NATIONAL UNION OF BANK EMPLOYEES, PETITIONER, VS. THE HONORABLE MINISTER OF LABOR, THE HONORABLE DEPUTY MINISTER OF LABOR, THE HONORABLE DIRECTOR OF THE BUREAU OF LABOR RELATION…

National Union of Bank Employees versus Minister of Labor

The Case

This is a petition for mandamus filed by the National Union of Bank Employees against the Minister of Labor, the Deputy Minister of Labor, the Director of the Bureau of Labor Relations, and the Producers Bank of the Philippines. The Union asked the Supreme Court to compel the public respondents to conduct a certification election among the rank and file employees of the Bank, or in the alternative, to require the Minister of Labor or his Deputy to act on the Bank's appeal and on the Union's motion to dismiss with motion to execute. The case matters because it fixes the ground rules for defining the appropriate bargaining unit, for the thirty percent consent requirement, and for the pendency of a cancellation proceeding as a supposed prejudicial question.

Procedural History

The petition for certification election was first heard by Med-Arbiter Climaco Plagata, who ordered a certification election. The Deputy Minister of Labor then assumed jurisdiction over the certification election case and the Bank's application for clearance to terminate thirteen employees, and deputized Med-Arbiter Luna Piezas to conduct summary investigations. The case was later transferred to Med-Arbiter Alberto Abis, who ordered the holding of a certification election but sustained the Bank's stand on the exclusion of certain employees. The Union filed a partial appeal to the Director of the Bureau of Labor Relations, and the Bank likewise appealed to the Minister of Labor. The Director of the Bureau of Labor Relations, Carmelo Noriel, rendered a decision affirming the Med-Arbiter's order with certain modifications. From that decision, the Union went to the Supreme Court by petition for mandamus.

Facts

On August 17, 1979, the Union filed a petition to be directly certified as the collective bargaining agent of the rank and file employees of the Bank. At the hearing on September 7, 1979, the Bank, through counsel, agreed that once the registration certificate of the local union was issued and it was shown that the local union represented the majority of the rank and file, the Bank would recognize the union and negotiate accordingly. The registration certificate was secured on October 5, 1979. On October 15, 1979, the Union filed a manifestation and urgent motion to decide, submitting the certificate and membership applications of 183 members out of more or less 259 rank and file employees, authorizing the Union to represent them as their sole and exclusive collective bargaining agent. The Bank nonetheless failed to submit the required payroll and list of rank and file workers.

On October 18, 1979, Med-Arbiter Plagata ordered a certification election. The Bank moved to suspend proceedings on the ground of a pending proceeding for cancellation of the Union's registration. On October 23, 1979, by agreement of the parties, the Deputy Minister of Labor assumed jurisdiction over the certification election case and the clearance application, and deputized Med-Arbiter Piezas to conduct summary investigations. Med-Arbiter Piezas later withdrew, and the case was transferred to Med-Arbiter Abis.

On November 19, 1979, Med-Arbiter Abis ordered a certification election but excluded secretaries of bank officials, employees of the Personnel, Accounting, Legal and Trust Departments, credit investigators, telephone operators, and loan security custodians, while allowing signature verifiers, drivers, messengers and other non-confidential employees to vote with their votes segregated as challenged. Both parties appealed. On January 24, 1980, Director Noriel affirmed the order with modifications, holding that the appropriate bargaining unit should embrace all regular rank and file employees at the head and branch offices, and that the exclusions were either superfluous, discriminatory or contrary to law.

Issues

• Whether or not the pendency of a cancellation proceeding against the Union's registration is a prejudicial question that should suspend the certification election.
• Whether or not the appropriate bargaining unit was properly defined.
• Whether or not the exclusion of the questioned employees from the bargaining unit was valid.
• Whether or not the thirty percent consent requirement was complied with.

Applicable Provisions

Article 244 of the Labor Code provides:

All persons employed in commercial, industrial and agricultural enterprises, including religious, charitable, medical or educational institutions operating for profit shall have the right to self-organization and to form, join, or assist labor organizations for purposes of collective bargaining.

This is the general grant of the right to self-organization that the exclusions would erode.

Articles 245 and 246 of the Labor Code provide:

Security guards and managerial employees are not eligible to form, assist or join any labor organization.

These are the only express exclusions, and the Court held that exclusion must strictly follow the definition of a managerial employee.

Section 7, Article Four of the Philippine Constitution provides:

The right to form associations or societies for purposes not contrary to law shall not be abridged.

This constitutional guarantee protects the workers' right of association.

Section 9, Article Two of the Philippine Constitution provides:

The State shall assure the rights of workers to self-organization, collective bargaining, security of tenure and just and humane conditions of work.

This is the specific constitutional mandate that exclusions, being in derogation of the right, must be construed strictly.

Ruling

On the first issue, the Court held that unless there is a final order of cancellation, the union's certificate of registration remains and its legal personality intact, and it is entitled to participate in a representation proceeding. The pendency of cancellation is not a prejudicial question.

On the second issue, the Court held that the appropriate bargaining unit is generally the employer unit, embracing all regular rank and file employees at the head and branch offices, absent circumstances requiring otherwise.

On the third issue, the Court held that the exclusions were either superfluous, discriminatory or contrary to law. Exclusion as a managerial employee is not based on the personality of the occupant but on the nature and function of the position, and the mere fact of being a supervisor or confidential employee does not exclude one from coverage. Exclusions, being the exception and in derogation of the constitutional mandate, should be construed in strictissimi juris, that is, strictly against exclusion.

On the fourth issue, the Court held that the definition of the bargaining unit does not call for an actual head count, and that since 188 of 264 employees subscribed, the thirty percent requirement was more than sufficiently complied with.

Doctrine

A certification election may proceed despite a pending cancellation proceeding, because until cancellation is final the union's registration and legal personality remain intact. The appropriate bargaining unit is generally the employer unit, and the definition of that unit does not require an actual head count. Only managerial employees as defined by the Labor Code are excluded, and exclusions being in derogation of the constitutional right to self-organization must be construed strictly. The thirty percent consent requirement is satisfied by substantial compliance measured against the defined bargaining unit.

Disposition

The petition was dismissed and the decision of the Director of the Bureau of Labor Relations was affirmed, with the certification election proceeding in favor of the Union.

Remember This

Memorize this line: a pending cancellation proceeding does not suspend a certification election, and exclusions from the bargaining unit are construed strictly against exclusion. Examiners use this case on the definition of the appropriate bargaining unit, the thirty percent consent requirement, and the effect of a pending cancellation case on representation proceedings.