Collective Bargaining 11 Cases Labor Relations With Eo180

8/12/2019 Collective Bargaining 11 Cases Labor Relations With Eo180

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Republic of the PhilippinesSUPREME COURT

ManilaTHIRD DIVISION

G.R. Nos. 64821-23 January 29, 1993UNIVERSITY OF PANGASINAN FACULTY UNION, petitioner,vs.

NATIONAL LABOR RELATIONS COMMISSION and UNIVERSITY OF PANGASINAN, respondents.Tanopo & Serafica for petitioner.Hermogenes S. Decano for private respondents.

ROMERO, J.:In the instant petition for mandamusand certiorari, petitioner union seeks to enjoin the respondent National Labor RelationsCommission (NLRC) to resolve, or direct the Labor Arbiter to hear and decide, the merits of three of petitioner's unresolvedcomplaints, and to annul and set aside the resolution of the NLRC affirming the decision of the Executive Labor Arbiter dismissingthe petitioner's complaints for violation of certain labor standards laws but requiring respondent university to integrate the cost ofliving allowance into the basic pay of the covered employees and reminding it to pay its employees at intervals not exceedingsixteen (16) days.The uncontroverted facts show that on various dates, petitioner filed the following complaints against the University of Pangasinan(University for brevity) before the Arbitration Branch of the NLRC in Dagupan City:

1. October 14, 1980: for nonpayment of benefits under P.D. No. 1713 and emergency cost of living allowance(ecola) to part-time teachers, and for prompt and accurate computation of benefits under P.D. No. 451 and thepayment of ecolas;2. November 7, 1980: for nonpayment of all ecolas to instructors from October 18-31, 1980;

3. November 20, 1980: for nonpayment of ecolas under P.D. Nos. 525, 1123, 1614, 1634, 1678 and 1713 forNovember 1-15, 1980, and extra loads during typhoons "Nitang" and "Osang" on July 21 and 25, 1980,respectively;4.April 13, 1981: for violation of P.D. No. 1751 and nonpayment of extra loads on February 12-13, 1980(Anniversary celebration);5.April 27, 1981: for nonpayment of all ecolas for April 1-15, 1981 to faculty members who were also membersof the union;6. May 21, 1981: for violation of Wage Order No. 1 and delayed payment of salaries; and7. June 17, 1981: for nonpayment of salary differentials for summer under P.D. No. 451.

1

The Regional Director in San Fernando, La Union certified six (6) of these complaints to Labor Arbiter Pedro Fernandez of theDagupan City District Office of the then Ministry of Labor and Employment for compulsory arbitration.

2According to the petitioner, it

was made to understand by Fernandez that the seventh complaint should also be discussed in its position paper. Accordingly,petitioner filed a position paper discussing the merits of all the seven complaints. On the other hand, the University limited itsdiscussion to only four: the complaints filed on April 13, 1981, April 27, 1981, May 21, 1981 and June 17, 1981. Petitioner was of theview that Executive Labor Arbiter Sotero L. Tumang adopted the stand of the University on the four complaints and accordinglydismissed them in his decision of January 25, 1982.

3

Observing that in its position paper, the petitioner included matters which were "beyond the scope of the issues alleged in t hecomplaints," said Labor Arbiter discussed the four complaints individually. On the April 13, 1981 complaint, he ruled that because atthe time P.D. No. 1123 took effect on May 1, 1977, the University had not increased its tuition fees, there was of "nothing tointegrate."

4However, from June 16, 1979 when the University increased its tuition fees, it was obligated to cause the integration of

the across-the-board increase of P60.00 in emergency allowance into the basic pay as mandated by P.D. Nos. 1123 and 1751.On the alleged nonpayment of extra loads handled by the employees on February 12 and 13, 1981 when classes were suspended,Tumang stated that Consuelo Abad, the petitioner's president, had no cause to complain because her salary was fully paid and that,since there were "no complainants for the alleged nonpayment of extra loads for two days," the issue had become academic.With respect to the April 27, 1981 complaint, Tumang said that since the salary paid to Consuelo Abad and other faculty membersfor the April 1-15, 1981 period had been earned "as part of their salary for the ten-month period," she was no longer entitled to anemergency cost of living allowance. He added that "payment of emergency cost of living allowance is based on actual workperformed except when they (employees) are on leave with pay." Hence, because classes ended in March 1981, the teachers whodid not report for work could not be considered on leave with pay and, therefore, they were not entitled to an emergency cost ofliving allowance.

As regards the May 21, 1981 complaint alleging violation of Wage Order No. 1, Tumang found that the University had actuallyimplemented the additional living allowance of P2.00 a day required therein. On the alleged delay in the payment of salaries of theemployees, he rationalized that delays could not be avoided but he reminded the University to pay its employees on time.

The June 17, 1981 complaint was also resolved in favor of the University. Stating that P.D. No. 451 which mandates salaryincreases is dependent on enrollment and allowable deductions, Tumang ruled that, again, Consuelo Abad had no cause tocomplain as she had been paid out of the allowable 12.74% for distribution which was a "substantial compliance with P.D. No.451."

5The dispositive portion of the decision states:

IN THE LIGHT OF THE FOREGOING CONSIDERATION, the above-entitled cases are dismissed for lack ofmerit. Respondent however, is required to integrate the allowance of P60.00 under P.D. 1123 into the basic payof the covered employees if the same has not as yet been complied with. Respondent is also reminded to paythe employees at intervals not exceeding sixteen (16) days pursuant to Article 102 of the Labor Code.SO ORDERED.

The petitioner appealed the said decision to the NLRC. In its resolution of June 20, 1993, the NLRC affirmed the decision ofExecutive Labor Article Tumang. Hence, the instant petition for mandamusand certiorariwith the following prayer:


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WHEREFORE, the foregoing premises considered, it is respectfully prayed that this petition be given duecourse and that judgment issue:1. Declaring petitioner as possessed with capacity to represent its members in the complaints it filed thru itspresident, Miss Consuelo Abad, against private respondent, and the complaints are pertaining to the memberswho are entitled under the law to the claims sought herein, not to Miss Abad alone;2. Annulling and setting aside the appealed resolution insofar as the issues of nonpayment of Ecola for April 1-15, 1981 and nonpayment of salary differentials for summer of 1981 under P.D. No. 451 are concerned;3. Ordering private respondent to pay covered members of petitioner their Ecola for April 1-15, 1981 and their

salary differentials for summer of 1981 pursuant to the mandate of P.D. 451;4. Enjoining public respondent to resolve on the merits the issues of nonpayment of extra loads of February 12-13, 1980 and violation of Wage Order No. 1 which were properly brought on appeal to said office;5. Enjoining public respondent to resolve on the merits the issues or grievances alleged in the complaints filedon October 14, November 7 and November 20, all in 1980, which were not resolved by the labor arbiter butnonetheless appealed to public respondents, or6. Enjoining public respondent to order or direct the labor arbiter to resolve on the merits the said issues orgrievances alleged in the complaints mentioned in the next preceding paragraph;7. Attorney's fee in such amount as this Honorable Tribunal may deem just and reasonable in the premises;8. Ordering private respondent to pay costs of suit, including this appeal.Petitioner further prays for safeguards and/or measures to insure the correct computation of the amount ofclaims herein sought due to each covered member of petitioner, and for such other reliefs just and equitable inthe premises.

6

We shall first deal with the propriety of the special civil action of mandamus. In this regard, petitioner contends that the NLRC shouldhave, in the exercise of its appellate jurisdiction, resolved the issues raised in the three (3) complaints filed on October 14,November 7 and November 20, 1980 or, in the alternative, ordered the Labor Arbiter to hear and decide the aforementioned three(3) complaints, it having the power of supervision over Labor Arbiters.

Sec. 3, Rule 65 of the Rules of Court provides:Sec. 3. Petition forMandamus. When any tribunal, corporation, board, or person unlawfully neglects theperformance of an act which the law specifically enjoins as a duty resulting from an office, trust, or station, orunlawfully excludes another from the use and enjoyment of a right or office to which such other is entitled, andthere is no other plain, speedy and adequate remedy in the ordinary course of law, the person aggrievedthereby may file a verified petition in the proper court alleging the facts with certainty and praying that judgmentbe rendered commanding the defendant, immediately or at some other specified time, to do the act required tobe done to protect the rights of the petitioner, and to pay the damages sustained by the petitioner by reason ofthe wrongful acts of the defendant.

As succinctly provided in this section, anyone who wishes to avail of the remedy of mandamusmust state in a verified petition "thefacts with certainty." On account of this requirement, mandamusis never issued in doubtful cases and showing of a clear andcertain right on the part of the petitioner is required.

7Indeed, while the labor arbiter is duty bound to resolve all complaints referred

to him for arbitration and, therefore, he may be compelled bymandamus to decide them (although not in any particular way or infavor of anyone),

8we find that the peculiar circumstances in this case do not merit the issuance of the writ of mandamus.

Petitioner admits that only six of the complaints were certified to Labor Arbiter Fernandez for compulsory arbitration. It failed,however, to allege why this was the case or whether it had exerted any effort to include the remaining complaint in the certification.What it stresses is the alleged assurance of Labor Arbiter Fernandez that the seventh complaint may be discussed in its positionpaper. It turned out, however, that, according to the unrebutted allegation of the Solicitor General, Labor Arbiter Fernandez inhibitedhimself from handling the cases referred to him as he was teaching at the University. Hence, Labor Arbiter Fernandez forwarded thecomplaints to the Assistant Director for Arbitration in Regional Office No. 1 in San Fernando, La Union for appropriate action. Heshould have forwarded allof the complaints to the said Assistant Director, but it appears that Fernandez turned over onlyfourofthem. In turn, the Assistant Director referred only complaints Nos. 5, 6 and 7, which had been docketed as RBI-C-24-81, LS-42-81and LS-43-81, to Executive Labor Arbiter Sotero L. Tumang for compulsory arbitration. However, while only these three docketnumbers appear on the caption of the decision, the same actually resolved four complaints, as earlier mentioned.

9

From these facts, one may infer that there must have been a mishandling of the complaints and/or the records of the cases.However, the petitioner failed to substantiate by evidence such negligence on the part of the public respondents as to warrant theissuance of a writ of mandamus.

10Its officials even neglected the simple act of verifying from the MOLE office in Dagupan City

whether the records of all the cases filed had been forwarded to the proper official who should resolve them.11

Infact, nowhere in itspleadings

12is there an allegation to that effect.

On the contrary, the petitioner took Fernandez' words seriously and allowed the proceedings to reach its inevitable conclusion.When it received a copy of the decision, the petitioner should have taken note of Executive Labor Arbiter Tumang's observationtherein that it had discussed matters "beyond the scope of the issues alleged in the complaints." In its memorandum of appeal, i tshould have prayed for the inclusion of the three complaints inasmuch as in labor cases, an appeal may be treated as a motion for

reconsideration orvice-versa.

13The fact that three complaints had been omitted did not escape the attention of the NLRC which stated in its resolution

that "since those cases were not consolidated it is now too late to consolidate them" with the four decided cases.14

We agree withthe NLRC that the said complaints should proceed separately as long as their resolution would not conflict with the resolvedcases.

15It should be added that under Art. 217(b) of the Labor Code, the NLRC has "exclusive appellate jurisdiction over all cases

decided by the Labor Arbiters." Needless to say, the NLRC could not have acted on matters outside of the cases appealed to it.Petitioner's contention that the cases filed by Consuelo Abad as its president should affect, not only herself, but all the other unionmembers similarly situated as she was, is well taken. The uncontroverted allegation of the petitioner is that it is the holder ofRegistration Certificate No. 9865-C, having been registered with the then Ministry of Labor and Employment on February 16, 1978.

As such, petitioner possessed the legal personality to sue and be sued under its registered name.16

Corollarily, its president,Consuelo Abad, correctly filed the complaints even if some of them involved rights and interest purely or exclusively appertaining to


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individual employees, it appearing that she signed the complaints "for and in behalf of the University of Pangasinan FacultyUnion."

17

The University's contention that petitioner had no legal personality to institute and prosecute money claims must, therefore, fail. Toquote then Associate Justice Teehankee inHeirs of Teodelo M. Cruz v. CIR,

18"[w]hat should be borne in mind is that the interest of

the individual worker can be better protected on the whole by a strong union aware of its moral and legal obligations to represent therank and file faithfully and secure for them the best wages and working terms and conditions. . . . Although this was stated within thecontext of collective bargaining, it applies equally well to cases, such as the present wherein the union, through its president,presented its individual members' grievances through proper proceedings. While the complaints might not

have disclosed the identities of the individual employees claiming monetary benefits,

19

such technical defect should not be takenagainst the claimants, especially because the University appears to have failed to demand a bill of particulars during theproceedings before the Labor Arbiter.On the merits of the petition, the NLRC did not abuse its discretion in resolving the appeal from the decision of Executive Labor

Arbiter Tumang except for the disallowance of the emergency cost of living allowance to members of the petitioner. The RulesImplementing P.D. No. 1713 which took effect on August 18, 1980 provide:

Sec. 6. Allowances of full-time and part-time employees. Employees shall be paid in full the monthlyallowance on the basis of the scales provided in Section 3 hereof, regardless of the number of their regularworking days if they incur no absences during the month. If they incur absences without pay, the amountscorresponding to the absences may be deducted from the monthly allowance provided that in determining theequivalent daily allowance of such deduction, the applicable monthly allowance shall be divided by thirty (30)days.

xxx xxx xxx(Emphasis supplied).

This Section, which is a virtual reproduction of Section 12 of the old Rules Implementing P.D. No. 1123, has been interpreted by thisCourt as requiring that the full amount of the cost of living allowance mandated by law should be given monthly to each employee ifthe latter has worked continuously for each month, regardless of the number of the regular working days.

20But more apropos is the

ruling of this Court in University of Pangasinan Faculty Union v. University of Pangasinan and NLRC,21a case involving the sameparties as in the instant petition and dealing with a complaint filed by the petitioner on December 18, 1981 seeking, among others,the payment of emergency cost of living allowances for November 7 to December 5, 1981, a semestral break. The Court heldtherein:

. . . The "No work, no pay" principle does not apply in the instant case. The petitioner's members received theirregular salaries during this period. It is clear from the . . . law that it contemplates a "no work" situation wherethe employees voluntarily absent themselves. Petitioners, in the case at bar, certainly do not, advoluntatem absent themselves during semestral breaks. Rather, they are constrained to take mandatory leavefrom work. For this, they cannot be faulted nor can they be begrudged that which is due them under the law. Toa certain extent, the private respondent can specify dates when no classes would be held. Surely, it was not theintention of the framers of the law to allow employers to withhold employee benefits by the simple expedient ofunilaterally imposing "no work" days and consequently avoiding compliance with the mandate of the law forthose days.

As interpreted and emphasized in the same case, the law granting emergency cost of living allowances was designed to augmentthe income of the employees to enable them to cope with the rising cost of living and inflation. Clearly, it was enacted in pursuanceof the State's duty to protect labor and to alleviate the plight of the workers. To uphold private respondent's interpretation of the lawwould be running counter to the intent of the law and the Constitution.WHEREFORE, the petition for mandamusis hereby DISMISSED. The decision of the NLRC is AFFIRMED subject to theMODIFICATION that private respondent University of Pangasinan shall pay its regular and fulltime teachers and employeesemergency cost of living allowance for the period April 1-15, 1981. Costs against private respondent.SO ORDERED.

[G.R. No. 131235. November 16, 1999]UST FACULTY UNION (USTFU), GIL Y. GAMILLA, CORAZON QUI, NORMA CALAGUAS, IRMA POTENCIANO, LUZ DE

GUZMAN, REMEDIOS GARCIA, RENE ARNEJO, EDITHA OCAMPO, CESAR REYES, CELSO NIERRA, GLICERIABALDRES, MA. LOURDES MEDINA, HIDELITA GABO, MAFEL YSRAEL, LAURA ABARA, NATIVIDAD SANTOS,FERDINAND LIMOS, CARMELITA ESPINA, ZENAIDA FAMORCA, PHILIP AGUINALDO, BENEDICTA ALAVA andLEONCIO CASAL, petiti oners vs.Dir. BENEDICTO ERNESTO R. BITONIO JR. of the Bureau of Labor Relations, Med-Arbiter TOMAS F. FALCONITIN of The National Capital Region, Department of Labor and Employment (DOLE),EDUARDO J. MARIO JR., MA. MELVYN ALAMIS, NORMA COLLANTES, URBANO ALABAGIA, RONALDOASUNCION, ZENAIDA BURGOS, ANTHONY CURA, FULVIO M. GUERRERO, MYRNA HILARIO, TERESITA MEER,FERNANDO PEDROSA, NILDA REDOBLADO, RENE SISON, EVELYN TIROL and ROSIE ALCANTARA, respondents.

D E C I S I O NPANGANIBAN, J.:

There is a right way to do the right thing at the right time for the right reasons ,[1]

and in the present case, in the right forum by the rightparties. While grievances against union leaders consti tute legitimate complaints deserving appropriate redress, action thereon should be made in

the proper forum at the proper time and after observance of proper procedures. Similarly, the election of union officers should be conducted inaccordance with the provisions of the unions constitution and bylaws, as well as the Philippine Constitution and the Labor Code. Specifically,

while all legitimate faculty members of the University of Santo Tomas (UST) belonging to a collective bargaining unit may take part in a duly

convened certification election, only bona fide members of the UST Faculty Union (USTFU) may participate and vote in a legally called electionfor union officers. Mob hysteria, however well-intentioned, is not a substitute for the rule of law.

The CaseThe Petition for Certioraribefore us assails the August 15, 1997 Resolution[2]of Director Benedicto Ernesto R. Bitonio Jr. of the Bureau

of Labor Relations (BLR) in BLR Case No. A-8-49-97, which affirmed the February 11, 1997 Decision of Med-Arbiter Tomas F.

Falconitin. The med-arbiters Decision disposed as follows:
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WHEREFORE, premises considered, judgment is hereby rendered declaring the election of USTFU officers conducted on October 4, 1996 and

its election results as null and void ab initio.Accordingly, respondents Gil Gamilla, et al are hereby ordered to cease and desist from acting and performing the duties and functions of the

legitimate officers of [the] University of Santo Tomas Faculty Union (USTFU) pursuant to [the] unions constitution and by-laws (CBL).

The Temporary Restraining Order (TRO ) issued by this Office on December 11, 1996 in connection with the instant petition, i s hereby madeand declared permanent.[3]

Likewise challenged is the October 30, 1997 Resolution[4]of Director Bitonio, which denied petitioners Motion for Reconsideration.The Facts

The factual antecedents of the case are summarized in the assailed Resolution as follows:Petitioners-appellees [herein Private Respondents] Marino, et. al. (appellees) are duly elected officers of the UST Faculty Union (USTFU). The

union has a subsisting five-year Collective Bargaining Agreement with its employer, the University of Santo Tomas (UST). The CBA was

registered with the Industrial Relations Division, DOLE-NCR, on 20 February 1995. It is set to expire on 31 May 1998.

On 21 September 1996, appellee Collantes, in her capacity as Secretary General of USTFU, posted a notice addressed to all USTFU members

announcing a general assembly to be held on 05 October 1996. Among others, the general assembly was called to elect USTFUs next set ofofficers. Through the notice, the members were also informed of the constitution of a Committee on Elections (COMELEC) to oversee the

elections. (Annex B, petition)

On 01 October 1996, some of herein appellants filed a separate petition with the Med-Arbiter, DOLE-NCR, directed against herein appelleesand the members of the COMELEC. Docketed as Case No. NCR-OD-M-9610-001, the petition alleged that the COMELEC was not constituted

in accordance with USTFUs constitution and by-laws (CBL) and that no rules had been issued to govern the conduct of the 05 October 1996

election.On 02 October 1996, the secretary general of UST, upon the request of the various UST faculty club presidents (See paragraph VI, Respondents

Comment and Motion to Dismiss), issued notices allowing all faculty members to hold a convocation on 04 October 1996 (See Annex C

Petition; Annexes 4 to 10, Appeal).Denominated as [a] general faculty assembly, the convocation was supposed to discuss the state of theunratified UST-USTFU CBA and status and election of USTFU officers (Annex 11, Appeal)

On 04 October 1996, the med-arbiter in Case No. NCR-OD-M-9610-001 issued a temporary restraining order against herein appellees enjoining

them from conducting the election scheduled on 05 October 1996.Also on 04 October 1996, and as earlier announced by the UST secretary general, the general faculty assembly was held as scheduled. The

general assembly was attended by members of the USTFU and, as admitted by the appellants, also by 'non-USTFU members [who] are membersin good standing of the UST Academic Community Collective Bargaining Unit' (See paragraph XI, Respondents Comment and Motionto

Dismiss). On this occasion, appellants were elected as USTFUs new set of officers by acclamation and clapping of hands (See paragraphs40 to

50, Annex '12', Appeal).The election of the appellants came about upon a motion of one Atty. Lopez, admittedly not a member of USTFU, that the USTFU CBL and 'the

rules of the election be suspended and that the election be held [on] that day' (See --paragraph 39, Idem.)

On 11 October 1996, appellees filed the instant petition seeking injunctive reliefs and the nullification of the results of the 04 October 1996election. Appellees alleged that the holding of the same violated the temporary restraining order issued in Case No. NCR-OD-M-9610-

001. Accusing appellants of usurpation, appellees characterized the election as spurious for being violative of USTFUs CBL, specifically

because the general assembly resulting in the election of appellants was not called by the Board of Officers of the USTFU; there was nocompliance with the ten-day notice rule required by Section 1, Article VIII of the CBL; the supposed elections were conducted without a

COMELEC being constituted by the Board of Officers in accordance with Section 1, Article IX of the CBL; the elections were not by secret

balloting as required by Section 1, Article V and Section 6, Article IX of the CBL, and, the general assembly was convened by faculty memberssome of whom were not members of USTFU, so much so that non-USTFU members were allowed to vote in violation of Section 1, Article V of

the CBL.

On 24 October 1996, appellees filed another urgent ex-parte motion for a temporary restraining order, this time alleging that appellants hadserved the former a notice to vacate the union office. For their part, appellants moved to dismiss the original petition and the subsequent motion

on jurisdictional grounds. Both the petition and the motion were captioned to be for Prohibition, Injunction with Prayer for Preliminary

Injunction and Temporary Restraining Order. According to the appellants, the med-arbiter has no jurisdiction over petitions for prohibition,

'including the ancillary remedies of restraining order and/or preliminary injunction, which are merely incidental to the main petition for

PROHIBITION' (Paragraph XVIII3, Respondents Comment and Motion to Dismiss). Appellants also averred that they now constituted the new

set of union officers having been elected in accordance with law after the term of office of appellees had expired. They further maintained thatappellees scheduling of the 5 October 1996 elections was illegal because no rules and regulations governing the elections were promulgated as

required by USTFUs CBL and that one of the members of the COMELEC was not a registered member of USTFU. Appellants likewise noted

that the elections called by the appellees should have been postponed to allow the promulgation of rules and regulations and to 'insure a free,clean, honest and orderly elections and to afford at the same time the greater majority of the general membership to participate' (See paragraph V,

Idem). Finally, appellants contended that the holding of the general faculty assembly on 04 October 1996 was under the control of the Council of

College/Faculty Club Presidents in cooperation with the USTFU Reformist Alliance and that they received the Temporary Restraining Orderissued in Case No. NCR-OD-M-9610-001 only on 07 October 1996 and were not aware of the same on 04 October 1996.

On 03 December 1996, appellants and UST allegedly entered into another CBA covering the period from 01 June 1996 to 31 May 2001 (Annex

11, appellants Rejoinder to the Reply and Opposition).

Consequently, appellees again moved for the issuance of a temporary restraining order to prevent appellants from making further representationsthat [they] had entered into a new agreement with UST. Appellees also reiterated their earlier stand that appellants were usurping the formers

duties and functions and should be stopped from continuing such acts.On 11 December 1996, over appellants insistence that the issue of jurisdiction should first be resolved, the med-arbiter issued a temporary

restraining order directing the respondents to cease and desist from performing any and all acts pertaining to the duties and functions of the

officers and directors of USTFU.In the meantime, appellants claimed that the new CBA was purportedly ratified by an overwhelming majority of USTs academic community on

12 December 1996 (Annexes 1 to 10, Idem). For this reason, appellants moved for the dismissal of what it denominated as appellees petition for

prohibition on the ground that this had become moot and academic.[5]

Petitioners appealed the med-arbiters Decision to the labor secretary,[6]who transmitted the records of the case to the Bureau of Labor

Relations which, under Department Order No. 9, was authorized to resolve appeals of intra-union cases, consistent with the last paragraph of

Article 241 of the Labor Code.[7]
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The Assailed RulingAgreeing with the med-arbiter that the USTFU officers purported election held on October 4, 1994 was void for having been conducted in

violation of the unions Constitution and Bylaws (CBL), Public Respondent Bitonio rejected petitioners contention that it was a legitimate

exercise of their right to self-organization. He ruled that the CBL, which constituted the covenant between the union and its members, could not

be suspended during the October 4, 1996 general assembly of all faculty members, since that assembly had not been convened or authorized bythe USTFU.

Director Bitonio likewise held that the October 4, 1996 election could not be legitimized by the recognition of the newly elected set of

officers by UST or by the alleged ratification of the new CBA by the general membership of the USTFU. Ruled Respondent Bitonio:

"This submission is flawed. The issue at hand is not collective bargaining representation but union leadership, a matter that should concern onlythe members of USTFU. As pointed out by the appellees, the privilege of determining who the union officers will be belongs exclusively to the

members of the union. Said privilege is exercised in an election proceeding in accordance with the union's CBL and applicable law.

To accept appellants' claim to legitimacy on the foregoing grounds is to invest in appellants the position, duties, responsibilities, rights and

privileges of USTFU officers without the benefit of a lawful electoral exercise as defined in USTFU's CBL and Article 241(c) of the Labor

Code. Not to mention the fact that labor laws prohibit the employer from interfering with the employees in the lat ter' exercise of their right toself-organization. To allow appellants to become USTFU officers on the strength of management's recognition of them is to concede to the

employer the power of determining who should be USTFU's leaders. This is a clear case of interference in the exercise by USTFU members of

their right to self-organization.[8]Hence, this Petition.[9]

The IssuesThe main issue in this case is whether the public respondent committed grave abuse of discretion in refusing to recognize the officers

electedduring the October 4, 1996 general assembly. Specifically, petitioners in their Memorandum urge the Court to resolve the following

questions:[10]

(1) Whether the Collective Bargaining Unit of all the faculty members in that General Faculty Assembly had the right in that General FacultyAssembly to suspend the provisions of the Constitution and By-Laws of the USTFU regarding the elections of officers of the union[.]

(2) Whether the suspension of the provisions of the Constitution and By-Laws of the USTFU in that General Faculty Assembly is valid

pursuant to the constitutional right of the Collective Bargaining Unit to engage in peaceful concerted activities for the purpose of ousting thecorrupt regime of the private respondents[.]

(3) Whether the overwhelming ratification of the Collective Bargaining Agreement executed by the petitioners in behalf of the USTFU with theUniversity of Santo Tomas has rendered moot and academic the issue as to the validity of the suspension of the Constitution and By-Laws and the

elections of October 4, 1996 in the General Faculty Assembly[.]The Courts Ruling

The petition is not meritorious. Petitioners fail to convince this Court that Director Bitonio gravely abused his discretion in affirming the

med-arbiter and in refusing to recognize the binding effect of the October 4, 1996 general assembly called by the UST administration.First Issue: Right to Self-Organization and Union M embership

At the outset, the Court stresses thatNational Federation of Labor (NFL) v. Laguesma[11]has held that challenges against rulings of the

labor secretary and those acting on his behalf, like the director of labor relations, shall be acted upon by the Court of Appeals, which has

concurrent jurisdiction with this Court over petitions for certiorari. However, inasmuch as the memoranda in the instant case have been filedprior to the promulgation and finality of our Decision inNFL, we deem it proper to resolve the present controversy directly, instead of remanding

it to the Court of Appeals. Having disposed of the foregoing procedural matter, we now tackle the issues in the present case seriatim.

Self-organization is a fundamental right guaranteed by the Philippine Constitution and the Labor Code. Employees have the right to form,join or assist labor organizations for the purpose of collective bargaining or for their mutual aid and protection.[12]Whether employed for a

definite period or not, any employee shall be considered as such, beginning on his first day of service, for purposes of membership in a labor

union.[13]Corollary to this right is the prerogative not to join, affiliate with or assist a labor union.[14]Therefore, to become a union member, an

employee must, as a rule, not only signify the intent to become one, but also take some positive steps to realize that intent. The procedure for

union membership is usually embodied in the unions constitution and bylaws.[15]An employee who becomes a union member acquires the rights

and the concomitant obligations that go with this new status and becomes bound by the unions rules and regulations.

When a man joins a labor union (or almost any other democratically controlled group), necessarily a portion of his individual freedom is

surrendered for the benefit of all members. He accepts the will of the majority of the members in order that he may derive the advantages to begained from the concerted action of all. Just as the enactments of the legislature bind all of us, to the constitution and by-laws of the union

(unless contrary to good morals or public policy, or otherwise illegal), which are duly enacted through democratic processes, bind all of the

members. If a member of a union dislikes the provisions of the by-laws, he may seek to have them amended or may withdraw from the union;otherwise, he must abide by them. It is not the function of courts to decide the wisdom or propriety of legitimate by-laws of a trade union.

On joining a labor union, the constitution and by-laws become a part of the members contract of membership under which he agrees to become

bound by the constitution and governing rules of the union so far as it is not inconsistent with controlling principles of law. The constitution andby-laws of an unincorporated trade union express the terms of a contract, which define the privileges and rights secured to, and duties assumed

by, those who have become members. The agreement of a member on joining a union to abide by its laws and comply with the will of the

lawfully constituted majority does not require a member to submit to the determination of the union any question involving his personal

rights.[16]

Petitioners claim that the numerous anomalies allegedly committed by the private respondents during the latters incumbency i mpelled the

October 4, 1996 election of the new set of USTFU officers. They assert that such exercise was pursuant to their right to self-organization.Petitioners frustration over the performance of private respondents, as well as their fears of a fraudulent election to be held under the

latters supervision, could not justify the method they chose to impose their will on the union. Director Bitonio aptly elucidated:[17]

The constitutional right to self-organization is better understood in the context of ILO Convention No. 87 (Freedom of Association andProtection of Right to Organize), to which the Philippines is signatory. Article 3 of the Convention provides that workers organizations shall

have the right to draw up their constitution and rules and to elect their representatives in full freedom, free from any interference from public

authorities. The freedom conferred by the provision is expansive; the responsibility imposed on union members to respect the constitution and

rules they themselves draw up equally so. The point to be stressed is that the unions CBL is the fundamental law that governs the relationship

between and among the members of the union. It is where the rights, duties and obligations, powers, functions and authority of the officers as
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well as the members are defined. It is the organic law that determines the validity of acts done by any officer or member of the union. Without

respect for the CBL, a union as a democratic institution degenerates into nothing more than a group of individuals governed by mob rule.Union El ection vs. Certification El ection

A union election is held pursuant to the unions constitution and bylaws, and the right to vote in it is enjoyed only by union members. A

union election should be distinguished from a certification election, which is the process of determining, through secret ballot, the sole andexclusive bargaining agent of the employees in the appropriate bargaining unit, for purposes of collective bargaining.[18]Specifically, the purpose

of a certification election is to ascertain whether or not a majority of the employees wish to be represented by a labor organization and, in the

affirmative case, by whichparticular labor organization.[19]

In a certification election, allemployees belonging to the appropriate bargaining unit can vote.[20]

Therefore, a unionmember who likewisebelongs to the appropriate bargaining unit is entitled to vote in said election. However, the reverse is not always true; an employee belonging to

the appropriate bargaining unit but who is not a member of the union cannot vote in the union election, unless otherwise authorized by the

constitution and bylaws of the union. Verily, union affairs and elections cannot be decided in a non-union activity.

In both elections, there are procedures to be followed. Thus, the October 4, 1996 election cannot properly be called a union election,

because the procedure laid down in the USTFUs CBL for the election of officers was not followed. It could not have been a certificationelection either, because representation was not the issue, and the proper procedure for such election was not followed. The participation of non-

union members in the election aggravated its irregularity.Second Issue: USTFUs Constitution and ByLaws Violated

The importance of a unions constitution and bylaws cannot be overemphasized. They embody a covenant between a union and its

members and constitute the fundamental law governing the members rights and obligations.[21]As such, the unions constitution and bylaws

should be upheld, as long as they are not contrary to law, good morals or public policy.We agree with the finding of Director Bitonio and Med-Arbiter Falconitin that the October 4, 1996 election was tainted with irregularities

because of the following reasons.

First, the October 4, 1996 assembly was not called by the USTFU. It was merely a convocation of faculty clubs, as indicated in thememorandum sent to allfaculty members by Fr. Rodel Aligan, OP, the secretary general of the University of Santo Tomas.[22]It was not convened

in accordance with the provision on general membership meetings as found in the USTFUs CBL, which reads:

ARTICLE VIII-MEETINGS OF THE UNIONSection 1. The Union shall hold regular general membership meetings at least once every three (3) months. Notices of the meeting shall be sent

out by the Secretary-General at least ten (10) days prior to such meetings by posting in conspicuous places, preferably inside Company premises,said notices. The date, time and place for the meetings shall be determined by the Board of Officers.[23]

Unquestionably, the assembly was not a union meeting. It was in fact a gathering that was called and participated in by management and

non-union members. By no legal fiat was such assembly transformed into a union activity by the participation of some union members.

Second, there was no commission on elections to oversee the election, as mandated by Sections 1 and 2 of Article IX of the USTFUs

CBL, which provide:

ARTICLE IX - UNION ELECTIONSection 1. There shall be a Committee on Election (COMELEC) to be created by the Board of Officers at least thirty (30) days before any

regular or special election. The functions of the COMELEC include the following:

a) Adopt and promulgate rules and regulations that will ensure a free, clean, honest and orderly election, whether regular orspecial;

b) Pass upon qualifications of candidates;

c) Rule on any question or protest regarding the conduct of the election subject to the procedure that may be promulgated by theBoard of Officers; and

d) Proclaim duly elected officers.

Section 2. The COMELEC shall be composed of a chairman and two members all of whom shall be appointed by the Board of Officers.xxxxxx xxx[24]

Third, the purported election was not done by secret balloting, in violation of Section 6, Article IX of the USTFUs CBL, as well as Article

241 (c) of the Labor Code.

The foregoing infirmities considered, we cannot attribute grave abuse of discretion to Director Bitonios finding and

conclusion. InRodriguez v. Director, Bureau of Labor Relations,[25]we invalidated the local union elections held at the wrong date without prior

notice to members and conducted without regard for duly prescribed ground rules. We held that the proceedings were rendered void by the lackof due process -- undue haste, lack of adequate safeguards to ensure integrity of the voting, and the absence of the notice of the dates of balloting.

Third Issue: Suspension of USTFUs CBLPetitioners contend that the October 4, 1996 assembly suspended the unions CBL. They aver that the suspension and the election that

followed were in accordance with their constituent and residual powers as members of the collective bargaining unit to choos e their

representatives for purposes of collective bargaining. Again they cite the numerous anomalies allegedly committed by the private respondents as

USTFU officers. This argument does not persuade.First, as has been discussed, the general faculty assembly was not the proper forum to conduct the election of USTFU officers. Not all

who attended the assembly were members of the union; some, apparently, were even disqualified from becoming union members, since they

represented management. Thus, Director Bitonio correctly observed:

Further, appellantscannot be heard to say that the CBL was effectively suspended during the 04 October 1996 general assembly. A union CBLis a covenant between the union and its members and among members (Johnson and Johnson Labor Union-FFW, et al. v. Director of Labor

Relations, 170 SCRA 469). Where ILO Convention No. 87 speaks of a unions full freedom to draw up its constitution and rules, it includesfreedom from interference by persons who are not members of the union. The democratic principle that governance is a matter for the governed

to decide upon applies to the labor movement which, by law and constitutional mandate, must be assiduously insulated against intrusions coming

from both the employer and complete strangers if the 'protection to labor clause' of the constitution is to be guaranteed. By appellants ownevidence, the general faculty assembly of 04 October 1996 was not a meeting of USTFU. It was attended by members and non-members alike,

and therefore was not a forum appropriate for transacting union matters. The person who moved for the suspension of USTFUs CBL was not a

member of USTFU. Allowing a non-union member to initiate the suspension of a unions CBL, and non-union members to participate in a union

election on the premise that the unions CBL had been suspended in the meantime, is incompatible with the freedom of association and protection

of the right to organize.
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If there are members of the so-called academic community collective bargaining unit who are not USTFU members but who would

nevertheless want to have a hand in USTFUs affairs, the appropriate procedure would have been for them to become members of USTFUfirst. The procedure for membership is very clearly spelled out in Article IV of USTFUs CBL. Having become members, they could then draw

guidance fromAng Malayang Manggagawa Ng Ang Tibay v. Ang Tibay, 103 Phil. 669. Therein the Supreme Court held that if a member of the

union dislikes the provisions of the by-laws he may seek to have them amended or may withdraw from the union; otherwise he must abide bythem. Under Article XVII of USTFUs CBL, there is also a specific provision for constitutional amendments. What is clear therefore is that

USTFUs CBL provides for orderly procedures and remedies which appellants could have easily availed [themselves] of instead of resorting to an

exercise of their so-called residual power'.[26]

Second, the grievances of the petitioners could have been brought up and resolved in accordance with the procedure laid down by theunions CBL[27]and by the Labor Code.[28]They contend that their sense of desperation and helplessness led to the October 4, 1996

election. However, we cannot agree with the method they used to rectify years of inaction on their part and thereby ease bottled-up frustrations,

as such method was in total disregard of the USTFUs CBL and of due process. The end never justifies the means.

We agree with the solicitor generals observation that the act of suspending the constitution when thequestioned election was held is an

implied admission that the election held on that date [October 4, 1996] could not be considered valid under the existing USTFU constitutionxxx.[29]

The ratification of the new CBA executed between the petitioners and the University of Santo Tomas management did not validate the

void October 4, 1996 election. Ratified were the termsof the new CBA, notthe issue of union leadership-- a matter that should be decided onlyby union members in the proper forum at the proper time and after observance of proper procedures.

EpilogueIn dismissing this Petition, we are not passing upon the merits of the mismanagement allegations imputed by the petitioners to the private

respondents; these are not at issue in the present case. Petitioners can bring their grievances and resolve their differences with private

respondents in timely and appropriate proceedings. Courts will not tolerate the unfair treatment of union members by their own leaders. When

the latter abuse and violate the rights of the former, they shall be dealt with accordingly in the proper forum after the observance of due process.

WHEREFORE, the Petition is herebyDISMISSEDand the assailed ResolutionsAFFIRMED. Costs against petitioners.SO ORDERED.

Victorian o vs Elizalde

Political Law Primacy of the Constitution over Contractual Rights

Victoriano, an Iglesia ni Cristo member, has been an employee of the Elizalde Rope Factory since 1958. He was also a member of

the EPWU. Under the CBA between ERF and EPWU, a close shop agreement is being enforced which means that employment in

the factory relies on the membership in the EPWU; that in order to retain employment in the said factory one must be a member of

the said Union. In 1962, Victoriano tendered his resignation from EPWU claiming that as per RA 3350 he is an exemption to the

close shop agreement by virtue of his being a member of the INC because apparently in the INC, one is forbidden from being a

member of any labor union. It was only in 1974 that his resignation from the Union was acted upon by EPWU which notified ERF

about it. ERF then moved to terminate Victoriano due to his non-membership from the EPWU. EPWU and ERF reiterated that he is

not exempt from the close shop agreement because RA 3350 is unconstitutional and that said law violates the EPWUs and ERFs

legal/contractual rights.

ISSUE: Whether or not RA 3350 is unconstitutional.

HELD: The right to religion prevails over contractual or legal rights. As such, an INC member may refuse to join a labor union and

despite the fact that there is a close shop agreement in the factory where he was employed, his employment could not be validly

terminated for his non-membership in the majority therein. Further, the right to join a union includes the right not to join a union. Thelaw is not unconstitutional. It recognizes both the rights of unions and employers to enforce terms of contracts and at the same time

it recognizes the workers right to join or not to join union. But the RA recognizes as well the primacy of a constitutional right over a

contractual right.

FIRST DIVISIONG.R. No. 93468 December 29, 1994

NATIONAL ASSOCIATION OF TRADE UNIONS (NATU)-REPUBLIC PLANTERS BANK SUPERVISORSCHAPTER, Petitioner, v. HON. RUBEN D. TORRES, SECRETARY OF LABOR AND EMPLOYMENT and

REPUBLIC PLANTERS BANK, Respondents.Filemon G. Tercero for petitioner.chanrobles virtual law libraryThe Government Corporate Counsel for Republic Planters Bank.

BELLOSILLO, J.:NATIONAL ASSOCIATION OF TRADE UNIONS (NATU)-REPUBLIC PLANTERS BANK SUPERVISORS CHAPTER seeksnullification of the decision of public respondent Secretary of Labor dated 23 March 1990, which modified the order

of Med-Arbiter Manases T. Cruz dated 17 August 1989 as well as his order dated 20 April 1990 denyingreconsideration.chanroblesvirtualawlibrarychanrobles virtual law libraryOn 17 March 1989, NATU filed a petition for certification election to determine the exclusive bargainingrepresentative of respondent Bank's employees occupying supervisory positions. On 24 April 1989, the Bankmoved to dismiss the petition on the ground that the supposed supervisory employees were actually managerialand/or confidential employees thus ineligible to join, assist or form a union, and that the petition lacked the 20%signatory requirement under the Labor Code.chanroblesvirtualawlibrarychanrobles virtual law libraryOn 17 August 1989, Med-Arbiter Manases T. Cruz granted the petition thus -WHEREFORE, . . . let a certification election be ordered conducted among all the regular employees of the RepublicPlanters Bank occupying supervisory positions or the equivalent within 20 days from receipt of a copy of this Order.
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The choice shall be: (1) National Association of Trade Unions (NATU)-Republic Planters Bank Supervisors Chapter;and (2) No Union.chanroblesvirtualawlibrarychanrobles virtual law libraryThe payroll three months prior to the filing of this petition shall be utilized in determining the list of eligible voters .. . .1chanrobles virtual law libraryRespondent Bank appealed the order to the Secretary of Labor on the main ground that several of the employeessought to be included in the certification election, particularly the Department Managers, Branch Managers/OICs,Cashiers and Controllers were managerial and/or confidential employees and thus ineligible to join, assist or form aunion. It presented annexes detailing the job description and duties of the positions in question and affidavits of

certain employees. It also invoked provisions of the General Banking Act and the Central Bank Act to show theduties and responsibilities of the bank and its branches.chanroblesvirtualawlibrarychanrobles virtual law libraryOn 23 March 1990, public respondent issued a decision partially granting the appeal, which is now being challengedbefore us -WHEREFORE, . . . the appeal is hereby partially granted. Accordingly, the Order dated 17 August 1989 is modifiedto the extent that Department Managers, Assistant Managers, Branch Managers, Cashiers and Controllers aredeclared managerial employees. Perforce, they cannot join the union of supervisors such as Division Chiefs,Accounts Officers, Staff Assistants and OIC's (sic) unless the latter are regular managerial employees . . ..2chanrobles virtual law libraryNATU filed a motion for reconsideration but the same was denied on 20 April 1990.3Hence this recourse assailingpublic respondent for rendering the decision of 23 March 1990 and the order of 20 April 1990 both with graveabuse of discretion.chanroblesvirtualawlibrarychanrobles virtual law libraryThe crucial issue presented for our resolution is whether the Department Managers, Assistant Managers, BranchManagers/OICs, Cashiers and Controllers of respondent Bank are managerial and/or confidential employees henceineligible to join or assist the union of petitioner.chanroblesvirtualawlibrarychanrobles virtual law library

NATU submits that an analysis of the decision of public respondent readily yields certain flaws that result inerroneous conclusions. Firstly, a branch does not enjoy relative autonomy precisely because it is treated as oneunit with the head office and has to comply with uniform policies and guidelines set by the bank itself. It would beabsurd if each branch of a particular bank would be adopting and implementing different policies coveringmultifarious banking transactions. Moreover, respondent Bank's own evidence clearly shows that policies andguidelines covering the various branches are set by the head office. Secondly, there is absolutely no evidenceshowing that bank policies are laid down through the collective action of the Branch Manager, the Cashier and theController. Thirdly, the organizational setup where the Branch Manager exercises control over branch operations,the Controller controls the Accounting Division, and the Cashier controls the Cash Division, is nothing but a properdelineation of duties and responsibilities. This delineation is a Central Bank prescribed internal control measureintended to objectively establish responsibilities among the officers to easily pinpoint culpability in case of error.The "dual control" and "joint custody" aspects mentioned in the decision of public respondent are likewise internalcontrol measures prescribed by the Central Bank.chanroblesvirtualawlibrarychanrobles virtual law libraryNeither is there evidence showing that subject employees are vested with powers or prerogatives to hire, transfer,suspend, lay off, recall, discharge, assign or discipline employees. The bare allegations in the affidavits ofrespondent Bank's Executive Assistant to the President4and the Senior Manager of the Human Resource

Management Department5

that those powers and prerogatives are inherent in subject positions are self-serving.Their claim cannot be made to prevail upon the actual duties and responsibilities of subjectemployees.chanroblesvirtualawlibrarychanrobles virtual law libraryThe other evidence of respondent Bank which purports to show that subject employees exercise managerialfunctions even belies such claim. Insofar as Department Managers and Assistant Managers are concerned, there isabsolutely no reason mentioned in the decision why they are managerial employees. Not even respondent Bank inits appeal questioned the inclusion of Assistant Managers among the qualified petitioning employees. Publicrespondent has deviated from the real issue in this case, which is, the determination of whether subject employeesare managerial employees within the contemplation of the Labor Code, as amended by RA 6715; instead, hemerely concentrated on the nature, conduct and management of banks conformably with the General Banking Actand the Central Bank Act.chanroblesvirtualawlibrarychanrobles virtual law libraryPetitioner concludes that subject employees are not managerial employees but supervisors. Even assuming thatthey are confidential employees, there is no legal prohibition against confidential employees who are notperforming managerial functions to form and join a union.chanroblesvirtualawlibrarychanrobles virtual law libraryOn the other hand, respondent Bank maintains that the Department Managers, Branch Managers, Cashiers andControllers are inherently possessed of the powers enumerated in Art. 212, par. (m), of the Labor Code. It relies

heavily on the affidavits of its Executive Assistant to the President and Senior Manager of the Human ResourceDepartment. The Branch Managers, Cashiers and Controllers are vested not only with policy-making powersnecessary to run the affairs of the branch, given the independence and relative autonomy which it enjoys in thepursuit of its goals and objectives, but also with the concomitant disciplinary authority over theemployees.chanroblesvirtualawlibrarychanrobles virtual law libraryThe Solicitor General argues that NATU loses sight of the fact that by virtue of the appeal of respondent Bank, thewhole case is thrown open for consideration by public respondent. Even errors not assigned in the appeal, such asthe exclusion by the Med-Arbiter of Assistant Managers from the managerial employees category, is within hisdiscretion to consider as it is closely related to the errors properly assigned. The fact that Department Managersare managerial employees is borne out by the evidence of petitioner itself. Furthermore, while it assails publicrespondent's finding that subject employees are managerial employees, petitioner never questioned the fact that


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said officers also occupy confidential positions and thus remain prohibited from forming or joining any labororganization.chanroblesvirtualawlibrarychanrobles virtual law libraryRespondent Bank has no legal personality to move for the dismissal of the petition for certification election on theground that its supervisory employees are in reality managerial employees. An employer has no standing toquestion the process since this is the sole concern of the workers. The only exception is where the employer itselfhas to file the petition pursuant to Art. 258 of the Labor Code because of a request to bargaincollectively.6chanrobles virtual law libraryPublic respondent, invoking RA 6715 and the inherent functions of Department Managers, Assistant Managers,

Branch Managers, Cashiers and Controllers, held that these officers properly fall within the definition of managerialemployees. The ratiocination in his Decision of 23 March 19907is that -Republic Act No. 6715, otherwise known as the Herrera-Veloso Law, restored the right of supervisors to form theirown unions while maintaining the proscription on the right to self-organization of managerial employees.Accordingly, the Labor Code, as amended, distinguishes managerial, supervisory and rank-and-file employees thus:Art. 212 (m) - Managerial employee is one who is vested with powers or prerogatives to lay down and executemanagement policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or disciplineemployees. Supervisoryemployees are those who, in the interest of the employer, effectively recommend suchmanagerial actions, if the exercise of such managerial authority is not routinary in nature but requires the use ofindependent judgment.All employees notfalling within any of the above definitions are considered rank-and-fileemployees (emphasis supplied).At first glance, pursuant to the above-definitions and based on their job descriptions as guideposts, there wouldseem to be no difficulty in distinguishing a managerial employee from that of a supervisor, or from that of a mererank-and-file employee. Yet, this task takes on a different dimension when applied to banks, particularly thebranches thereof. This is so because unlike ordinary corporations, a bank's organizational operation is governed

and regulated by the General Banking Act and the Central Bank Act, both special laws . . ..chanroblesvirtualawlibrarychanrobles virtual law libraryAs pointed out by the respondent, in the banking industry, a branch is the microcosm of a banking institution,uniquely autonomous andself-governing.chanroblesvirtualawlibrarychanrobles virtual law libraryThis relative autonomy of a branch finds legal basis in Section 27 of the General Banking Act, as amended, thus:. . . . The bank shall be responsible for all business conducted in such branches to the same extent and in the samemanner as though such business had all been conducted in the head office.For the purpose of this Act, a bank and its branches shall be treated as a unit(emphasis supplied).Conformably with the above, bank policies are laid down and/or executed through the collective action of theBranch Manager, Cashier and Controller at the branch level. The Branch Manager exercises over-all control andsupervision over branch operation being on the top of the branch's pyramid structure. However, both the controllerand the cashier who are called in banking parlance as "Financial Managers" due to their fiscal functions are givensuch a share and sphere of responsibility in the operations of the bank. The cashier controls and supervises thecash division while the controller that of the Accounting Division. Likewise, their assigned task is of greatsignificance, without which a bank or branch for that matter cannot operate or

function.chanroblesvirtualawlibrarychanrobles virtual law libraryThrough the collective action of these three branch officers operational transactions are carried out like: The two(2)-signature requirement of the manager, on one hand, and that of the controller or cashier on the other hand asrequired in bank's issuances and releases. This is the so-called "dual control" through check-and-balance asprescribed by the Central Bank, per Section 1166.6, Book I, Manual of Regulations for Banks and FinancialIntermediaries. Another is in the joint custody of the branch's cash in vault, accountable forms, collaterals,documents of title, deposit, ledgers and others, among the branch manager and at least two (2) officers of thebranch as required under Section 1166.6 of the Manual of Regulations for Banks and Other FinancialIntermediaries.chanroblesvirtualawlibrarychanrobles virtual law libraryThis structural set-up creates a triad of managerial authority among the branch manager, cashier and controller.Hence, no officer of the bank ". . . have (sic) complete authority and responsibility for handling all phases of anytransaction from beginning to end without some control or balance from some other part of the organization"(Section 1166.3, Division of Duties and Responsibilities,Ibid). This aspect in the banking system which calls for thedivision of duties and responsibilities is a clear manifestation of managerial power and authority. No operationaltransaction at branch level is carried out by the singular act of the Branch Manager but rather through thecollective act of the Branch Manager, Cashier/Controller (emphasis supplied).chanroblesvirtualawlibrarychanrobles

virtual law libraryNoteworthy is the "on call client" set up in banks. Under this scheme, the branch manager is tasked with theresponsibility of business development and marketing of the bank's services which place him on client call. Duringsuch usual physical absences from the branch, the cashier assumes the reins of branch control and administration.On those occasions, the "dual control system" is clearly manifest in the transactions and operations of the branchbank as it will then require the necessary joint action of the controller and the cashier.The grave abuse of discretion committed by public respondent is at once apparent. Art. 212, par. (m), of the LaborCode is explicit. A managerial employee is (a) one who is vested with powers or prerogatives to lay down andexecute management policies, or to hire, transfer, suspend, lay off, recall, discharge, assign or disciplineemployees; or (b) one who is vested with both powers or prerogatives. A supervisory employee is different from amanagerial employee in the sense that the supervisory employee, in the interest of the employer, effectively


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recommendssuch managerial actions, if the exercise of such managerial authority is not routinary in nature butrequires the use of independent judgment.chanroblesvirtualawlibrarychanrobles virtual law libraryRanged against these definitions and after a thorough examination of the evidence submitted by both parties, wearrive at a contrary conclusion. Branch Managers, Cashiers and Controllers of respondent Bank are not managerialemployees but supervisory employees. The finding of public respondent that bank policies are laid down and/orexecuted through the collective action of these employees is simply erroneous. His discussion on the division oftheir duties and responsibilities does not logically lead to the conclusion that they are managerial employees, asthe term is defined in Art. 212, par. (m).chanroblesvirtualawlibrarychanrobles virtual law library

Among the general duties and responsibilities of a Branch Manager is "[t]o discharge his duties and authority witha high sense of responsibility and integrity and shall at all times be guided by prudence like a good father of thefamily, and sound judgment in accordance with and within the limitations of the policy/policies promulgated by theBoard of Directors and implemented by the Managementuntil suspended, superseded, revoked or modified" (par.5, emphasis supplied).8Similarly, the job summary of a Controller states: "Supervises the Accounting Unit of thebranch; sees to the compliance by the Branch with established procedures, policies, rules and regulations of theBank and external supervising authorities; sees to the strict implementation of control procedures (emphasissupplied).9The job description of a Cashier does not mention any authority on his part to lay down policies,either. 10On the basis of the foregoing evidence, it is clear that subject employees do not participate in policy-making but are given approved and established policies to execute and standard practices to observe,11leavinglittle or no discretion at all whether to implement said policies or not.12It is the nature of the employee's functions,and not the nomenclature or title given to his job, which determines whether he has rank-and-file, supervisory ormanagerial status.13chanrobles virtual law libraryMoreover, the bare statement in the affidavit of the Executive Assistant to the President of respondent Bank thatthe Branch Managers, Cashiers and Controllers "formulate and implement the plans, policies and marketing

strategies of the branch towards the successful accomplishment of its profit targets and objectives," 14iscontradicted by the following evidence submitted by respondent Bank itself:(a) Memorandum issued by respondent Bank's Assistant Vice President to all Regional Managers and BranchManagers giving them temporary discretionary authority to grant additional interest over the prescribed boardrates for both short-term and long-term CTDs subject, however, to specific limitations and guidelines set forth inthe same memorandum;15(b) Memorandum issued by respondent Bank's Executive Vice President to all Regional Managers and BranchOfficers regarding the policy and guidelines on drawing against uncollected deposits (DAUD);16(c) Memorandum issued by respondent Bank's President to all Field Offices regarding the guidelines on domesticbills purchased(DBP);17andchanrobles virtual law library(d) Memorandum issued by the same officer to all Branch Managers regarding lending authority at the branch leveland the terms and conditions thereof.18chanrobles virtual law libraryAs a consequence, the affidavit of the Executive Assistant cannot be given any weight atall.chanroblesvirtualawlibrarychanrobles virtual law libraryNeither do the Branch Managers, Cashiers and Controllers have the power to hire, transfer, suspend, lay off, recall,

discharge, assign or discipline employees. The Senior Manager of the Human Resource Management Department ofrespondent Bank, in her affidavit, stated that "the power to hire, fire, suspend, transfer, assign or otherwiseimpose discipline among subordinates within their respective jurisdictions is lodged with the heads of the variousdepartments, the branch managers and officers-in-charge, the branch cashiers and the branch controllers. Inherentas it is in the aforementioned positions, the authority to hire, fire, suspend, transfer, assign or otherwise disciplineemployees within their respective domains was deemed unnecessary to be incorporated in their individual jobdescriptions; By way of illustration, on August 24, 1989, Mr. Renato A. Tuates, the Officer-in-Charge/BranchCashier of the Bank's Dumaguete Branch, placed under preventive suspension and thereafter terminated the tellerof the same branch . . . . Likewise, on February 22, 1989, Mr. Francis D. Robite, Sr., the Officer-in-Charge ofInternational Department, assigned the cable assistant of the International Department as the concurrent FCDUAccountable Forms Custodian."19chanrobles virtual law libraryHowever, a close scrutiny of the memorandum of Mr. Tuates reveals that he does not have said managerial powerbecause as plainly stated therein, it was issued "upon instruction from Head Office." 20With regard to thememorandum of Mr. Robite, Sr., it appears that the power he exercised was merely in an isolated instance, takinginto account the other evidence submitted by respondent Bank itself showing lack of said power by other BranchManagers/OICs:

(a) Memorandum from the Branch Manager for theAVP-Manpower Management Department expressing the opinion that a certain employee, due to habitualabsenteeism and tardiness, must be penalized in accordance with respondent Bank's Code of Discipline;andchanrobles virtual law library(b) Memorandum from a Branch OIC for the Assistant Vice President recommending a certain employee'spromotional adjustment to the present position he occupies.Clearly, those officials or employees possess only recommendatory powers subject to evaluation, review and finalaction by higher officials. Therefore, the foregoing affidavit cannot bolster the stand of respondentBank.chanroblesvirtualawlibrarychanrobles virtual law libraryThe positions of Department Managers and Assistant Managers were also declared by public respondent asmanagerial, without providing any basis therefor. Petitioner asserts that the position of Assistant Manager was not


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even included in the appeal filed by respondent Bank. While we agree with the Office of the Solicitor General that itis within the discretion of public respondent to consider an unassigned issue that is closely related to an issueproperly assigned, still, public respondent's error lies in the fact that his finding has no leg to stand on. Anyway,inasmuch as the entire records are before us, now is the opportunity to discuss thisissue.chanroblesvirtualawlibrarychanrobles virtual law libraryWe analyzed the evidence submitted by respondent Bank in support of its claim that Department Managers aremanagerial employees 21and concluded that they are not. Like Branch Managers, Cashiers and Controllers,Department Managers do not possess the power to lay down policies nor to hire, transfer, suspend, lay off, recall,

discharge, assign or discipline employees. They occupy supervisory positions, charged with the duty among othersto "recommend proposals to improve and streamline operations."22With respect to Assistant Managers, there isabsolutely no evidence submitted to substantiate public respondent's finding that they are managerial employees;understandably so, because this position is not included in the appeal of respondentBank.chanroblesvirtualawlibrarychanrobles virtual law libraryAs regards the other claim of respondent Bank that Branch Managers/OICs, Cashiers and Controllers areconfidential employees, having control, custody and/or access to confidential matters, e.g., the branch's cashposition, statements of financial condition, vault combination, cash codes for telegraphic transfers, demand draftsand other negotiable instruments, 23pursuant to Sec. 1166.4 of the Central Bank Manual regarding jointcustody, 24this claim is not even disputed by petitioner. A confidential employee is one entrusted with confidenceon delicate matters, or with the custody, handling, or care and protection of the employer's property. 25While Art.245 of the Labor Code singles out managerial employees as ineligible to join, assist or form any labor organization,under the doctrine of necessary implication, confidential employees are similarly disqualified. This doctrine statesthat what is implied in a statute is as much a part thereof as that which is expressed, as elucidated in severalcases26the latest of which is Chua v. Civil Service Commission27where we said:

No statute can be enacted that can provide all the details involved in its application. There is always an omissionthat may not meet a particular situation. What is thought, at the time of enactment, to be an all-embracinglegislation may be inadequate to provide for the unfolding events of the future. So-called gaps in the law developas the law is enforced. One of the rules of statutory construction used to fill in the gap is the doctrine of necessaryimplication . . . . Every statute is understood, by implication, to contain all such provisions as may be necessary toeffectuate its object and purpose, or to make effective rights, powers, privileges or jurisdiction which it grants,including all such collateral and subsidiary consequences as may be fairly and logically inferred from its terms. Exnecessitatelegis. . . .In applying the doctrine of necessary implication, we took into consideration the rationale behind thedisqualification of managerial employees expressed in Bulletin Publishing Corporation v. Sanchez,28thus: ". . . ifthese managerial employees would belong to or be affiliated with a Union, the latter might not be assured of theirloyalty to the Union in view of evident conflict of interests. The Union can also become company-dominated withthe presence of managerial employees in Union membership." Stated differently, in the collective bargainingprocess, managerial employees are supposed to be on the side of the employer, to act as its representatives, andto see to it that its interests are well protected. The employer is not assured of such protection if these employees

themselves are union members. Collective bargaining in such a situation can become one-sided.29

It is the samereason that impelled this Court to consider the position of confidential employees as included in the disqualificationfound in Art. 245 as if the disqualification of confidential employees were written in the provision. If confidentialemployees could unionize in order to bargain for advantages for themselves, then they could be governed by theirown motives rather than the interest of the employers. Moreover, unionization of confidential employees for thepurpose of collective bargaining would mean the extension of the law to persons or individuals who are supposed toact "in the interest of" the employers. 30It is not farfetched that in the course of collective bargaining, they might

jeopardize that interest which they are duty-bound to protect. Along the same line of reasoning we held in GoldenFarms, Inc. v. Ferrer-Calleja31reiterated inPhilips Industrial Development, Inc. v. NLRC,32that "confidentialemployees such as accounting personnel, radio and telegraph operators who, having access to confidentialinformation, may become the source of undue advantage. Said employee(s) may act as spy or spies of either partyto a collective bargaining agreement."chanrobles virtual law libraryIn fine, only the Branch Managers/OICs, Cashiers and Controllers of respondent Bank, being confidentialemployees, are disqualified from joining or assisting petitioner Union, or joining, assisting or forming any otherlabor organization. But this ruling should be understood to apply only to the present case based on the evidence ofthe parties, as well as to those similarly situated. It should not be understood in any way to apply to banks in

general.chanroblesvirtualawlibrarychanrobles virtual law libraryWHEREFORE, the petition is partially GRANTED. The decision of public respondent Secretary of Labor dated 23March 1990 and his order dated 20 April 1990 are MODIFIED, hereby declaring that only the BranchManagers/OICs, Cashiers and Controllers of respondent Republic Planters Bank are ineligible to join or assistpetitioner National Association of Trade Unions (NATU)-Republic Planters Bank Supervisors Chapter, or join, assistor form any other labor organization.chanroblesvirtualawlibrarychanrobles virtual law librarySO ORDERED.Davide, Jr., Quiason and Kapunan, JJ., concur.

SMC Supervisors and Exempt Union vs Hon Laguesma

G.R. No. 110399 August 15, 1997


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SAN MIGUEL CORPORATION SUPERVISORS AND EXEMPT UNION vs.

HONORABLE BIENVENIDO E. LAGUESMA

FACTS:

Petitioner union filed before the Department of Labor and Employment (DOLE) a Petition for Direct Certification or Certificat ion

Election among the supervisors and exempt employees of the SMC Magnolia Poultry Products Plants of Cabuyao, San Fernando

and Otis. Med-Arbiter Danilo L. Reynante issued an Order for the conduct of certification election among the supervisors and

exempt employees of the SMC Magnolia Poultry Products Plants of Cabuyao, San Fernando and Otis as one bargaining unit.

Respondent San Miguel Corporation opposed arguing that the Med-Arbiters committed an error in grouping together all three

separate plants into one bargaining unit, and in including supervisory levels 3 and above whose positions are confidential in nature.

The public respondent citing the doctrine enunciated in Philips Industrial Development, Inc.v.NLRCissued an 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.

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. If they are not confidential employees, do the employees of the three plants constitute an appropriate single bargaining unit?

HELD:

1. NO. Supervisory employees 3 and 4 and the exempt employees of the company do not fall within the term confidential

employees who may be prohibited from joining a union.

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 relat ions.

An important element of the confidential employee rule is the employees need to use labor relations information. Thus

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