ERSON ANG LEE DOING BUSINESS AS "SUPER LAMINATION SERVICES v.

SAMAHANG MANGGAGAWA NG
SUPER LAMINATION (SMSLS-NAFLU-KMU).
G.R. No. 193816, November 21, 2016

Facts:

Petitioner Erson Ang Lee, through Super Lamination, is an entity engaged in the business of providing
lamination services. Respondent SMSLS-NAFLUC-KMU), is a legitimate Labor Union, while Express Lamination
and Express Coat are entities separately registered with the Securities and Exchange Commission (SEC).

This controversy stemmed from three (3) separate Petitions for Certification Election filed by three (3)
different Labor Unions (Unions A,B, and C) to represent all the rank-and-file employees under their respective
employers: Super Lamination, Express Lamination, and Express Coat. These establishments, all represented
by one counsel, separately claimed in their Comments and Motions to Dismiss that the petitions must be
dismissed on the same ground: lack of employer-employee relationship between these establishments and
the bargaining units that Unions A, B, and C seek to represent.

All 3 Petitions for CE were denied. Hence, the 3 unions filed their respective appeals before the Office of the
DOLE Secretary. DOLE found out that the 3 establishments were sister companies that had a common human
resource department. It also found out that the 3 companies constantly rotated their workers, and that the
latter's identification cards had only one signatory. To DOLE, these circumstances showed that the companies
were engaged in a work-pooling scheme and hence, one and the same entity for the purpose of determining
the appropriate bargaining unit in a certification election.

Issue: WON the application of the doctrine of piercing the corporate veil is warranted 

Ruling:

YES. The Court held that as a rule, companies are distinct entities with separate juridical personalities. ] Hence,
employees of one corporation cannot be allowed to vote in the certification election of another corporation.
However, it has to disregard separate juridical personalities under the doctrine of piercing the corporate veil in
cases where a separate legal entity is used to defeat public convenience, justify wrong, protect fraud, or
defend crime, among other grounds. Thus, a settled formulation of the doctrine of piercing the corporate veil
is that when two business enterprises are owned, conducted, and controlled by the same parties, both law
and equity will, when necessary to protect the rights of third parties, disregard the legal fiction that these two
entities are distinct and treat them as identical or as one and the same.
In the instant case, the following facts show that Petitioner Erson Ang Lee is the common employer of the 3
establishments:

1. They hired employees through a common human resource department;  

2. Their workers were constantly rotated and periodically assigned to Super Lamination or Express
Lamination or Express Coat to perform the same or similar tasks;
3. That the common human resource department imposed disciplinary sanctions and directed the daily
performance of all the members of Unions A, B, and C; 
4. Super Lamination included in its payroll and SSS registration not just its own employees, but also the
employees of Express Lamination and Express Coat.
5. Super Lamination had issued and signed the identification cards of employees who were working for
Express Lamination and Express Coat;  
6. Super Lamination, Express Lamination, and Express Coat were represented by the same counsel who
interposed the same arguments before the Med-Arbiters and DOLE.

Therefore, to safeguard the right of the workers and Unions A, B, and C to engage in collective bargaining, the
corporate veil of Super Lamination Express Lamination and Express Coat must be pierced and their separate
existence must be disregarded