PHILIPPINE ASSOCIATION OF FREE LABOR UNIONS (PAFLU), PETITIONER AND APPELLANT, VS. THE HON. SECRETARY OF LABOR, RESPONDENT AND APPELLEE.

Herein
petitioner, Philippine Association of Free Labor Unions (PAFLU), is a
duly registered labor federation. It instituted this action for a
declaratory relief in the Court of First Instance of Manila, to
overrule certain views entertained by respondent, Secretary of Labor.
After appropriate proceedings said Court rendered judgment for the
respondent. Hence this appeal by petitioner, which maintains:

1. That
   a proviso in Section 23(e) of Republic Act No. 875, as amended by
   Republic Act No. 1941, be declared unconstitutional and violative of
   Conventions 87 and 98 of the International Labor Organization;

2. That the 10% minimum requirement in Section 17 of Republic Act No. 875 is a condition sine quanon for the exercise of the visitorial powers of the respondent under Republic Act No. 1941;
3. That
   said visitorial power of respondent under this Act may be exercised
   only in aid or to complement the functions and powers of the Court of
   Industrial Relations under said Section 17 of Republic Act No. 875; and

4. That said visitorial power is merely an adjunct of the right of union members to inspect union books under said
   Section 17 of Republic Act No. 875.

Republic Act No. 1941, approved on June 22, 1957, amended Section 23(e) of Republic Act No. 875 to read as follows:

“Provisions
of Commonwealth Act Numbered Two Hundred and Thirteen providing for
registration, licensing, and cancellation of registration of
organizations, associations, or union of labor, as qualified and
expanded by the preceding paragraphs of this Act, are hereby amended; Provided, however,
that the Secretary of Labor or his duly authorized representative is
hereby empowered to inquire, from time to time, into the financial
activities of any legitimate labor organization and to examine its
books of accounts and other financial records to determine compliance
or non-compliance with the laws and to aid in the prosecution for any
violation thereof.

“The
Secretary of Labor shall appoint such accounts examiners as may be
necessary for carrying out the purposes of this section.”

It
is argued by petitioner herein that this proviso is inconsistent with
Articles 3, 4, 7 and 8 of said Convention 87, to which the Philippines
is a party, reading:

“1. Workers’ and
employers’ organizations shall have the right to draw up their
constitutions and rules, to elect their representatives in full
freedom, to organize their administration and activities and to
formulate their programmes.

“2. The public authorities
shall refrain from any interference which would restrict this right or
impede the lawful exercise thereof.” (Article 3).

“Workers’
and employers’ organizations shall not be liable to be dissolved or
suspended by administrative authority.” (Article 4)

“The
acquisition of legal personality by workers’ and employers’
organizations, federations and confederations shall not be made subject
to conditions of such a character as to restrict the application of the
provisions of Articles 2, 3, and 4 hereof.” (Article 7)

“3.
The law of the land shall not be such as to impair, nor shall it be so
applied to impair the guarantees provided for in this Convention.”
(Article 8)

We are not aware of, and
petitioner has not cited, any provision of Convention No. 98, which is
infringed by Republic Act No. 1941, except insofar as said Convention,
like Convention No. 87, provides for the time and procedure for
denunciation by any of the contracting parties, thus indicating that
the latter, are, prior thereto, bound to comply with the provisions of
both Conventions.

Moreover, petitioner assumes that an act of
Congress is unconstitutional and/or invalid if it contravenes an
international agreement to which the Philippines is a party. Without
passing upon the validity or accuracy of this predicate, we find that
petitioner’s contention is untenable. Indeed, we see no conflict
between Republic Act No. 1941, on the one hand, and any of the
provisions of said Conventions. There is in said Republic Act No. 1941
nothing that may authorize respondent either to interfere in the rights
of workers’ and employers’ organisations to draw up their
constitutions, to freely elect their representatives, to organize their
administration and activities and to formulate their programmes, or to
dissolve or suspend said organizations, or to subject the acquisition
of legal personality thereof to such conditions as to restrict or
impair the rights aforementioned.

Respondent’s authority
under said Act is limited to an inquiry into the financial activities
of any legitimate labor organization and to the examination of “its
books of accounts and other financial records to determine compliance or non-compliance with the laws and to aid in the prosecution for any violations thereof.”
Certainly, none of the provisions of Conventions 87 and 93 seek to
protect or shield labor organizations which violate said laws. Upon the
other hand, Republic Act No. 1941 merely tries to forestall the misuse
of funds of the union by officers thereof, by restoring to
the Secretary of Labor a visitorial power he had under Commonwealth Act
No. 213, which had not been included in Republic Act No. 875. Needless
to say, if respondent should use the powers under Republic Act No. 1941
in such an arbitrary or oppressive manner as to impair the rights of
the workers or of their organization, then the remedy would be to
challenge the action thus taken, “not to invalidate the law”—in the language used in Philippine Association of Colleges and Universities vs. Secretary of Education 97 Phil., 806; (51 Off. Gaz., 6230).

With
respect to the second, third and fourth points raised by herein
petitioner, the opening paragraph of Section 17 of Republic Act No. 875
provides:

“It is hereby declared to be the
public policy of the Philippines to encourage the following internal
labor organization procedures. A minimum of ten per cent of the members
of a labor organization may report an alleged violation of those
procedures in their labor organization to the Court. If the Court
finds, upon investigation, evidence to substantiate the alleged
violation and that efforts to correct the alleged violation through the
procedures provided by the labor organization’s constitution or by-laws
have been exhausted, the Court shall dispose of the complaint as in
unfair labor practice cases.”

Then paragraph
(a) prohibits arbitrary or excessive initiation fees; paragraph (b)
grants to members the right to fell and detailed reports of all
financial transactions; paragraph (e) disqualifies those convicted of
any crime involving moral turpitude for any position involving the
collection, custody, management, control or disbursement of funds;
paragraph (f) forbids the collection of fees or dues, or the
disbursement of any funds of the organization without authority
therefor pursuant to its constitution and by-laws; paragraph (g)
requires that every payment of fees, dues or other contributions by a
member be evidenced by a receipt signed by the person making the
collection and entered upon the records of the organization; paragraph
(h) prohibits the application of funds for any purpose or object other
than those expressly stated in the constitution or by-laws of the
organization or those expressly authorized by resolution of a majority
of its members, paragraph (i) directs that every expenditure of funds
be evidenced by a receipt of the payee, with specification of the date,
place and purpose of the payment, and that said receipt be part of the
records of the organization; paragraph (j) forbids the payment to the
officers of any other compensation, in adiition to the salaries and
expenses specifically provided in the constitution and by-laws, except
in pursuance of a resolution approved in a meeting by a majority vote;
paragraph (k) regulates the duties of the treasurer and every officer
responsible for the accounts of the organization or for the collection,
disbursement, custody or control of its funds, moneys and other
properties; and paragraph (l) provides that the books of accounts and
other records of financial activities shall be open to inspection by
any officer or member of the organization.

As heretofore
indicated, petitioner maintains that respondent’s visitorial power
under Republic Act No. 1941 may be exercised only when a “minimum of
ten per cent of the members of a labor organization” have reported an
alleged violation of the procedures prescribed in said paragraphs of
Section 17 of Republic Act No. 875, and that said visitorial power may
be exercised only as an aid or adjunct to the functions and powers of
the Court of Industrial Relations and to the right of inspection of
union members. We find no merit in this pretense.

Section 17 of said Act deals with the “Rights and Conditions of Membership in Labor Organizations”. Pursuant thereto, the members
of a labor organization may, upon petition of at least ten per cent of
the members thereof, predicated upon an alleged violation of the
“procedures” prescribed in said section, compel the Court of Industrial Relations to
investigate whether or not the organization has in fact committed such
violation and to take appropriate measures in connection therewith.
Upon the other hand, Republic Act No. 1941 is concerned with the
authority of the Department of labor to inquire into the
financial activities of said organization in order “to determine
compliance or non-compliance with the laws and to aid in the
prosecution for any violation thereof”. This authority is not dependent
upon the request of said members. Much less does it require a request
backed up by 10% of the members of the organization.

Indeed, Section 17 refers to proceedings before the Court of Industrial Relations, whereas violations of the laws in connection with financial activities of labor organizations may warrant prosecution before ordinary courts of justice
for crimes which are beyond the jurisdiction of the Court of Industrial
Relations. Hence, the functions of respondent under Republic Act No.
1941 are not merely complementary to those of the Court of Industrial
Relations and to the right of inspection of members of labor
organizations, except only in the broad abstract sense that every
provision of Republic Act No. 875 tends to carry out or promote the
accomplishment of its lofty objectives.

It may not be amiss
to note that the authority of the Department of Labor to cancel the
registration and permit of a labor organization upon the ground that
the same does not meet the requirements of paragraph (c) of Section 23
of Republic Act No. 875, is based upon paragraph (d) of said section,
not upon paragraph (e) thereof as amended by Republic Act No. 1941.
Moreover, the order of cancellation of the registration and permit,
which may not be issued except after due notice and hearing, is
appealable to the Court of Appeals, or to the Supreme Court, depending
upon the issues raised in the appeal.

Wherefore, the decision appealed from is hereby affirmed, with costs against petitioner herein. It is so ordered.

Bengzon, C.J., Bautista Angelo, Reyes, J.B.L., Barrera, Dizon, Regala, Makalintal, Bengzon, J.P., Zaldivar, and Sanchez, JJ., concur.