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Juat v. CIR

This is a petition for certiorari to review the decision dated August 15, 1962 and the resolution en banc dated October 30, 1962, of the Court of Industrial Relations in its Case No. 2889-ULP.

After investigating charges of unfair labor practice filed by petitioner Santos Juat before the Court ofIndustrial Relations against respondents Bulaklak Publications and its Executive Officer, ActingProsecutor Alberto Cruz of the Court of Industrial Relations filed a complaint, docketed as Case No.2889-ULP, charging Bulaklak Publications and/or Juan N. Evangelista of unfair labor practice withinthe meaning of Section 4 (a) subsections 1, 4 and 5 of Republic Act 875, alleging, among others,that complainant Santos Juat was an employee of the respondent company since August 1953; thaton or about July 15, 1960, and on several occasions thereafter, complainant Santos Juat was askedby his respondent employer to join the Busocope Labor Union, but he refused to do so; thatrespondent employer suspended him without justifiable cause; that two separate cases were filed bycomplainant against the respondents one on March 13, 1961 for unfair labor practice, andanother on March 18, 1961 for payment of wages for overtime work and work on Sundays andholidays, the filing of which cases had come to the knowledge of the respondents; that on March 15,1961, respondent employer dismissed him from the service without justifiable cause and that fromthe time of his dismissal up to the filing of the complaint he had not found any substantialemployment for himself.

In their answer, dated August 3, 1961, respondent alleged, among others, that complainant SantosJuat was suspended for cause; that while Case No. 1462-V was filed with the Court of IndustrialRelations on March 13, 1961, the same came to the knowledge of respondents only when theyreceived the summons and a copy of the petition on March 24, 1961, and while case No. 2789-ULPwas filed on April 3, 1961, the same became known to respondents long after the employer-employee relationship between respondent employer and Santos Juat had been terminated, so thatthe suspension of the complainant on March 1, 1961 and his subsequent separation from the servicewere not acts of reprisal because of the filing of those two cases; that it was complainant Juat whohad caused his separation when he ignored the letter sent to him by Juan N. Evangelista, executiveofficer of respondent company, requiring him to report for work; that the principal reason why

complainant refused to work with respondent company was because he was occupied with his workin the Juat Printing Press Co. of which he was a stockholder and the treasurer. Respondentcompany thereby made a counterclaim for damages because of complainant's having filed anunwarranted and malicious action against it.

On August 15, 1962, after hearing, Associate Judge Baltazar N. Villanueva of the Court of IndustrialRelations rendered a decision dismissing the complaint but made no pronouncement regardingrespondent's counterclaim.

Petitioner filed a motion for reconsideration of the decision, and in a resolution dated October 30,1962, the Court of Industrial Relations en banc denied the motion for reconsideration. Hence, thispetition for certiorari to review said decision and resolution.

The facts of this case may best be gathered from the findings and conclusions of the Court ofIndustrial Relations in its decision, as follows:

On December 1, 1959, a collective bargaining agreement was entered into between theBulaklak Publications and the BUSOCOPE LABOR UNION, to remain in effect for 3 years,and renewable for another term of 3 years. Section 4 of said agreement contains a closedshop proviso. On December 27, 1960, said Section 4 of said agreement was amended toread as follows:

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"All employees and/or workers who on January 1, 1960 are members of the Union ingood standing in accordance with its Constitution and By-Laws and all members whobecome members after that date shall, as a condition of employment, maintain theirmembership in the Union for the duration of this Agreement. All employees and/orworkers who on January 1, 1961 are not yet members of the Union shall, as acondition of maintaining their employment, become members of such union."

It is clear that it was by virtue of the above-mentioned closed shop provision of the collectivebargaining agreement between the Busocope Labor Union and the Bulaklak Publicationsthat the management of the latter required Santos Juat to become a member of the former.In requiring Santos Juat to become a member of said Union, it was only obeying the lawbetween the parties, which is their collective bargaining agreement.

Because of the refusal of Santos Juat to become a member of said Union, Mr. Juan N.Evangelists, the executive officer of respondent company, suspended him for 15 days. Afterthe expiration of the suspension of Santos Juat, Mr. Evangelista addressed a letter to theformer, ordering him to report back for duty, and in spite of said letter, Santos Juat did notreport for work, consequently, Santos Juat was dropped from the service of the company.Juat could afford not to report for duty because he has his own business by the name ofJUAT PRINTING PRESS CO., INC. The refusal of Santos Juat to become a member of theBusocope Labor Union as well as his refusal to report for work when ordered by his superiorofficer, shows the lack of respect on the part of Santos Juat toward his superior officer. Withsuch attitude, the continuation in the service of the company of Santos Juat is indeed inimicalto the interest of his employer.

The charge of complainant to the effect that on March 13, 1961, he filed a petition with thisCourt against respondent company which was docketed as Case No. 1462-V is of nomoment, because according to the decision of the Supreme Court in Case G.R. No. L-11745, Royal Interocean Lines, et al. vs. Hon. Court of Industrial Relations, et al. ,Promulgated October 31, 1960, it was held that an employee's having filed charges orhaving given testimony or being about to give testimony has no relation to union activities.

With respect to Case No. 2789-ULP, Mr. Evangelista stated that he did not know anythingabout its having been filed in Court.

It is now contended by the petitioner before this Court that:

1. The Court of Industrial Relations erred, or committed a grave abuse of discretion, when itapplied to the petitioner the collective bargaining agreement with closed shop provisobetween the respondent Bulaklak Publications and the Busocope Labor Union, he being anold employee;

2. The Court of Industrial Relations erred, or committed a grave abuse of discretion, inholding that the respondent Bulaklak Publications did not commit unfair labor practice when it

dismissed petitioner for his refusal to join the Busocope Labor Union; and

3. The Court of Industrial Relations committed a grave abuse of discretion when it dismissedthe complaint of petitioner because its allegations; are not supported by substantialevidence.

The contentions of the petitioner are without merit, The closed-shop proviso in a collectivebargaining agreement between employer and employee is sanctioned by law. The pertinentprovision of the law, in this connection, says:

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Provided , that nothing in this Act or in any Act or statute of the Republic of the Philippinesshall preclude an employer from making an agreement with a labor organization to require asa condition of employment membership therein, if such labor organization is therepresentative of the employees as provided in said section twelve; ... ." (Section 4,subsection [a] par. 4 of Republic Act No. 875, known as the Industrial Peace Act).

The validity of a closed-shop agreement has been upheld by this Court. In one particular case thisCourt held:

There is no need for us to take sides and give reasons because our Congress, in theexercise of its policy-making power, has chosen to approve the closed-shop, when itlegalized in Sec. 4, sub-section (a) paragraph 4 of Republic Act 875 (Magna Charta of Labor)"any agreement of the employer with a labor organization requiring membership in suchorganization as condition of employment," provided such labor organization properlyrepresents the employees (National Labor Union vs. Aguinaldo's Echague, et al., G.R. No. L-7358, May 31, 1955.)

The foregoing pronouncement of this Court had been reiterated in the cases of Tolentino, et al. vs.

Angeles, et al ., G.R. No. L-8150, May 30, 1956; Ang Malayang Manggagawa Ng Ang Tibay Enterprises, et al., vs. Ang Tibay, et al ., G.R. No. L-8259, Dec. 23, 1957; Confederated Sons of Labor vs. Anakan Lumber Co., et al ., G.R. No. L-12503, April 20, 1960; Bacolod-Murcia Milling Co.,et al. vs. National Employees Workers Security Union , 53 O.G. 615.

A closed-shop agreement has been considered as one form of union security whereby only unionmembers can be hired and workers must remain union members as a condition of continuedemployment. The requirement for employees or workers to become members of a union as acondition for employment redounds to the benefit and advantage of said employees because byholding out to loyal members a promise of employment in the closed-shop the union wields groupsolidarity. In fact, it is said that "the closed-shop contract is the most prized achievement ofunionism" (National Labor Union vs. Aguinaldo's-Echague, Inc. et al., supra ).

Coming now to the closed-shop proviso of the collective bargaining agreement between therespondent Bulaklak Publications and the Busocope Labor Union, it is clearly provided that "Allemployees and/or workers who on January 1, 1961 are not yet members of the Union shall, ascondition of maintaining their employment, become members of such Union." The question nowbefore Us is whether the above-quoted proviso of the said collective bargaining agreement appliesto the petitioner Santos Juat. The contention of said petitioner is that the said proviso cannot apply,and should not be applied to him because he is an old employee of the Bulaklak Publications. It isnot disputed that petitioner had been employed with the Bulaklak Publications since 1953, and thecollective bargaining agreement embodying the closed-shop proviso in question was entered intoonly on December 1, 1959 and amended on December 27, 1960. It has been established, however,that said petitioner was not a member of any labor union when that collective bargaining agreementwas entered into, and in fact he had never been a member of any labor union.

This Court had categorically held in the case of Freeman Shirt Manufacturing Co., Inc., et al. vs.Court of Industrial Relations, et al. , G.R. No. L-16561, Jan. 28, 1961, that the closed-shop proviso ofa collective bargaining agreement entered into between an employer and a duly authorized laborunion is applicable not only to the employees or laborers that are employed after the collectivebargaining agreement had been entered into but also to old employees who are not members of anylabor union at the time the said collective bargaining agreement was entered into. In other words, ifan employee or laborer is already a member of a labor union different from the union that enteredinto a collective bargaining agreement with the employer providing for a closed-shop, said employee

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or worker cannot be obliged to become a member of that union which had entered into a collectivebargaining agreement with the employer as a condition for his continued employment. This Court inthat Freeman case made this clear pronouncement:

The closed-shop agreement authorized under Sec. 4 sub-sec. a (4) of the Industrial PeaceAct above-quoted should, however, apply only to persons to be hired or to employees who

are not yet members of any labor organization. It is inapplicable to those already in the service who are members of another union. To hold otherwise, i.e., that the employees in acompany who are members of a minority union may be compelled to disaffiliate from theirunion and join the majority or contracting union, would render nugatory the right of allemployees to self-organization and to form, joint or assist labor organizations of their ownchoosing, a right guaranteed by the Industrial Peace Act (sec. 3, Rep. Act No. 875) as wellas by the Constitution (Art. III, see. 1 [6]).

Section 12 of the Industrial Peace Act, providing that when there is reasonable doubt as towho the employees have chosen as their representative the Industrial Court can order acertification election, would also become useless. For once a union has been certified by thecourt and enters into a collective bargaining agreement with the employer a closed-shopclause applicable to all employees be they union or non-union members, the question ofmajority representation among the members would be closed forever. Certainly, there can nolonger exist any petition for certification election, since eventually the majority or contractingunion will become a perpetual labor union. This alarming result could not have been theintention of Congress. The Industrial Peace Act was enacted precisely for the promotion ofunionism in this country. (Emphasis supplied)

Villar v. Inciong

The facts are as follows:

Petitioners were members of the Amigo Employees Union-PAFLU, a duly registered labororganization which, at the time of the present dispute, was the existing bargaining agent of theemployees in private respondent Amigo Manufacturing, Inc. (hereinafter referred to as Company).The Company and the Amigo Employees Union-PAFLU had a collective bargaining agreementgoverning their labor relations, which agreement was then about to expire on February 28, 1977.Within the last sixty (60) days of the CBA, events transpired giving rise to the present dispute.

On January 5, 1977, upon written authority of at least 30% of the employees in the company,including the petitioners, the Federation of Unions of Rizal (hereinafter referred to as FUR) filed apetition for certification election with the Med-Arbiter's Office, Regional Office No. 4 of the Ministry ofLabor and Employment. The petition was, however, opposed by the Philippine Association of FreeLabor Unions (hereinafter referred to as PAFLU) with whom, as stated earlier, the Amigo EmployeesUnion was at that time affiliated. PAFLU's opposition cited the "Code of Ethics" governing inter-federation disputes among and between members of the Trade Unions Congress of the Philippines

(hereinafter referred to as TUCP). Consequently, the Med-Arbiter indorsed the case to TUCP forappropriate action but before any such action could be taken thereon, the petitioners disauthorizedFUR from continuing the petition for certification election for which reason FUR withdrew the petition.

On February 7, 1977, the same employees who had signed the petition filed by FUR signed a jointresolution reading in toto as follows:

Sama-Samang Kapasiyahan

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1. TUMIWALAG bilang kasaping Unyon ng Philippine Association of Free LaborUnions (PAFLU) at kaalinsabay nito, inaalisan namin ang PAFLU ng kapangyarihanna katawanin kami sa anumang pakikipagkasundo (CBA) sa Pangasiwaan ng amingpinapasukan at kung sila man ay nagkasundo o magkakasundo sa kabila ngpagtitiwalag na ito, ang nasabing kasunduan ay hindi namin pinagtitibay at tahasangaming itinatakwil/tinatanggihan;

2. BINABAWI namin ang aming pahintulot sa Federation of Unions of Rizal (FUR) nakatawanin kami sa Petition for Certification Election (RO4-MED Case No. 743-77)at/o sa sama-samang pakikipagkasundo sa aming patrons;

3. PANATILIHIN na nagsasarili (independent) ang aming samahan, AMIGOEMPLOYEES' UNION, alinsunod sa Artikulo 240 ng Labor Code;

4. MAGHAIN KAAGAD ang aming Unyong nagsasarili, sa pamumuno ng amingpangsamantalang Opisyal na kinatawan, si Ginang DOLORES VILLAR, ng Petitionfor Certification Election sa Department of Labor, para kilalanin ang aming Unyongnagsasarili bilang Tanging kinatawan ng mga manggagawa sa sama-samang

pakikipagkasundo (CBA);

5. BIGYAN ng kopya nito ang bawa't kinauukulan at ang mga kapasiyahang ito aymagkakabisa sa oras na matanggap ng mga kinauukulan ang kani-kanilang sipinito. 1

Immediately thereafter or on February 9, 1977, petitioner Dolores Villar, representing herself to bethe authorized representative of the Amigo Employees Union, filed a petition for certification electionin the Company before Regional Office No. 4, with the Amigo Employees Union as the petitioner.The Amigo Employees Union-PAFLU intervened and moved for the dismissal of the petition forcertification election filed by Dolores Villar, citing as grounds therefor, viz: (a) the petition lacked themandatory requisite of at least 30% of the employees in the bargaining unit; (2) Dolores Villar had nolegal personality to sign the petition since she was not an officer of the union nor is there factual orlegal basis for her claim that she was the authorized representative of the local union; (3) there wasa pending case for the same subject matter filed by the same individuals; (4) the petition was barredby the new CBA concluded on February 15, 1977; (5) there was no valid disaffiliation from PAFLU;and (6) the supporting signatures were procured through false pretenses.

Finding that the petition involved the same parties and causes of action as the case previouslyindorsed to the TUCP, the Med-Arbiter dismiss the petition filed by herein petitioner Villar, whichdismissal is still pending appeal before the Bureau of Labor Relations.

In the meantime, on February 14, 1977, the Amigo Employees Union- PAFLU called a specialmeeting of its general membership. A Resolution was thereby unanimously approved which calledfor the investigation by the PAFLU national president, pursuant to the constitution and by-laws of the

Federation, of all of the petitioners and one Felipe Manlapao, for "continuously maligning, libellingand slandering not only the incumbent officers but even the union itself and the federation;"spreading 'false propaganda' that the union officers were 'merely appointees of the management',and for causing divisiveness in the union.

Pursuant to the Resolution approved by the Amigo Employees Union- PAFLU, the PAFLU, throughits national President, formed a Trial Committee to investigate the local union's charges against thepetitioners for acts of disloyalty inimical to the interest of the local union, as well as directing the TrialCommittee to subpoena the complainants (Amigo Employees Union-PAFLU) and the respondents

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(herein petitioners) for investigation, to conduct the said investigation and to submit its findings andrecommendations for appropriate action.

And on the same date of February 15, 1977, the Amigo Employees Union- PAFLU and the Companyconcluded a new CBA which, besides granting additional benefits to the workers, alsoreincorporated the same provisions of the existing CBA, including the union security clause reading,

to wit:

ARTICLE IIIUNION SECURITY WITH RESPECT TO PRESENT MEMBERS

All members of the UNION as of the signing of this Agreement shall remain membersthereof in good standing. Therefore, any members who shall resign, be expelled, orshall in any manner cease to be a member of the UNION, shall be dismissed fromhis employment upon written request of the UNION to the Company. 2

Subsequently, petitioners were summoned to appear before the PAFLU TrialCommittee for the aforestated investigation of the charges filed against them by the

Amigo Employees Union-PAFLU. Petitioners, however, did not attend but requestedfor a "Bill of Particulars" of the charges, which charges were stated by the Chairmanof the committee as follows:

1. Disaffiliating from PAFLU and affiliating with the Federation of Unions of Rizal(FUR).

2. Filling petition for certification election with the Bureau of Labor Relations anddocketed as Case No. R04-MED-830-77 and authorizing a certain Dolores Villar asyour authorized representative without the official sanction of the mother Federation-PAFLU.

3. Maligning, libelling and slandering the incumbent officers of the union as well as ofthe PAFLU Federation.

4. By spreading false propaganda among members of the Amigo Employees Union-PAFLU that the incumbent union officers are 'merely appointees' of the management.

5. By sowing divisiveness instead of togetherness among members of the AmigoEmployees Union-PAFLU.

6. By conduct unbecoming as members of the Amigo Employees Union- PAFLUwhich is highly prejudicial to the union as well as to the PAFLU Federation.

All these charges were formalized in a resolution of the incumbent officers of theAmigo Employees Union-PAFLU dated February 14, 1977. 3

Not recognizing PAFLU's jurisdiction over their case, petitioners again refused to participate in theinvestigation rescheduled and conducted on March 9, 1979. Instead, petitioners merely appeared tofile their Answer to the charges and moved for a dismissal.

Petitioners contend in their Answer that neither the disaffiliation of the Amigo Employees Union fromPAFLU nor the act of filing the petition for certification election constitute disloyalty as these are in

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the exercise of their constitutional right to self-organization. They further contended that PAFLU waswithout jurisdiction to investigate their case since the charges, being intra-union problems within theAmigo Employees Union-PAFLU, should be conducted pursuant to the provisions of Article XI,Sections 2, 3, 4 and 5 of the local union's constitution and by-laws.

The complainants, all of whom were the then incumbent officers of the Amigo Employees Union-

PAFLU, however, appeared and adduced their evidence supporting the charges against hereinpetitioners.

Based on the findings and recommendations of the PAFLU trial committee, the PAFLU President, onMarch 15, 1977, rendered a decision finding the petitioners guilty of the charges and disposing in thelast paragraph thereof, to wit,

Excepting Felipe Manlapao, the expulsion from the AMIGO EMPLOYEES UNION ofall the other nine (9) respondents, Dionisio Ramos, Recitation Bernus, Dolores Villar,Romeo Dequito, Rolando de Guzman, Anselma Andan, Rita Llagas, BenignoMamaradlo and Orlando Acosta is hereby ordered, and as a consequence theManagement of the employer, AMIGO MANUFACTURING, INC. is hereby requested

to terminate them from their employment in conformity with the security clause in thecollective bargaining agreement. Further, the Trial Committee is directed toinvestigate Felipe Manlapao when he shall have reported back for duty. 4

Petitioners appealed the Decision to the PAFLU, citing the same grounds as before, and in additionthereto, argued that the PAFLU decision cannot legally invoke a CBA which was unratified, notcertified, and entered into without authority from the union general membership, in asking theCompany to terminate them from their employment. The appeal was, likewise, denied by PAFLU in aResolution dated March 28, 1977.

After denying petitioner's appeal, PAFLU on March 28, 1977 sent a letter to the Company stating, towit,

We are furnishing you a copy of our Resolution on the Appeal of the respondent inAdministrative Case No. 2, Series of 1977, Amigo Employees Union-PAFLU vs.Dionisio Ramos, et al.

In view of the denial of their appeal and the Decision of March 15, 1977 havingbecome final and executory we would appreciate full cooperation on your part byimplementing the provision of our CBA on security clause by terminating therespondents concerned from their employment. 5

This was followed by another letter from PAFLU to the Company dated April 25, 1977, reiterating thedemand to terminate the employment of the petitioners pursuant to the security clause of the CBA,with a statement absolving the Company from any liability or damage that may arise from petitioner'stermination.

Acting on PAFLU's demand, the Company informed PAFLU that it will first secure the necessaryclearances to terminate petitioners. By letter dated April 28, 1977, PAFLU requested the Companyto put petitioners under preventive suspension pending the application for said clearances toterminate the petitioners, upon a declaration that petitioners' continued stay within the work premiseswill "result in the threat to the life and limb of the other employees of the company." 6

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Hence, on April 29, 1977, the Company filed the request for clearance to terminate the petitionersbefore the Department of Labor, Regional Office No. 4. The application, docketed as RO4-Case No.7-IV-3549-T, stated as cause therefor, "Demand by the Union Pursuant to the Union SecurityClause," and further, as effectivity date, "Termination-upon issuance of clearance; Suspension-uponreceipt of notice of workers concerned." 7 Petitioners were then informed by memorandum datedApril 29, 1977 that the Company has applied for clearance to terminate them upon demand of

PAFLU, and that each of them were placed under preventive suspension pending the resolution ofthe said applications. The security guard was, likewise, notified to refuse petitioners entry into thework premises. 8

In an earlier development, on April 25, 1977, or five days before petitioners were placed underpreventive suspension, they filed a complaint with application for preliminary injunction before thesame Regional Office No. 4, docketed as RO4-Case No. RD-4-4088-77-T, praying that after duenotice and hearing, "(1) A preliminary injunction be issued forthwith to restrain the respondents fromdoing the act herein complained of, namely: the dismissal of the individual complainants from theiremployment; (2) After due hearing on the merits of the case, an Order be entered denying and/orsetting aside the Decision dated March 15, 1977 and the Resolution dated March 28, 1977, issuedby respondent Onofre P. Guevara, National President of respondent PAFLU; (3) The Appeal of theindividual complainants to the General Membership of the complainant AMIGO EMPLOYEESUNION, dated March 22, 1977, pursuant to Sections 2, 3, 4 & 5, Article XI in relation of Section 1,Article XII of the Union Constitution and By-Laws, be given due course; and (4) Thereafter, the saidpreliminary injunction be made permanent, with costs, and with such further orders/reliefs that are

just and equitable in the premises." 9

In these two cases filed before the Regional Office No. 4, the parties adopted their previouspositions when they were still arguing before the PAFLU trial committee.

On October 14, 1977, Vicente Leogardo, Jr., Officer-in-Charge of Regional Office No. 4, rendered adecision jointly resolving said two cases, the dispositive portion of which states, to wit,

IN VIEW OF THE FOREGOING, judgment is hereby rendered granting theapplication of the Amigo Manufacturing, Inc., for clearance to terminate theemployment of Dolores D. Villar, Dionisio Ramos, Benigno Mamaraldo, OrlandoAcosta, Recitacion Bernus, Anselma Andan, Rolando de Guzman, and Rita Llagas.The application of oppositors, under RO4-Case No. RD-4-4088-77, for a preliminaryinjunction to restrain the Amigo Manufacturing, Inc. from terminating theiremployment and from placing them under preventive suspension, is herebyDISMISSED. 10

Not satisfied with the decision, petitioners appealed to the Office of the Secretary of Labor. By Orderdated February 15, 1979, the respondent Amado G. Inciong, Deputy Minister of Labor, dismissedtheir appeal for lack of merit. 11

Hence, the instant petition for review, raising the following issues:

A. Is it not error in both constitutional and statutory law by the respondent Ministerwhen he affirmed the decision of the RO4-Officer-in-Charge allowing the preventivesuspension and subsequent dismissal of petitioners by reason of the exercise of theirright to freedom of association?

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B. Is it not error in law by the respondent Minister when he upheld the decision of theRO4 OIC which sustained the availment of the respondent PAFLU's constitution overthat of the local union constitution in the settlement of intra-union dispute?

C. Is it not error in law amounting to grave abuse of discretion by the Minister inaffirming the conclusion made by the RO4 OIC, upholding the legal applicability of

the security clause of a CBA over alleged offenses committed earlier than itsconclusion, and within the 60-day freedom period of an old CBA? 12

The main thrust of the petition is the alleged illegality of the dismiss of the petitioners by privaterespondent Company upon demand of PAFLU which invoked the security clause of the collectivebargaining agreement between the Company and the local union, Amigo Employees Union-PAFLU.Petitioners contend that the respondent Deputy Minister acted in grave abuse of discretion when heaffirmed the decision granting the clearance to terminate the petitioners and dismissed petitioners'complaint, and in support thereof, allege that their constitutional right to self-organization had beenimpaired. Petitioner's contention lacks merit.

It is true that disaffiliation from a labor union is not open to legal objection. It is implicit in the freedom

of association ordained by the Constitution.13

But this Court has laid down the ruling that a closedshop is a valid form of union security, and such provision in a collective bargaining agreement is nota restriction of the right of freedom of association guaranteed by the Constitution. 14

In the case at bar, it appears as an undisputed fact that on February 15, 1977, the Company and theAmigo Employees Union-PAFLU entered into a Collective Bargaining Agreement with a unionsecurity clause provided for in Article XII thereof which is a reiteration of the same clause in the oldCBA. The quoted stipulation for closed-shop is clear and unequivocal and it leaves no room fordoubt that the employer is bound, under the collective bargaining agreement, to dismiss theemployees, herein petitioners, for non- union membership. Petitioners became non-union membersupon their expulsion from the general membership of the Amigo Employees Union-PAFLU on March15, 1977 pursuant to the Decision of the PAFLU national president.

We reject petitioners' theory that their expulsion was not valid upon the grounds adverted to earlier inthis Decision. That PAFLU had the authority to investigate petitioners on the charges filed by theirco-employees in the local union and after finding them guilty as charged, to expel them from the rollof membership of the Amigo Employees Union-PAFLU is clear under the constitution of the PAFLUto which the local union was affiliated. And pursuant to the security clause of the new CBA,reiterating the same clause in the old CBA, PAFLU was justified in applying said security clause. Wefind no abuse of discretion on the part of the OIC of Regional Office No. 4 in upholding the validity ofthe expulsion and on the part of the respondent Deputy Minister of Labor in sustaining the same. Weagree with the OIC's decision, pertinent portion of which reads:

Stripped of non-essentials, the basic and fundamental issue in this case tapers downto the determination of WHETHER OR NOT PAFLU HAD THE AUTHORITY TO

INVESTIGATE OPPOSITORS AND, THEREAFTER, EXPEL THEM FROM THEROLL OF MEMBERSHIP OF THE AMIGO EMPLOYEES UNION-PAFLU.

Recognized and salutary is the principle that when a labor union affiliates with amother union, it becomes bound by the laws and regulations of the parentorganization. Thus, the Honorable Secretary of Labor, in the case of Amador Bolivar,et al. vs. PAFLU, et al., NLRC Case No. LR-133 & MC-476, promulgated onDecember 3, 1973, declared-

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When a labor union affiliates with a parent organization or mother union, or accepts acharter from a superior body, it becomes subject to the laws of the superior bodyunder whose authority the local union functions. The constitution, by-laws and rulesof the parent body, together with the charter it issues pursuant thereto to thesubordinate union, constitute an enforceable contract between the parent body andthe subordinate union, and between the members of the subordinate union inter se.

(Citing Labor Unions, Dangel and Shriber, pp. 279-280).

It is undisputable that oppositors were members of the Amigo Employees Union atthe time that said union affiliated with PAFLU; hence, under the afore-quotedprinciple, oppositors are bound by the laws and regulations of PAFLU.

Likewise, it is undeniable that in the investigation of the charges against them,oppositors were accorded 'due process', because in this jurisdiction, the doctrine isdeeply entrenched that the term 'due process' simply means that the parties weregiven the opportunity to be heard. In the instant case, ample and unmistakableevidence exists to show that the oppositors were afforded the opportunity to presenttheir evidence, but they themselves disdained or spurned the said opportunity givento them.

PAFLU, therefore, correctly and legally acted when, pursuant to its Constitution andBy-Laws, it conducted and proceeded with the investigation of the charges againstthe oppositors and found them guilty of acts prejudicial and inimical to the interests ofthe Amigo Employees Union- PAFLU, to wit: that of falsely and maliciouslyslandering the officers of the union; spreading false propaganda among the membersof the Amigo Employees Union-PAFLU; calling the incumbent officers as mereappointees and robots of management; calling the union company-dominated orassisted union; committing acts unbecoming of the members of the union anddestructive of the union and its members.

Inherent in every labor union, or any organization for that matter, is the right of self-preservation. When members of a labor union, therefore, sow the seeds ofdissension and strife within the union; when they seek the disintegration anddestruction of the very union to which they belong, they thereby forfeit their rights toremain as members of the union which they seek to destroy. Prudence and equity,as well as the dictates of law and justice, therefore, compelling mandate the adoptionby the labor union of such corrective and remedial measures in keeping with its lawsand regulations, for its preservation and continued existence; lest by its folly andinaction, the labor union crumble and fall.

Correctly and legally, therefore, the PAFLU acted when, after proper investigationand finding of guilt, it decided to remove the oppositors from the list of members ofthe Amigo Employees Union-PAFLU, and thereafter, recommended to the Amigo

Manufacturing, Inc.; the termination of the employment of the oppositors.15

We see no reason to disturb the same.

The contention of petitioners that the charges against them being intra-union problems, should havebeen investigated in accordance with the constitution and by-laws of the Amigo Employees Union-PAFLU and not of the PAFLU, is not impressed with merit. It is true that under the ImplementingRules and Regulations of the Labor Code, in case of intra-union disputes, redress must first besought within the organization itself in accordance with its constitution and by-laws. However, it has

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been held that this requirement is not absolute but yields to exception under varying circumstances.Thus, in Kapisanan ng mga Manggagawa sa MRR vs. Hernandez , 20 SCRA 109, We held:

In the case at bar, noteworthy is the fact that the complaint was filed against theunion and its incumbent officers, some of whom were members of the board ofdirectors. The constitution and by-laws of the union provide that charges for any

violations thereof shall be filed before the said board. But as explained by the lowercourt, if the complainants had done so the board of directors would in effect be actingas respondent investigator and judge at the same time. To follow the procedureindicated would be a farce under the circumstances, where exhaustion of remedieswithin the union itself would practically amount to a denial of justice or would beillusory or vain, it will not be insisted upon, particularly where property rights of themembers are involved, as a condition to the right to invoke the aid of a court.

The facts of the instant petition stand on all fours with the aforecited case that the principle thereinenunciated applies here as well. In the case at bar, the petitioners were charged by the officers ofthe Amigo Employees Union- PAFLU themselves who were also members of the Board of Directorsof the Amigo Employees Union-PAFLU. Thus, were the petitioners to be charged and investigatedaccording to the local union's constitution, they would have been tried by a trial committee of three(3) elected from among the members of the Board who are themselves the accusers. (Section 2,Article 11, Constitution of the Local Union). Petitioners would be in a far worse position had thisprocedure been followed. Nonetheless, petitioners admit in their petition that two (2) of the six (6)charges, i.e. disaffiliation and filing a petition for certification election, are not intra-union mattersand, therefore, are cognizable by PAFLU.

Petitioners insist that their disaffiliation from PAFLU and filing a petition for certification election arenot acts of disloyalty but an exercise of their right to self-organization. They contend that these actswere done within the 60-day freedom period when questions of representation may freely be raised.Under the peculiar facts of the case, We find petitioners' insistence untenable.

In the first place, had petitioners merely disaffiliated from the. Amigo Employees Union-PAFLU,there could be no legal objections thereto for it was their right to do so. But what petitioners did bythe very clear terms of their "Sama-Samang Kapasiyahan" was to disaffiliate the Amigo EmployeesUnion-PAFLU from PAFLU, an act which they could not have done with any effective consequencebecause they constituted the minority in the Amigo Employees Union-PAFLU.

Extant from the records is the fact that petitioners numbering ten (10), were among the ninety-six(96) who signed the "Sama-Samang Kapasiyahan" whereas there are two hundred thirty four (234)union members in the Amigo Employees Union-PAFLU. Hence, petitioners constituted a smallminority for which reason they could not have successfully disaffiliated the local union from PAFLU.Since only 96 wanted disaffiliation, it can be inferred that the majority wanted the union to remain anaffiliate of PAFLU and this is not denied or disputed by petitioners. The action of the majority must,therefore, prevail over that of the minority members. 16

Neither is there merit to petitioners' contention that they had the right to present representationissues within the 60-day freedom period. It is true, as contended by petitioners, that under Article257 of the Labor Code and Section 3, Rule 2, Book 2 of its Implementing Rules, questions ofexclusive bargaining representation are entertainable within the sixty (60) days prior to the expirydate of an existing CBA, and that they did file a petition for certification election within that period.But the petition was filed in the name of the Amigo Employees Union which had not disaffiliated fromPAFLU, the mother union. Petitioners being a mere minority of the local union may not bind themajority members of the local union.

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Moreover, the Amigo Employees Union, as an independent union , is not duly registered as such withthe Bureau of Labor Relations. The appealed decision of OIC Leogardo of Regional Office No. 4states as a fact that there is no record in the Bureau of Labor Relations that the Amigo EmployeesUnion (Independent) is registered, and this is not disputed by petitioners, notwithstanding theirallegation that the Amigo Employees Union is a duly registered labor organization bearing Ministry ofLabor Registration Certification No. 5290-IP dated March 27, 1967. But the independent union

organized after the "Sama-Samang Kapasiyahan" executed February 7, 1977 could not have beenregistered earlier, much less March 27, 1967 under Registration Certificate No. 5290-IP. As suchunregistered union, it acquires no legal personality and is not entitled to the rights and privilegesgranted by law to legitimate labor organizations upon issuance of the certificate of registration.Article 234 of the New Labor Code specifically provides:

Art. 234. Requirements of Registration .Any applicant labor organization,association, or group of unions or workers shall acquire legal personality and shall beentitled to the rights and privileges granted by law to legitimate labor organizationsupon issuance of the certificate of registration. ....

In Phil. Association of Free Labor Unions vs. Sec. of Labor , 27 SCRA 40, We had occasion tointerpret Section 23 of R.A. No. 875 (Industrial Peace Act) requiring of labor unions registration bythe Department of Labor in order to qualify as "legitimate labor organization," and We said:

The theory to the effect that Section 23 of Republic Act No. 875 unduly curtails thefreedom of assembly and association guaranteed in the Bill of Rights is devoid offactual basis. The registration prescribed in paragraph (b) of said section 17 is not alimitation to the right of assembly or association, which may be exercised with orwithout said registration. The latter is merely a condition sine qua non for theacquisition of legal personality by labor organizations, associations or unions and thepossession of the 'rights and privileges granted by law to legitimate labororganizations.' The Constitution does not guarantee these rights and privileges,much less said personality, which are mere statutory creations, for the possessionand exercise of which registration is required to protect both labor and the public

against abuses, fraud, or impostors who pose as organizers, although not trulyaccredited agents of the union they purport to represent. Such requirement is a validexercise of the police power, because the activities in which labor organizations,associations and union or workers are engaged affect public interest, which shouldbe protected.

Simply put, the Amigo Employees Union (Independent) Which petitioners claim to represent, notbeing a legitimate labor organization, may not validly present representation issues. Therefore, theact of petitioners cannot be considered a legitimate exercise of their right to self-organization.Hence, We affirm and reiterate the rationale explained in Phil Association of Free Labor Unions vs.Sec. of Labor case, supra , in order to protect legitimate labor and at the same time maintaindiscipline and responsibility within its ranks.

The contention of petitioners that the new CBA concluded between Amigo Employees Union-PAFLUand the Company on February 15, 1977 containing the union security clause cannot be invoked asagainst the petitioners for offenses committed earlier than its conclusion, deserves scantconsideration. We find it to be the fact that the union security clause provided in the new CBA merelyreproduced the union security clause provided in the old CBA about to expire. And since petitionerswere expelled from Amigo Employees Union-PAFLU on March 28, 1982 upon denial of their Motionfor Reconsideration of the decision expelling them, the CBA of February 15, 1977 was alreadyapplicable to their case. The "closed-shop provision" in the CBA provides:

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All members of the UNION as of the signing of this Agreement shall remain membersthereof in good standing. Therefore, any members who shall resign, be expelled, orshall in any manner cease to be a member of the UNION, shall be dismissed fromhis employment upon written request of the UNION to the Company. (Art. III)

A closed-shop is a valid form of union security, and a provision therefor in a collective bargaining

agreement is not a restriction of the right of freedom of association guaranteed by the Constitution.(Manalang, et al. vs. Artex Development Co., Inc., et al., L-20432, October 30, 1967, 21 SCRA 561).Where in a closed-shop agreement it is stipulated that union members who cease to be in goodstanding shall immediately be dismissed, such dismissal does not constitute an unfair labor practiceexclusively cognizable by the Court of Industrial Relations. (Seno vs. Mendoza, 21 SCRA 1124).

Finally, We reject petitioners' contention that respondent Minister committed error in law amountingto grave abuse of discretion when he affirmed the conclusion made by the RO4 OIC, upholding thelegal applicability of the security clause of a CBA over alleged offenses committed earlier than itsconclusion and within the 60-day freedom period of an old CBA. In the first place, as We statedearlier, the security clause of the new CBA is a reproduction or reiteration of the same clause in theold CBA. While petitioners were charged for alleged commission of acts of disloyalty inimical to theinterests of the Amigo Employees Union-PAFLU in the Resolution of February 14, 1977 of the AmigoEmployees Union- PAFLU and on February 15, 1977 PAFLU and the Company entered into andconcluded a new collective bargaining agreement, petitioners may not escape the effects of thesecurity clause under either the old CBA or the new CBA by claiming that the old CBA had expiredand that the new CBA cannot be given retroactive enforcement. To do so would be to create a gapduring which no agreement would govern, from the time the old contract expired to the time a newagreement shall have been entered into with the union. As this Court said in Seno vs. Mendoza , 21SCRA 1124, "without any agreement to govern the relations between labor and management in theinterim, the situation would well be productive of confusion and result in breaches of the law byeither party. "

The case of Seno vs. Mendoza, 21 SCRA 1124 mentioned previously needs further citation of thefacts and the opinion of the Court, speaking through Justice Makalintal who later became Chief

Justice, and We quote:

It appears that petitioners other than Januario T. Seno who is their counsel, weremembers of the United Seamen's Union of the Philippines. Pursuant to a letter-request of the Union stating that they 'had ceased to be members in good standing'and citing a closed shop clause in its bargaining agreement with respondent CarlosA. Go Thong & Co., the latter dismissed said petitioners. Through counsel,petitioners requested that they be reinstated to their former positions and paid theirbackwages, otherwise they would picket respondents' offices and vessels. Therequest was denied on the ground that the dismissal was unavoidable under theterms of the collective bargaining agreement. ...

We, therefore, hold and rule that petitioners, although entitled to disaffiliate from their union and forma new organization of their own, must, however, suffer the consequences of their separation fromthe union under the security clause of the CBA

Asia Bed Factory v. Kapok Industries

On June 2, 1953, the petitioner Asia Bed Factory and respondent labor union entered into acollective bargaining agreement which contained, among other things, the following clause:

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XI. PAYMENTS FROM MONTHLY TO DAILY

Employees now paid on a monthly basis shall be paid under this agreement on the dailybasis at rates based on their present compensation plus the additional increase of (P0.30)THIRTY CENTAVOS a day, with the understanding that these employees shall be providedwith work on Sundays at time and one-half; and that in the event that no work on Sundays is

available through no fault of the employee or employees, they shall be entitled to payment ofthe equivalent of their wages as if they had performed referred to that day. The rates ofpayment of these employees above referred to shall be computed in the attached documentmarked as annex "a" and made an integral part of this agreement.

In the event that an employee shall absent himself for no excusable reasons, the Companyshall be entitled to reduce the corresponding wage or wages.

The petitioner faithfully complied with the terms of the above clause until it was forced to suspend itsbusiness on Sundays in obedience to the provisions of Republic Act No. 946, known as the BlueSunday Law, which took effect on September 8, 1953, prohibiting the opening of any commercial,industrial or agricultural enterprise on Sundays. As some of petitioner's employees claimed that

under the terms of their bargaining agreement they were entitled to their Sunday wages even if theydid not work on those days, petitioner filed a petition in the Court of First Instance of Manila for adeclaratory judgment that it ceased to be bound by the above-quoted clause of the collectivebargaining agreement when the Blue Sunday Law went into effect.

Without disputing the facts alleged in the petition, the respondent labor union, by way of answer,filed a motion for a summary judgment declaring that petitioner's employees were entitled to Sundaywages notwithstanding the passage of the Blue Sunday Law.

On the basis of the pleadings thus filed, the lower court rendered judgment holding that, in view ofthe provision of the Blue Sunday Law prohibiting the opening of commercial and industrialestablishments on Sundays, the petitioner was relieved from compliance with its agreement "toprovide its employees with work on Sundays and to pay them for Sundays." Reconsideration of the

judgment having been denied, the respondents appealed directly to this Court on a pure question oflaw.

The question for determination is whether the approval of the Blue Sunday Law relieved petitionerfrom complying with its agreement to pay its laborers Sunday wages since they can not be givenwork on Sundays because of the closure of the petitioner's business on those days as required bysaid law. The lower court answers the question in the affirmative on the ground that the clause inquestion provided for mutual prestations between the contracting parties the petitioner to provideits employees with work on Sundays and pay them for such work and the employees to do the workgiven them on those days and that these prestations became impossible of performance whenthe Blue Sunday Law prohibited the opening of commercial and industrial establishments onSundays.

To this view we are inclined to agree. The bargaining agreement puts the employees on a dailybasis at rates of compensation therein provided, with the express stipulation that work shall beprovided on Sundays and at higher compensation. As the trial court says, payment for Sundays is inreturn for work done. It is true the agreement provides for the payment of wages on Sundays if nowork is made available on those days through no fault of the employees. But the fact is that theagreement does give the employer the right to provide work on Sundays. And it would seem theheight of injustice to deprive the employer of this right without, at the same time, relieving him of theobligation to pay the employees.

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Section 6 of the Blue Sunday Law which says that "it shall be unlawful for any employer to reducethe compensation of any of his employees or laborers by reason of the provisions of this Act" doesnot militate against this view. There is here no attempt on the part of the employer to reduce thecompensation of his employees. It is the law itself which in effect reduces that compensation bydepriving the employees of work on Sundays, thus preventing them from earning the wagesstipulatedin the bargaining agreement.

There is nothing to the contention that to apply the Blue Sunday Law to present agreement wouldinfringe the constitutional prohibition against the impairment of the obligations of contract. The BlueSunday Law is intended for the health, well-being and happiness of the working class and is alegitimate exercise of the police power.

De los Reyes v. Alojado

On or about January 22, 1905, Veronica Alojado received, as a loan, from Benito de los Reyes thatthe sum P67 .60, for the purpose of paying a debt she owed to Olimpia Zaballa. It was agreedbetween Alojado and Reyes that the debtor should remain as a servant in the house and in theservice of her creditor, without any renumeration whatever, until she should find some one who

would furnish her with the said sum where with to repeat the loan. The defendant, Veronica Alojado,afterwards left the house of the plaintiff, on March 12, 1906, without having paid him her debt, nordid she do so at any subsequent date, notwithstanding his demands. The plaintiff, therefore, on the15th of march, 1906, filed suit in the court of the justice of the peace of Santa Rosa, La Laguna,against Veronica Alojado to recover the said sum or, in a contrary case, to compel her to return tohis service. The trial having been had, the justice of the peace, on April 14, 1906, rendered judgmentwhereby he sentenced the defendant to pay to the plaintiff the sum claimed and declared that, incase the debtor should be insolvent, she should be obliged to fulfill the agreement between her andthe plaintiff. The costs of the trial were assessed against the defendant.

The defendant appealed from the said judgment to the Court of First Instance to which the plaintiff,after the case had been docketed by the clerk of court, made a motion on May 4, 1906, requestingthat the appeal interposed by the defendant be disallowed, with the costs of both instances againsther. The grounds alleged in support of this motion. were that the appeal had been filed on the sixthday following that when judgment was rendered in the trial, on April 14th, and that it, therefore, didnot come within the period of the five days prescribed by section 76 of the Code of Civil Procedure,as proven by the certificate issued by the justice of the peace of Santa Rosa. The Court of FirstInstance, however, by order of July 16, 1906, overruled the motion of the plaintiff-appellee, for thereasons therein stated, namely, that the defendant was not notified of the judgment rendered in thecase on April 14th of that year until the 16th of the same month, and the appeal having been filedfour days later, on the 20th, it could having seen that the five days specified by section 76 of theCode of Civil Procedure had not expired. The plaintiff was advised to reproduce his complaint withinten days, in order that due procedure might he had thereupon.

The plaintiff took exception to the aforementioned order and at the same time reproduced the

complaint he had filed in the court of the justice of the peace, in which, after relating to the factshereinbefore stated, added that the defendant, besides the sum above-mentioned, had also receivedfrom the plaintiff, under the same conditions, various small amounts between the dates of January22, 1905, and March 10, 1906, aggregating altogether P11.97, and that they had not been repaid tohim. He therefore asked that judgment be rendered sentencing the defendant to comply with thesaid contract and to pay to the plaintiff the sums referred to, amounting in all to P79.57, and that untilthis amount should have been in paid, the defendant should remain gratuitously in the service ofplaintiff's household, and that she should pay the costs of the trial.

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The defendant, in her written answer of August 15, 1906, to the aforesaid complaint, denied theallegations contained in paragraphs 1 and 2 of the complaint and alleged that, although she had leftthe plaintiff's service, it was because the latter had paid her no sum whatever for the services shehad rendered in his house. The defendant likewise denied the conditions expressed in paragraph 4of the complaint, averring that the effects purchased, to the amount of P11.97, were in thepossession of the plaintiff, who refused to deliver them to her. She therefore asked that she be

absolved from the complaint and that the plaintiff be absolved from the complaint the wages due herfor the services she had rendered.

The case came to trial on October 19, 1906, and, after the production of testimony by both parties,the judge, on November 21st of the same year, rendered judgment absolving the defendant from thecomplain, with the costs against the plaintiff, and sentencing the latter to pay to the former the sumof P2.43, the balance found to exist between the defendant's debt of P79.57 and the wages due herby the plaintiff, which amounted to P82. The plaintiff, on the 6th of December, filed a writtenexception to the judgment aforesaid through the regular channels, and moved for a new trial on theground that the findings of fact set forth in the judgment were manifestly contrary to the weight of theevidence. This motion was overruled on the 17th of the same month, to which exception was takenby the appellant, who afterwards filed the proper bill of exceptions, which was approved, certified,and forwarded to the clerk of this court.

The present suit, initiated in a justice of the peace court and appealed to the Court of First Instanceof La Laguna at a time prior to the enactment of Act No. 1627, which went into effect on July 1,1907, which limited to two instances the procedure to be observed in verbal actions, concerns thecollection of certain sum received as a loan by the defendant from the plaintiff, and of the wagesearned by the former for services rendered as a servant in the said plaintiff's house.

Notwithstanding the denial of the defendant, it is a fact clearly proven, as found in the judgmentappealed from, that the plaintiff did deliver to Hermenegildo de los Santos the sum of P67.60 to paya debt was paid by De los Santos with the knowledge and in behalf of the said defendant who, of herfree will, entered the service of the plaintiff and promised to pay him as soon as she should find themoney wherewith to do so.

The duty to pay the said sum, as well as that of P11.97 delivered to the defendant in small amountsduring the time that she was in the plaintiff's house, is unquestionable, inasmuch as it is a positivedebt demandable of the defendant by her creditor. (Arts. 1754, 1170, Civil Code.) However, thereason alleged by the plaintiff as a basis for the loan is untenable, to wit, that the defendant wasobliged to render service in his house as a servant without remuneration whatever and to remaintherein so long as she had not paid her debt, inasmuch as this condition is contrary to law andmorality. (Art. 1255, Civil Code.)

Domestic services are always to be remunerated, and no agreement may subsist in law in which it isstipulated that any domestic service shall be absolutely gratuitous, unless it be admitted that slaverymay be established in this country through a covenant entered into between the interested parties.

Articles 1583, 1584, and 1585 of the Civil Code prescribe rules governing the hiring of services ofdomestics servants, the conditions of such hire, the term during which the service may rendered andthe wages that accrue to the servant, also the duties of the latter and of the master. The first of thearticles cited provides that a hiring for life by either of the contracting parties is void, and, accordingto the last of three articles just mentioned, besides what is prescribed in the preceding articles withregard to masters and servants, the provisions of special laws and local ordinances shall beobserved.

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During the regime of the former sovereignty, the police regulations governing domestic service, ofthe date of September 9, 1848, were in force, article 19 of which it is ordered that all usuriousconduct toward the servants and employees of every class is prohibited, and the master who, underpretext of an advance of pay or of having paid the debts or the taxes of his servant, shall havesucceeded in retaining the latter in his service at his house, shall be compelled to pay to suchservant all arrears due him and any damages he may have occasioned him, and the master shall

also be fined.

The aforementioned article 1585 of the Civil Code undoubtedly refers to the provisions of theregulations just cited.

When legal regulations prohibit even a usurious contract and all abuses prejudicial to subordinatesand servant, in connection with their salaries and wages, it will be understood at once that thecompact whereby service rendered by a domestic servant in the house of any inhabitant of thiscountry is to be gratuitous, is in all respects reprehensible and censurable; and consequently, thecontention of the plaintiff, that until the defendant shall have paid him her debt she must serve him inhis house gratuitously is absolutely inadmissible.

The trial record discloses no legal reason for the rejection of the findings of fact and of law containedin the judgment appealed from, nor for an allowance of the errors attributed appealed from, nor foran allowance of the errors attributed thereto; on the contrary, the reasons hereinabove stated showthe propriety of the said judgment.

Kaisahan ng mga Manggagawa sa Kahoy sa Pilipinas v. Gotamco Saw Mill

In its petition for a writ of certiorari , the "Kaisahan ng mga Manggagawa sa Kahoy sa Pilipinas"prays, for the reasons therein set forth, that we reverse and vacate the orders of the Court ofIndustrial Relations dated September 23, 1946 (Annex A) and March 28, 1947 (Annex B) and itsresolution of July 11, 1947 (Annex C).

In the order of September 23, 1946, it is recited that the laborers in the main case (case No. 31-V ofthe Court of Industrial Relations) declared a strike on September 10, 1946, "which suspended all thework in the respondent company"; that on September 19, 1946 (presumably after the case had beenbrought to the Court of Industrial Relations) said court informed the parties that the continuation ofthe strike would necessarily prejudice both parties, and that a temporary solution, satisfactory to bothparties, must be found to put an end to it, at the same time, urging both parties to be reasonable intheir attitude towards each other; that ample opportunity was given to both parties to iron out theirdifferences until September 21, 1946, when the court continued the conference at which, amongother things, the leader of the laborers informed the court that, although said laborers were notexactly satisfied with the arrangement, in order to cooperate with the court and with the parties sothat the laborers could return to work and the company resume its operation, they had no objectionto accepting a temporary settlement of P3.50 without meal, as against the proposal of the companyof P2.00 without meal; that after a series of conferences held on September 23, 1946, the date of

the order now under consideration, the labor leader decided to accept a temporary arrangement ofthe wage problem as proposed by management, that is, P2.00 over-all increase without meal to allstriking laborers; that Francisco Cruz, President of the Union, manifested that he would have a hardtime convincing the laborers, but in view of their desire to preserve that harmony which used to existbetween the parties, they were going to accede to this proposition, provided that the managementwould permit the laborers to bring with them home, if available, small pieces of lumber to be utilizedas firewood; that the negotiations culminated in an agreement by which the laborers would return totheir work on Tuesday, September 24, 1946, at 7:00 o'clock in the morning, and the respondentcompany would resume its operation on said date under the following conditions:

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(1) That all the laborers and workingmen will receive an over-all increase of P2.00 daily,without meal, over the wages received by them before the strike;

(2) That the management will permit the laborers to bring with them home, if available, smallpieces of lumber to be utilized as firewood; and

(3) That the foregoing increase and privilege will take effect upon the return of theworkingmen to work until the final determination of the present controversy.

The same order then proceeds as follows:

Finding the above temporary agreement between the parties to be reasonable andadvantageous to both, the court approves the same and orders the striking laborers of therespondent company to return to their work on Tuesday, September 24, 1946 at 7:00 o'clockin the morning, and the respondent company to resume its operation and admit the strikinglaborers. The respondent company is enjoined not to lay-off, suspend or dismiss any laboreraffiliated with the petitioning union, nor suspend the operation of the temporary agreement,and the labor union is enjoined not to stage a walk-out or strike during the pendency of the

hearing.

From the order of March 27, 1947, it appears that on January 7, 1947, the respondent Gotamco SawMill filed with the Court of Industrial relations an urgent motion asking that the petitioning union beheld for contempt of court for having staged a strike during the pendency of the main case "inviolation of the order of this court dated September 23, 1946"; that on January 9, 1947, petitionerfiled an answer with a counter-petition alleging, among other things, that a representative ofpetitioner conferred with respondent regarding certain discriminations obtaining in the respondent'ssaw mill, but instead of entertaining their grievances said respondent in a haughty and arbitrarymanner ordered the stoppage of the work and consequently the workers did then and there stopworking; and in the counter-petition said petitioner asked the respondent be held for contempt forhaving employed four new Chinese laborers during the pendency of the hearing of the main case,without express authority of the court and in violation of section 19 of Commonwealth Act No. 103,as amended. It is also recited in the said order of March 28, 1947, that on that same date, January 9,1947, respondent filed with the court another urgent motion for contempt against the petitioningunion for picketing on the premises of the respondent's saw mill and for grave threats whichprevented the remaining laborers from working.

Upon request of both parties, the court required the presentation of evidence pertinent to theincidents thus raised. Thereafter, the said order of March 28, 1947, was entered, and the courtstated therein the three questions to be determined as follows: first , if there was a violation by thepetitioning union of the order of said court of September 23, 1946, which would warrant thecommencement of contempt proceedings; second , whether the facts and circumstances attendingthe picketing constitute contempt of court; third , whether there was a violation by the respondent ofsection 19 of the Commonwealth Act No. 103, as amended, in taking four Chinese laborers pending

the hearing and without express authority of the court; and fourth , whether the dismissal of MaximinoMillan was with or without just cause.

The court, passing upon these questions, found and held:

(1) That there was a violation of the order of the court dated September 23, 1946, by thepetitioning union and thereby ordered Atty. Pastor T. Reyes, special agent of the court, totake such action as may be warranted in the premises against the person or personsresponsible therefor for contempt:

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(2) That the question of picketing being closely and intimately related to the strike which hadbeen found illegal, did not need to be passed upon, it being imbibed by question No. 1;

(3) That there being no strong and clear proof on the question of respondent having violatedsection 19 of Commonwealth Act No. 103, as amended, respondent was thereby exoneratedfrom any liability in connection with the alleged employment of four Chinamen;

(4) That Maximino Millan being of troublesome nature and unworthy to work among hisfellow laborers, his petition for reinstatement contained in demand No. 5 of the main casewas thereby denied.

The above cited resolution of July 11, 1947, was entered by the Court of Industrial Relations,sitting in banc , and denied reconsideration of its order of March 28, 1947, as requested by thepetitioning union's contention is recited that the provisions of section 19 of Commonwealth Act No.103, as amended, upon which order of September 23, 1946, was based, had not been compliedwith; in other words, that the said order was not issued in conformity with the requisites of saidsection, because, it was said, before its issuance there had been no proper hearing and there wasand there was no express finding by the court that public interest required the return of the striking

workers. The further contention is therein recited that, granting that the order of September 23, 1946,was issued in conformity with said section 19, said provision is unconstitutional for being in violationof the organic proscription of involuntary servitude. Passing upon these contentions, the Court ofIndustrial Relations said:

The order of September 23, 1946, was issued in conformity with the provisions of section 19.Said order was proposed and issued on the basis of the agreement entered into by theparties after the preliminary hearings and conferences. While it is true that the order of theCourt now in question did not make any express finding as to whether public interestrequired the return of the striking workers, it is undeniable, however, that until the numerousincidents arising therefrom since the certification of the dispute promptly, need not be statedin the said order because it is a fact which is borne out by the entire record of the case. If thepetitioner was aggrieved by the terms of the order, it could have objected right then andthere and could have appealed said order within the period prescribed by law, and nor towait after it had become final, definite, and conclusive. The record shows that the petitionerin its answer answer and counter-petition for contempt based its complaint upon section 19(incidental Case No. 31-V [4]). It is, indeed, strange that after taking advantage of this orderand enjoyed (enjoying) the benefits thereunder, the petitioner now comes to impugn andchallenge the validity. The second motion for reconsideration is the sad instance where thepetitioner attacks the validity of an order under which it once took shelter.

The court believes that section 19 is constitutional. To start with, this section is presumed tobe constitutional. Several laws promulgated which apparently infringe the human rights ofindividuals were "subjected to regulation by the State basically in the exercise of itsparamount police power". The provisions of Act No. 103 were inspired by the constitutional

injunction making it the concern of the State to promote social justice to insure the well beingand economic security of all the people. In order to attain this object, section 19 waspromulgated which grants to labor what it grants to capital and denies to labor what it deniesto capital. Section 19 complements the power of the Court to settle industrial disputes andrenders effective such powers which are conferred upon it by the different provisions of theCourt's organic law, more particularly, sections 1 and 4, and "other plenary powers conferredupon the Court to enable it to settle all questions matters, controversies or disputes arisingbetween, and/or affecting employers and employees", "to prevent non-pacific methods in thedetermination of industrial or agricultural disputes" (International HardWood and Venser

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Co. vs The Pangil Federation of Laborers, G.R. No. 47178, cited in the case of MindanaoBus Co. vs . Mindanao Bus Co. Employees' Association, 40 Off. Gaz., 115). Section 4 hasbeen upheld in the case aforecited. It appearing that the power of this Court to execute itsorders under section 19 is also the same power it possesses under section 4 of the sameact, it inferentially follows that section 19 is likewise valid. (Manila Trading and Supply Co. vs .Philippine Labor Union, G.R. No. 47796.)

In Manila Trading and Supply Company vs . Philippine Labor Union, supra , this Court said:

In the first place, the ultimate effect of petitioner's theory is to concede to the Court ofIndustrial Relations the power to decide a case under section 19 but deny it, the power toexecute its decision thereon. The absurdity of this proposition, is too evident to requireargument. In the second place considering that the jurisdiction of the Court of IndustrialRelations under section 19 is merely incidental to the same jurisdiction it has previouslyacquired under section 4 of the law, if follows that the power to execute its orders undersection 19 is also the same power that it possesses under section 4. (40 Off. Gaz., [14thSupp.], No. 23, p. 178.)

Among the powers thus conferred is that to punish a violation of an order such as those now underconsideration as for contempt of court.

We agree with the Court of Industrial Relations that section 19 of Commonwealth Act No. 103 isconstitutional. It does not offend against the constitutional inhibition prescribing involuntary servitude.An employee entering into a contract of employment said law went into effect, voluntarily accepts,among other conditions, those prescribed in said section 19, among which is the "implied conditionthat when any dispute between the employer or landlord and the employee, tenant or laborer hasbeen submitted to the Court of Industrial Relations for settlement or arbitration, pursuant to theprovisions of this Act, and pending award or decision by it, the employee, tenant or laborer shall notstrike or walk out of his employment when so joined by the court after hearing and when publicinterest so requires, and if he has already done so, that he shall forthwith return to it, upon order ofthe court, which shall be issued only after hearing when public interest so requires or when the dispute can not, in its opinion, be promptly decided or settled ...". (Emphasis supplied.)The voluntariness of the employee's entering into such a contract of employment he has a freechoice between entering into it or not with such an implied condition, negatives the possibility ofinvoluntary servitude ensuing. The resolution of July 11, 1947, states that the order of September23, 1946, was issued after a series of preliminary hearings or conferences, and we are satisfied thatthese were "hearings" within the meaning of the above mentioned section 19 of the law. The recordcertainly reveals that what was done during and what resulted from said preliminary hearings orconferences were reported to the court at a formal hearing . As to public interest requiring that thecourt enjoin the strike or walk out, or the return of striking laborers, aside from the legal presumptionthat the Court of Industrial Relations complied with the provisions of the law in this respect, we thinkthat, considering the universally known fact, of which this Court takes judicial notice, that as a resultof the destructions wrought by the late war, the economic and social rehabilitation of the countryurgently demands the reconstruction work will inevitably tend to paralyze, impede or slow down thecountry's program of rehabilitation which, for obvious and natural reasons, the government is strivingto accelerate as much as is humanly possible.

Besides, the order of the court was for the striking workers to return to their work. And that order wasmade after hearing, and, moreover, section 19 of Commonwealth Act No. 103, in providing for anorder of the court fro the return of striking workers, authorizes such order, among other cases, "whenthe dispute can not, in its opinion, be promptly decided or settled". The provision says: "... and if hehas already done so (struck or walked out),that he shall forthwith return to it, upon order of the court,

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which shall be issued only after hearing when public interest so requires or when the dispute cannot,in its opinion, be promptly decided or settled, (emphasis supplied). In other words the order to return,if the dispute can be promptly decided or settled, may be issued "only after hearing when publicinterest so requires", but if in the court's opinion the dispute can not be promptly decided or settled,then it is also authorized after hearing to issue the order: we construe the provision to mean that thevery impossibility of prompt decision or settlement of the dispute confers upon the court the power to

issue the order for the reason that the public has an interest in preventing undue stoppage orparalyzation of the wheels of industry. And, as well stated by the court's resolution of July 11, 1947,this impossibility of prompt decision or settlement was a fact which was borne out by the entirerecord of the case and did not need express statement in the order.

Finally, this Court is not authorized to review the findings of fact made by the Court of IndustrialRelations (Commonwealth Act No. 103, section 15, as amended by Commonwealth Act 559, section2; Rule 44, Rules of Court; National Labor Union vs . Phil. Match Co., 40 Off. Gaz. 8th Supp. p. 134,Bardwell Brothers vs . Phil. Labor Union, 39 Off. Gaz. 1032; Pasumil Workers' Union vs . Court ofIndustrial Relations, 40 Off. Gaz. 6th Supp., p. 71).

However, Mr. Justice Briones thinks that we should expressly reserve our opinion on theconstitutionality of the above statutory and reglementary provisions should it, in the future, becomenecessary to decide it.

PAGKAKAISA NG MGA MANGGAGAWA SA TRIUMPH INTERNATIONAL-UNITED LUMBERAND GENERAL WORKERS OF THE PHILIPPINES v. Calleja

Once again we uphold the existing law which encourages one union, one company policy in thispetition for certiorari with prayer for preliminary injunction, The petitioner assails the resolutions of thepublic respondent dated August 24, 1988 and October 28, 1988 both ordering the holding of acertification election among certain monthly-paid employees of Triumph International Philippines,Inc. (Triumph International for brevity).

The petitioner is the recognized collective bargaining agent of the rank-and-file employees ofTriumph International with which the latter has a valid and existing collective bargaining agreementeffective up to September 24, 1989.

On November 25, 1987, a petition for certification election was filed by the respondent union with theDepartment of Labor and Employment.

On January 30, 1988, a motion to dismiss the petition for certification election was filed by TriumphInternational on the grounds that the respondent union cannot lawfully represent managerialemployees and that the petition cannot prosper by virtue of the contract-bar rule. On the samegrounds, the petitioner, as intervenor, filed its opposition to the petition oil February 18, 1988.

On April 13, 1988, the Labor Arbiter issued an order granting the petition for certification election anddirecting the holding of a certification election to determine the sole and exclusive bargainingrepresentative of all monthly-paid administrative, technical, confidential and supervisory employeesof Triumph International.

On appeal, the public respondent on August 24, 1988 affirmed the Labor Arbiter's order with certainmodifications as follows:

WHEREFORE, premises considered, the order appealed from is hereby affirmedsubject to the modification in that the subject employees sought to be represented by

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the petitioner union are given the option whether to join the existing bargaining unitcomposed of daily paid rank-and-file employees. If they opt to join, the pertinentprovision of the existing CBA should be amended so as to include them in itscoverage. ( Rollo , p. 19)

On September 5, 1988, Triumph International filed a motion for reconsideration which was denied by

the public respondent in a resolution dated October 28, 1988.

The sole issue presented by the petitioner in the instant case is whether or not the public respondentgravely abused its discretion in ordering the immediate holding of a certification election among theworkers sought to be represented by the respondent union.

The petitioner argues that the members of respondent union and managerial employees who areexpressly excluded from joining, assisting or forming any labor organization under Art. 245 of theLabor Code.

In the determination of whether or not the members of respondent union are managerial employees,we accord due respect and, therefore, sustain the findings of fact made by the public respondent

pursuant to the time-honored rule that findings of fact of quasi-judicial agencies like the Bureau ofLabor Relations which are supported by substantial evidence are binding on us and entitled to greatrespect considering their expertise in their respective fields. ( see Phil. Airlines Employees Asso.(PALEA) v. Ferrer-Calleja, 162 SCRA 426 [1988]; Producers Bank of the Philippines v. NationalLabor Relations Commission, G.R. No. 76001, September 5, 1988; Salvador Lacorte v. Hon. AmadoG. Inciong, et al., G.R. No. 52034, September 27, 1988: Johnson and Johnson Labor Union-FFW etal. v. Director cf. Labor Relations, G.R. No. 76427, February 21, 1989; Teofila Arica, et al. v.National Labor Relations Commission, et al., G.R. No. 78210, February 28, 1989; A.M. Oreta & Co.Inc. v. National Labor Relations Commission, G.R. No. 74004, August 10, 1989). According to theMed-Arbiter, while the functions, and we may add, the titles of the personnel sought to be organizedappear on paper to involve an apparent exercise of managerial authority, the fact remains that noneof them discharge said functions. The petitioner has failed to show reversible error insofar as thisfinding is concerned.

In ruling that the members of respondent union are rank and file and not managerial employees, thepublic respondent made the following findings:

. . . (1) They do not have the power to lay down and execute management policies asthey are given ready policies merely to execute and standard practices to observe; 2)they do not have the power to hire, transfer, suspend, lay-off, recall, discharge,assign or discipline employees but only to recommend for such actions as the powerrests upon the personnel manager; and 3) they do not have the power to effectivelyrecommend any managerial actions as their recommendations have to pass throughthe department manager for review, the personnel manager for attestation andgeneral manager/president for final actions. . . . (At pp. 17-18, Rollo )

The petitioner further argues that while it has recognized those signatories and employeesoccupying the positions of Assistant Manager, Section Chief, Head Supervisor and Supervisor asmanagerial employees under the existing collective bargaining agreement, in the event that they aredeclared as rank-and-file employees in the present case they are not precluded from joining andthey should join the petitioner.

We find the aforesaid contention of the petitioner meritorious in the absence of a showing that thereare compelling reasons such as the denial of the right to join the petitioner which is the certified

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bargaining unit to the members of respondent union or that there are substantial distinctionswarranting the recognition of a separate group of rank-and-file employees even as there is anexisting bargaining agent for rank and file employees.

Thus, the right of supervisory employees to organize under the Industrial Peace Act is once morerecognized under the present amendments to the Labor Code. ( see Adamson & Adamson Inc., v.

The Court of Industrial Relations, 127 SCRA 268 [1984]). In the absence of any grave abuse ofdiscretion on the part of the public respondent as to the status of the members of the respondentunion, we adopt its findings that the employees sought to be represented by the respondent unionare rank-and-file employees.

There is no evidence in the records which sufficiently distinguishes and clearly separates the groupof employees sought to be represented by the private respondents into managerial and supervisoryon one hand or supervisory and rank-and-file on the other. The respondents' pleadings do not showthe distinctions in functions and responsibilities which differentiate the managers from thesupervisors and sets apart the rank-and-file from either the managerial or supervisory groups. As amatter of fact, the formation of a supervisor's union was never before the Labor Arbiter and theBureau of Labor Relations and neither is the issue before us. We, therefore, abide by the publicrespondent's factual findings in the absence of a showing of grave abuse of discretion.

In the case at bar, there is no dispute that the petitioner is the exclusive bargaining representative ofthe rank-and-file employees of Triumph International. A careful examination of the records of thiscase reveals no evidence that rules out the commonality of interests among the rank-and-filemembers of the petitioner and the herein declared rank-and-file employees who are members of therespondent union. Instead of forming another bargaining unit, the law requires them to be membersof the existing one. The ends of unionism are better served if all the rank-and-file employees withsubstantially the same interests and who invoke their right to self-organization are part of a singleunit so that they can deal with their employer with just one and yet potent voice. The employees'bargaining power with management is strengthened thereby. Hence, the circumstances of this caseimpel us to disallow the holding of a certification election among the workers sought to berepresented by the respondent union for want of proof that the right of said workers to self-

organization is being suppressed.

Once again we enunciate that the proliferation of unions in an employer unit is discouraged as amatter of policy unless compelling reasons exist which deny a certain and distinct class ofemployees the right to self-organization for purposes of collective bargaining. ( see General Rubber& Footwear Corporation v. Bureau of Labor Relations, 155 SCRA 283 [1987]).

Anent the correlative issue of whether or not the contract-bar rule applies to the present case, RuleV, Section 3, Book V of the Implementing Rules and Regulations of the Labor Code is written in plainand simple terms. It provides in effect that if a collective bargaining agreement validly exists, apetition for certification election can only be entertained within sixty (60) days prior to the expiry dateof said agreement. Respondent union's petition for certification election was filed on November 25,

1987. At the time of the filing of the said petition, a valid and existing CBA was present betweenpetitioner and Triumph International. The CBA was effective up to September 24, 1989. There is nodoubt that the respondent union's CBA constituted a bar to the holding of the certification election aspetitioned by the respondent union with public respondent. ( see Associated Trade Unions [ATU] v.Trajano, 162 SCRA 318 [1988], Federation of Democratic Trade Union v. Pambansang Kilusan ngPaggawa, 156 SCRA 482 [1987]); Tanduay Distillery Labor Union v. National Labor RelationsCommission, 149 SCRA 470 [1987]). The members of the respondent union should wait for theproper time.

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The CBA in this case expired on September 24, 1989. If a new CBA with the same provisions as theold one has been executed, its terms should be amended so as to conform to the tenor of thisdecision.

Beneco v. Calleja

On June 21, 1985 Beneco Worker's Labor Union-Association of Democratic Labor Organizations(hereinafter referred to as BWLU- ADLO) filed a petition for direct certification as the sole andexclusive bargaining representative of all the rank and file employees of Benguet ElectricCooperative, Inc. (hereinafter referred to as BENECO) at Alapang, La Trinidad, Benguet alleging,inter alia, that BENECO has in its employ two hundred and fourteen (214) rank and file employees;that one hundred and ninety-eight (198) or 92.5% of these employees have supported the fi