TRADE UNIONS OF THE PHILIPPINES AND ALLIED SERVICES, PETITIONER, VS. NATIONAL HOUSING CORPORATION AND ATTY. VIRGILIO SY, AS OFFICER-IN-CHARGE OF THE BUREAU OF LABOR RELATIONS, R…

The employees of the public sector comprise the largest bloc of
workers in our national work force. 
Governmental bureaucracy is continually being reorganized to cope with
the growing complexity of the problems and needs of political and
administrative governance.  As the
increase in the number of government employees grows apace, the need to enhance
their welfare correspondingly becomes more imperative.  While it may be assumed that the Government
is exerting efforts to advance the interests of its employees, it is quite
understandable that the employees themselves should actively seek arrangements
whereby they can participate more meaningfully in management and employment
relationships.  There is, thus, a proliferation
of unions or employees’ organizations, each seeking
concomitant representational recognition.

The antecedent facts
which led to the filing of this special civil action for certiorari are
clear and undisputed.  The juridical
status and relevant circumstances of respondent corporation
have been established in a case of illegal dismissal filed against it, as
previously decided by the Court and hereinafter discussed.  However, submitted this time for Our resolution is a controversy on the propriety of and
requirements for certification elections in government-owned or controlled
corporations like the respondent.

Respondent National
Housing Corporation (hereinafter referred to as NHC) is a corporation organized
in 1959 in accordance with Executive Order No. 399, otherwise known as the
Uniform Charter of Government Corporations, dated January 1, 1951.  Its
shares of stock are and have been one hundred percent (100%) owned by the
Government from its incorporation under Act 459, the former corporation law.  The government entities that own its shares
of stock are the Government Service Insurance System, the Social Security
System, the Development Bank of the Philippines,
the National Investment and Development Corporation and the People’s Homesite and Housing Corporation.^[1]
Petitioner Trade Unions of the Philippines
and Allied Services (TUPAS, for brevity) is a legitimate labor organization
with a chapter in NHC.

On July 13, 1977,
TUPAS filed a petition for the
conduct of a certification
election with Regional Office No. IV of the Department of Labor
in order to determine the exclusive bargaining representative of the workers in
NHC.  It was claimed that its
members comprised the majority of the employees of the corporation.^[2]
The petition was dismissed by med-arbiter Eusebio M.
Jimenez in an order, dated November 7, 1977, holding that NHC “being a
government-owned and/or controlled corporation its employees/workers are
prohibited to form, join or assist any labor organization for purposes of
collective bargaining pursuant to Section 1, Rule II, Book V of the Rules and
Regulations implementing the Labor Code.”^[3]

From this order of dismissal, TUPAS appealed to the Bureau of
Labor Relations^[4]
where, acting thereon in BLR Case No. A-984-77 (R04-MED-1090-77), Director Carmelo C. Noriel reversed the
order of dismissal and ordered the holding of a certification election.^[5]
This order was, however, set aside by Officer-in-Charge Virgilio
S.J. Sy in his resolution of November 21, 1978^[6]
upon a motion for reconsideration
of respondent NHC.

In the instant petition for certiorari, TUPAS seeks the
reversal of the said resolution and prays that a certification election be held
among the rank and file employees of NHC.

In retrospect, it will be recalled that in a former case of
illegal dismissal involving the same respondent corporation,^[7]
We had ruled that the employees of NHC and of other government owned or
controlled corporations were governed by civil service laws, rules and
regulations pursuant to the 1973 Constitution which provided that “the
civil service embraces every branch, agency, subdivision and instrumentality of
the government, including government-owned or controlled corporations.”^[8]

It was therein stressed that to allow subsidiary corporations to
be excluded from the civil service laws would be to permit the circumvention or
emasculation of the above-quoted constitutional provision.  As perceptively analyzed therein, “(i)t would be possible for a
regular ministry of government to create a host of subsidiary corporations
under the Corporation Code funded by a willing legislature.  A government-owned corporation could create
several subsidiary corporations.  These
subsidiary corporations would enjoy the best of two
worlds.  Their officials and employees
would be privileged individuals, free from the strict accountability required
by the Civil Service Decree and the regulations of the Commission on Audit.  Their
incomes would not be subject to
the competitive restraints of the open market nor to the terms and conditions
of civil service employment.”

The rule, however, was modified in the 1987 Constitution, the
corresponding provision whereof declares that “(t)he civil service
embraces all branches,
subdivisions, instrumentalities and agencies of the government, including
government-owned or controlled corporations with original charters.”^[9]

Consequently, the civil service now covers only government-owned
or controlled corporations with original or legislative charters, that is those created by an act of Congress or by special law,
and not those incorporated under and pursuant to a general legislation.  As We recently held –

“x x x, the situations sought to be avoided by the 1973
Constitution and expressed by this Court in the National Housing Corporation case x x x appear relegated to relative
insignificance by the 1987 Constitutional provision that the Civil Service
embraces government-owned or controlled corporations with original
charters and therefore, by clear implication, the Civil Service does not
include government-owned or controlled corporations which are organized as
subsidiaries of government-owned or controlled corporations under the general
corporation law.”^[10]

While the aforecited
cases sought different reliefs, that is,
reinstatement consequent to illegal dismissal, the same lis mota
determinative of the present special civil action was involved therein.

The workers or employees of NHC undoubtedly have the right to
form unions or employees’ organizations. 
The right to unionize or to form organizations is now explicitly
recognized and granted to employees in both the governmental and the private
sectors.  The Bill of Rights provides
that “(t)he right of the people, including those employed in the public
and private sectors, to form unions, associations or societies for purposes not
contrary to law shall not be abridged.”^[11]

This guarantee is reiterated in the second paragraph of Section
3, Article XIII, on Social Justice and Human Rights, which mandates that the
State “shall guarantee the rights of all workers to self-organization, collective
bargaining and negotiations, and peaceful concerted activities, including the
right to strike in accordance with law.  x x x.”

Specifically with respect to government employees, the right to
unionize is recognized in Paragraph (5), Section 2, Article IX B^[12]
which provides that “(t)he right to
self-organization shall not be denied to government employees.” The
rationale of and justification for this innovation which found expression in
the aforesaid provision was explained by its proponents, as follows:

“x x x The government is in a sense the
repository of the national sovereignty and, in that respect, it must be held in reverence if not in awe.  It symbolizes the unity of the nation, but it
does perform a mundane task as well.  It
is an employer in every sense of the word except that terms and conditions of
work are set forth through a Civil Service Commission.  The government is the biggest employer in the
Philippines.  There is an employer-employee relationship
and we all know that the accumulated grievances
of several decades are now beginning to explode in our faces among government
workers who feel that the rights afforded by the Labor Code, for example, to
workers in the private sector have been effectively denied to workers in
government in what looks like a grotesque, (sic) a caricature of the equal
protection of the laws.  For
example, x x x there were
many occasions under the old government when wages and cost of living
allowances were granted to workers in the private sector but denied to workers
in the government for some reason or another, and the government did not even
state the reasons why.  The government
employees were being discriminated against. 
As a general rule, the majority of the world’s countries now entertain
public service unions.  What they really
add up to is that the employees of the
government form their own association. 
Generally, they do not bargain
for wages because these are fixed in the budget but they do acquire a
forum where, among other things, professional and self-development is (sic) promoted and encouraged.  They also
act as watchdogs of their own bosses so that when graft and corruption
is committed, generally, it is the unions who are no longer afraid by virtue of
the armor of self-organization that become the public’s own allies for
detecting graft and corruption and for exposing it.  x x x“^[13]

There is, therefore, no impediment to the holding of a certification election among the workers
of NHC for it is clear that they are covered by the Labor Code, the NHC being a
government-owned and/or controlled corporation without an original
charter.  Statutory implementation of the
last-cited section of the Constitution is found in Article 244 of the Labor
Code, as amended by Executive Order No. 111, thus:

“Right of employees
in the public service.  – Employees
of the government corporations established under the Corporation Code shall
have the right to organize and to bargain collectively with their respective
employers.  All other employees in the
civil service shall have the right to form associations for purposes not
contrary to law.”

The records do not show that supervening factual events have
mooted the present action.  It is meet,
however, to also call attention to the fact that, insofar as certification
elections are concerned, subsequent statutory developments have rendered
academic even the distinction between the two types of government-owned or
controlled corporations and the laws governing employment relations therein, as
hereinbefore discussed.  For, whether the
employees of NHC are covered by the Labor Code or by the civil service laws, a
certification election may be conducted.

For employees in corporations and entities covered by the Labor
Code, the determination of the exclusive bargaining representative is
particularly governed by Articles 255 to 259 of said Code.  Article 256 provides for the procedure when
there is a representation issue in organized establishments, while Article 257
covers unorganized establishments.  These
Labor Code provisions are fleshed out by Rules V to VII, Book V of the Omnibus Implementing Rules.

With respect to other civil servants, that is, employees of all
branches, subdivisions, instrumentalities and agencies of the government
including government-owned or controlled corporations with original charters
and who are, therefore, covered by the civil service laws, the guidelines for the exercise of their
right to organize is provided for under Executive Order No. 180.  Chapter IV thereof, consisting of Sections 9
to 12, regulates the determination of the “sole and exclusive employees’
representative.” Under Section 12, “where there are two or more duly
registered employees’ organizations in the appropriate organizational unit, the
Bureau of Labor Relations shall, upon petition, order the conduct of
certification election and shall certify the winner as the exclusive
representative of the rank-and-file employees in said organizational
unit.”

Parenthetically, note
should be taken of the specific qualification in the Constitution that the
State “shall guarantee the rights of all workers to self-organization,
collective bargaining, and peaceful concerted activities, including the right
to strike in accordance with law“ and that “(t)hey shall also participate
in policy and decision-making processes affecting their rights and benefits as
may be provided by law.”^[14] (Emphasis supplied.)

ON THE FOREGOING CONSIDERATIONS, the assailed resolution of the Bureau of Labor Relations, dated November
21, 1978, is ANNULLED
and SET ASIDE,
and the conduct of a certification election among the affected employees of
respondent National Housing Corporation in accordance with the rules therefor is hereby GRANTED.

SO ORDERED.

Fernan, C.J., Narvasa,
Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano, Padilla, Bidin,
Sarmiento, Cortes, Griño-Aquino,
and Medialdea,
JJ., concur.

Gancayco, J., on leave.

^[1]
Rollo, 191; National Housing Corporation vs. Juco,
et al., 134 SCRA 172 (1985).

^[2]
Ibid., 14; Annex A.

^[3]
Ibid., 20, Annex B.

^[4]
Ibid., 21, Annex C.

^[5]
Ibid., 27, Annex D.

^[6]
Ibid., 31, Annex E.

^[7]
National Housing Corporation vs. Juco, et al.,
ante.

^[8]
Sec. 1, Art. XII B.

^[9]
Section 2 (1), Art. IX B.

^[10]
National Service Corporation, et al. vs. The Hon. Third Division, National
Labor Relations Commission, etc., et al., G.R. No. 69870, Nov. 29, 1988; see also Bliss Development
Corporation vs. National Labor Relations Commission, et al., G.R. No.
82824, Resolution, Jan.
18, 1989.

^[11]
Sec. 8, Art. III, 1987 Constitution.

^[12]
Constitutional Commissions; B.  The Civil Service
Commission.

^[13]
Records of the Constitutional Commission, Vol. I, 567.

^[14]
Sec. 3 (2nd par.), Art. XIII.