NUWHRAIN-APL-IUF DUSIT HOTEL NIKKO CHAPTER v.

CA

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088 NUWHRAIN-APL-IUF DUSIT HOTEL NIKKO CHAPTER v. CA

G.R. No. 163942/ G.R. No. 166295

November 11, 2008

Digest by: Michelle Vale Cruz

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Petitioner: NATIONAL UNION OF WORKERS IN THE HOTEL RESTAURANT AND ALLIED

INDUSTRIES (NUWHRAIN-APL-IUF) DUSIT HOTEL NIKKO CHAPTER

Respondent: THE HONORABLE COURT OF APPEALS (Former Eighth Division), THE NATIONAL
LABOR RELATIONS COMMISSION (NLRC), PHILIPPINE HOTELIERS INC., owner and operator of
DUSIT HOTEL NIKKO and/or CHIYUKI FUJIMOTO, and ESPERANZA V. ALVEZ

Ponente: Velasco

Topic: Bargaining Procedure: Conciliation/preventive mediation

FACTS:

The Union is the certified bargaining agent of the regular rank-and-file employees of Dusit Hotel
Nikko (Hotel).

On October 24, 2000, the Union submitted its Collective Bargaining Agreement (CBA)
negotiation proposals to the Hotel. As negotiations ensued, the parties failed to arrive at
mutually acceptable terms and conditions. Due to the bargaining deadlock, the Union, on
December 20, 2001, filed a Notice of Strike on the ground of the bargaining deadlock with the
National Conciliation and Mediation Board (NCMB)
Thereafter, conciliation hearings were conducted which proved unsuccessful.

Soon thereafter, in the afternoon of January 17, 2002, the Union held a general assembly at its
office located in the Hotels basement, where some members sported closely cropped hair or
cleanly shaven heads.

The next day, or on January 18, 2002, more male Union members came to work sporting the
same hair style. The Hotel prevented these workers from entering the premises claiming that
they violated the Hotels Grooming Standards.

In view of the Hotels action, the Union staged a picket outside the Hotel premises. Later, other
workers were also prevented from entering the Hotel causing them to join the picket. For this
reason the Hotel experienced a severe lack of manpower which forced them to temporarily
cease operations in three restaurants.

Consequently, the Hotel issued notices to Union members, preventively suspending them and
charging them with the following offenses: (1) violation of the duty to bargain in good faith; (2)
illegal picket; (3) unfair labor practice; (4) violation of the Hotels Grooming Standards; (5) illegal
strike; and (6) commission of illegal acts during the illegal strike.

The next day, the Union filed with the NCMB a second Notice of Strike on the ground of unfair
labor practice and violation of Article 248(a) of the Labor Code on illegal lockout

The Hotel terminated the services of 29 Union officers and 61 members; and suspended 81
employees for 30 days, forty-eight 48 employees for 15 days, 4) employees for 10 days, and 3
employees for five days. On the same day, the Union declared a strike. Starting that day, the
Union engaged in picketing the premises of the Hotel. During the picket, the Union officials and
members unlawfully blocked the ingress and egress of the Hotel premises.
The Union filed its third Notice of Strike with the NCMB, this time on the ground of unfair labor
practice and union-busting.

NLRC Decision: It ordered the Hotel and the Union to execute a CBA within 30 days from the
receipt of the decision. NLRC ruled that the strike conducted was illegal.

CA affirmed NLRC’s decision

ISSUE: W/N the Union is guiltyfor illegal strike

RULING: YES.

First, the Unions violation of the Hotels Grooming Standards was clearly a deliberate and
concerted action to undermine the authority of and to embarrass the Hotel and was, therefore,
not a protected action. The appearances of the Hotel employees directly reflect the character
and well-being of the Hotel, being a five-star hotel that provides service to top-notch clients. It
can be gleaned from the records before us that the Union officers and members deliberately
and in apparent concert shaved their heads or cropped their hair. This was shown by the fact
that after coming to work on January 18, 2002, some Union members even had their heads
shaved or their hair cropped at the Union office in the Hotels basement. Clearly, the decision to
violate the company rule on grooming was designed and calculated to place the Hotel
management on its heels and to force it to agree to the Unions proposals. This Court is of the
opinion, therefore, that the act of the Union was not merely an expression of their grievance or
displeasure but, indeed, a calibrated and calculated act designed to inflict serious damage to
the Hotels finances or its reputation. Thus, we hold that the Unions concerted violation of the
Hotels Grooming Standards which resulted in the temporary cessation and disruption of the
Hotels operations is an unprotected act and should be considered as an illegal strike.

Second, the Unions concerted action which disrupted the Hotels operations clearly violated the
CBAs No Strike, No Lockout provision. The facts are clear that the strike arose out of a
bargaining deadlock in the CBA negotiations with the Hotel. The concerted action is an
economic strike upon which the afore-quoted no strike/work stoppage and lockout prohibition
is squarely applicable and legally binding.

RELEVANT TO THE TOPIC REGARDING CONCILITION: Third, the Union officers and members
concerted action to shave their heads and crop their hair not only violated the Hotels Grooming
Standards but also violated the Unions duty and responsibility to bargain in good faith. By
shaving their heads and cropping their hair, the Union officers and members violated then
Section 6, Rule XIII of the Implementing Rules of Book V of the Labor Code. This rule prohibits
the commission of any act which will disrupt or impede the early settlement of the labor
disputes that are under conciliation. Since the bargaining deadlock is being conciliated by the
NCMB, the Unions action to have their officers and members heads shaved was manifestly
calculated to antagonize and embarrass the Hotel management and in doing so effectively
disrupted the operations of the Hotel and violated their duty to bargain collectively in good
faith.

Fourth, the Union failed to observe the mandatory 30-day cooling-off period and the seven-day
strike ban before it conducted the strike on January 18, 2002. The NLRC correctly held that the
Union failed to observe the mandatory periods before conducting or holding a strike. Records
reveal that the Union filed its Notice of Strike on the ground of bargaining deadlock on
December 20, 2001. The 30-day cooling-off period should have been until January 19, 2002. On
top of that, the strike vote was held on January 14, 2002 and was submitted to the NCMB only
on January 18, 2002; therefore, the 7-day strike ban should have prevented them from holding
a strike until January 25, 2002. The concerted action committed by the Union on January 18,
2002 which resulted in the disruption of the Hotels operations clearly violated the above-stated
mandatory periods.

Last, the Union committed illegal acts in the conduct of its strike. The NLRC ruled that the strike
was illegal since, as shown by the pictures presented by the Hotel, the Union officers and
members formed human barricades and obstructed the driveway of the Hotel. There is no
merit in the Unions argument that it was not its members but the Hotels security guards and
the police officers who blocked the driveway, as it can be seen that the guards and/or police
officers were just trying to secure the entrance to the Hotel. The pictures clearly demonstrate
the tense and highly explosive situation brought about by the strikers presence in the Hotels
driveway.

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Samahan ng Manggagawa sa Top Form Manufacturing (SMTFM-UWP) v. NLRC

Topics: CBA interpretation and Minutes of registration

FACTS:

Petitioner Samahang Manggagawa sa Top Form Manufacturing — United Workers of the

Philippines (SMTFM) was the certified collective bargaining representative of all regular rank
and file employees of private respondent Top Form Manufacturing Philippines, Inc. At the
collective bargaining negotiation held at the Milky Way Restaurant in Makati, Metro Manila on
February 27, 1990, the parties agreed to discuss unresolved economic issues. According to the
minutes of the meeting, Article VII of the collective bargaining agreement was discussed.
RTWPB-NCR issued Wage Order No. 01 granting an increase of P17.00 per day in the salary of
workers. This was followed by Wage Order No. 02 dated December 20, 1990 providing for a
P12.00 daily increase in salary.

As expected, the union requested the implementation of said wage orders. However, they
demanded that the increase be on an across-the-board basis. Private respondent refused to
accede to that demand. Instead, it implemented a scheme of increases purportedly to avoid
wage distortion. Thus, private respondent granted the P17.00 increase under Wage Order No.
01 to workers/employees receiving salary of P125.00 per day and below. The P12.00 increase
mandated by Wage Order No. 02 was granted to those receiving the salary of P140.00 per day
and below. For employees receiving salary higher than P125.00 or P140.00 per day, private
respondent granted an escalated increase ranging from P6.99 to P14.30 and from P6.00 to
P10.00, respectively.

The union, through its legal counsel, wrote private respondent a letter demanding that it should
“fulfill its pledge of sincerity to the union by granting an across-the-board wage increases (sic)
to all employees under the wage orders.” The union reiterated that it had agreed to “retain the
old provision of CBA” on the strength of private respondent’s “promise and assurance” of an
across-the-board salary increase should the government mandate salary increases. Several
conferences between the parties notwithstanding, private respondent adamantly maintained
its position on the salary increases it had granted that were purportedly designed to avoid wage
distortion.

Consequently, the union filed a complaint with the NCR NLRC alleging that private respondent’s
act of “reneging on its undertaking/promise clearly constitutes act of unfair labor practice
through bargaining in bad faith.” It charged private respondent with acts of unfair labor
practices or violation of Article 247 of the Labor Code, as amended, specifically “bargaining in
bad faith,” and prayed that it be awarded actual, moral and exemplary damages. In its position
paper, the union added that it was charging private respondent with “violation of Article 100 of
the Labor Code.”

Private respondent, on the other hand, contended that in implementing Wage Orders Nos. 01
and 02, it had avoided “the existence of a wage distortion” that would arise from such
implementation. It emphasized that only “after a reasonable length of time from the
implementation” of the wage orders “that the union surprisingly raised the question that the
company should have implemented said wage orders on an across-the-board basis.” It asserted
that there was no agreement to the effect that future wage increases mandated by the
government should be implemented on an across-the-board basis. Otherwise, that agreement
would have been incorporated and expressly stipulated in the CBA.

Labor Arbiter Jose G. de Vera rendered a decision dismissing the complaint for lack of merit.

Union appealed to the NLRC that, in turn, promulgated the assailed Resolution of April 29, 1993
9 dismissing the appeal for lack of merit. Still dissatisfied, petitioner sought reconsideration
which, however, was denied by the NLRC in the Resolution dated January 17, 1994. Hence, the
instant petition for certiorari

ISSUE: whether or not an employer committed an unfair labor practice by bargaining in bad
faith and discriminating against its employees.

RULING:

To start with, if there was indeed a promise or undertaking on the part of private respondent to
obligate itself to grant an automatic across-the-board wage increase, petitioner union should
have requested or demanded that such “promise or undertaking” be incorporated in the CBA.
After all, petitioner union has the means under the law to compel private respondent to
incorporate this specific economic proposal in the CBA.

It could have invoked Article 252 of the Labor Code defining “duty to bargain,” Thus, the duty
includes “executing a contract incorporating such agreements if requested by either party.”
Petitioner union’s assertion that it had insisted on the incorporation of the same proposal may
have a factual basis considering the allegations in the aforementioned joint affidavit of its
members.
However, Article 252 also states that the duty to bargain “does not compel any party to agree
to a proposal or make any concession.”

Thus, petitioner union may not validly claim that the proposal embodied in the Minutes of the
negotiation forms part of the CBA that it finally entered into with private respondent.

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Manila Fashions nc. v. NLRC

FACTS:

Nagkakaisang Manggagawa ng Manila Fashions, Inc., through its president, Zamora, filed a
complaint before the LA on behalf of its one 150 members who were regular employees of
Manila Fashions, Inc. The complaint charged petitioner with non-compliance with Wage Order
mandating a P12 increase in.

As a result, complainants’ basic pay, 13th month pay, service incentive leave pay, legal holiday
pay, night shift differential and overtime pay were all underpaid.
Manila Fashions, Inc. countered that the failure to comply with the pertinent Wage Order was
brought about by the tremendous losses suffered by it which were aggravated when the
workers staged a strike on account of the non-adjustment of their basic pay.

To forestall continuous suspension/closure of business operations, which petitioner did for

three (3) months, the strikers sent a notice that they were willing to condone the
implementation of the increase. The condonation was distinctly stated in Sec. 3, Art. VIII, of
their CBA.

ISSUE/S: Was the condonation of the implementation of Wage Order No. NCR-02 and 02-A
contained in Sec. 3, Art. VIII, of the CBA valid?

RULING: No, the condonation appearing in Sec. 3, Art. VIII, of the CBA did not exempt
petitioner from compliance with Wage Order No. NCR-02 and 02-A.

A Collective Bargaining Agreement refers to the negotiated contract between a legitimate labor
organization and the employer concerning wages, hours of work and all other terms and
conditions of employment in a bargaining unit, including mandatory provisions for grievances
and arbitration machineries. As in all other contracts, the parties in a CBA may establish such
stipulations, clauses, terms and conditions as they may deem convenient provided they are not
contrary to law, morals, good customs, public order or public policy.

The CBA questioned provision is a void because by agreeing to condone the implementation of
the Wage Order the parties thereby contravened its mandate on wage increase of P12. It is only
the Tripartite Wage Productivity Board of the DOLE that could approve exemption of an
establishment from coverage of a Wage Order.
If petitioner is a financially distressed company then it should have applied for a wage
exemption so that it could meet its labor costs without endangering its viability or its very
existence upon which both management and labor depend for a living. SOLGEN emphasizes the
point that parties to a CBA may not, by themselves, set a wage lower than the minimum wage.
To do so would render nugatory the purpose of a wage exemption, not to mention the
possibility that employees may be duped or be unwittingly put in a position to accept a lower
wage.

As regards the alternative argument of petitioner that the computation of the award was
erroneous and arbitrary, it must be rejected outright as it was apparently never brought to the
attention of respondent NLRC. Consequently, it cannot be raised for the first time before this
Court since that would be offensive to the basic rule of fair play, justice and due process.
Moreover, the original and exclusive jurisdiction of this Court to review a decision of
respondent NLRC in a petition for certiorari under Rule 65 does not normally include an inquiry
into the correctness of its evaluation of the evidence but confined merely to issues of
jurisdiction or grave abuse of discretion.

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COLEGIO DE SAN JUAN DE LETRAN v. ASSOCIATION OF EMPLOYEES AND FACULTY OF LETRAN

Topic: Contract Bar Rule

FACTS:

1. Salvador Abtria, then President of respondent union, Association of Employees and

Faculty of Letran, initiated the renegotiation of its Collective Bargaining Agreement with
petitioner Colegio de San Juan de Letran for the last two (2) years of the CBA's five (5) year
lifetime from 1989-1994.

2. On the same year, the union elected a new set of officers wherein private respondent
Eleanor Ambas emerged as the newly elected President.

3. Ambas wanted to continue the renegotiation of the CBA but petitioner, through Fr. Edwin
Lao, claimed that the CBA was already prepared for signing by the parties.

4. Petitioner accused the union officers of bargaining in bad faith before the National Labor
Relations Commission.

5. Labor Arbiter Edgardo M. Madriaga: decided in favor of the petitioner.

6. However, the Labor Arbiter's decision was reversed on appeal before the NLRC.

7. The union notified the National Conciliation and Mediation Board (NCMB) of its intention
to strike on the grounds (sic) of petitioner's: non-compliance with the NLRC (1) order to delete
the name of Atty. Federico Leynes as the union's legal counsel; and (2) refusal to bargain.

8. The union filed a notice of strike.

9. The union received petitioner's letter dismissing Ambas for alleged insubordination.
Hence, the union amended its notice of strike to include Ambas' dismissal.

10. Both parties again discussed the ground rules for the CBA renegotiation. However,
petitioner stopped the negotiations after it purportedly received information that a new group
of employees had filed a petition for certification election.

11. The union finally struck.

12. The Secretary of Labor and Employment assumed jurisdiction and ordered all striking
employees including the union president to return to work and for petitioner to accept them
back under the same terms and conditions before the actual strike.
13. Secretary of Labor and Employment: issued an order declaring petitioner guilty of unfair
labor practice on two counts and directing the reinstatement of private respondent Ambas with
backwages.

14. Petitioner filed a Motion for Reconsideration but was denied.

15. Hence, this petition for review on certiorari.

ISSUES

1. Whether or not petitioner is guilty of unfair labor practice by refusing to bargain with the
union when it unilaterally suspended the ongoing negotiations for a new Collective Bargaining
Agreement (CBA) upon mere information that a petition for certification has been filed by
another legitimate labor organization?

2. Whether or not the termination of the union president amounts to an interference of the
employees' right to self-organization?

RULING: 1. Yes, petitioner Colegio De San Juan De Letran is guilty of unfair labor practice.

Yes, because Petitioner's utter lack of interest in bargaining with the union is obvious in its
failure to make a timely reply to the proposals presented by the latter. More than a month after
the proposals were submitted by the union, petitioner still had not made any counter-
proposals. This inaction on the part of petitioner prompted the union to file its second notice of
strike on March 13, 1996. Petitioner could only offer a feeble explanation that the Board of
Trustees had not yet convened to discuss the matter as its excuse for failing to file its reply. This
is a clear violation of Article 250 of the Labor Code governing the procedure in collective
bargaining, to wit:

Art. 250. Procedure in collective bargaining. - The following procedures shall be observed in
collective bargaining:
(a) When a party desires to negotiate an agreement, it shall serve a written notice upon the
other party with a statement of its proposals. The other party shall make a reply thereto not
later than ten (10) calendar days from receipt of such notice.

2.Yes, the dismissal was effected in violation of the employees' right to self-organization.

Yes, because the factual backdrop of the termination of Ms. Ambas leads us to no other
conclusion that she was dismissed in order to strip the union of a leader who would fight for
the right of her co-workers at the bargaining table. Ms. Ambas, at the time of her dismissal, had
been working for the petitioner for ten (10) years already. In fact, she was a recipient of a
loyalty award. Moreover, for the past ten (10) years her working schedule was from Monday to
Friday. However, things began to change when she was elected as union president and when
she started negotiating for a new CBA. Thus, it was when she was the union president and
during the period of tense and difficult negotiations when her work schedule was altered from
Mondays to Fridays to Tuesdays to Saturdays. When she did not budge, although her schedule
was changed, she was outrightly dismissed for alleged insubordination.

The dismissal of Ms. Ambas was clearly designed to frustrate the Union in its desire to forge a
new CBA with the College that is reflective of the true wishes and aspirations of the Union
members. Her dismissal was merely a subterfuge to get rid of her, which smacks of a pre-
conceived plan to oust her from the premises of the College. It has the effect of busting the
Union, stripping it of its strong-willed leadership. When management refused to treat the
charge of insubordination as a grievance within the scope of the Grievance Machinery, the
action of the College in finally dismissing her from the service became arbitrary, capricious and
whimsical, and therefore violated Ms. Ambas' right to due process

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DIVINE WORD UNIVERSITY OF TACLOBAN vs SECRETARY OF LABOR AND EMPLOYMENT and

DIVINE WORD UNIVERSITY EMPLOYEES UNION-ALU

Topic: Deadlock Bar Rule

FACTS:

Divine Word University Employees Union (DWUEU) was certified as the sole and exclusive
bargaining agent of the Divine Word University. Subsequently, the Divine Union submitted its
collective bargaining proposals March 7, 1985

The University replied and requested a preliminary conference. However, two days before the
scheduled conference the DWUEU’s resigned vice-president Mr. Brigido Urminita wrote a letter
addressed to the University unilaterally withdrawing the CBA proposals. Consequently, the
preliminary conference was cancelled.

After almost three years, or on March 11, 1988, the DWUEU, which had by then affiliated with
the Associated Labor Union (ALU), requested a conference with the University for the purpose
of continuing the collective bargaining negotiations. A follow-up letter was sent regarding their
request but to no avail.

DWUEU -ALU filed with the National Conciliation and Mediation Board of the Department of
Labor and Employment a notice of strike on the grounds of bargaining deadlock and unfair
labor practice acts, specifically, refusal to bargain, discrimination and coercion on employees.

After the filing of the notice of strike, a conference was held which led to the conclusion of an
agreement between the University and DWUEU-ALU on May 10, 1888
However, it turned out that an hour before the May 10, 1988 agreement was concluded, the
University had filed a petition for certification election

On the other hand, on May 19, 1988, DWUEU-ALU, consonant with the agreement, submitted
its collective bargaining proposals. These were ignored by the University.

Med-Arbiter Milado, acting on the University’s petition for certification election, issued an
Order directing the conduct of a certification election to be participated in by DWUEU-ALU and
“no union,” after he found the petition to be “well-supported in fact and in law.

Said Order prompted the DWUEU-ALU to file with the Secretary of Labor an urgent motion
seeking to enjoin Milado from further acting on the matter of the certification election.

The Divine Word University Independent Faculty and Employees Union (DWUIFEU), which was
registered earlier that day, filed a motion for intervention alleging that it had “at least 20% of
the rank and file employees” of the University.

The Secretary of Labor dismissed not only the case filed by DWUEU-ALU for unfair labor
practice on the ground of the union’s failure to prove the commission of the unfair labor
practice acts specifically complained of but also the complaint filed by the University for unfair
labor practices and illegal strike for “obvious lack of merit brought about by its utter failure to
submit evidence”

The DWUEU-ALU had filed a second notice of strike charging the University with violation of the
return-to-work order which was previously ordered by the Secretary of Labor and unfair labor
practices such as dismissal of union officers, coercion of employees and illegal suspension

Acting Secretary then concluded that for reneging on the agreement of May 10, 1988 and for its
“reluctance and subscription to legal delay,” the University should be “declared in default.” He
also maintained that since under the circumstances the University cannot claim deprivation of
due process, the Office of the Secretary of Labor may rightfully impose the Union’s May 19,
1988 collective bargaining agreement proposals motu proprio.

ISSUE: Whether or not there was a deadlock or an impasse in the collective bargaining process

RULING: YES. A thorough study of the records reveals that there was no “reasonable effort at
good faith bargaining” especially on the part of the University. Its indifferent attitude towards
collective bargaining inevitably resulted in the failure of the parties to arrive at an agreement.
As it was evident that unilateral moves were being undertaken only by the DWUEU-ALU, there
was no “counteraction” of forces or an impasse to speak of. While collective bargaining should
be initiated by the union, there is a corresponding responsibility on the part of the employer to
respond in some manner to such acts.

However, the Court cannot help but notice that the DWUEU was not entirely blameless in the
matter of the delay in the bargaining process. While it is true that as early as March 7, 1985,
said union had submitted its collective bargaining proposals and that, its subsequent
withdrawal by the DWUEU Vice President being unauthorized and therefore ineffective, the
same proposals could be considered as subsisting, the fact remains that said union remained
passive for three years. The records do not show that during this three-year period, it exerted
any effort to pursue collective bargaining as a means of attaining better terms of employment.

It was only after its affiliation with the ALU that the same union, through the ALU Director for
Operations, requested an “initial conference” for the purpose of collective bargaining. That the
DWUEU abandoned its collective bargaining proposals prior to its affiliation with ALU is further
confirmed by the fact that in the aforequoted May 10, 1988 agreement with the University, said
Union bound itself to submit a new set of proposals on May 13, 1988. Under the circumstances,
the agreement of May 10, 1988 may as well be considered the written notice to bargain
referred to in the aforequoted Art. 250(a) of the Labor Code, which thereby set into motion the
machinery for collective bargaining, as in fact, on May 19, 1988, DWUEU-ALU submitted its
collective bargaining proposals.
Be that as it may, the Court is not inclined to rule that there has been a deadlock or an impasse
in the collective bargaining process. As the Court earlier observed, there has not been a
“reasonable effort at good faith bargaining” on the part of the University. While DWUEU-ALU
was opening all possible avenues for the conclusion of an agreement, the record is replete with
evidence on the University’s reluctance and thinly disguised refusal to bargain with the duly
certified bargaining agent, such that the inescapable conclusion is that the University evidently
had no intention of bargaining with it. Thus, while the Court recognizes that technically, the
University has the right to file the petition for certification election as there was no bargaining
deadlock to speak of, to grant its prayer that the herein assailed Orders be annulled would put
an unjustified premium on bad faith bargaining. Bad faith on the part of the University is further
exemplified by the fact that an hour before the start of the May 10, 1988 conference, it
surreptitiously filed the petition for certification election. And yet during said conference, it
committed itself to “sit down” with the Union. Obviously, the University tried to preempt the
conference which would have legally foreclosed its right to file the petition for certification
election. In so doing, the University failed to act in accordance with Art. 252 of the Labor Code
which defines the meaning of the duty to bargain collectively as “the performance of a mutual
obligation to meet and convene promptly and expeditiously in good faith.” Moreover, by filing
the petition for certification election while agreeing to confer with the DWUEU-ALU, the
University violated the mandate of Art. 19 of the Civil Code that “(e)very person must, in the
exercise of his rights and in the performance of his duties, act with justice, give everyone his
due, and observe honesty and good faith.”

Kiok Loy vs. NLRC is applicable in the instant case considering that the facts therein have also
been indubitably established in this case. These factors are: (a) the union is the duly certified
bargaining agent; (b) it made a definite request to bargain and submitted its collective
bargaining proposals, and (c) the University made no counter proposal whatsoever. As we said
in Kiok Loy, “[a] company’s refusal to make counter proposal if considered in relation to the
entire bargaining process, may indicate bad faith and this is especially true where the Union’s
request for a counter proposal is left unanswered.”

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R TRANSPORT CORP. VS. LAGUESMA

TOPIC: One Year Bar/Certification year Rule

FACTS:

Respondent Christian Labor Organization of the Philippines (CLOP), filed with the Med-
Arbitration Unit of the DOLE a petition for certification election among the rank and file
employees of the petitioner (NCR-OD-M-91-01-002).

Med-Arbiter A. Dizon dismissed the petition on the ground that the bargaining unit sought to
be represented by respondent did not include all the eligible employees of petitioner but only
the drivers, conductors and conductresses to the exclusion of the inspectors, inspectresses,
dispatchers, mechanics and washerboys.

THIS IS IMPORTANT! Respondent CLOP rectified its mistake and filed a second petition for
certification election, which included all the rank and file employees of the company, who hold
non-managerial. and non-supervisorial positions.

Petitioner filed a motion to dismiss the second petition and contended that the dismissal of the
first petition constituted res judicata. Petitioner argued that respondent CLOP should have
interposed an appeal to the dismissal of the first petition and its failure to do so barred it from
filing another petition for certification election.
Med-Arbiter R. Parungo rendered a decision, which ordered that a certification election among
the regular rank and file workers of petitioner company be conducted.

Associated Labor Unions (ALU-TUCP) filed a motion for intervention and alleged that it has
members in the proposed bargaining unit. Subsequently, the National Federation of Labor
Unions (NAFLU) filed a separate petition for certification election and a motion to consolidate
related cases to avoid confusion.

Dissatisfied with the Decision dated July 3, 1991 rendered by Med-Arbiter R. Parungo,
petitioner appealed to the DOLE Secretary, who, through Undersecretary Bienvenido E.
Laguesma, affirmed the Med-Arbiter in its Resolution dated July 22, 1992 calling for the
conduct of the certification election.

Petitioner filed a Motion for Reconsideration, again stressing the principle of res judicata.
Petitioner further argued that the second petition for a certification election by respondent
CLOP, NAFLU and ALU-TUCP were barred at least for a period of one year from the time the
first petition of CLOP was dismissed pursuant to Section Rule V, Book V of the Omnibus Rules
Implementing the Labor Code as amended. The said MR was denied

Petitioner filed a Motion to Suspend Proceedings based on Prejudicial Questions as an

Addendum to the Motion for Reconsideration filed on July 31, 1992. Petitioner argued that the
present case must be indefinitely suspended until the following cases are resolved by the NLRC
and the Supreme Court: a) NLRC-NCR Case No. 00-08-04708-91 entitled "R". Transport
Corporation v. Jose S. Torregaza, et. al., wherein Labor Arbiter de Castro declared the strike
staged by respondent CLOP illegal and ordered the strikers to pay petitioner the amount of
P10,000.00 as exemplary damages; b) NLRC-NCR Case No. 06-03415092 filed by respondent
CLOP and its members for illegal dismissal; and NLRC-NCR Case No. 00-08-04389-92 filed by
respondent CLOP in behalf of its affected members for illegal dismissal (Rollo, pp. 139-145).
Undersecretary Laguesma in a resolution denied the motion to suspend the conduct of the
certification election.
This must be so, because the employees subject of the pending cases before the NLRC legally
remain as employees of respondent until the motion to declare them as having lost their
employment status by reason of the illegal strike or their complaint for illegal dismissal is finally
resolved. (Rollo, pp. 181-182; emphasis supplied). MR was again denied.

Petitioner filed a Comment and Objection to the Order dated October 29, 1992 with Urgent
Motion to Dismiss the Petition for Certification Election. Without waiting for the resolution of
the motion to dismiss, petitioner resorted to this Court by way of the instant special civil action.

ISSUE: WON the second petition for certification election should have been filed after one year
from the dismissal of the first petition certification election under Section 3, Rule V, Book V of
the Omnibus Rules?

RULING: NO.

In the case at bench, it cannot be said that the parties in the first and second actions were
identical. The first action was dismissed by the Med-Arbiter because it excluded parties
essential to the bargaining unit such as inspectors, inspectresses, dispatchers and washer boys.
The second petition included all the employees who were excluded in the first petition.
Therefore, the Med-Arbiter was correct when he gave due course to the second petition for
certification election after respondent CLOP corrected its mistake.

Likewise untenable is petitioner's contention that the second petition for certification election
should have been filed after one year from the dismissal of the first petition certification
election under Section 3, Rule V, Book V of the Omnibus Rules Implementing the Labor Code as
amended. Said section provides as follows:

When to file — In the absence of collective bargaining agreement duly registered in accordance
with Article 231 of the Code, a petition for certification election may be filed any time.
However, no certification election may be held within one year from the date of the issuance of
a final certification election result (Emphasis supplied).
Apparently, petitioner misread the above-mentioned provision of law. The phrase "final
certification election result" means that there was an actual conduct of election i.e. ballots
were cast and there was a counting of votes. In this case, there was no certification election
conducted precisely because the first petition was dismissed, on the ground of a defective
petition which did not include all the employees who should be properly included in the
collective bargaining unit.

Devoid of merit is petitioner's contention that the employment status of the members of
respondent CLOP who joined the strike must first be resolved before a certification election can
be conducted.

It should be noted that it is the petitioner, the employer, which has offered the most tenacious
resistance to the holding of a certification election. This must not be so for the choice of a
collective bargaining agent is the sole concern of the employees. The employer has no right to
interfere in the election and is merely regarded as a bystander (Divine Word University of
Tacloban v. Secretary of Labor and Employment, 213 SCRA 759 [1992]).

Finally, petitioner's Comment and Objection to the Order dated October 29, 1992 with Urgent
Motion to Dismiss the Petition for Certification Election is still pending with the Undersecretary
of Labor. The resort to judicial action by petitioner is premature. Hence, it is also guilty of
forum-shopping in pursuing the same cause of action involving the same issue, parties and
subject matter before two different fora.

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Asian Design and Manufacturing Corp. vs. Calleja

Facts:

Upon petition of Buklod ng Manggagawang Pilipino (BMP), one of several labor unions at
ADMACOR'S factory, the Labor Relations Division, Regional Office VII (Cebu City) ordered a
certification election to be conducted on May 21, 1986, a regular business day. Several factory
workers of ADMACOR (petitioner) held a strike. No previous notice of strike was filed by the
factory workers with the Bureau of Labor Relations Regional Office. On May 20,1986,
ADMACOR filed a petition) for the indefinite resetting of the scheduled certification election,
which petition was not acted upon by the Labor Relations Division.

The scheduled certification election was conducted, despite the strike. Of the 423 workers who
voted, 413 voted for Southern Philippines Federation of Labor (SPFL) as their exclusive
bargaining agent, On the same day, ADMACOR filed a complaint for illegal strike.

ADMACOR filed a petition to declare the certification election conducted on May 21, 1986 as
null and void on the ground that there being a strike by some workers in the premises of the
factory on the day of the certification election, such day cannot be considered a regular
business day, pursuant to Section 2, Rule VI, Book V of the Omnibus Rules Implementing the
Labor Code.

Med-Arbiter dismissed ADMACOR's complaint to annul the May 21, 1986 certification election
and certified SPFL as the sole and exclusive bargaining agent of the rank and file employees of
ADMACOR. This dismissal was appealed by ADMACOR to the Bureau of Labor Relations.

Director Calleja of BLR affirmed Med-Arbiter.

Issue: WON there was compliance to the procedural requirement that election shall be set
during a regular business day
Ruling:

Yes, the Court agrees with the said ruling of respondent Director upholding the validity of the
certification election despite the strike. In the first place, since petitioner invoked the
jurisdiction of the Bureau when it filed its election protest before the Med-Arbiter, it cannot
now be allowed to repudiate the same jurisdiction after failing to obtain affirmative relief.
Moreover, it can not be denied that an actual election was conducted on said date where, of
the 423 workers who voted, 413 voted for SPFL as its exclusive bargaining agent. In the
"Minutes of the Certification Election among the Rank and File Employees of Asian Design
Manufacturing Corp.", the representatives of the contending unions, and of the Ministry of
Labor even attested that the election was peaceful and orderly and none of the parties
registered any protest on any matter concerning the election proceedings. There is thus, no
valid reason to annul the certification election.

On the pretext that the issue deposited in this petition is the lack of jurisdiction of the Bureau in
dismissing its protest against the certification election despite the pendency of the case before
the Labor Arbiter on the validity of the strike, petitioner seeks exception to the rule that an
employer has no standing to question a certification election. The Court reiterates the rule that
such concern over the validity of certification election must come from the employees
themselves.

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Labels: Labor Relations

PLUM FEDERATION OF INDUSTRIAL AND AGRARIAN WORKERS v. NORIEL

Topic: Certification Election – Process and Procedure; Effect of Private Agreement

QUICKIE SUMMARY: PLUM filed a petition for certification election but this was opposed by
PTGWO claiming that they (PTGWO) are the recognized collective bargaining representative of
the employees of the company. PTGWO also invoked the Code of Ethics of TUCP, a federation
were both of them are members. The records of the case were forwarded to TUCP and TUCP
declared that PTGWO is the exclusive bargaining agent. BLR Director Noriel sustained TUCP’s
decision and ratiocinated that the internal rules of the federation must be kept intact. SC ruled
that TUCP has no authority to declare such and allowed PLUM to file their certification election
and let the employees vote who they want to be their collective bargaining representative.

FACTS:

Plum Federation of Industrial and Agrarian Workers (PLUM) filed a petition, praying that it be
certified as the sole and exclusive bargaining agent of the rank-and-file workers of Manila
Jockey Club, Inc.

Manila Jockey Club Race Day Operation Employees Labor Union-PTGWO filed a motion to
intervene and opposition to said petition and alleged that it is the recognized collective
bargaining representative of all the employees of the company and that it is in the process of
negotiating a modification of the collective bargaining agreement.

Another supplemental motion to dismiss was filed by intervenor PTGWO, this time invoking the
"No Union Raiding Clause" of the "Code of Ethics" adopted by the members of the Trade Union
Congress of the Philippines (TUCP) wherein both petitioner and intervenor are members, and
claiming that the petition failed to satisfy the 30% requirement of the law. The entire record of
the case was forwarded to the Office of the President of the TUCP for the purpose of submitting
the matter to the Congress for decision.

TUCP’s decision: MJCR-OELU-PTGWO be declared as the sole and exclusive bargaining agent,
thus dismissing the petition of PLUM
Petitioner PLUM filed an appeal to the Bureau of Labor Relations predicated on the ground that
TUCP has no authority in law to grant or deny election under the Labor Code which mandated
the secret ballot to elect the true union representative.

BLR Director: dismissed PLUM’s the appeal. The ratio of the BLR was “While it may be true that
the facts of the case may warrant the holding of a certification election in the bargaining unit
concerned, to sustain first the decision arrived at by the National Executive Board of TUCP
appears of indispensable importance. Contenders in the case at bar are both members of TUCP.
Undeniably, there are internal rules including their Code of Ethics to keep them intact, to
govern their actions and finally to preserve the Congress. It is therefore, a matter of utmost
necessity that a decision arrived at by the National Executive Board be respected and enforced
not only by the members of the Congress themselves but also by this Bureau and the
Department if necessity arises”

ISSUE: W/N TUCP (here both PLU and PTGWO) has the authority to supersede or impair the
holding of a certification election or deny the majority employees of their right to elect their
own union

RULING: NO. Certification election is the fairest and most effective way of determining which
labor organization can truly represent the working force. It is a fundamental postulate that the
win of the maj• rity if given expression in an honest election with freedom on the part of the
voters to make their choice, is controlling. Protection to labor and freedom of peaceful
assembly and association are guaranteed by the Constitution.

A letter from the president of respondent union reveals the present state of affairs of the
employees wherein they are deprived of the benefits of a collective bargaining agreement, for
management refused to bargain with the union. If this situation continues, the employees
would stand to lose a long-line of cases that the workers' welfare can be promoted through the
bargaining process.
As to the issue of whether or not the 30% minimum subscription requirement was met, it was
held that the Director is still empowered to call for a certification election provided there was
no abuse of discretion. However, in the case at bar, instead of ordering an election, respondent
Director dismissed the appeal of PLUM based on the decision of the TUCP, which the Court
considers an impairment of the freedom of the workers to voice out their choice of the union to
represent them. If there is any doubt as to the required number having met, there would be no
better way than the holding of a certification election to ascertain which union really
commands the allegiance of the rank-and-file employees. If the desired goal is for the execution
of a collective bargaining contract to protect the workers, then certification election is the most
appropriate means to attain said end.

Since there has been no certification election for the past three (3) years as well as a certified
collective bargaining agreement which should govern the economic and working conditions of
the workers, a certification election should immediately be ordered.

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BENGUET ELECTRIC COOP. INC. VS. CALLEJA

TOPIC: Requisite for Validity of Election/ Failure of Election

FACTS:

Beneco Worker's Labor Union-Association of Democratic Labor Organizations (BWLU- ADLO)

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

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

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

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

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

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

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

ISSUE: W/N employees of a cooperative are qualified to form or join a labor organization for
purposes of collective bargaining.

RULING: No

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

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

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

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

The above contention is based on the erroneous presumption that membership in a

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

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