HOLY CHILD CATHOLIC SCHOOL, PETITIONER, VS. HON. PATRICIA STO. TOMAS, IN HER OFFICIAL CAPACITY AS SECRETARY OF THE DEPARTMENT OF LABOR AND EMPLOYMENT, AND PINAG-ISANG TINIG AT L…

Holy Child Catholic School versus Sto. Tomas

The Case

This is a petition for review on certiorari brought by Holy Child Catholic School against the Secretary of the Department of Labor and Employment and against Pinag-Isang Tinig at Lakas ng Anakpawis, the Holy Child Catholic School Teachers and Employees Labor Union. The school asks the Supreme Court to reverse the ruling of the Court of Appeals, which had upheld the Secretary's order directing two separate certification elections among the school's teaching personnel and its non-teaching personnel. The case matters because it settles two questions every labor law candidate must know: first, who may be counted as a managerial or supervisory employee for purposes of union membership, and second, whether a union that mixes teaching and non-teaching employees may still file a petition for certification election.

Procedural History

On May 31, 2002, the union filed a petition for certification election before the Med-Arbiter. On August 10, 2002, Med-Arbiter Agatha Ann L. Daquigan denied the petition, holding that the bargaining unit sought to be represented was inappropriate because there was no community or mutuality of interest between the teaching and the non-teaching staff. The union appealed to the Secretary of Labor and Employment. On December 27, 2002, the Secretary reversed and set aside the Med-Arbiter's decision, and instead directed the conduct of two separate certification elections, one among the non-teaching personnel and one among the teaching personnel. The school's motion for reconsideration was denied in a Resolution dated February 13, 2003.

The school then filed a petition for certiorari before the Court of Appeals, with a prayer for a temporary restraining order and preliminary injunction. The Court of Appeals eventually granted the preliminary injunction. On April 18, 2007, the Court of Appeals dismissed the petition. It held that the Toyota ruling was inapplicable because the vice-principals, the department head, and the coordinators were neither supervisory nor managerial employees. It also held that the Secretary did not commit grave abuse of discretion in not dismissing the petition, since the Secretary had directed two separate certification elections in line with the University of the Philippines versus Ferrer-Calleja ruling. The school's motion for reconsideration was denied on July 31, 2007. Hence, this petition for review on certiorari under Rule 45 of the Rules of Civil Procedure.

Facts

Holy Child Catholic School is a private educational institution, specifically a parochial school. As of June 28, 2002, it had one hundred fifty-six employees: ninety-eight teaching personnel, twenty-five non-teaching academic employees, and thirty-three non-teaching non-academic workers. On May 31, 2002, the union filed a petition for certification election, claiming that it was a legitimate labor organization duly registered with the Department of Labor and Employment, that the school was unorganized, and that there was no collective bargaining agreement or certified bargaining agent within one year prior to the filing of the petition.

The school opposed the petition. It alleged that of the employees who signed in support of the petition, fourteen had already resigned and six had signed twice. More importantly, it alleged that the union's membership was a mixture of managerial, supervisory, and rank-and-file employees, since three were vice-principals, one was a department head or supervisor, and eleven were coordinators. It further alleged that the membership combined teaching and non-teaching personnel, since twenty-seven were non-teaching personnel. The school argued that under Article 245 of the Labor Code, the union was not a legitimate labor organization and lacked personality to file the petition.

The union countered that the school failed to substantiate its claim that some of its members held managerial or supervisory positions. It argued that a mixture of employees is not among the grounds for dismissal of a petition under the implementing rules, and that questions on the qualifications of employees may be threshed out in inclusion-exclusion proceedings. The Med-Arbiter dismissed the petition, but the Secretary reversed and ordered two separate certification elections. The Court of Appeals affirmed the Secretary, and the matter reached the Supreme Court.

Issues

• Whether or not the Court of Appeals erred in holding that the Toyota ruling does not apply despite the alleged commingling of supervisory or managerial and rank-and-file employees in the union.
• Whether or not the Court of Appeals erred in allowing the conduct of a certification election despite its own finding that there is no mutuality of interest between the teaching and non-teaching members of the union.

Applicable Provisions

Article 245 of the Labor Code, as amended by Republic Act No. 6715, provides:

Managerial employees are not eligible to join, assist or form any labor organization. Supervisory employees shall not be eligible for membership in a labor organization of the rank-and-file employees but may join, assist or form separate labor organizations of their own.

This is the provision on which the school's argument that the union is illegitimate rests, and the Court examines whether the persons it identifies are truly managerial or supervisory.

Section 1 of Rule II of the Rules and Regulations Implementing Republic Act No. 6715 provides:

Supervisory employees and security guards shall not be eligible for membership in a labor organization of the rank-and-file employees but may join, assist or form separate labor organizations of their own; Provided, that those supervisory employees who are included in an existing rank-and-file bargaining unit, upon the effectivity of Republic Act No. 6715, shall remain in that unit.

This rule supplied the detail that the statute omitted, and it is the basis for the Court's statement that a questioned mingling will prevent a labor organization from exercising its right to file a petition for certification election.

Section 2 of Rule V of the same Rules provides:

The petition, when filed by a legitimate labor organization, shall contain, among others: a description of the bargaining unit which shall be the employer unit unless circumstances otherwise require; and provided further, that the appropriate bargaining unit of the rank-and-file employees shall not include supervisory employees and or security guards.

This provision ties the composition of the bargaining unit to the question of who may properly be included in it.

Ruling

On the first issue, the Court denied the petition. It held that the vice-principals, the department head, and the coordinators were neither managerial nor supervisory employees. Their functions were not confined to policy-determining matters such as hiring, firing, and disciplining of employees, salaries, working hours, and other terms and conditions of employment. While they may formulate policies or guidelines, such formulation is merely recommendatory and remains subject to review and evaluation by the principals or executive officers of the school. Company policies had already been pre-formulated by the higher executives, and these employees merely carried them out. There was therefore no improper commingling of members that would preclude the petition.

The Court also addressed the union's invocation of Republic Act No. 9481. That law took effect only on June 14, 2007, so it applies only to labor representation cases filed on or after that date. The governing law was Republic Act No. 6715 and Department Order No. 9. Even without the express provision of Republic Act No. 9481, the Court said, the bystander rule is well entrenched: a certification election is the sole concern of the workers, and the employer is merely a bystander with no personality to dispute the election. The rationale is that the employees' bargaining representative should be chosen free from any extraneous influence of management.

On the second issue, the Court likewise ruled against the school. While the nature of the teaching personnel's work does not coincide with that of the non-teaching personnel, the Secretary did not commit grave abuse of discretion in refusing to dismiss the petition. Following the University of the Philippines versus Ferrer-Calleja ruling, the Secretary instead directed the conduct of two separate certification elections, one for the teaching personnel and one for the non-teaching personnel. The union may continue to exist as a legitimate labor organization with a combined membership, representing both classes of employees in separate bargaining negotiations and agreements.

Doctrine

First, a labor organization composed of both rank-and-file and supervisory employees is no labor organization at all, and it cannot possess the rights of a legitimate labor organization, including the right to file a petition for certification election. But the inquiry turns on substance: an employee is managerial or supervisory only if he actually performs policy-determining functions. Where the policies and guidelines he formulates are merely recommendatory and subject to review by higher executives, he remains a rank-and-file employee.

Second, the employer is a mere bystander in a certification election. It has no personality to dispute the election, and its role ceases after it files a petition when requested to bargain collectively.

Third, the inappropriateness of the bargaining unit is not a ground for dismissing a petition for certification election. The remedy is to order separate certification elections for the distinct groups, as the Court did here for the teaching and non-teaching personnel.

Disposition

The Supreme Court denied the petition and affirmed the decision and resolution of the Court of Appeals, allowing the two separate certification elections to proceed.

Remember This

Memorize this line: a labor organization composed of both rank-and-file and supervisory employees is no labor organization at all, but the test is actual policy-determining power, not title. Examiners use this case to test the commingling rule under Article 245, the bystander rule, and the rule that an inappropriate bargaining unit does not justify dismissing a certification election petition but instead calls for separate elections.