ATLANTIC, GULF AND PACIFIC COMPANY OF MANILA, INC., PETITIONER, VS. HON. BIENVENIDO E. LAGUESMA, UNDERSECRETARY, DEPARTMENT OF LABOR & EMPLOYMENT; HON. TOMAS F. FALCONITIN, MED-…

This is a petition for certiorari and prohibition with a
prayer for the issuance of a writ of preliminary injunction and/or temporary
restraining order to annul and set aside the Order dated December 11, 1990 of
the Department of Labor and Employment affirming its Resolution dated November
22, 1990 and the Order of the Med-Arbiter in ordering that a certification
election among the regular project employees of the herein petitioner Atlantic,
Gulf and Pacific Company of Manila, Inc. at its Steel and Marine Structures
Group (AG&P-SMSG) be conducted immediately.

The antecedent facts of the case are as follows:

Petitioner Atlantic, Gulf and Pacific Company of Manila, Inc. is
engaged in the construction and fabrication business and conducts its
construction business in different construction sites here and abroad while its
fabrication operations are conducted by its Steel and Marine Structures Group
at its Batangas Marine and Fabrication Yard (“BMFY”, for brevity) in Bauan,
Batangas where the steel structures and other heavy marine works are fabricated.

In the exercise of
its management prerogative, petitioner has adopted the practice of hiring
project employees when existing fabrication capacity cannot absorb increases in
job orders for steel structures and other heavy construction works. Said project employees are covered by the Project Worker/Reliever
Employment Agreements which indicate the specific projects to which they are
assigned and the duration of their employment. Upon the expiration of their contracts/agreements, the employment of these
employees is automatically terminated unless the projects to which they are
assigned have not yet been completed, in which case, they are rehired for the
remainder of the project. The positions
occupied by the regular rank-and-file employees and the project employees are
basically similar in nature and are directly related to the main line of
petitioner’s business.

On June 8, 1990, petitioner executed a Collective Bargaining
Agreement with the AG&P United Rank & File Association (“URFA”, for
brevity) which is the sole and exclusive bargaining agent of all the regular
rank-and-file employees of the petitioner.^[1] Said
Collective Bargaining Agreement was subsequently registered on July 9, 1990
with the Bureau of Labor Relations and Certificate of Registration No.
BLR-90-0131 was issued.

On June 29, 1990, private respondent Lakas ng Manggagawa sa
AG&P-SMSG-National Federation of Labor (“LAKAS-NFL”, for brevity) filed a
Petition for Certification Election with the Med-Arbitration Unit to be
certified as the sole and exclusive bargaining agent of the regular non-project
employees of the Steel and Marine Structure at the BMFY representing
approximately 1,000 employees or that a certification be conducted among said
employees.^[2]

On September 25, 1990, public respondent Med-­Arbiter Tomas F.
Falconitin of the Department of Labor and Employment issued an Order, the
dispositive portion of which reads:

“WHEREFORE, premises considered, it is hereby ordered that
certification election among the regular “Project Workers”/employees of
Atlantic Gulf and Pacific Company of Manila, Inc. at its Steel and Marine
Structures Group (AG&P-SMSG) be conducted immediately. The Representation Officer is hereby
directed to conduct the usual pre-­election conference in connection thereof
with the following choices to consider:

1.  Lakas Ng Manggagawa Sa AG&P-SMSG National
Federation of Labor (LAKAS-NFL); and

2. No Union.

SO ORDERED.”^[3]

On October 11, 1990, petitioner filed an appeal with the
Department of Labor and Employment.^[4]

On October 26, 1990, 691 alleged project employees sought to be
represented by private respondent LAKAS­-NFL were formally issued regular
employment appointments by the petitioner` effective November 1,1990 which were
accepted by said project employees.

Thereafter, in a Resolution dated November 22, 1990, public
respondent Undersecretary of the Department of Labor and Employment Bienvenido
E. Laguesma denied petitioner’s appeal for lack of merit.

On November 28, 1990, petitioner’s project employees at its SMSG
site who were not given regular employment appointment on October 26, 1990 went
on strike and completely paralyzed petitioner’s operations in Bauan,
Batangas. Said strike was settled in a
conciliation conference convened by the National Conciliation and Mediation
Board on December 8, 1990 when an Agreement was reached by the petitioner and
private respondent LAKAS-NFL wherein petitioner agreed to formally regularize
all the remaining alleged project employees with at least one year of service
pending the final outcome of the certification election case.^[5]
Thereafter, 686 additional regular project employees were regularized effective
December 1, 1990 in pursuance to said Agreement.

On December 6, 1990, petitioner received a letter from URFA
informing the former about the admission into URFA of the membership of 410
regular project employees who were formally regularized by the petitioner
effective November 1, 1990.

On that same date, petitioner filed a Motion for Reconsideration
on the Resolution dated November 22, 1990 alleging that the employees sought to
be represented by the private respondent LAKAS-NFL are regular employees of the
petitioner and are deemed included in the existing Collective Bargaining
Agreement of the regular rank-and-file employees of the petitioner which motion
was subsequently denied by the public respondent Undersecretary Laguesma in an
Order dated December 11, 1990.

Hence, this petition assailing said Order and Resolution on the following grounds:

“I.  RESPONDENT UNDERSECRETARY ACTED WITH GRAVE
ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION IN ISSUING THE RESOLUTION
DATED 22 NOVEMBER 1990 AND THE ORDER DATED 11 DECEMBER 1990 IN THAT THEY FAILED
TO HOLD THAT THE CONTRACT-BAR RULE APPLIES TO THE INSTANT CASE

II. RESPONDENT
UNDERSECRETARY ACTED WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF
JURISDICTION IN ISSUING THE RESOLUTION DATED 22 NOVEMBER 1990 AND THE ORDER
DATED 11 DECEMBER 1990 IN THAT THEY FAILED TO CONSIDER THE SUPERVENING FACT
THAT THE BARGAINING UNIT OF THE ALLEGED REGULAR PROJECT WORKERS HAS CEASED TO
EXIST BY VIRTUE OF THE REGULARIZATION OF ALL THE ALLEGED PROJECT WORKERS WITH
AT LEAST ONE YEAR OF SERVICE”^[6]

The contentions of the petitioner are meritorious.

Section 1 of Article II of petitioner’s Collective Bargaining Agreement with URFA defined
appropriate bargaining unit as follows:

ARTICLE II
SCOPE

Sec. 1. Appropriate Bargaining Unit –
The appropriate bargaining unit covered by this Agreement consists of those
regular rank-and-file employees of the COMPANY who have remained as such up to
the date of execution of this Agreement, as well as those who may hereafter
acquire the same status. It is hereby understood and agreed that the
following are not within the appropriate bargaining unit and, therefore, this
Agreement is not applicable to them, to wit:

a. Executives,
division department and section heads, staff members, managerial employees, and
executive secretaries;      

b. Workers hired by
the COMPANY as project employees as contemplated by existing laws including
relievers of regular employees who are sent abroad are not covered by this
Contract. Provided, however, that
regular employees who are assigned as relievers shall continue to be covered by
this Contract, and provided further that relievers who are assigned to regular positions which may become
vacant shall be duly considered for such regular positions after attaining the
six months probationary period.

c. Security personnel.”^[7]

Although the aforementioned definition does not include
petitioner’s regular project employees in the coverage of the existing
Collective Bargaining Agreement between petitioner and the URFA, the
regularization of all the regular project employees with at least one year of
service and the subsequent membership of said employees with the URFA mean that
the alleged regular project employees whom respondent LAKAS-NFL seeks to
represent are, in fact, regular employees by contemplation of law and included
in the appropriate bargaining unit of said Collective Bargaining Agreement consequently,
the bargaining unit which respondent LAKAS-NFL seeks to represent has already
ceased to exist.

The Labor Code provides:

“Art. 232. Prohibition on Certification Election. – The Bureau
shall not entertain any petition for certification election or any other action
which may disturb the administration of duly registered existing collective
bargaining agreements affecting the parties except under Articles 253, 253-A
and 256 of this Code.”

Paragraph 2 of Section 3, Rule V, Book V of the Implementing Rules
and Regulations likewise provides:

“If a collective bargaining
agreement has been duly registered in accordance with Article 231 of the Code,
a petition for certification election or a motion for intervention can only be
entertained within sixty (60) days prior to the expiry date of such agreement.”

Consequently, the existence of a duly registered Collective
Bargaining Agreement between the petitioner and URFA, which is the sole and
exclusive bargaining representative of all the regular rank-and-file employees
of the petitioner including the regular project employees with more than one
year of service, bars any other labor organization from filing a petition for
certification election except within the 60-day period prior to the expiration
of the Collective Bargaining Agreement.

To rule otherwise
would negate the legislative intent in the enactment of Article 232 of the
Labor Code which was designed to ensure industrial peace between the employer
and its employees during the existence of the collective bargaining agreement.

WHEREFORE, finding the petition meritorious, the assailed
Resolution of November 22, 1990 and the Order dated December 11, 1990 are
hereby annuled and set aside. The
temporary restraining order issued is made permanent. Costs against respondents.

SO ORDERED.

Narvasa, C.J. (Chairman), Padilla, and Regalado, JJ., concur.

^[1]
Rollo, p. 32.

^[2]
Id. at p. 64.

^[3]
Id. at p. 189.

^[4]
Id. at p. 95.

^[5]
Id. at pp. 232-233.

^[6]
Id. at pp. 16-17. .

^[7]
Id. at p. 145.