the
local/chapter, it does not make sense to have the
local/chapter’s officers x x x certify or attest to a document
which they had no hand in the preparation of.23
In accordance with this ruling, petitioner union’s charter
certificate need not be executed under oath. Consequently, it
validly acquired the status of a legitimate labor organization
upon submission of (1) its charter certificate,24 (2) the names of
its officers, their addresses, and its principal office,25 and (3) its
constitution and by-laws26— the last two requirements having
been executed under oath by the proper union officials as
borne out by the records.
2. The mixture of rank-and-file and supervisory
employees in petitioner union does not nullify its legal
personality as a legitimate labor organization.
The CA found that petitioner union has for its membership both
rank-and-file and supervisory employees. However, petitioner
union sought to represent the bargaining unit consisting of
rank-and-file employees. Under Article 24527 of the Labor
Code, supervisory employees are not eligible for membership
in a labor organization of rank-and-file employees.
Nonetheless, the inclusion of the aforesaid supervisory
employees in petitioner union does not divest it of its status as
a legitimate labor organization. In Kawashima, we explained at
length how and why the Toyota doctrine no longer holds sway
under the altered state of the law and rules applicable to this
case, viz:
R.A. No. 6715 omitted specifying the exact effect any
violation of the prohibition [on the co-mingling of
supervisory and rank-and-file employees] would bring
about on the legitimacy of a labor organization.
It was the Rules and Regulations Implementing R.A. No. 6715
(1989 Amended Omnibus Rules) which supplied the deficiency
by introducing the following amendment to Rule II (Registration
of Unions):
"Sec. 1. Who may join unions. - x x x Supervisory employees
and security guards shall not be eligible for membership
7

in a labor organization of the rank-and-file employees but
may join, assist or form separate labor organizations of
their own; Provided, that those supervisory employees who
are included in an existing rank-and-file bargaining unit, upon
the effectivity of Republic Act No. 6715, shall remain in that
unit x x x. (Emphasis supplied) and Rule V (Representation
Cases and Internal-Union Conflicts) of the Omnibus Rules, viz:
"Sec. 1. Where to file. - A petition for certification election may
be filed with the Regional Office which has jurisdiction over the
principal office of the employer. The petition shall be in writing
and under oath.
Sec. 2. Who may file. - Any legitimate labor organization or the
employer, when requested to bargain collectively, may file the
petition.
The petition, when filed by a legitimate labor organization, shall
contain, among others:
(c) description of the bargaining unit which shall be the
employer unit unless circumstances otherwise require;
and provided further, that the appropriate bargaining unit
of the rank-and-file employees shall not include
supervisory employees and/or security guards. (Emphasis
supplied)
By that provision, any questioned mingling will prevent an
otherwise legitimate and duly registered labor organization
from exercising its right to file a petition for certification
election.
Thus, when the issue of the effect of mingling was brought to
the fore in Toyota, the Court, citing Article 245 of the Labor
Code, as amended by R.A. No. 6715, held:
"Clearly, based on this provision, a labor organization
composed of both rank-and-file and supervisory employees is
no labor organization at all. It cannot, for any guise or purpose,
be a legitimate labor organization. Not being one, an
organization which carries a mixture of rank-and-file and
supervisory employees cannot possess any of the rights
of a legitimate labor organization, including the right to file
a petition for certification election for the purpose of
collective bargaining. It becomes necessary, therefore,
anterior to the granting of an order allowing a certification
election, to inquire into the composition of any labor
organization whenever the status of the labor organization
is challenged on the basis of Article 245 of the Labor
Code.
In the case at bar, as respondent union's membership list
contains the names of at least twenty-seven (27) supervisory
employees in Level Five positions, the union could not, prior to
purging itself of its supervisory employee members, attain the
status of a legitimate labor organization. Not being one, it
cannot possess the requisite personality to file a petition for
certification election."
Labor Review Digests 1
In Dunlop, in which the labor organization that filed a petition
for certification election was one for supervisory employees,
but in which the membership included rank-and-file employees,
the Court reiterated that such labor organization had no legal
right to file a certification election to represent a bargaining unit
composed of supervisors for as long as it counted rank-and-file
employees among its members.
It should be emphasized that the petitions for certification
election involved in Toyota and Dunlop were filed on
November 26, 1992 and September 15, 1995, respectively;
hence, the 1989 Rules was applied in both cases.
Specifically, the requirement under Sec. 2(c) of the 1989
Amended Omnibus Rules – that the petition for certification
election indicate that the bargaining unit of rank-and-file
employees has not been mingled with supervisory employees
– was removed. Instead, what the 1997 Amended Omnibus
Rules requires is a plain description of the bargaining unit,
thus:
Rule XI
Certification Elections
Sec. 4. Forms and contents of petition. - The petition shall be
in writing and under oath and shall contain, among others, the
following: x x x (c) The description of the bargaining unit.
In Pagpalain Haulers, Inc. v. Trajano, the Court had occasion
to uphold the validity of the 1997 Amended Omnibus Rules,
although the specific provision involved therein was only Sec.
1, Rule VI, to wit:
"Section. 1. Chartering and creation of a local/chapter.- A duly
registered federation or national union may directly create a
local/chapter by submitting to the Regional Office or to the
Bureau two (2) copies of the following: a) a charter certificate
issued by the federation or national union indicating the
creation or establishment of the local/chapter; (b) the names of
the local/chapter's officers, their addresses, and the principal
office of the local/chapter; and (c) the local/ chapter's
constitution and by-laws; provided that where the
local/chapter's constitution and by-laws is the same as that of
the federation or national union, this fact shall be indicated
accordingly.
All the foregoing supporting requirements shall be certified
under oath by the Secretary or the Treasurer of the
local/chapter and attested to by its President." which does not
require that, for its creation and registration, a local or chapter
submit a list of its members.
Then came Tagaytay Highlands Int'l. Golf Club, Inc. v.
Tagaytay Highlands Employees Union-PGTWO in which the
core issue was whether mingling affects the legitimacy of a
labor organization and its right to file a petition for certification
election. This time, given the altered legal milieu, the Court
abandoned the view in Toyota and Dunlop and reverted to its
pronouncement in Lopez that while there is a prohibition
8
 Labor Review Digests 1

against the mingling of supervisory and rank-and-file
employees in one labor organization, the Labor Code does not
provide for the effects thereof. Thus, the Court held that after a
labor organization has been registered, it may exercise all the
rights and privileges of a legitimate labor organization. Any
mingling between supervisory and rank-and-file employees in
its membership cannot affect its legitimacy for that is not
among the grounds for cancellation of its registration, unless
such mingling was brought about by misrepresentation, false
statement or fraud under Article 239 of the Labor Code.
bargaining with the employer. The choice of their
representative is the exclusive concern of the employees; the
employer cannot have any partisan interest therein; it cannot
interfere with, much less oppose, the process by filing a motion
to dismiss or an appeal from it; not even a mere allegation that
some employees participating in a petition for certification
election are actually managerial employees will lend an
employer legal personality to block the certification election.
The employer's only right in the proceeding is to be notified or
informed thereof. (angel)

In San Miguel Corp. (Mandaue Packaging Products Plants) v.

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

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

Labor Relations, which involved a petition for cancellation of
union registration filed by the employer in 1999 against a rank-
and-file labor organization on the ground of mixed
membership: the Court therein reiterated its ruling in Tagaytay
Highlands that the inclusion in a union of disqualified
employees is not among the grounds for cancellation, unless
such inclusion is due to misrepresentation, false statement or
fraud under the circumstances enumerated in Sections (a) and
(c) of Article 239 of the Labor Code.

All said, while the latest issuance is R.A. No. 9481, the 1997
Amended Omnibus Rules, as interpreted by the Court in
Tagaytay Highlands, San Miguel and Air Philippines, had
already set the tone for it. Toyota and Dunlop no longer hold
sway in the present altered state of the law and the rules.32
[Underline supplied]

The applicable law and rules in the instant case are the same
as those in Kawashima because the present petition for
certification election was filed in 1999 when D.O. No. 9, series
of 1997, was still in effect. Hence, Kawashima applies with
equal force here. As a result, petitioner union was not divested
of its status as a legitimate labor organization even if some of
its members were supervisory employees; it had the right to file
the subject petition for certification election.

3. The legal personality of petitioner union cannot be

collaterally attacked by respondent company in the certification
election proceedings.

Petitioner union correctly argues that its legal personality

cannot be collaterally attacked in the certification election
proceedings. As we explained in Kawashima:

Except when it is requested to bargain collectively, an

employer is a mere bystander to any petition for certification
election; such proceeding is non-adversarial and merely
investigative, for the purpose thereof is to determine which
organization will represent the employees in their collective

9

6/15
Yokohama Tire Phils. Vs. Yokohama Employees Union
G.R. No. 163532, March 10, 2010
Facts:
Yokohama Employees Union (YEU) is the labor organization of
the rank-and-file employees of Yokohama Tire Philippines, Inc.
(YTPI). YEU was registered as a legitimate labor labor union
on 10 September 1999. YEU filed before the Regional Office a
petition for certification election. YTPI filed a petition in the
Regional Office for the revocation of YEU’s registration alleging
fraud and misrepresentation. YTPI alleged that YEU violated
Article 239(a) of the Labor Code: (1) YEU fraudulently included
the signature of a certain Ronald O. Pineda (Pineda) in the
organizational documents; (2) Pineda was not aware of any
election of union officers; (3) YEU fraudulently obtained the
employees’ signatures by making them believe that they were
signing a petition for a 125% increase in the minimum wage,
not a petition for registration; (4) the employees did not belong
to a single bargaining unit; and (5) YEU fraudulently stated in
its organizational meeting minutes that its second vice
president was Bernard David, not Bernardo David. YTPI’s
petition was granted and YEU appealed to the BLR, which
reversed the decision.
The BLR found that (1) Pineda did not approach any officer of
YEU to have his signature removed from the organizational
documents; (2) Pineda’s affidavit that no election of officers
took place was unreliable and inconsistent with his earlier
written statement; (3) the affidavit of a certain Rachelle
Gonzales (Gonzales) that no election of officers took place was
unreliable and inconsistent with her earlier resignation letter;
(4) the affidavit of a certain Arthur Calma (Calma) did not state
that no election of officers took place; (5) at least 82 other
members of YEU did not question the legality of YEU’s
organization; and (6) 50 YEU members executed a Sama-
Samang Pahayagwhich alleged that they have indeed
attended a meeting for the purpose of organizing and ratifying
their Union By Laws and that the employees did not question
the legality of YEU’s organization. The BLR also held that
although the Sama-Samang Pahayag did not specifically
mention that an election took place during the organizational
meeting, it may be possible that the same was conducted and
that any infirmity in the election of union officers may be
remedied under the last paragraph of Article 241 of the Labor
Code and under Rule XIV of DOLE Department Order No. 9.
YTPI filed for a motion for reconsideration before the BLR,
which was denied. Then a petition for certiorari under Rule 65
was filed in the CA, the same was denied, as well as the
motion for reconsideration.
Issue:
Did YEU commit fraud and misrepresentation?
Labor Review Digests 1
Ruling:
No. Whether YEU committed fraud and misrepresentation in
failing to remove signatures of some employees from the list of
employees who supported YEU’s application for registration
and whether YEU conducted an election of its officers are
questions of fact. YTPI, being the one which filed the petition
for the revocation of YEU’s registration, had the burden of
proving that YEU committed fraud and misrepresentation. The
CA already ruled that YTPI failed to prove that YEU committed
fraud and misrepresentation.
Factual findings of the CA and other lower tribunals are binding
on the Court. A petition for review on certiorari under Rule 45
of the Rules of Court should include only questions of law —
questions of fact are not reviewable. A question of law exists
when the doubt centers on what the law is on a certain set of
facts, while a question of fact exists when the doubt centers on
the truth or falsity of the alleged facts. There is a question of
law if the issue raised is capable of being resolved without
need of reviewing the probative value of the evidence. Once
the issue invites a review of the evidence, the question is one
of fact.
The cancellation of union registration at the employer’s
instance, while permitted, must be approached with caution
and strict scrutiny in order that the right to belong to a
legitimate labor organization and to enjoy the privileges
appurtenant to such membership will not be denied to the
employees. As the applicant for cancellation, the petitioner
naturally had the burden to present proof sufficient to warrant
the cancellation. The petitioner was thus expected to
satisfactorily establish that YEU committed misrepresentations,
false statements or fraud in connection with the election of its
officers, or with the minutes of the election of officers, or in the
list of votes, as expressly required in Art. 239, (c), Labor Code.
But, as the respondent BLR Director has found and
determined, and We fully agree with him, the petitioner simply
failed to discharge its burden.
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.
Petition denied. (estella)
10
 Labor Review Digests 1

dismissible. The Court of Appeals cannot be said to have acted

with grave abuse of discretion amounting to lack or excess of
jurisdiction in annulling the Decision of the NLRC because the
findings of the Court of Appeals that private respondent
Tamondong was indeed a supervisory employee and not a
managerial employee, thus, eligible to join or participate in
7/15 the union activities of private respondent CUSE, were
CATHAY PACIFIC STEEL CORPORATION, BENJAMIN supported by evidence on record. Tamondong may have
CHUA JR., VIRGILIO AGERO, and LEONARDO VISORRO, possessed enormous powers and was performing
JR. vs. HON. COURT OF APPEALS, CAPASCO UNION OF important functions that goes with the position of
SUPERVISORY EMPLOYEES (CUSE) and ENRIQUE Personnel Superintendent, nevertheless, there was no
TAMONDONG III clear showing that he is at liberty, by using his own
G.R. No. 164561. August 30, 2006. discretion and disposition, to lay down and execute major
FACTS: business and operational policies for and in behalf of
CAPASCO. (lori)
Private respondent Tomondong was the Assistant to the
Personnel Manager of Petitioner CAPASCO. He was promoted
to the position of Personnel/Administrative Officer, and later to
that of Personnel Superintendent. The supervisory personnel
of CAPASCO launched a move to organize a union among
their ranks, later known as private respondent CUSE.
Tamondong actively involved himself in the formation of the
union and was even elected as one of its officers after its
creation. CAPASCO sent a memo to Tamondong requiring
him to explain and to discontinue from his union activities, with
a warning that a continuance thereof shall adversely affect his
employment in the company. Tamondong ignored said warning
and made a reply letter invoking his right as a supervisory
employee to join and organize a labor union. Thereafter
CAPASCO terminated the employment of Tamondong on the
ground of loss of trust and confidence, citing his union activities
as acts constituting serious disloyalty to the company.
Tamondong challenged his dismissal for being illegal and as
an act involving unfair labor practice Though he admitted his
active role in the formation of a union composed of supervisory
personnel in the company, he claimed that such was not a
valid ground to terminate his employment because it was a
legitimate exercise of his constitutionally guaranteed right to
self-organization. CAPASCO contended that Tamondong's
position as Personnel Superintendent and the functions
actually performed by him in the company makes him a
managerial employee, thus, under the law he was prohibited
from joining a union as well as from being elected as one of its
officers.
The LA ruled in favor of Tamondong. On appeal, the NLRC
modified the ruling by dismissing the complaints for ULP and
Illegal dismissal and also the award for damages but ordered
the payment of backwages to Tamondong. On petition, the CA
granted the nullification of the decision of the NLRC. Hence,
this present Petition for Certiorari.
ISSUE:
WON the CA committed grave abuse of discretion in finding
petitioner guilty of illegal dismissal and ULP?
RULING:
No. Where the issue or question involves or affects the
wisdom or legal soundness of the decision, and not the
jurisdiction of the court to render said decision, the same is
beyond the province of a petition for certiorari. In any event,
granting arguendo, that the present petition is proper, still it is

11

8/15
G.R. No. 110399 August 15, 1997
SAN MIGUEL CORPORATION SUPERVISORS AND
EXEMPT UNION AND ERNESTO L. PONCE, President,
petitioners,
vs.
HONORABLE BIENVENIDO E. LAGUESMA IN HIS
CAPACITY AS UNDERSECRETARY OF LABOR AND
EMPLOYMENT, HONORABLE DANILO L. REYNANTE IN
HIS CAPACITY AS MED-ARBITER AND SAN MIGUEL
CORPORATION, respondents.
ROMERO, J.:
This is a Petition for Certiorari with Prayer for the Issuance of
Preliminary Injunction seeking to reverse and set aside the
order of public respondent, Undersecretary of the Department
of Labor and Employment, Bienvenido E. Laguesma, the order
excluding the employees under supervisory levels 3 and 4 and
the so-called exempt employees from the proposed bargaining
unit and ruled out their participation in the certification election.
FACTS:
On October 5, 1990, petitioner union filed before the
Department of Labor and Employment (DOLE) a Petition for
Certification Election among the supervisors and exempt
employees of the SMC Magnolia Poultry Products Plants of
Cabuyao, San Fernando and Otis.
On December 19, 1990, Med-Arbiter Danilo L. Reynante
issued an Order ordering the conduct of certification election
among the supervisors and exempt employees of Cabuyao,
San Fernando and Otis as one bargaining unit.
San Miguel Corporation appealed, pointing out the Med-
Arbiter's error in grouping together all three (3) separate plants
into one bargaining unit, and in including supervisory levels 3
and above whose positions are confidential in nature.
Laguesma directed the conduct of separate certification
elections among the supervisors ranked as supervisory levels
1 to 4 (S1 to S4) and the exempt employees in each of the
three plants.
San Miguel Corporation filed a Motion for Reconsideration with
Motion to suspend proceedings.
An Order was issued by Laguesma granting the Motion, citing
the doctrine enunciated in Philips Industrial Development, Inc.
v. NLRC case. Said Order reads in part:
. . . Confidential employees, like managerial
Labor Review Digests 1
employees, are not allowed to form, join or assist a
labor union for purposes of collective bargaining.
In this case, S3 and S4 Supervisors and the so-called
exempt employees are admittedly confidential
employees and therefore, they are not allowed to
form, join or assist a labor union for purposes of
collective bargaining following the above court's
ruling. Consequently, they are not allowed to
participate in the certification election.
ISSUES:
1. Whether Supervisory employees 3 and 4 and the exempt
employees of the company are considered confidential
employees, hence ineligible from joining a union.
2 Do the employees of the three plants constitute an
appropriate single bargaining unit.
HELD:
1. No. Confidential employees are those who (1) assist or act
in a confidential capacity, (2) to persons who formulate,
determine, and effectuate management policies in the field of
labor relations. The two criteria are cumulative, and both must
be met if an employee is to be considered a confidential
employee — that is, the confidential relationship must exist
between the employee and his supervisor, and the supervisor
must handle the prescribed responsibilities relating to labor
relations. In determining the confidentiality of certain
employees, a key question frequently considered is the
employee's necessary access to confidential labor relations
information.
Herein listed are the functions of supervisors 3 and higher:
a) To undertake decisions to discontinue/temporarily stop
shift operations when situations require.
b) To effectively oversee the quality control function at the
processing lines in the storage of chicken and other
products.
c) To administer efficient system of evaluation of products
in the outlets.
d) To be directly responsible for the recall, holding and
rejection of direct manufacturing materials.
e) To recommend and initiate actions in the maintenance
of sanitation and hygiene throughout the plant.
In the case at bar, supervisors 3 and above may not be
considered confidential employees merely because they
handle "confidential data" as such must first be strictly
classified as pertaining to labor relations for them to fall under
said restrictions. The information they handle are properly
classifiable as technical and internal business operations data
12

which, to our mind, has no relevance to negotiations and
settlement of grievances wherein the interests of a union and
the management are invariably adversarial. Since the
employees are not classifiable under the confidential type, this
Court rules that they may appropriately form a bargaining unit
for purposes of collective bargaining. Furthermore, even
assuming that they are confidential employees, jurisprudence
has established that there is no legal prohibition against
confidential employees who are not performing managerial
functions to form and join a union.
2. Yes. It is the contention of the petitioner union that the
creation of three (3) separate bargaining units, one each for
Cabuyao, Otis and San Fernando as ruled by the respondent
Undersecretary, is contrary to the one-company, one-union
policy. It adds that Supervisors level 1 to 4 and exempt
employees of the three plants have a similarity or a community
of interests.
This Court finds the contention of the petitioner meritorious.
An appropriate bargaining unit may be defined as "a group of
employees of a given employer, comprised of all or less than
all of the entire body of employees, which the collective interest
of all the employees, consistent with equity to the employer,
indicate to be best suited to serve the reciprocal rights and
duties of the parties under the collective bargaining provisions
of the
law."
A unit to be appropriate must effect a grouping of employees
who have substantial, mutual interests in wages, hours,
working conditions and other subjects of collective bargaining.
It is readily seen that the employees in the instant case have
"community or mutuality of interests," which is the standard in
determining the proper constituency of a collective bargaining
unit. It is undisputed that they all belong to the Magnolia
Poultry Division of San Miguel Corporation. This means that,
although they belong to three different plants, they perform
work of the same nature, receive the same wages and
compensation, and most importantly, share a common stake in
concerted activities. (bonna)
Labor Review Digests 1
9/15
STANDARD CHARTERED BANK EMPLOYEES UNION
(SCBEU-NUBE) vs. STANDARD CHARTERED BANK and
ANNEMARIE DURBIN, in her capacity as Chief Executive
Officer, Philippines, Standard Chartered Bank
G.R. No. 161933 April 22, 2008
Petitioner and the Standard Chartered Bank (Bank) began
negotiating for a new Collective Bargaining Agreement (CBA)
in May 2000 as their 1998-2000 CBA already expired. Due to a
deadlock in the negotiations, petitioner filed a Notice of Strike
prompting the Secretary of Labor and Employment to assume
jurisdiction over the labor dispute.
The CBA provisions in dispute are the exclusion of certain
employees from the appropriate bargaining unit and the
adjustment of remuneration for employees serving in an acting
capacity for one month.
In their proposal, petitioner sought the exclusion of only the
following employees from the appropriate bargaining unit – all
managers who are vested with the right to hire and fire
employees, confidential employees, those with access to labor
relations materials, Chief Cashiers, Assistant Cashiers,
personnel of the Telex Department and one Human Resources
(HR) staff.
In the previous 1998-2000 CBA,10 the excluded employees are
as follows:
A. All covenanted and assistant officers (now called
National Officers)
B. One confidential secretary of each of the:
1. Chief Executive, Philippine Branches
2. Deputy Chief Executive/Head, Corporate
Banking Group
3. Head, Finance
4. Head, Human Resources
5. Manager, Cebu
6. Manager, Iloilo
7. Covenanted Officers provided said
positions shall be filled by new recruits.
C. The Chief Cashiers and Assistant Cashiers in
Manila, Cebu and Iloilo, and in any other branch
that the BANK may establish in the country.
D. Personnel of the Telex Department
E. All Security Guards
F. Probationary employees, without prejudice to
Article 277 (c) of the Labor Code, as amended by
R.A. 6715, casuals or emergency employees; and
G. One (1) HR Staff
ISSUE:
13

Whether or not the Bank's Chief Cashiers and Assistant
Cashiers, personnel of the Telex Department and HR staff are
confidential employees, such that they should be excluded.
Whether or not additional remuneration should be given to
employees placed in an acting capacity for one month.
HELD:
NO. Petitioner insists that the foregoing employees are not
confidential employees; however, it failed to buttress its claim.
Aside from its generalized arguments and despite the
Secretary's finding that there was no evidence to support it,
petitioner still failed to substantiate its claim. Petitioner did not
even bother to state the nature of the duties and functions of
these employees, depriving the Court of any basis on which it
may be concluded that they are indeed confidential employees.
As aptly stated by the CA:
While We agree that petitioner's proposed revision is
in accordance with the law, this does not necessarily
mean that the list of exclusions enumerated in the
1998-2000 CBA is contrary to law. As found by public
respondent, petitioner failed to show that the
employees sought to be removed from the list of
exclusions are actually rank and file employees
who are not managerial or confidential in status
and should, accordingly, be included in the
appropriate bargaining unit.
Absent any proof that Chief Cashiers and
Assistant Cashiers, personnel of the Telex
department and one (1) HR Staff have mutuality of
interest with the other rank and file employees,
then they are rightfully excluded from the
appropriate bargaining unit. x x x21(Emphasis
supplied)
Petitioner cannot simply rely on jurisprudence without
explaining how and why it should apply to this case.
Allegations must be supported by evidence. In this case, there
is barely any at all.
YES. There is likewise no reason for the Court to disturb the
conclusion of the Secretary and the CA that the additional
remuneration should be given to employees placed in an
acting capacity for one month. The Secretary agreed with the
Bank's position that a restrictive provision would curtail
management's prerogative, and at the same time, recognized
that employees should not be made to work in an acting
capacity for long periods of time without adequate
compensation. (berna)
Labor Review Digests 1
10/15
G.R. No. 157117 November 20, 2006
COASTAL SUBIC BAY TERMINAL, INC., vs. 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,
Facts: 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
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.
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. The Secretary 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. 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. Accordingly, the
Secretary ordered the holding of separate certification election.
Issue: 1. WON supervisory and the rank-and-file unions can
file separate petitions for certification election?
2. WON ALU, a rank-and-file union and APSOTEU, a
supervisory union one and the same because of the
commonalities between them? Are they commingled?
Held:
1. 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
14
 Labor Review Digests 1

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.
2. 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.
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.
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. (angel)

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

15

11/15
G.R. No. 162025 August 3, 2010
TUNAY NA PAGKAKAISA NG MANGGAGAWA SA ASIA
BREWERY, Petitioner,
vs.
ASIA BREWERY, INC., Respondent.
Facts:
Respondent Asia Brewery, Inc. (ABI) is engaged in the
manufacture, sale and distribution of beer, shandy, bottled
water and glass products. ABI entered into a Collective
Bargaining Agreement (CBA) effective for five (5) years from
August 1, 1997 to July 31, 2002, with Bisig at Lakas ng mga
Manggagawa sa Asia-Independent (BLMA-INDEPENDENT),
the exclusive bargaining representative of ABI’s rank-and-file
employees. On October 3, 2000, ABI and BLMA-
INDEPENDENT signed a renegotiated CBA effective from
August 1, 2000 to 31 July 2003.
Article I of the CBA defined the scope of the bargaining unit, as
follows:
Section 2. Bargaining Unit. The bargaining unit shall be
comprised of all regular rank-and-file daily-paid employees of
the COMPANY. However, the following jobs/positions as
herein defined shall be excluded from the bargaining unit, to
wit:
1. Managers
2. Assistant Managers
3. Section Heads
4. Supervisors
5. Superintendents
6. Confidential and Executive Secretaries
7. Personnel, Accounting and Marketing Staff
8. Communications Personnel
9. Probationary Employees
Labor Review Digests 1
10. Security and Fire Brigade Personnel
11. Monthly Employees
12. Purchasing and Quality Control Staff
Subsequently, a dispute arose when ABI’s management
stopped deducting union dues from eighty-one (81)
employees, believing that their membership in BLMA-
INDEPENDENT violated the CBA. Eighteen (18) of these
affected employees are QA Sampling Inspectors/Inspectresses
and Machine Gauge Technician who formed part of the Quality
Control Staff. Twenty (20) checkers are assigned at the
Materials Department of the Administration Division, Full
Goods Department of the Brewery Division and Packaging
Division. The rest are secretaries/clerks directly under their
respective division managers.
BLMA-INDEPENDENT claimed that ABI’s actions restrained
the employees’ right to self-organization and brought the
matter to the grievance machinery. As the parties failed to
amicably settle the controversy, BLMA-INDEPENDENT lodged
a complaint before the National Conciliation and Mediation
Board (NCMB). The parties eventually agreed to submit the
case for arbitration to resolve the issue of "[w]hether or not
there is restraint to employees in the exercise of their right to
self-organization.
In his Decision, Voluntary Arbitrator sustained the BLMA-
INDEPENDENT after finding that the records submitted by ABI
showed that the positions of the subject employees qualify
under the rank-and-file category because their functions are
merely routinary and clerical. On appeal, the CA reversed the
Voluntary Arbitrator, ruling that
a) the 81 employees are excluded from and are not
eligible for inclusion in the bargaining unit as defined
in Section 2, Article I of the CBA;
b) the 81 employees cannot validly become members
of respondent and/or if already members, that their
membership is violative of the CBA and that they
should disaffiliate from respondent; and
c) petitioner has not committed any act that restrained
or tended to restrain its employees in the exercise of
their right to self-organization.
BLMA-INDEPENDENT filed a motion for reconsideration. In
the meantime, a certification election was held on August 10,
2002 wherein petitioner Tunay na Pagkakaisa ng Manggagawa
sa Asia (TPMA) won. As the incumbent bargaining
representative of ABI’s rank-and-file employees claiming
interest in the outcome of the case, petitioner filed with the CA
an omnibus motion for reconsideration of the decision and
intervention, with attached petition signed by the union officers.
Both motions were denied by the CA.
16
 Labor Review Digests 1

Issues: employee rule.” There is no showing in this case that the

1. Whether or not the workers were confidential employees.
2. Whether or not the company committed unfair labor practice
by restraining its employees in the exercise of their right to self-
organization.
secretaries/clerks and checkers assisted or acted in a
confidential capacity to managerial employees and obtained
confidential information relating to labor relations policies. And
even assuming that they had exposure to internal business
operations of the company, respondent claimed, this is not per
se ground for their exclusion in the bargaining unit of the daily-
paid rank-and-file employees.

Held; Not being confidential employees, the secretaries/clerks and

1. No. Respondent failed to indicate who among the numerous
employees have access to confidential data relating to
management policies that could give rise to potential conflict of
interest with their Union membership. We thus hold that the
secretaries/clerks, numbering about forty (40), are rank-and-file
employees and not confidential employees.
With respect to the Sampling Inspectors/Inspectresses and the
Gauge Machine Technician, there seems no dispute that they
form part of the Quality Control Staff who, under the express
terms of the CBA, fall under a distinct category. But we
disagree with respondent’s contention that the twenty (20)
checkers are similarly confidential employees being "quality
control staff" entrusted with the handling and custody of
company properties and sensitive information.
Again, the job descriptions of these checkers assigned in the
storeroom section of the Materials Department, finishing
section of the Packaging Department, and the decorating and
glass sections of the Production Department plainly showed
that they perform routine and mechanical tasks preparatory to
the delivery of the finished products. While it may be argued
that quality control extends to post-production phase -- proper
packaging of the finished products -- no evidence was
presented by the respondent to prove that these daily-paid
checkers actually form part of the company’s Quality Control
Staff who as such "were exposed to sensitive, vital and
confidential information about [company’s] products" or "have
knowledge of mixtures of the products, their defects, and even
their formulas" which are considered ‘trade secrets’. Such
allegations of respondent must be supported by evidence.
checkers are not disqualified from membership in the Union of
respondent’s rank-and-file employees. Petitioner argues that
respondent’s act of unilaterally stopping the deduction of union
dues from these employees constitutes unfair labor practice as
it "restrained" the workers’ exercise of their right to self-
organization, as provided in Article 248 (a) of the Labor Code.
2. No. Unfair labor practice refers to "acts that violate the
workers’ right to organize." The prohibited acts are related to
the workers’ right to self organization and to the observance of
a CBA. For a charge of unfair labor practice to prosper, it must
be shown that ABI was motivated by ill will, "bad faith, or fraud,
or was oppressive to labor, or done in a manner contrary to
morals, good customs, or public policy, and, of course, that
social humiliation, wounded feelings or grave anxiety resulted x
x x" from ABI’s act in discontinuing the union dues deduction
from those employees it believed were excluded by the CBA.
Considering that the herein dispute arose from a simple
disagreement in the interpretation of the CBA provision on
excluded employees from the bargaining unit, respondent
cannot be said to have committed unfair labor practice that
restrained its employees in the exercise of their right to self-
organization, nor have thereby demonstrated an anti-union
stance. WHEREFORE, the petition is GRANTED. (estella)

Consequently, we hold that the twenty (20) checkers may not

be considered confidential employees under the category of
Quality Control Staff who were expressly excluded from the
CBA of the rank-and-file bargaining unit.

Confidential employees are defined as those who (1) assist or

act in a confidential capacity, (2) to persons who formulate,
determine, and effectuate management policies in the field of
labor relations. The two (2) criteria are cumulative, and both
must be met if an employee is to be considered a confidential
employee – that is, the confidential relationship must exist
between the employee and his supervisor, and the supervisor
must handle the prescribed responsibilities relating to labor
relations. The exclusion from bargaining units of employees
who, in the normal course of their duties, become aware of
management policies relating to labor relations is a principal
objective sought to be accomplished by the "confidential

17

12/15
San Miguel Foods v. SMC Supervisors & Exempt Union
1 Aug 2011
Facts:
In a previous case, it was ruled that even if they handle
confidential data regarding technical & internal business
operations, supervisory employees 3 & 4 & the exempt
employees of petitioner are not to be considered confidential
employees, because the same do not pertain to labor relations,
particularly, negotiation & settlement of grievances.
Consequently, they were allowed to form an appropriate
bargaining unit for the purpose of collective bargaining.
On the date of the election, petitioner questioned the eligibility
to vote by some of its employees on the grounds that some of
the employees do not belong to the bargaining unit w/c
respondent seeks to represent or that there exists no Ee-Er
relationship w/ petitioner. It was argued that certain employees
should not be allowed to vote as they are confidential
employees.
After elections, the Med-Arbiter declared respondent as the
exclusive bargaining agent of the supervisors & the exempt
employees of petitioner. The CA modified the Resolution &
held that those holding the positions of Human Resource
Assistant & Personnel Assistant are excluded from the
bargaining unit.
Issue:
Whether the CA erred in not excluding the position of Payroll
Master in the definition of confidential employee as to exclude
said position & all other positions w/ access to salary &
compensation data from the bargaining unit
Held:
No. A confidential employee is one entrusted with
confidence on delicate, or with the custody, handling or care
and protection of the employer’s property.[28] Confidential
employees, such as accounting personnel, should be excluded
Labor Review Digests 1
from the bargaining unit, as their access to confidential
information may become the source of undue advantage.
[29]
However, such fact does not apply to the position of Payroll
Master and the whole gamut of employees who, as perceived
by petitioner, has access to salary and compensation
data. The CA correctly held that the position of Payroll
Master does not involve dealing with confidential labor
relations information in the course of the performance of his
functions. Since the nature of his work does not pertain to
company rules and regulations and confidential labor relations,
it follows that he cannot be excluded from the subject
bargaining unit.
Corollarily, although Article 245[30] of the Labor Code
limits the ineligibility to join, form and assist any labor
organization to managerial employees, jurisprudence has
extended this prohibition to confidential employees or those
who by reason of their positions or nature of work are required
to assist or act in a fiduciary manner to managerial employees
and, hence, are likewise privy to sensitive and highly
confidential records.[31] Confidential employees are thus
excluded from the rank-and-file bargaining unit. The rationale
for their separate category and disqualification to join any labor
organization is similar to the inhibition for managerial
employees, because if allowed to be affiliated with a union, the
latter might not be assured of their loyalty in view of evident
conflict of interests and the union can also become company-
denominated with the presence of managerial employees in
the union membership.[32] Having access to confidential
information, confidential employees may also become the
source of undue advantage. Said employees may act as a spy
or spies of either party to a collective bargaining agreement.[33]
In this regard, the CA correctly ruled that the positions of
Human Resource Assistant and Personnel Assistant belong to
the category of confidential employees and, hence, are
excluded from the bargaining unit, considering their respective
positions and job descriptions. As Human
Resource Assistant,[34] the scope of one’s work necessarily
involves labor relations, recruitment and selection of
employees, access to employees' personal files and
compensation package, and human resource
management. As regards a Personnel Assistant,[35] one's work
includes the recording of minutes for management during
collective bargaining negotiations, assistance to management
during grievance meetings and administrative investigations,
and securing legal advice for labor issues from the petitioner’s
team of lawyers, and implementation of company
programs. Therefore, in the discharge of their functions, both
gain access to vital labor relations information which outrightly
disqualifies them from union membership. (lori)
18

13/15
G.R. No. 96566 January 6, 1992
ATLAS LITHOGRAPHIC SERVICES, INC., petitioner,
vs.
UNDERSECRETARY BIENVENIDO E. LAGUESMA
(Department of Labor and Employment) and ATLAS
LITHOGRAPHIC SERVICES, INC. SUPERVISORY,
ADMINISTRATIVE, PERSONNEL, PRODUCTION,
ACCOUNTING AND CONFIDENTIAL EMPLOYEES
ASSOCIATION-KAISAHAN NG MANGGAWANG PILIPINO
(KAMPIL-KATIPUNAN), respondents.
GUTIERREZ, JR., J.:
This is a petition for certiorari under Rule 65 of the Rules of
Court seeking the modification of the Order and the Resolution
issued by the public respondents.
FACTS:
On July 16, 1990, the supervisory, administrative personnel,
production, accounting and confidential employees of the
petitioner Atlas Lithographic Services, Inc. (ALSI) affiliated with
private respondent Kaisahan ng Manggagawang Pilipino, a
national labor organization. The local union adopted the name
Atlas Lithographic Services, Inc. Supervisory, Administrative,
Personnel, Production, Accounting and Confidential
Employees Association or ALSI-SAPPACEA-KAMPIL
(supervisors union).
Shortly thereafter, private respondent Kampil-Katipunan filed
on behalf of the "supervisors" union a petition for certification
election so that it could be the sole and exclusive bargaining
agent of the supervisory employees.
The petitioners opposed the private respondent's petition
claiming that under Article 245 of the Labor bode the private
Labor Review Digests 1
respondent cannot represent the supervisory employees for
collective bargaining purposeless because the private
respondent also represents the rank-and-file employees' union
and it will tantamount to allowing the circumvention of the
principle of the separation of unions. It further argues that the
intent of the law is to prevent a single labor organization from
representing different classes of employees with conflicting
interests.
The Med-Arbiter issued an order in favor of the union.
The petitioners appealed.Leguesma issued a resolution
affirming the Med-Arbiter's order.
The petitioners, in turn, filed a motion for reconsideration but
the same was denied. Hence, this petition for certiorari.
ISSUE:
Whether or not, under Article 245 of the Labor Code, a local
union of supervisory employees may be allowed to affiliate with
a national federation of labor organizations of rank-and-file
employees.
HELD:
No. A revision of the Labor Code undertaken by the bicameral
Congress brought about the enactment of Rep. Act No. 6715 in
March 1989 in which employees were reclassified into three
groups, namely: (1) the managerial employees; (2)
supervisors; and (3) the rank and file employees. Under the
present law, the category of supervisory employees is once
again recognized. Hence, Art. 212 (m) states:
(m) . . . Supervisory employees are those who, in the
interest of the employer, effectively recommend such
managerial actions if the exercise of such authority is
not merely routinary or clerical in nature but requires
the use of independent judgment. . . .
The rationale for the amendment is the government's
recognition of the right of supervisors to organize with the
qualification that they shall not join or assist in the organization
of rank-and-file employees. The functions of supervisors, being
recommendatory in nature, are more identified with the
interests of the employer. The performance of those functions
may, thus, run counter to the interests of the rank-and-file.
This intent of the law is made clear in the deliberations of the
legislators on then Senate Bill 530 now enacted as Rep. Act
No. 6715.
The definition of managerial employees was limited to those
having authority to hire and fire while those who only
19

recommend effectively the hiring or firing or transfers of
personnel would be considered as closer to rank-and-file
employees. The exclusion, therefore, of middle level
executives from the category of managers brought about a
third classification, the supervisory employees. These
supervisory employees are allowed to form their own union but
they are not allowed to join the rank-and-file union because of
conflict of interest.
Thus, if the intent of the law is to avoid a situation where
supervisors would merge with the rank and-file or where the
supervisors' labor organization would represent conflicting
interests, then a local supervisors' union should not be allowed
to affiliate with the national federation of union of rank-and-file
employees where that federation actively participates in union
activity in the company. (bonna)
14/15
DE LA SALLE UNIVERSITY MEDICAL CENTER AND
COLLEGE OF MEDICINE vs.HON. BIENVENIDO E.
LAGUESMA, Undersecretary of Labor and Employment;
ROLANDO S. DE LA CRUZ, Med-Arbiter Regional Office
No. IV, DE LA SALLE UNIVERSITY MEDICAL CENTER AND
COLLEGE OF MEDICINE SUPERVISORY UNION-
FEDERATION OF FREE WORKERS
G.R. No. 102084 August 12, 1998
FACTS:
Petitioner De La Salle University Medical Center and College
of Medicine (DLSUMCCM) is a hospital and medical school at
Dasmariñas, Cavite. Private respondent Federation of Free
Workers-De La Salle University Medical Center and College of
Medicine Supervisory Union Chapter (FFW-DLSUMCCMSUC),
on the other hand, is a labor organization composed of the
supervisory employees of petitioner DLSUMCCM.
On April 17, 1991, the Federation of Free Workers (FFW), a
national federation of labor unions, issued a certificate to
private respondent FFW-DLSUMCCMSUC recognizing it as a
local chapter. On the same day, it filed on behalf of private
respondent FFW-DLSUMCCMSUC a petition for certification
election among the supervisory employees of petitioner
DLSUMCCM. Its petition was opposed by petitioner
DLSUMCCM on the grounds that several employees who
signed the petition for certification election were managerial
employees and that the FFW-DLSUMCCMSUC was
composed of both supervisory and rank-and-file employees in
the company.
In its reply dated May 29, 1991, private respondent FFW-
DLSUMCCMSUC denied petitioner's allegations. It contended
that —
2. Herein petition seeks for the holding of a
Labor Review Digests 1
certification election among the supervisory
employees of herein respondent. It does not
intend to include managerial employees.
xxx xxx xxx
6. It is not true that supervisory employees
are joining the rank-and-file employees'
union. While it is true that both regular rank-
and-file employees and supervisory
employees of herein respondent have
affiliated with FFW, yet there are two
separate unions organized by FFW. The
supervisory employees have a separate
charter certificate issued by FFW.
On July 5, 1991, respondent Rolando S. de la Cruz, med-
arbiter of the Department of Labor and Employment Regional
Office No. IV, issued an order granting respondent union's
petition for certification election. He said;
. . . [petitioner] . . . claims that based on the
job descriptions which will be presented at
the hearing, the covered employees who are
considered managers occupy the positions
of purchasing officers, personnel officers,
property officers, cashiers, heads of various
sections and the like.
[Petitioner] also argues that assuming that
some of the employees concerned are not
managerial but mere supervisory employees,
the Federation of Free Workers (FFW)
cannot extend a charter certificate to this
group of employees without violating the
express provision of Article 245 which
provides that "supervisory employees shall
not be eligible for membership in a labor
organization of the rank-and-file employees
but may join, assist or form separate labor
organizations of their own" because the FFW
had similarly issued a charter certificate to its
rank-and-file employees.
In its position paper, [petitioner] stated that
most, if not all, of the employees listed in . . .
the petition are considered managerial
employees, thereby admitting that it has
supervisory employees who are undoubtedly
qualified to join or form a labor organization
of their own. The record likewise shows that
[petitioner] promised to present the job
descriptions of the concerned employees
during the hearing but failed to do so.
ISSUE:
Whether or not the rank-and-file employees of petitioner
DLSUMCCM who compose a labor union are directly under the
supervisory employees whose own union is affiliated with the
same national federation (Federation of Free Workers) and
whether such national federation is actively involved in union
20

activities in the company so as to make the two unions in the
same company, in reality, just one union.
HELD:
NO. Although private respondent FFW-DLSUMCCMSUC and
another union composed of rank-and-file employees of
petitioner DLSUMCCM are indeed affiliated with the same
national federation, the FFW, petitioner DLSUMCCM has not
presented any evidence showing that the rank-and-file
employees composing the other union are directly under the
authority of the supervisory employees. As held in Adamson &
Adamson, Inc. v. CIR, 17 the fact that the two groups of workers
are employed by the same company and the fact that they are
affiliated with a common national federation are not sufficient to
justify the conclusion that their organizations are actually just
one. Their immediate professional relationship must be
established. To borrow the language of Adamson & Adamson,
Inc. v. CIR: 18
We find without merit the contention of
petitioner that if affiliation will be allowed,
only one union will in fact represent both
supervisors and rank-and-file employees of
the petitioner; that there would be an indirect
affiliation of supervisors and rank-and-file
employees with one labor organization; that
there would be a merging of the two
bargaining units; and that the respondent
union will lose its independence because it
becomes an alter ego of the federation. 19
Mention has already been made of the fact that the petition for
certification election in this case was filed by the FFW on
behalf of the local union. This circumstance, while showing
active involvement by the FFW in union activities at the
company, is by itself insufficient to justify a finding of violation
of Art. 245 since there is no proof that the supervisors who
compose the local union have direct authority over the rank-
and-file employees composing the other local union which is
also affiliated with the FFW. This fact differentiates the case
from Atlas Lithographic Services. Inc. v. Laguesma, 20 in which,
in addition to the fact that the petition for certification election
had been filed by the national federation, it was shown that the
rank-and-file employees were directly under the supervisors
organized by the same federation. (berna)
Labor Review Digests 1
15/15
G.R. No. 142000 January 22, 2003
TAGAYTAY HIGHLANDS INTERNATIONAL GOLF CLUB
INCORPORATED, petitioner,
vs.
TAGAYTAY HIGHLANDS EMPLOYEES UNION-PGTWO,
respondent.
Facts: Tagaytay Highlands Employees Union (THEU)–
Philippine Transport and General Workers Organization
(PTGWO), Local Chapter No. 776, a legitimate labor
organization said to represent majority of the rank-and-file
employees of THIGCI, filed a petition for certification election
before the DOLE Mediation-Arbitration Unit, Regional Branch
No. IV.
THEU opposed the petition for certification election on the
ground that the list of union members submitted by it was
defective and fatally flawed as it included the names and
signatures of supervisors, resigned, terminated and absent
without leave (AWOL) employees, as well as employees of
The Country Club, Inc., a corporation distinct and separate
from THIGCI; and that out of the 192 signatories to the petition,
only 71 were actual rank-and-file employees of THIGCI.
THIGCI also alleged that some of the signatures in the list of
union members were secured through fraudulent and deceitful
means, and submitted copies of the handwritten denial and
withdrawal of some of its employees from participating in the
petition. However, THEU asserted that it had complied with all
the requirements for valid affiliation and inclusion in the roster
of legitimate labor organizations pursuant to DOLE Department
Order No. 9, series of 1997,5 on account of which it was duly
granted a Certification of Affiliation by DOLE on October 10,
1997;6 and that Section 5, Rule V of said Department Order
provides that the legitimacy of its registration cannot be subject
to collateral attack, and for as long as there is no final order of
cancellation, it continues to enjoy the rights accorded to a
21

legitimate organization.
DOLE Med-Arbiter Anastacio Bactin ordered the holding of a
certification election among the rank-and-file employees of
THIGCI. The Med-Arbiter held that the allegation that some of
the union members are supervisory, resigned and AWOL
employees or employees of a separate and distinct corporation
should be properly raised in the exclusion-inclusion
proceedings at the pre-election conference. As for the
allegation that some of the signatures were secured through
fraudulent and deceitful means, Med-Arbiter held that it should
be coursed through an independent petition for cancellation of
union registration which is within the jurisdiction of the DOLE
Regional Director. In any event, the Med-Arbiter held that
THIGCI failed to submit the job descriptions of the questioned
employees and other supporting documents to bolster its claim
that they are disqualified from joining THEU.
THIGCI appealed to the Office of the DOLE Secretary which,
by Resolution of June 4, 1998, set aside the said Med-Arbiter’s
Order and accordingly dismissed the petition for certification
election on the ground that there is a "clear absence of
community or mutuality of interests," it finding that THEU
sought to represent two separate bargaining units (supervisory
employees and rank-and-file employees) as well as employees
of two separate and distinct corporate entities.
Undersecretary Dimapilis-Baldoz held that since THEU is a
local chapter, the twenty percent (20%) membership
requirement is not necessary for it to acquire legitimate status,
hence, "the alleged retraction and withdrawal of support by 45
of the 70 remaining rank-and-file members . . . cannot negate
the legitimacy it has already acquired before the petition;" that
rather than disregard the legitimate status already conferred on
THEU by the Bureau of Labor Relations, the names of alleged
disqualified supervisory employees and employees of the
Country Club, Inc., a separate and distinct corporation, should
simply be removed from the THEU’s roster of membership;
and that regarding the participation of alleged resigned and
AWOL employees and those whose signatures are illegible,
the issue can be resolved during the inclusion-exclusion
proceedings at the pre-election stage.
Issue: WON union’s legal personality can be subject to
collateral attack after a certificate of registration is issued
Held: While above-quoted Article 245 expressly prohibits
supervisory employees from joining a rank-and-file union, it
does not provide what would be the effect if a rank-and-file
union counts supervisory employees among its members, or
vice-versa.
Citing Toyota19 which held that "a labor organization composed
of both rank-and-file and supervisory employees is no labor
organization at all," and the subsequent case of Progressive
Development Corp. – Pizza Hut v. Ledesma20 which held that:
"The Labor Code requires that in organized and
unorganized establishments, a petition for certification
election must be filed by a legitimate labor
Labor Review Digests 1
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 organization,’"21
We also do not agree with the ruling of the respondent
Secretary of Labor that the infirmity in the membership of the
respondent union can be remedied in "the pre-election
conference thru the exclusion-inclusion proceedings wherein
those employees who are occupying rank-and-file positions will
be excluded from the list of eligible voters."
After a certificate of registration is issued to a union, its legal
personality cannot be subject to collateral attack. It may be
questioned only in an independent petition for cancellation in
accordance with Section 5 of Rule V, Book IV of the "Rules to
Implement the Labor Code" (Implementing Rules) which
section reads:
Sec. 5. Effect of registration. The labor organization or
workers’ association shall be deemed registered and
vested with legal personality on the date of issuance
of its certificate of registration. Such legal personality
cannot thereafter be subject to collateral attack, but
may be questioned only in an independent
petition for cancellation in accordance with these
Rules.
The grounds for cancellation of union registration are provided
for under Article 239 of the Labor Code. The inclusion in a
union of disqualified employees is not among the grounds for
cancellation, unless such inclusion is due to misrepresentation,
false statement or fraud under the circumstances
enumerated in Sections (a) and (c) of Article 239 of above-
quoted Article 239 of the Labor Code.
THEU, having been validly issued a certificate of registration,
should be considered to have already acquired juridical
personality which may not be assailed collaterally.
As for petitioner’s allegation that some of the signatures in the
petition for certification election were obtained through fraud,
false statement and misrepresentation, the proper procedure
is, as reflected above, for it to file a petition for cancellation of
the certificate of registration, and not to intervene in a petition
for certification election.
Regarding the alleged withdrawal of union members from
participating in the certification election, this Court’s following
ruling is instructive:
22
 Labor Review Digests 1

"‘[T]he best forum for determining whether there were

indeed retractions from some of the laborers is in the
certification election itself wherein the workers can
freely express their choice in a secret ballot.’ Suffice it
to say that the will of the rank-and-file employees
should in every possible instance be determined by
secret ballot rather than by administrative or quasi-
judicial inquiry. Such representation and certification
election cases are not to be taken as contentious
litigations for suits but as mere investigations of a
non-adversary, fact-finding character as to which of
the competing unions represents the genuine choice
of the workers to be their sole and exclusive collective
bargaining representative with their employer."23

As for the lack of mutuality of interest argument of petitioner, it,

at all events, does not lie given, as found by the court a quo, its
failure to present substantial evidence that the assailed
employees are actually occupying supervisory positions.

While petitioner submitted a list of its employees with their

corresponding job titles and ranks,24 there is nothing mentioned
about the supervisors’ respective duties, powers and
prerogatives that would show that they can effectively
recommend managerial actions which require the use of
independent judgment.25

As this Court put it in Pepsi-Cola Products Philippines, Inc. v.

Secretary of Labor: designation should be reconciled with the
actual job description of subject employees The mere fact that
an employee is designated manager does not necessarily
make him one. Otherwise, there would be an absurd situation
where one can be given the title just to be deprived of the right
to be a member of a union.

In the case of National Steel Corporation vs. Laguesma (G. R.

No. 103743, January 29, 1996), it was stressed that: What is
essential is the nature of the employee’s function and not
the nomenclature or title given to the job which determines
whether the employee has rank-and-file or managerial status
or whether he is a supervisory employee. (angel)

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