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Republic of the PhilippinesSUPREME COURT

Manila

FIRST DIVISION

G.R. No. 96490 February 3, 1992

INDOPI! TE"TI!E MI!! #OR$ERS UNION%PTG#O, petitioner,vs.&O!UNT'R( 'R)ITR'TOR TEODORICO P. C'!IC' a*+ INDOPI! TE"TI!E MI!!S, INC.,respondents.

Romeo C. Lagman for petitioner.

Borreta, Gutierrez & Leogardo for respondent Indophil Textile Mills, Inc.

MEDI'!DE', J.:

This is a petition for certiorari seein! the nullification of the a"ard issued b# the respondentVoluntar# $rbitrator Teodorico P. %alica dated Dece&ber ', ())* findin! that Section ( +c, $rticle I ofthe %ollective -ar!ainin! $!ree&ent bet"een Indophil Tetile Mills, Inc. and Indophil Tetile Mill/orers 0nion1PT2/O does not etend to the e&plo#ees of Indophil $cr#lic Manufacturin!%orporation as an etension or epansion of Indophil Tetile Mills, Incorporated.

The antecedent facts are as follo"s3

Petitioner Indophil Tetile Mill /orers 0nion1PT2/O is a le!iti&ate labor or!ani4ation dul#re!istered "ith the Depart&ent of 5abor and 6&plo#&ent and the eclusive bar!ainin! a!ent of allthe ran1and1file e&plo#ees of Indophil Tetile Mills, Incorporated. Respondent Teodorico P. %alica isi&pleaded in his official capacit# as the Voluntar# $rbitrator of the National %onciliation andMediation -oard of the Depart&ent of 5abor and 6&plo#&ent, "hile private respondent IndophilTetile Mills, Inc. is a corporation en!a!ed in the &anufacture, sale and eport of #arns of variouscounts and inds and of &aterials of indred character and has its plants at -arrio 5a&bain.Marilao, -ulacan.

In $pril, ()'7, petitioner Indophil Tetile Mill /orers 0nion1PT2/O and private respondent IndophilTetile Mills, Inc. eecuted a collective bar!ainin! a!ree&ent effective fro& $pril (, ()'7 to March

8(, ())*.

On Nove&ber 8, ()97 Indophil $cr#lic Manufacturin! %orporation "as for&ed and re!istered "iththe Securities and 6chan!e %o&&ission. Subse:uentl#, $cr#lic applied for re!istration "ith the-oard of Invest&ents for incentives under the ()'7 O&nibus Invest&ents %ode. The application"as approved on a preferred non1pioneer status.

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In ()'', $cr#lic beca&e operational and hired "orers accordin! to its o"n criteria and standards.So&eti&e in ;ul#, ()'), the "orers of $cr#lic unioni4ed and a dul# certified collective bar!ainin!a!ree&ent "as eecuted.

In ())* or a #ear after the "orers of $cr#lic have been unioni4ed and a %-$ eecuted, thepetitioner union clai&ed that the plant facilities built and set up b# $cr#lic should be considered as an

etension or epansion of the facilities of private respondent %o&pan# pursuant to Section (+c,$rticle I of the %-$, to "it,.

c This $!ree&ent shall appl# to the %o&pan#

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The central issue sub&itted for arbitration is "hether or not the operations in Indophil $cr#lic%orporation are an etension or epansion of private respondent %o&pan#. %orollar# to theafore&entioned issue is the :uestion of "hether or not the ran1and1file e&plo#ees "orin! atIndophil $cr#lic should be reco!ni4ed as part of, andor "ithin the scope of the bar!ainin! unit.

Petitioner &aintains that public respondent $rbitrator !ravel# erred in interpretin! Section l+c, $rticle

I of the %-$ in its literal &eanin! "ithout tain! co!ni4ance of the facts adduced that the creation ofthe aforesaid Indophil $cr#lic is but a devise of respondent %o&pan# to evade the application of the%-$ bet"een petitioner 0nion and respondent %o&pan#.

Petitioner stresses that the articles of incorporation of the t"o corporations establish that the t"oentities are en!a!ed in the sa&e ind of business, "hich is the &anufacture and sale of #arns ofvarious counts and inds and of other &aterials of indred character or nature.

%ontrar# to petitionerunct or business conduit ofprivate respondent because it has a separate le!iti&ate business purpose. In addition, the Solicitor2eneral alle!es that the pri&ar# purpose of private respondent is to en!a!e in the business of

&anufacturin! #arns of various counts and inds and tetiles. On the other hand, the pri&ar#purpose of Indophil $cr#lic is to &anufacture, bu#, sell at "holesale basis, barter, i&port, eport andother"ise deal in #arns of various counts and inds. @ence, unlie private respondent, Indophil

$cr#lic cannot &anufacture tetiles "hile private respondent cannot bu# or i&port #arns.

Further&ore, petitioner e&phasi4es that the t"o corporations have practicall# the sa&eincorporators, directors and officers. In fact, of the total stoc subscription of Indophil $cr#lic,P(,7=),)7*.** "hich represents sevent# percent +7*E of the total subscription of P?,**,***.**"as subscribed to b# respondent %o&pan#.

On this point, private respondent cited the case of iatagon La!or "ederation #.$ple, 2.R. No. 51===)81)=, Dece&ber 8, ()'*, (*l S%R$ 8=, "hich ruled that t"o corporations cannot be treated asa sin!le bar!ainin! unit even if their businesses are related. It sub&its that the fact that there are as&an# bar!ainin! units as there are co&panies in a con!lo&eration of co&panies is a positive proofthat a corporation is endo"ed "ith a le!al personalit# distinctl# its o"n, independent and separatefro& other corporations +seeRollo, pp. (9*1(9(.

Petitioner notes that the fore!oin! evidence sufficientl# establish that $cr#lic is but an etension orepansion of private respondent, to "it3

+a the t"o corporations have their ph#sical plants, offices andfacilities situated in the sa&e co&pound, at -arrio 5a&bain, Marilao,-ulacanG

+b &an# of private respondent

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Private respondent insists that the eistence of a bonafide business relationship bet"een $cr#lic andprivate respondent is not a proof of bein! a sin!le corporate entit# because the services "hich aresupposedl# provided b# it to $cr#lic are auiliar# services or activities "hich are not reall# essentialin the actual production of $cr#lic. It also pointed out that the essential services are dischar!edeclusivel# b# $cr#lic personnel under the control and supervision of $cr#lic &ana!ers andsupervisors.

In su&, petitioner insists that the public respondent co&&itted !rave abuse of discretion a&ountin!to lac or in ecess of >urisdiction in erroneousl# interpretin! the %-$ provision and in failin! todisre!ard the corporate entit# of $cr#lic.

/e find the petition devoid of &erit.

Ti&e and a!ain, /e stress that the decisions of voluntar# arbitrators are to be !iven the hi!hestrespect and a certain &easure of finalit#, but this is not a hard and fast rule, it does not preclude

>udicial revie" thereof "here "ant of >urisdiction, !rave abuse of discretion, violation of due process,denial of substantial >ustice, or erroneous interpretation of the la" "ere brou!ht to our attention. +seeOca&po, et al. v. National 5abor Relations %o&&ission, 2.R. No. '(977, ? ;ul# ())*, First Division

Minute Resolution citingOceanic -ic Division +FF/ v. Ro&ero, 2.R. No. 51=8')*, ;ul# (9, ()'=,(8* S%R$ 8)?

It should be e&phasi4ed that in renderin! the sub>ect arbitral a"ard, the voluntar# arbitratorTeodorico %alica, a professor of the 0.P. $sian 5abor 6ducation %enter, no" the Institute forIndustrial Relations, found that the eistin! la" and >urisprudence on the &atter, supported theprivate respondentustif# the piercin! of the corporate veil of $cr#lic.

In the sa&e case of %mali, et al.#.Court of ppeals+supra, /e alread# e&phasi4ed that Hthe le!alcorporate entit# is disre!arded onl# if it is sou!ht to hold the officers and stocholders directl# liable

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for a corporate debt or obli!ation.H In the instant case, petitioner does not see to i&pose a clai&a!ainst the &e&bers of the $cr#lic.

Further&ore, /e alread# ruled in the case of iatagon La!or "ederation Local ''( of the %LG)* #.$ple+supra that it is !rave abuse of discretion to treat t"o co&panies as a sin!le bar!ainin! unit"hen these co&panies are indubitabl# distinct entities "ith separate >uridical personalities.

@ence, the $cr#lic not bein! an etension or epansion of private respondent, the ran1and1filee&plo#ees "orin! at $cr#lic should not be reco!ni4ed as part of, andor "ithin the scope of thepetitioner, as the bar!ainin! representative of private respondent.

$ll pre&ises considered, the %ourt is convinced that the public respondent Voluntar# $rbitrator didnot co&&it !rave abuse of discretion in its interpretation of Section l+c, $rticle I of the %-$ that the

$cr#lic is not an etension or epansion of private respondent.

$%%ORDIN25A, the petition is D6NI6D and the a"ard of the respondent Voluntar# $rbitrator arehereb# $FFIRM6D.

SO ORD6R6D.

+ar#asa, C.., Cruz and Grino-uino, ., concur.

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Republic of the PhilippinesSUPREME COURT

Manila

FIRST DIVISION

G.R. No. 111262 Se-eber 19, 1996

S'N MIGUE! CORPOR'TION EMP!O(EES UNION%PTG#O, rere/e*-e+ by -/ Pre/+e*-R'(MUNDO IPO!ITO, R., petitioner,vs.ON. M'. NIE&ES D. CONFESOR, Sere-ary o !abor, De-. o !abor E5oye*-, S'NMIGUE! CORPOR'TION, M'GNO!I' CORPOR'TION Forer5y, Ma7*o5a P5a*-8 a*+ S'NMIGUE! FOODS, INC. Forer5y, )%Me7 P5a*-8, respondents.

$'PUN'N, J.:

This is a petition for certiorariassailin! the Order of the Secretar# of 5abor rendered onFebruar# (, ())8 involvin! a labor dispute at San Mi!uel %orporation.

The facts are as follo"s3

On ;une ?', ())*, petitioner1union San Mi!uel %orporation 6&plo#ees 0nion PT2/Oentered into a %ollective -ar!ainin! $!ree&ent +%-$ "ith private respondent San Mi!uel%orporation +SM% to tae effect upon the epiration of the previous %-$ or on ;une 8*,()').

This %-$ provided, a&on! others, that3

$RTI%56 CIV

%RTI$+ $" GR//M/+T

Sec. (. This greement 0hich shall !e !inding upon the parties hereto and theirrespecti#e successors-in-interest, shall !ecome effecti#e and shall remain in forceand effect until une 1(, '223.

Sec. ?. In accordance 0ith rticle 341- of the La!or Code as amended, the term of

this greement insofar as the representation aspect is concerned, shall !e for fi#e 5467ears from ul7 ', '282 to une 1(, '229.:ence, the freedom period for purposes ofsuch representation shall !e sixt7 5;(6 da7s prior to une 1(, '229 .

Sec. 8.

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In eepin! "ith their vision and lon! ter& strate!# for business epansion, SM%&ana!e&ent infor&ed its e&plo#ees in a letter dated $u!ust (8, ())( 2that the co&pan#"hich "as co&posed of four operatin! divisions na&el#3 +( -eer, +? Paca!in!, +8 Feedsand 5ivestocs, += Ma!nolia and $!ri1business "ould under!o a restructurin!. 3

6ffective October (, ())(, Ma!nolia and Feeds and 5ivestoc Division "ere spun1off and

beca&e t"o separate and distinct corporations3 Ma!nolia %orporation +Ma!nolia and SanMi!uel Foods, Inc. +SMFI. Not"ithstandin! the spin1offs, the %-$ re&ained in force andeffect.

$fter ;une 8*, ())?, the %-$ "as rene!otiated in accordance "ith the ter&s of the %-$ and$rticle ?81$ of the 5abor %ode. Ne!otiations started so&eti&e in ;ul#, ())? "ith the t"oparties sub&ittin! their respective proposals and counterproposals.

Durin! the ne!otiations, the petitioner1union insisted that the bar!ainin! unit of SM% shouldstill include the e&plo#ees of the spun1off corporations3 Ma!nolia and SMFIG and that therene!otiated ter&s of the %-$ shall be effective onl# for the re&ainin! period of t"o #ears oruntil ;une 8*, ())=.

SM%, on the other hand, contended that the &e&berse&plo#ees "ho had &oved toMa!nolia and SMFI, auto&aticall# ceased to be part of the bar!ainin! unit at the SM%.Further&ore, the %-$ should be effective for three #ears in accordance "ith $rt. ?81$ of the5abor %ode.

0nable to a!ree on these issues "ith respect to the bar!ainin! unit and duration of the %-$,petitioner1union declared a deadloc on Septe&ber ?), ())*.

On October ?, ())?, a Notice of Strie "as filed a!ainst SM%.

In order to avert a strie, SM% re:uested the National %onciliation and Mediation -oard

+N%M- to conduct preventive &ediation. No settle&ent "as arrived at despite several&eetin!s held bet"een the parties.

On Nove&ber 8, ())?, a strie vote "as conducted "hich resulted in a H#es voteH in favor ofa strie.

On Nove&ber =, ())?, private respondents SM%, Ma!nolia and SMFI filed a petition "ith theSecretar# of 5abor pra#in! that the latter assu&e >urisdiction over the labor dispute in a vitalindustr#.

$s pra#ed for, the Secretar# of 5abor assu&ed >urisdiction over the labor dispute onNove&ber (*, ())?. 4Several conciliation &eetin!s "ere held but still no

a!ree&entsettle&ent "as arrived at b# both parties.

$fter the parties sub&itted their respective position papers, the Secretar# of 5abor issued theassailed Order on Februar# (, ())8 directin!, a&on! others, that the rene!otiated ter&s ofthe %-$ shall be effective for the period of three +8 #ears fro& ;une 8*, ())?G and that such%-$ shall cover onl# the e&plo#ees of SM% and not of Ma!nolia and SMFI.

Dissatisfied, petitioner1union no" co&es to this %ourt :uestionin! this Order of the Secretar#of 5abor.

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Subse:uentl#, on March 8*, ()), petitioner1union filed a Motion for Issuance of aTe&porar# Restrainin! Order or /rit of Preli&inar# In>unction to en>oin the holdin! of thecertification elections in the different co&panies, &aintainin! that the e&plo#ees of Ma!noliaand SMFI fall "ithin the bar!ainin! unit of SM%.

On March ?), ()), the %ourt issued a resolution !rantin! the te&porar# restrainin! order

pra#ed for. 6

Mean"hile, an ur!ent &otion for leave to intervene :in the case "as filed b# the Sa&ahann! Mala#an! Man!!a!a"a1San Mi!uel %orporation1Federation of Free /orers +SMM1SM%1FF/ throu!h its authori4ed representative, 6l&er S. $r&ando, alle!in! that it is one ofthe contendin! parties adversel# affected b# the te&porar# restrainin! order.

The Intervenor cited the case of aniel eopardi4ed the e&plo#ees< ri!ht to conclude a ne" %-$. $t the sa&e ti&e, he challen!edthe le!al personalit# of Mr. Ra#&undo @ipolito, ;r. to represent the 0nion as its president"hen the latter "as alread# officiall# dis&issed fro& the co&pan# on October =, ())=.

$&idst all these pleadin!s, the follo"in! pri&ordial issues arise3

( /hether or not the duration of the rene!otiated ter&s of the %-$ is to be effective forthree #ears of for onl# t"o #earsG and

? /hether or not the bar!ainin! unit of SM% includes also the e&plo#ees of the Ma!nolia

and SMFI.

Petitioner1union contends that the duration for the non1representation provisions of the %-$should be coter&inous "ith the ter& of the bar!ainin! a!enc# "hich in effect shall be for there&ainin! t"o #ears of the current %-$, citin! a previous decision of the Secretar# of 5aboron Dece&ber (=, ())? in the &atter of the labor dispute at Philippine Refinin! %o&pan#.

@o"ever, the Secretar# of 5abor, in her :uestioned Order of Februar# (, ())8 ruled that therene!otiated ter&s of the %-$ at SM% should run for a period of three +8 #ears.

/e a!ree "ith the Secretar# of 5abor.

Pertinent to the first issue is $rt. ?81$ of the 5abor %ode as a&ended "hich reads3

$rt. ?81$. Terms of a Collecti#e Bargaining greement. n7 Collecti#eBargaining greement that the parties ma7 enter into shall, insofar as therepresentation aspect is concerned, !e for a term of fi#e 546 7ears. No petition:uestionin! the &a>orit# status of the incu&bent bar!ainin! a!ent shall beentertained and no certification election shall be conducted b# the Depart&ent of5abor and 6&plo#&ent outside of the sit#1da# period i&&ediatel# before the date ofepir# of such five #ear ter& of the %ollective -ar!ainin! $!ree&ent.ll other

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pro#isions of the Collecti#e Bargaining greement shall !e renegotiated not laterthan three 516 7ears after its execution. $n# a!ree&ent on such other provisions ofthe %ollective -ar!ainin! $!ree&ent entered into "ithin si +9 &onths fro& the dateof epir# of the ter& of such other provisions as fied in such %ollective -ar!ainin!

$!ree&ent, shall retroact to the da# i&&ediatel# follo"in! such date. If an# sucha!ree&ent is entered into be#ond si &onths, the parties shall a!ree on the duration

of retroactivit# thereof. In case of a deadloc in the rene!otiation of the collectivebar!ainin! a!ree&ent, the parties &a# eercise their ri!hts under this %ode.+6&phasis supplied.

$rticle ?81$ is a ne" provision. This "as incorporated b# Section ?( of Republic $ct No.97( +the @errera1Veloso 5a" "hich too effect on March ?(, ()'). This ne" provisionstates that the %-$ has a ter& of five + #ears instead of three #ears, before thea&end&ent of the la" as far as the representation aspect is concerned. $ll other provisionsof the %-$ shall be ne!otiated not later than three +8 #ears after its eecution. TheHrepresentation aspectH refers to the identit# and &a>orit# status of the union that ne!otiatedthe %-$ as the eclusive bar!ainin! representative of the appropriate bar!ainin! unitconcerned. H$ll other provisionsH si&pl# refers to the rest of the %-$, econo&ic as "ell asnon1econo&ic provisions, ecept representation. 10

$s the Secretar# of 5abor herself observed in the instant case, the la" is clear and definiteon the duration of the %-$ insofar as the representation aspect is concerned, but is :uitea&bi!uous "ith the ter&s of the other provisions of the %-$. It is a cardinal principle ofstatutor# construction that the %ourt &ust ascertain the le!islative intent for the purpose of!ivin! effect to an# statute. The histor# of the ti&es and state of the thin!s eistin! "hen theact "as fra&ed or adopted &ust be follo"ed and the conditions of the thin!s at the ti&e ofthe enact&ent of the la" should be considered to deter&ine the le!islative intent. 11/e loointo the discussions leadin! to the passa!e of the la"3

T@6 %@$IRM$N +R6P. V65$S%O3 . . .the CB, insofar as the economic pro#isionsare concerned . . .

T@6 %@$IRM$N +S6N. @6RR6R$3 Maximum of three 7earsJ

T@6 %@$IRM$N +S6N. V65OSO3 Maximum of three 7ears.

T@6 %@$IRM$N +S6N. @6RR6R$3 Present practiceJ

T@6 %@$IRM$N +R6P. V65OSO3 In other "ords, after three #ears p"ede nan!&a!ne!otiate in the %-$ for the re&ainin! t"o #ears.

T@6 %@$IRM$N +R6P. @6RR6R$3 Aou can ne!otiate for one #ear, t"o #ears orthree #ears but assu&in! three #ears "hich, I thin, thatan ang importante.

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Aou no", for us na na!ne1ne!otiate, an! ha4ard tala!a sa ne!otiation, "hen "ene!otiate "ith so&ebod# na hindi natin ilala, then, "e are !overned b# our biasesna ito a# destro#er n! 5aborG an! &!a e&plo#er, ito ba#aran o lan! ito oa# na.

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@ON. %@$IRM$N @6RR6R$3 $ne the third 7ear 7ou can start negotiating tochange the terms and conditions.

@ON. ISIDRO3 Aes.

@ON. %@$IRM$N @6RR6R$3 $ssu&in! #ou "ill follo" the practice . . .

@ON. ISIDRO3 Oo.

@ON. %@$IRM$N @6RR6R$3 But on the fifth 7ear, ang representation status no0can !e uestioned, so !a?a pu0edeng mag?aroon ng certification election. If theincum!ent union loses, then the ne0 union administers the contract for one 7ear togi#e him time to ?no0 his counterpart @ the emplo7er, !efore he can negotiate for ane0 term. I7an ang ad#antage.

@ON. ISIDRO3 Basi, "hen the %-$ has onl# a three1#ear lifeti&e "ith respect to theter&s and conditions and then, so #ou have to rene" that in three #ears #ourene" for another three #ears, &a#roon na na&an another five #ears i#on! ano . . .

@ON. $NI$23 @indi, an! natitira duon sa representation t"o #ears na lan!.

@ON. %@$IRM$N @6RR6R$3 T"o #ears na lan! sa representation.

@ON. $NI$23 So that if the# chan!ed the union, i#on! last #ear . . .

@ON. %@$IRM$N @6RR6R$3 I#on lan!, that #ou have to ad&inister the contract.Then, voluntar# arbitration na a#o and then &a#roon a nan! probis#on Hretroact onthe date of the epir# dateH. Pa!natalo an! incu&bent un#on, &a!1aassu&e an!ne" union, ad&inister the contract.s far as the term and condition, for one 7ear,and that 0ill gi#e him time and the emplo7er to ?no0 each other.

@ON. ;$-$R3 -o#, let us be realistic. I thin if a ne" union "ins a certificationelection, it "ould not "ant to ad&inister a %-$ "hich has not been ne!otiated b# theunion itself.

@ON. %@$IRM$N @6RR6R$3 That is not true, @on. This is true because "hat ishappenin! no" in the countr# is that the ter& n! contract natin, duon din &a!e1epire an! representation. I#on an! nan!#ari. That is "here #ou have the !ulo.2anoon an! nan!#ari. So, an! nan!#ari di#an, pa!1&a#roon certification election,epire an! contract, ano an! usual issue co&pan# union. I can #ou +sic !ive #ou&ore "hat the incu&bent union is !ivin!. So an! &an!#a#ari di#an, pa!1ne!otiate&o hardline na a!ad.

@ON. %@$IRM$N V65OSO 3 Mon, for four #earsJ

@ON. ISIDRO3 $n! tin!in o lan! dito, i#on! distinction bet"een the ter&s and therepresentation aspect "h# do "e have to distin!uish bet"een three and fiveJ/hat

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@ON. ISIDRO3 Puro three #ears.

@ON. %@$IRM$N @6RR6R$3 That is "hat "e are tr#in! to avoid because an!realit# di#an, Mart, pa!paso &o sa u&pan#a, &a!1ne1ne!otiate a n! si &onths,that

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the incu&bent union as the eclusive bar!ainin! a!ent. 5ie"ise, the ter&s and conditions ofe&plo#&ent +econo&ic and non1econo&ic can not be :uestioned b# the e&plo#ers ore&plo#ees durin! the period of effectivit# of the %-$. The %-$ is a contract bet"een theparties and the parties &ust respect the ter&s and conditions of the a!ree&ent. 14Notabl#,the fra&ers of the la" did not !ive a fied ter& as to the effectivit# of the ter&s andconditions of e&plo#&ent. It can be !leaned fro& their discussions that it "as left to the

parties to fi the period.

In the instant case, it is not difficult to deter&ine the period of effectivit# for the non1representation provisions of the %-$. Tain! it fro& the histor# of their %-$s, SM% intendedto have the ter&s of the %-$ effective for three +8 #ears reconed fro& the epiration of theold or previous %-$ "hich "as on ;une 8*, ()'), as it provides3

Sec. (. This $!ree&ent "hich shall be bindin! upon the parties hereto and theirrespective successors1in1interest, shall beco&e effective and shall re&ain in forceand effect until ;une 8*, ())?.

The ar!u&ent that the PR% case is applicable is indeed &isplaced. /e :uote "ith favor the

Order of the Secretar# of 5abor in the li!ht of SM%ective cannot be achieved "ithout !ivin! due consideration to thepeculiarities and uni:ue characteristics of the e&plo#er. In the case at bar, there isno dispute that the &other corporation +SM% spun1off t"o of its divisions andthereb# !ave birth to t"o +? other entities no" no"n as Ma!nolia %orporation andSan Mi!uel Foods, Inc. In order to effect a s&ooth transition, the co&paniesconcerned continued to reco!ni4e the eistin! unions as the bar!ainin! a!ents oftheir respective bar!ainin! units. In the &eanti&e, the other unions in theseco&panies eventuall# concluded their %-$ ne!otiations on the re&ainin! ter& and

all of the& a!reed on a 81#ear c#cle. Notabl#, the follo"in! %-$s "ere for!edincorporatin! a ter& of 81#ears on the rene!otiated provisions, to "it3

(. SM% dail#1paid e&plo#ees union +I-M

?. SMFI &onthl#1paid e&plo#ees and dail#1paid e&plo#ees at the %abu#ao Plant.

There is a direct lin bet"een the voluntar# reco!nition b# the co&pan# of thecontinuin! representative status of the unions after the afore&entioned spin1offs and

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the stand of the co&pan# for a 81#ear rene!otiated c#cle "hen the econo&icprovisions of the eistin! %-$s epired, i.e., the &aintain stabilit# and avoidconfusion "hen the u&bilical cord of the t"o divisions "ere severed fro& theirparent. These t"o cannot be considered independentl# of each other for the# "ereintended to reinforce one another. Precisel#, the co&pan# conceded to face thesa&e union not"ithstandin! the spin1offs in order to preserve industrial peace durin!

the infanc# of the t"o corporations. If the union "ould insist on a shorter rene!otiatedter&, then all the advanta!es !ained b# both parties in this re!ard, "ould have !oneto nau!ht. /ith this in &ind, this office feels that it "ill betra# its &andate should "eorder the parties to eecute a ?1#ear rene!otiated ter& for then chaos and confusion,rather than tran:uillit#, "ould be the order of the da#. /orse, there is a stron!lielihood that such a rulin! &i!ht spa"n discontent and possible &ass actionsa!ainst the co&pan# co&in! fro& the other unions "ho had alread# a!reed to a 81#ear rene!otiated ter&s. If this happens, the purpose of this Officeorit# of the &e&bersin the bar!ainin! unit, the sub>ect contract is valid and le!al and therefore, binds the

contractin! parties. The sa&e "ill ho"ever not adversel# affect the ri!ht of anotherunion to challen!e the &a>orit# status of the incu&bent bar!ainin! a!ent "ithin sit#+9* da#s before the lapse of the ori!inal five + #ear ter& of the %-$.

Thus, "e do not find an# !rave abuse of discretion on the part of the Secretar# of 5abor inrulin! that the effectivit# of the rene!otiated ter&s of the %-$ shall be for three +8 #ears.

/ith respect to the second issue, there is, lie"ise, no &erit in petitioner1union

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satisf# the chan!in! needs of our custo&ers and end1consu&ers. $s subsidiaries,Ma!nolia and F5D "ill !ain better industr# focus and fleibilit#, !reater a"areness ofoperatin! results, and speedier, &ore responsive decision &ain!.

/e onl# have to loo at the eperience of %oca1%ola -ottlers Philippines, Inc., sincethis co&pan# "as or!ani4ed about ten #ears a!o, to see the benefits that arise fro&restructurin! a division of San Mi!uel into a &ore co&petitive or!ani4ation. $s astand1alone enterprise, %%-PI en!ineered a dra&atic turnaround and has sustainedits sales and &aret share leadership ever since.

/e are confident that histor# "ill repeat itself, and the transfor&ation of Ma!noliaand F5D "ill be successful as that of %%-PI. 1:

0ndeniabl#, the transfor&ation of the co&panies "as a &ana!e&ent prero!ative andbusiness >ud!&ent "hich the courts can not loo into unless it is contrar# to la", public polic#or &orals. Neither can "e i&pute an# bad faith on the part of SM% so as to >ustif# the

application of the doctrine of piercin! the corporate veil.1;

6ver &indful of the e&plo#eesuridicalpersonalities. Thus, the# can not belon! to a sin!le bar!ainin! unit as held in the case ofiatagon La!or "ederation Local ''( of the %LG)* #. $ple. 21/e elucidate3

The fact that their businesses are related and that the ?89 e&plo#ees of the 2eor!iaPacific International %orporation "ere ori!inall# e&plo#ees of 5ian!a -a# 5o!!in!%o., Inc. is not a >ustification for disre!ardin! their separate personalities. @ence, the?89 e&plo#ees, "ho are no" attached to 2eor!ia Pacific International %orporation,should not be allo"ed to vote in the certification election at the 5ian!a -a# 5o!!in!%o., Inc. The# should vote at a separate certification election to deter&ine thecollective bar!ainin! representative of the e&plo#ees of 2eor!ia Pacific International%orporation.

Petition1union

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Moreover, in deter&inin! an appropriate bar!ainin! unit, the test of !roupin! is &utualit# orco&&onalit# of interests. The e&plo#ees sou!ht to be represented b# the collectivebar!ainin! a!ent &ust have substantial &utual interests in ter&s of e&plo#&ent and "orin!conditions as evinced b# the t#pe of "or the# perfor&ed. 22%onsiderin! the spin1offs, theco&panies "ould conse:uentl# have their respective and distinctive concerns in ter&s of thenature of "or, "a!es, hours of "or and other conditions of e&plo#&ent. Interests of

e&plo#ees in the different co&panies perforce differ. SM% is en!a!ed in the business of thebeer &anufacturin!. Ma!nolia is involved in the &anufacturin! and processin! of diar#products 23"hile SMFI is involved in the production of feeds and the processin! of chicen.24The nature of their products and scales of business &a# re:uire different sills "hich &ustnecessaril# be co&&ensurated b# different co&pensation paca!es. The differentco&panies &a# have different volu&es of "or and different "orin! conditions. For suchreason, the e&plo#ees of the different co&panies see the need to !roup the&selvesto!ether and or!ani4e the&selves into distinctive and different !roups. It "ould then be bestto have separate bar!ainin! units for the different co&panies "here the e&plo#ees canbar!ain separatel# accordin! to their needs and accordin! to their o"n "orin! conditions.

/e reiterate "hat "e have eplained in the case of %ni#ersit7 of the *hilippines #. "errer-Calle=a 2that3

KTLhere are various factors "hich &ust be satisfied and considered in deter&inin! theproper constituenc# of a bar!ainin! unit. No one particular factor is itself decisive ofthe deter&ination. The "ei!ht accorded to an# particular factor varies in accordance"ith the particular :uestion or :uestions that &a# arise in a !iven case. /hat arethese factorsJ Rothenber! &entions a !ood nu&ber, but the &ost pertinent to ourcase are3 +( "ill of the e&plo#ees +2lobe DoctrineG +? affinit# and unit ofe&plo#ees< interest, such as substantial si&ilarit# of "or and duties, or si&ilarit# ofco&pensation and "orin! conditionsG +8 prior collective bar!ainin! histor#G and +=e&plo#&ent status, such as te&porar#, seasonal and probationar# e&plo#ees. . . .

$n enli!htenin! appraisal of the proble& of definin! an appropriate bar!ainin! unit is!iven in the (*th $nnual Report of the National 5abor Relations -oard "herein it ise&phasi4ed that the factors "hich said board &a# consider and "ei!h in fiin!appropriate units are3 the histor#, etent and t#pe of or!ani4ation of e&plo#eesG thehistor# of their collective bar!ainin!G the histor#, etent and t#pe of or!ani4ation ofe&plo#ees in other plants of the sa&e e&plo#er, or other e&plo#ers in the sa&eindustr#G the sill, "a!es, "or, and "orin! conditions of the e&plo#eesG the desiresof the e&plo#eesG the eli!ibilit# of the e&plo#ees for &e&bership in the union orunions involvedG and the relationship bet"een the unit or units proposed and thee&plo#erects of collective bar!ainin! +citing S&ith on 5abor 5a"s,8(918(7G Francisco, 5abor 5a"s, (9?. . .

Finall#, "e tae note of the fact that the separate interests of the e&plo#ees of Ma!nolia andSMFI fro& those of SM% has been reco!ni4ed in the case of aniel Bor!on #. Laguesma. 26/e :uote3

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6ven assu&in! in gratia argumentithat at the ti&e of the election the# "ere re!ulare&plo#ees of San Mi!uel, nonetheless, these "orers are no lon!er connected "ithSan Mi!uel %orporation in an# &anner because Ma!nolia has ceased to be adivision of San Mi!uel %orporation and has been for&ed into a separate corporation"ith a personalit# of its o"n +p. 8*, Rollo. This develop&ent, "hich "as brou!ht toour attention b# private respondents, necessaril# renders &oot and acade&ic an#

further discourse on the propriet# of the elections "hich petitioners i&pu!n #iatherecourse +p. 8(), Rollo.

In vie" of all the fore!oin!, "e do not find an# !rave abuse of discretion on the part of theSecretar# of 5abor in renderin! the assailed Order.

/@6R6FOR6, the petition is DISMISS6D for lac of &erit. The Te&porar# Restrainin!Order issued on March ?), ()) is lifted.

SO ORD6R6D.

Bellosillo, Aitug and :ermosisima, r., ., concur.

*adilla, ., too? no part.

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Republic of the PhilippinesSUPREME COURT

Manila

S6%OND DIVISION

G.R. No. 9:020 u*e ;, 1992

C'!IFORNI' M'NUF'CTURING CORPOR'TION, petitioner,vs.TE ONOR')!E UNDERSECRET'R( OF !')OR )IEN&ENIDO E. !'GUESM', ')DFEDER'TION OF FREE #OR$ERS FF#8, C'!IFORNI' MFG. CORP. SUPER&ISORS UNIONC'PTER C'!M'SUCO8, respondents.

P'R'S, J.:

This is a petition for revie" on certiorari"ith pra#er for preli&inar# in>unction andor te&porar#restrainin! order seein! to annul and set aside the +a resolution

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On ;ul# ?=. ())*, FF/%$5M$S0%O filed its repl# &aintainin! that under the la", "hen there isno eistin! unit #et in aparticular !argaining unitat the ti&e a petition for certification election isfiled, the ?E rule on the si!natories does not appl#G that the Hor!ani4ed establish&entHconte&plated b# la" does not refer to a Hco&pan#Hper sebut rather refers to a Hbar!ainin! unitH"hich &a# be of different classifications in a sin!le co&pan#G that %M% has at least t"o +? differentbar!ainin! units, na&el#, the supervisor# +unor!ani4ed and the ran1and1file +or!ani4edG that the

si!natories to the petition have been perfor&in! supervisor# functionsG that since it is %M% "hichpro&oted the& to the positions, of supervisors. it is alread# estopped fro& clai&in! that the# are notsupervisorsG that the said supervisors "ere ecluded fro& the covera!e of the collective bar!ainin!a!ree&ent of its ran1and1file e&plo#eesG and that the contested si!natories are indeed supervisorsas sho"n in the H%M% Master 5ist of 6&plo#eesH of ;anuar# ?, ())* and the %MS Publication+$nne H2H, I!id., p 8*.

On $u!ust (?, ())*, the Med1$rbiter issued an order, the decretal portion of "hich reads3

/@6R6FOR6, pre&ises considered, it is hereb# ordered that a certification electionbe conducted a&on! the supervisor# e&plo#ees of %alifornia Manufacturin!%orporation "ithin t"ent# +?* da#s fro& receipt hereof "ith the usual pre1election

conference of the parties to thresh out the &echanics of the election The pa#roll ofthe co&pan# three +8 &onths prior to the filin! of the petition shall be used as thebasis in deter&inin! the list of eli!ible voters.

The choices are3

(. Federation of Free /orers +FF/ %alifornia Manufacturin!%orporation Supervisors 0nion %hapter +%$5M$S0%OG and

?. No union.

SO ORD6R6D. +$nne H@H I!id., p. 88.

%M% thereafter appealed to the Depart&ent of 5abor and 6&plo#&ent "hich, ho"ever, affir&ed theabove order in its assailed resolution dated October (9, ())* +$nne, H-H,I!id, a (' %M%

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+6&phasis supplied. Other"ise stated, the establish&ent concerned &ust have no certifiedbar!ainin! a!ent +$ssociated 5abor 0nions K$50L v. %alle>a 2.R. No. '??9*, ;ul# (), ()'), (7S%R$ =)*. In the instant case, it is be#ond cavil that the supervisors of %M% "hich constitute abar!ainin! unit separate and distinct fro& that of the ran1and1file, have no such a!ent. thus the#correctl# filed a petition for certification election thru union FF/1%$5M$S0%O, lie"ise indubitabl# ale!iti&ate labor or!ani4ation. %M%

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Republic of the PhilippinesSUPREME COURT

Manila

FIRST DIVISION

G.R. No. ;0; No=eber 6, 19;9

'SSOCI'TED !')OR UNIONS '!U8, petitioner,vs.ON. PUR' FERRER%C'!!E', DIRECTOR, )URE'U OF !')OR RE!'TIONS, DEP'RTMENTOF !')OR 'ND EMP!O(MENT, N'TION'! FEDER'TION OF !')OR UNIONS N'F!U8,respondents.

G'NC'(CO, J.:

Is the contract bar rule applicable "here a collective bar!ainin! a!ree&ent "as hastil# concluded indefiance of the order of the &ed1arbiter en>oinin! the parties fro& enterin! into a %-$ until the issueon representation is finall# resolvedJ This is the pri&ar# issue in this special civil action for certiorari.

The Philippine $ssociated S&eltin! and Refinin! %orporation +P$S$R is a corporation establishedand eistin! pursuant to Philippine la"s and is en!a!ed in the &anufacture and processin! ofcopper cathodes "ith a plant operatin! in Isabel, 5e#te. It e&plo#s &ore or less ei!ht hundred fift#+'* ran1and1file e&plo#ees in its depart&ents.

Petitioner $ssociated 5abor 0nion +$50 had a collective bar!ainin! a!ree&ent +%-$ "ith P$S$R"hich epired on $pril (, ()'7. Several da#s before the epiration of the said %-$ or on March ?8,()'7, private respondent National Federation of 5abor 0nions +N$F50 filed a petition for

certification election "ith the -ureau of 5abor Relations Re!ional Office in Tacloban %it# doceted asM6D1$R-1RO VII %ase No. 81?'1'7, alle!in!, a&on! others, that no certification election had beenheld in P$S$R "ithin t"elve +(? &onths i&&ediatel# precedin! the filin! of the said petition.

Petitioner &oved to intervene and sou!ht the dis&issal of the petition on the !round that N$F50failed to present the necessar# si!natures in support of its petition. In the order dated $pril ?(, ()'7,1Med1$rbiter -ienvenido %. 6lorcha dis&issed the petition. @o"ever, the order of dis&issal "as setaside in another order dated Ma# ', ()'7 and the case "as rescheduled for hearin! on Ma# ?),()'7. The said order lie"ise en>oined P$S$R fro& enterin! into a collective bar!ainin! a!ree&ent"ith an# union until after the issue of representation is finall# resolved. In the order dated ;une (,()'7, 2the petition for certification "as dis&issed for failure of N$F50 to solicit ?*H7c of the totalnu&ber of ran and file e&plo#ees "hile $50 sub&itted 88 pa!es containin! the si!natures of''.E of the ran and file e&plo#ees at P$S$R.

Private respondent appealed the order of dis&issal to the -ureau of 5abor Relations. /hile theappeal "as pendin!, petitioner $50 concluded ne!otiations "ith P$S$R on the proposed %-$. On;ul# ?=, ()'7, copies of the ne"l# concluded %-$ "ere posted in four += conspicuous places in theco&pan# pre&ises. The said %-$ "as ratified b# the &e&bers of the bar!ainin! unit on ;ul# ?',()'7. 3Thereafter, petitioner $50 &oved for the dis&issal of the appeal alle!in! that it had >ustconcluded a %-$ "ith P$S$R and that the said %-$ had been ratified b# )'E of the re!ular ran1

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and1file e&plo#ees and that at least 7 of N$F50orit# status in the bar!ainin! unit has indeed a considerable support that a certificationelection should be ordered, other"ise, the petition should be su&&aril# dis&issed. 6Petitioner addsthat public respondent &issed the le!al intent of $rticle ?7 of the 5abor %ode as a&ended b#

6ecutive Order No. (((.:

In effect, petitioner is of the vie" that $rticle ?7 of the 5abor %ode "hich re:uires the si!nature of atleast ?*E of the total nu&ber of ran1and1file e&plo#ees should be applied in the case at bar.

The petition is devoid of &erit.

$s it has been ruled in a lon! line of decisions, ;a certification proceedin!s is not a liti!ation in thesense that the ter& is ordinaril# understood, but an investi!ation of a non1adversarial and fact1findin! character. $s such, it is not covered b# the technical rules of evidence. Thus, as providedunder $rticle ??( of the 5abor %ode, proceedin!s before the National 5abor Relations %o&&ission+N5R% are not covered b# the technical rules of procedure and evidence. The %ourt had previousl#

construed $rticle ??( as to allo" the N5R% or the labor arbiter to decide the case on the basis ofposition papers and other docu&ents sub&itted "ithout resortin! to technical rules of evidence asobserved in re!ular courts of >ustice. 9

On the other hand, $rticle ?7 is applicable onl# to unor!ani4ed labor or!ani4ations and not toestablish&ents lie P$S$R "here there eists a certified bar!ainin! a!ent, petitioner $50, "hich asthe record sho"s had previousl# entered into a %-$ "ith the &ana!e&ent. This could be discernedfro& the clear intent of the la" "hich provides that

$RT. ?7. *etitions in unorganized esta!lishments. In an# establish&ent"here there is no certified bar!ainin! a!ent, the petition for certificationelection filed b# a le!iti&ate labor or!ani4ation shall be supported b# the"ritten consent of at least t"ent# per cent +?*E of all the e&plo#ees in thebar!ainin! unit. 0pon receipt and verification of such petition, the Med1$rbitershall auto&aticall# order the conduct of a certification election.

Said article traverses the clai& of the petitioner that in this case there is a need for a considerablesupport of the ran1and1file e&plo#ees in order that a certification election &a# be ordered. No"herein the said provision does it re:uire that the petition in or!ani4ed establish&ent should beacco&panied b# the "ritten consent of at least t"ent# percent +?*E of the e&plo#ees of thebar!ainin! unit concerned &uch less a re:uire&ent that the petition be supported b# the &a>orit# of

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the ran1and1file e&plo#ees. $s above stated, $rticle ?7 is applicable onl# to unor!ani4edestablish&ents.

The %ourt reiterates that in cases of or!ani4ed establish&ents "here there eists a certifiedbar!ainin! a!ent, "hat is essential is "hether the petition for certification election "asfiled "ithin thesit#1da# freedo& period. $rticle ?9 of the 5abor %ode, as a&ended b# 6ecutive Order No. (((,

provides3

$RT. ?9. Representation issue in organized esta!lishments. In or!ani4edesta!lishments,"hen a petition :uestionin! the &a>orit# status of theincu&bent bar!ainin! a!ent is filed before the Depart&ent "ithin the sit#1da# period before the epiration of the collective bar!ainin! a!ree&ent, theMed1$rbiter shall auto&aticall# order an election b# secret ballot to ascertainthe "ill of the e&plo#ees in the appropriate bar!ainin! unit. To have a validelection, at least a &a>orit# of all eli!ible voters in the unit &ust have casttheir votes. The labor union receivin! the &a>orit# of the valid votes cast shallbe certified as the eclusive bar!ainin! a!ent of all the "orers in the unit./hen an election "hich provides for three or &ore choices results in no

choice receivin! a &a>orit# of the valid votes cast, a run1off election shall beconducted bet"een the choices receivin! the t"o hi!hest nu&ber of votes.

$rticle ?9 is clear and leaves no roo& for interpretation. The &ere filin! of a petition for certificationelection "ithin the freedo& period is sufficient basis for the respondent Director to order the holdin!of a certification election.

/as the petition filed b# N$F50 instituted "ithin the freedo& periodJ The record speas for itself.The previous %-$ entered into b# petitioner $50 "as due to epire on $pril (, ()'7. The petition forcertification "as filed b# N$F50 on March ?8, ()'7, "ell "ithin the freedo& period.

The contract bar rule is applicable onl# "here the petition for certification election "as filed eitherbefore or after the freedo& period. Petitioner, ho"ever, contends that since the ne" %-$ hadalread# been ratified over"hel&in!l# b# the &e&bers of the bar!ainin! unit and that said %-$ hadalread# been consu&&ated and the &e&bers of the bar!ainin! unit have been continuousl#en>o#in! the benefits under the said %-$, no certification election &a# be conducted, 10citin!,"oamtex La!or %nion-T%*< #s. +oriel, 11and Trade %nions of the *hil. and llied

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the contendin! union had a clear &a>orit# of the "orers concerned since out of 9=( of the total"orin! force, the said union had =)) "ho did not onl# ratif# the %-$ concluded bet"een the saidunion and the &ana!e&ent but also affir&ed their &e&bership in the said union so that apparentl#petitioners therein did not have the support of 8*E of all the e&plo#ees of the bar!ainin! unit.

Nevertheless, even assu&in! for the sae of ar!u&ent that the petitioner herein has the &a>orit# of

the ran1and1file e&plo#ees and that so&e &e&bers of the N$F50 even renounced their&e&bership thereat and affir&ed &e&bership "ith the petitioner, /e cannot, ho"ever, appl#T0P$S in the case at bar. 0nlie in the case of herein petitioner, in T0P$S, the petition forcertification election "as filed nineteen +() da#s after the %-$ "as si!ned "hich "as "ell be#ondthe freedo& period.

On the other hand, as earlier &entioned, the petition for certification election in this case "as filed"ithin the freedo& period but the petitioner and P$S$R hastil# concluded a %-$ despite the order ofthe Med1$rbiter en>oinin! the& fro& doin! so until the issue of representation is finall# resolved. $spointed out b# public respondent in its co&&ent, 13the parties "ere in bad faith "hen the#concluded the %-$. Their act "as clearl# intended to bar the petition for certification election filed b#N$F50. $ collective bar!ainin! a!ree&ent "hich "as pre&aturel# rene"ed is not a bar to the

holdin! of a certification election.

14

Such indecent haste in rene"in! the %-$ despite an orderen>oinin! the& fro& doin! so 1is desi!ned to frustrate the constitutional ri!ht of the e&plo#ees toself1or!ani4ation. 16Moreover, /e cannot countenance the actuation of the petitioner and the&ana!e&ent in this case "hich is not conducive to industrial peace.

The rene"ed %-$ cannot constitute a bar to the instant petition for certification election for the ver#reason that the sa&e "as not #et in eistence "hen the said petition "as filed. 1:The holdin! of acertification election is a statutor# polic# that should not be circu&vented. 1;

Petitioner posits the vie" that to !rant the petition for certification election "ould open the flood!atesto unbridled and scrupulous petitions the ob>ective of "hich is to pre>udice the industrial peace andstabilit# eistin! in the co&pan#.

This %ourt believes other"ise. Our established >urisprudence adheres to the polic# of enhancin! the"elfare of the "orers. Their freedo& to choose "ho should be their bar!ainin! representative is ofpara&ount i&portance. The fact that there alread# eists a bar!ainin! representative in the unitconcerned is of no &o&ent as lon! as the petition for certification "as filed "ithin the freedo&period. /hat is i&perative is that b# such a petition for certification election the e&plo#ees are !iventhe opportunit# to &ae no"n "ho shall have the ri!ht to represent the& thereafter. Not onl# so&ebut all of the& should have the ri!ht to do so. 19Petitionerorit# is i&&aterial. /hat is e:uall# i&portant is that ever#one be !iven a de&ocratic space in thebar!ainin! unit concerned. Ti&e and a!ain, /e have reiterated that the &ost effective "a# ofdeter&inin! "hich labor or!ani4ation can trul# represent the "orin! force is b# certification election.20

Finall#, petitioner insists that to allo" a certification election to be conducted "ill pro&otedivisiveness and eventuall# cause polari4ation of the &e&bers of the bar!ainin! unit at the epenseof national interest. 21

The clai& is bereft of &erit. Petitioner failed to establish that the callin! of certification election "ill bepre>udicial to the e&plo#ees concerned andor to the national interest. The fear perceived b# thepetitioner is &ore i&a!inar# than real. If it is true, as pointed out b# the petitioner, that it has thesupport of &ore than the &a>orit# and that there "as even a bi!!er nu&ber of &e&bers of N$F50"ho affir&ed their &e&bership to petitioner1union, then /e see no reason "h# petitioner should be

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apprehensive over the issue. If their clai& is true, then &ost liel# the conduct of a certificationelection "ill stren!then their hold as an# doubt "ill be erased thereb#. /ith the resolution of suchdoubts, fra!&entation of the bar!ainin! unit "ill be avoided, and hence coherence a&on! the"orers "ill liel# follo".

Petitioner

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Republic of the PhilippinesSUPREME COURT

Manila

S6%OND DIVISION

G.R. No. !%4334 a*uary 22, 19;6

$IO$ !O(, +o*7 bu/*e// u*+er ->e *ae a*+ /-y5e S#EDEN ICE CRE'M P!'NT, petitioner,vs.N'TION'! !')OR RE!'TIONS COMMISSION N!RC8 a*+ P'M)'NS'NG $I!US'N NGP'GG'#' $I!US'N8, respondents.

!lan and ssociates for petitioner.

!dulcadir T. I!rahim for pri#ate respondent.

CUE&'S, J.:

Petition for certiorari to annul the decision 1of the National 5abor Relations %o&&ission +N5R%dated ;ul# ?*, ()7) "hich found petitioner S"eden Ice %rea& !uilt# of unfair labor practice forun>ustified refusal to bar!ain, in violation of par. +! of $rticle ?=)2of the Ne" 5abor %ode, 3anddeclared the draft proposal of the 0nion for a collective bar!ainin! a!ree&ent as the !overnin!collective bar!ainin! a!ree&ent bet"een the e&plo#ees and the &ana!e&ent.

The pertinent bac!round facts are as follo"s3

In a certification election held on October 8, ()7', the Pa&bansan! Bilusan! Pa!!a"a +0nion for

short, a le!iti&ate late labor federation, "on and "as subse:uentl# certified in a resolution datedNove&ber ?), ()7' b# the -ureau of 5abor Relations as the sole and eclusive bar!ainin! a!ent ofthe ran1and1file e&plo#ees of S"eden Ice %rea& Plant +%o&pan# for short. The %o&pan#

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respective position papers as re:uired, the said hearin! "as cancelled and reset to another date.Mean"hile, the 0nion sub&itted its position paper. The %o&pan# did not, and instead re:uested fora resettin! "hich "as !ranted. The %o&pan# "as directed ane" to sub&it its financial state&entsfor the #ears ()79, ()77, and ()7'.

The case "as further reset to Ma# ((, ()7) due to the "ithdra"al of the %o&pan#ustified refusal to bar!ain, in violation of Section +! $rticle ?=' +no" $rticle ?=),of P.D. ==?, as a&ended. Further, the draft proposal for a collective bar!ainin!a!ree&ent +6h. H6 H hereto attached and &ade an inte!ral part of this decision,sent b# the 0nion +Private respondent to the respondent +petitioner herein and"hich is hereb# found to be reasonable under the pre&ises, is hereb# declared to bethe collective a!ree&ent "hich should !overn the relationship bet"een the partiesherein.

SO ORD6R6D. +6&phasis supplied

Petitioner no" co&es before 0s assailin! the aforesaid decision contendin! that the National 5aborRelations %o&&ission acted "ithout or in ecess of its >urisdiction or "ith !rave abuse of discretiona&ountin! to lac of >urisdiction in renderin! the challen!ed decision. On $u!ust =, ()'*, this %ourtdis&issed the petition for lac of &erit. 0pon &otion of the petitioner, ho"ever, the Resolution ofdis&issal "as reconsidered and the petition "as !iven due course in a Resolution dated $pril (,()'(.

Petitioner %o&pan# no" &aintains that its ri!ht to procedural due process has been violated "hen it"as precluded fro& presentin! further evidence in support of its stand and "hen its re:uest forfurther postpone&ent "as denied. Petitioner further contends that the National 5abor Relations%o&&ission

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responsibilit# of the e&plo#er and the 0nion and is characteri4ed as a le!al obli!ation. So &uch sothat $rticle ?=), par. +! of the 5abor %ode &aes it an unfair labor practice for an e&plo#er to refuseHto &eet and convene pro&ptl# and epeditiousl# in !ood faith for the purpose of ne!otiatin! ana!ree&ent "ith respect to "a!es, hours of "or, and all other ter&s and conditions of e&plo#&entincludin! proposals for ad>ustin! an# !rievance or :uestion arisin! under such an a!ree&ent andeecutin! a contract incorporatin! such a!ree&ent, if re:uested b# either part#.

/hile it is a &utual obli!ation of the parties to bar!ain, the e&plo#er, ho"ever, is not under an# le!aldut# to initiate contract ne!otiation.:The &echanics of collective bar!ainin! is set in &otion onl#"hen the follo"in! >urisdictional preconditions are present, na&el#, +( possession of the status of&a>orit# representation of the e&plo#ees< representative in accordance "ith an# of the &eans ofselection or desi!nation provided for b# the 5abor %odeG +? proof of &a>orit# representationG and +8a de&and to bar!ain under $rticle ?(, par. +a of the Ne" 5abor %ode . ... all of "hich preconditionsare undisputedl# present in the instant case.

Fro& the over1all conduct of petitioner co&pan# in relation to the tas of ne!otiation, there can be nodoubt that the 0nion has a valid cause to co&plain a!ainst its +%o&pan#oined b# the 5abor

%ode to bar!ain in !ood faith.

/e are in total confor&it# "ith respondent N5R%

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not even bother to furnish or serve the 0nion "ith its counter proposal despite persistent re:uests&ade therefor. %ertainl#, the &oves and overall behavior of petitioner1co&pan# "ere in totaldero!ation of the polic# enshrined in the Ne" 5abor %ode "hich is ai&ed to"ards epeditin!settle&ent of econo&ic disputes. @ence, this %ourt is not prepared to affi its i&pri&atur to such anille!al sche&e and dubious &aneuvers.

Neither are /6 persuaded b# petitioner1co&pan#

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Republic of the PhilippinesSUPREME COURT

Manila

S6%OND DIVISION

G.R. No. 1149:4 u*e 16, 2004

ST'ND'RD C'RTERED )'N$ EMP!O(EES UNION NU)E8,petitioner,vs.T>e o*orab5e M'. NIE&ES R. CONFESOR, * >er aa-y a/ SECRET'R( OF !')OR 'NDEMP!O(MENT? a*+ ->e ST'ND'RD C'RTERED )'N$, respondents.

D 6 % I S I O N

C'!!EO, SR., J.:

This is a petition for certiorari under Rule 9 of the Rules of %ourt filed b# the Standard %hartered

-an 6&plo#ees 0nion, seein! the nullification of the October ?), ())8 Order(of then Secretar# of5abor and 6&plo#&ent Nieves R. %onfesor and her resolutions dated Dece&ber (9, ())8 andFebruar# (*, ())=.

The $ntecedents

Standard %hartered -an +the -an, for brevit# is a forei!n banin! corporation doin! business inthe Philippines. The eclusive bar!ainin! a!ent of the ran and file e&plo#ees of the -an is theStandard %hartered -an 6&plo#ees 0nion +the 0nion, for brevit#.

In $u!ust of ())*, the -an and the 0nion si!ned a five1#ear collective bar!ainin! a!ree&ent +%-$"ith a provision to rene!otiate the ter&s thereof on the third #ear. Prior to the epiration of the three1

#ear period?but "ithin the sit#1da# freedo& period, the 0nion initiated the ne!otiations. OnFebruar# (', ())8, the 0nion, throu!h its President, 6ddie 5. Divina!racia, sent a letter8containin!its proposals=coverin! political provisionsand thirt#1four +8= econo&ic provisions.9Included therein"as a list of the na&es of the &e&bers of the 0nions ne!otiatin! panel.7

In a 5etter dated Februar# ?=, ())8, the -an, throu!h its %ountr# Mana!er Peter @. @arris, toonote of the 0nions proposals. The -an attached its counter1proposal to the non1econo&icprovisions proposed b# the 0nion.'The -an posited that it "ould be in a better position to presentits counter1proposals on the econo&ic ite&s after the 0nion had presented its >ustifications for theecono&ic proposals.)The -an, lie"ise, listed the &e&bers of its ne!otiatin! panel.(*The partiesa!reed to set &eetin!s to settle their differences on the proposed %-$.

-efore the co&&ence&ent of the ne!otiation, the 0nion, throu!h Divina!racia, su!!ested to the-ans @u&an Resource Mana!er and head of the ne!otiatin! panel, %ielito Diono, that the banla"#ers should be ecluded fro& the ne!otiatin! tea&. The -an acceded.((Mean"hile, Dionosu!!ested to Divina!racia that ;ose P. 0&ali, ;r., the President of the National 0nion of -an6&plo#ees +N0-6, the federation to "hich the 0nion "as affiliated, be ecluded fro& the 0nionsne!otiatin! panel.(?@o"ever, 0&ali "as retained as a &e&ber thereof.

On March (?, ())8, the parties &et and set the !round rules for the ne!otiation. Diono su!!estedthat the ne!otiation be ept a Hfa&il# affair.H The proposed non1econo&ic provisions of the %-$ "ere

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discussed first.(86ven durin! the final readin! of the non1econo&ic provisions on Ma# =, ())8, there"ere still provisions on "hich the 0nion and the -an could not a!ree. Te&poraril#, the notationHD6F6RR6DH "as placed therein. To"ards the end of the &eetin!, the 0nion &anifested that thesa&e should be chan!ed to HD6$D5O%B6DH to indicate that such ite&s re&ained unresolved. -othparties a!reed to place the notation HD6F6RR6DD6$D5O%B6D.H(=

On Ma# (', ())8, the ne!otiation for econo&ic provisions co&&enced. $ presentation of the basisof the 0nions econo&ic proposals "as &ade. The net &eetin!, the -an &ade a si&ilarpresentation. To"ards the end of the -ans presentation, 0&ali re:uested the -an to validate the0nions Hguestimates,H especiall# the fi!ures for the ran and file staff.(In the succeedin! &eetin!s,0&ali chided the -an for the insufficienc# of its counter1proposal on the provisions on salar#increase, !roup hospitali4ation, death assistance and dental benefits. @e re&inded the -an, ho"the 0nion !ot "hat it "anted in ()'7, and stated that if need be, the 0nion "ould !o throu!h thesa&e route to !et "hat it "anted.(9

0pon the -ans insistence, the parties a!reed to tacle the econo&ic paca!e ite& b# ite&. 0ponthe 0nions su!!estion, the -an indicated "hich provisions it "ould accept, re>ect, retain and a!reeto discuss.(7The -an su!!ested that the 0nion prioriti4e its econo&ic proposals, considerin! that

&an# of such econo&ic provisions re&ained unresolved. The 0nion, ho"ever, de&anded that the-an &ae a revised ite&i4ed proposal.

In the succeedin! &eetin!s, the 0nion &ade the follo"in! proposals3

/a!e Increase3

(st Aear Reduced fro& =E to =*E

?nd Aear 1 Retain at ?*E

Total Q 9*E

2roup @ospitali4ation Insurance3

Mai&u& disabilit# benefit reduced fro& P7,***.** to P9*,***.** per illnessannuall#

Death $ssistance3

For the e&plo#ee Reduced fro& P*,***.** to P=,***.**

For I&&ediate Fa&il# Me&ber Reduced fro& P8*,***.** to P?,***.**

Dental and all others No chan!e fro& the ori!inal de&and.('

In the &ornin! of the ;une (, ())8 &eetin!, the 0nion su!!ested that if the -an "ould not &aethe necessar# revisions on its counter1proposal, it "ould be best to see a third part# assistance.()

$fter the brea, the -an presented its revised counter1proposal?*as follo"s3

/a!e Increase 3 (st Aear fro& P(,*** to P(,**.**

?nd Aear P'**.** no chan!e

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2roup @ospitali4ation Insurance

Fro&3 P8,***.** per illness

To 3 P8,***.** per illness per #ear

Death $ssistance For e&plo#ee

Fro&3 P?*,***.**

To 3 P?,***.**

Dental Retainer Ori!inal offer re&ains the sa&e?(

The 0nion, for its part, &ade the follo"in! counter1proposal3

/a!e Increase3 (st Aear 1 =*E

?nd Aear 1 ().E

2roup @ospitali4ation Insurance

Fro&3 P9*,***.** per #ear

To 3 P*,***.** per #ear

Dental3

Te&porar# Fillin! P(*.**

Tooth 6traction

Per&anent Fillin! ?**.**

Proph#lais ?*.**

Root %anal Fro& P?,*** per tooth

To3 (,'**.** per tooth

Death $ssistance3

For 6&plo#ees3 Fro& P=,***.** to P=*,***.**

For I&&ediate Fa&il# Me&ber3 Fro& P?,***.** to P?*,***.**.??

The 0nions ori!inal proposals, aside fro& the above1:uoted, re&ained the sa&e.

$nother set of counter1offer follo"ed3

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Mana!e&ent 0nion

/a!e Increase

(st Aear P(,**.** =*E

?nd Aear 1 '*.** ().*E?8

Diono stated that, in order for the -an to &ae a better offer, the 0nion should clearl# identif# "hatit "anted to be included in the total econo&ic paca!e. 0&ali replied that it 0as impossi!le to do so!ecause the Ban?s counter-proposal 0as unaccepta!le. :e furthered asserted that it 0ould ha#e!een easier to !argain if the atmosphere 0as the same as !efore, 0here !oth panels trusted eachother. Diono re:uested the 0nion panel to refrain fro& involvin! personalities and to instead focuson the ne!otiations.?=@e su!!ested that in order to brea the i&passe, the 0nion should prioriti4ethe ite&s it "anted to iron out. Divina!racia stated that the -an should &ae the first &ove and&ae a list of ite&s it "anted to be included in the econo&ic paca!e. 6cept for the provisions onsi!nin! bonus and unifor&s, the 0nion and the -an failed to a!ree on the re&ainin! econo&icprovisions of the %-$. The 0nion declared a deadloc?and filed a Notice of Strie before theNational %onciliation and Mediation -oard +N%M- on ;une ?(, ())8, doceted as N%M-1N%R1NS1

*918'*1)8.?9

On the other hand, the -an filed a co&plaint for 0nfair 5abor Practice +05P and Da&a!es beforethe $rbitration -ranch of the National 5abor Relations %o&&ission +N5R% in Manila, doceted asN5R% %ase No. **1*91*=()(1)8 a!ainst the 0nion on ;une ?', ())8. The -an alle!ed that the0nion violated its dut# to bar!ain, as it did not bar!ain in !ood faith. It contended that the 0nionde&anded Ds# hi!h econo&ic de&ands,H indicative of !lue-s?7 !argaining.?7Further, the 0nionviolated its no strie1 no locout clause b# filin! a notice of strie before the N%M-. %onsiderin! thatthe filin! of notice of strie "as an ille!al act, the 0nion officers should be dis&issed. Finall#, the-an alle!ed that as a conse:uence of the ille!al act, the -an suffered no&inal and actualda&a!es and "as forced to liti!ate and hire the services of the la"#er.?'

On ;ul# ?(, ())8, then Secretar# of 5abor and 6&plo#&ent +SO56 Nieves R. %onfesor, pursuant to$rticle ?98+! of the 5abor %ode, issued an Order assu&in! >urisdiction over the labor dispute at the-an. The co&plaint for 05P filed b# the -an before the N5R% "as consolidated "ith the co&plaintover "hich the SO56 assu&ed >urisdiction. $fter the parties sub&itted their respective positionpapers, the SO56 issued an Order on October ?), ())8, the dispositive portion of "hich is herein:uoted3

/@6R6FOR6, the Standard %hartered -an and the Standard %hartered -an6&plo#ees 0nion N0-6 are hereb# ordered to eecute a collective bar!ainin!a!ree&ent incorporatin! the dispositions contained herein. The %-$ shall beretroactive to *( $pril ())8 and shall re&ain effective for t"o #ears thereafter, or untilsuch ti&e as a ne" %-$ has superseded it. $ll provisions in the epired %-$ notepressl# &odified or not passed upon herein are dee&ed retained "hile all ne"

provisions "hich are bein! de&anded b# either part# are dee&ed denied, but "ithoutpre>udice to such a!ree&ents as the parties &a# have arrived at in the &eanti&e.

The -ans char!e for unfair labor practice "hich it ori!inall# filed "ith the N5R% asN5R%1N%R %ase No. **1*91*=()(1)8 but "hich is dee&ed consolidated herein, isdis&issed for lac of &erit. On the other hand, the 0nions char!e for unfair laborpractice is si&ilarl# dis&issed.

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5et a cop# of this order be furnished the 5abor $rbiter in "hose sala N5R%1N%R%ase No. **1*91*=()(1)8 is pendin! for his !uidance and appropriate action.?)

The SO56 !ave the follo"in! econo&ic a"ards3

(. /a!e Increase3

a To be incorporated to present salar# rates3

Fourth #ear 3 7E of basic &onthl# salar#

Fifth #ear 3 E of basic &onthl# salar# based on the =th #ear ad>usted salar#

b $dditional fied a&ount3

Fourth #ear 3 P9**.** per &onth

Fifth #ear 3 P=**.** per &onth

?. 2roup Insurance

a @ospitali4ation 3 P=,***.**

b 5ife 3 P(8*,***.**

c $ccident 3 P(8*,***.**

8. Medicine $llo"ance

Fourth #ear 3 P,**.**

Fifth #ear 3 P9,***.**

=. Dental -enefits

Provision of dental retainer as proposed b# the -an, but "ithout di&inishin! eistin!benefits

. Optical $llo"ance

Fourth #ear3 P?,***.**

Fifth #ear 3 P?,**.**

9. Death $ssistance

a 6&plo#ee 3 P8*,***.**

b I&&ediate Fa&il# Me&ber 3 P,***.**

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7. 6&er!enc# 5eave Five + da#s for each contin!enc#

'. 5oans

a %ar 5oan 3 P?**,***.**

b @ousin! 5oan 3 It cannot be denied that the costs attendant to havin!ones o"n ho&e have tre&endousl# !one up. The need, therefore, toi&prove on this benefit cannot be overe&phasi4ed. Thus, the &ana!e&ent isur!ed to increase the eistin! and allo"able housin! loan that the -anetends to its e&plo#ees to an a&ount that "ill !ive &eanin! and substanceto this %-$ benefit.8*

The SO56 dis&issed the char!es of 05P of both the 0nion and the -an, eplainin! that bothparties failed to substantiate their clai&s. %itin! +ational La!or %nion #. Insular->e!ana To!accoCorporation,8(the SO56 stated that 05P char!es "ould prosper onl# if sho"n to have directl#pre>udiced the public interest.

Dissatisfied, the 0nion filed a &otion for reconsideration "ith clarification, "hile the -an filed a&otion for reconsideration. On Dece&ber (9, ())8, the SO56 issued a Resolution den#in! the&otions. The 0nion filed a second &otion for reconsideration, "hich "as, lie"ise, denied onFebruar# (*, ())=.

On March ??, ())=, the -an and the 0nion si!ned the %-$.8?I&&ediatel# thereafter, the "a!eincrease "as effected and the si!nin! bonuses based on the increased "a!e "ere distributed to thee&plo#ees covered b# the %-$.

T>e Pre/e*- Pe--o*

On $pril ?', ())=, the 0nion filed this petition for certiorari under Rule 9 of the Rules of Procedure

alle!in! as follo"s3

$. R6SPOND6NT @ONOR$-56 S6%R6T$RA %OMMITT6D 2R$V6 $-0S6 OFDIS%R6TION $MO0NTIN2 TO 5$%B OF ;0RISDI%TION IN DISMISSIN2 T@60NIONS %@$R26 OF 0NF$IR 5$-OR PR$%TI%6 IN VI6/ OF T@6 %56$R6VID6N%6 OF R6%ORD $ND $DMISSIONS PROVIN2 T@6 0NF$IR 5$-ORPR$%TI%6S %@$R26D.88

-. R6SPOND6NT @ONOR$-56 S6%R6T$RA %OMMITT6D 2R$V6 $-0S6 OFDIS%R6TION $MO0NTIN2 TO 5$%B OF ;0RISDI%TION IN F$I5IN2 TO R056 ONOT@6R 0NF$IR 5$-OR PR$%TI%6S %@$R26D.8=

%. R6SPOND6NT @ONOR$-56 S6%R6T$RA %OMMITT6D 2R$V6 $-0S6 OFDIS%R6TION $MO0NTIN2 TO 5$%B OF ;0RISDI%TION IN DISMISSIN2 T@6%@$R26S OF 0NF$IR 5$-OR PR$%TI%6S ON T@6 2RO0ND T@$T NO PROOFOF IN;0RA TO T@6 P0-5I% INT6R6ST /$S PR6S6NT6D.8

The 0nion alle!es that the SO56 acted "ith !rave abuse of discretion a&ountin! to lac or ecessof >urisdiction "hen it found that the -an did not co&&it unfair labor practice "hen it interfered "iththe 0nions choice of ne!otiator. It ar!ued that, Dionos su!!estion that the ne!otiation be li&ited asa Hfa&il# affairH "as tanta&ount to su!!estin! that Federation President ;ose 0&ali, ;r. be ecluded

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fro& the 0nions ne!otiatin! panel. It further ar!ued that contrar# to the rulin! of the publicrespondent, da&a!e or in>ur# to the public interest need not be present in order for unfair laborpractice to prosper.

The 0nion, lie"ise, pointed out that the public respondent failed to rule on the 05P char!es arisin!fro& the -ans surface bar!ainin!. The 0nion contended that the -an &erel# "ent throu!h the

&otions of collective bar!ainin! "ithout the intent to reach an a!ree&ent, and &ade bad faithproposals "hen it announced that the parties should be!in fro& a clean slate. It ar!ued that the-an opened the political provisions Hup for !rabs,H "hich had the effect of di&inishin! or obliteratin!the !ains that the 0nion had &ade.

The 0nion also accused the -an of refusin! to disclose &aterial and necessar# data, even after are:uest "as &ade b# the 0nion to validate its Hguestimates.H

In its %o&&ent, the -an pra#ed that the petition be dis&issed as the 0nion "as estopped,considerin! that it si!ned the %ollective -ar!ainin! $!ree&ent +%-$ on $pril ??, ())=. It assertedthat contrar# to the 0nions alle!ations, it "as the 0nion that co&&itted 05P "hen ne!otiator ;ose0&ali, ;r. hurled invectives at the -ans head ne!otiator, %ielito Diono, and de&anded that she be

ecluded fro& the -ans ne!otiatin! tea&. Moreover, the 0nion en!a!ed in !lue-s?7 !argainingand isolated the no strie1no locout clause of the eistin! %-$.

The Office of the Solicitor 2eneral, in representation of the public respondent, pra#ed that thepetition be dis&issed. It asserted that the 0nion failed to prove its 05P char!es and that the publicrespondent did not co&&it an# !rave abuse of discretion in issuin! the assailed order andresolutions.

T>e I//ue/

The issues presented for resolution are the follo"in!3 +a "hether or not the 0nion "as able tosubstantiate its clai& of unfair labor practice a!ainst the -an arisin! fro& the latters alle!ed

HinterferenceH "ith its choice of ne!otiatorG surface bar!ainin!G &ain! bad faith non1econo&icproposalsG and refusal to furnish the 0nion "ith copies of the relevant dataG +b "hether or not thepublic respondent acted "ith !rave abuse of discretion a&ountin! to lac or ecess of >urisdiction"hen she issued the assailed order and resolutionsG and, +c "hether or not the petitioner isestopped fro& filin! the instant action.

T>e Cour-@/ Ru5*7

The petition is bereft of &erit.

DInterferenceD under rticle

398 5a6 of the La!or Code

The petitioner asserts that the private respondent co&&itted 05P, i.e., interference in the selectionof the 0nions ne!otiatin! panel, "hen %ielito Diono, the -ans @u&an Resource Mana!er,su!!ested to the 0nions President 6ddie 5. Divina!racia that ;ose P. 0&ali, ;r., President of theN0-6, be ecluded fro& the 0nions ne!otiatin! panel. In support of its clai&, Divina!racia eecutedan affidavit, statin! that prior to the co&&ence&ent of the ne!otiation, Diono approached hi& andsu!!ested the eclusion of 0&ali fro& the 0nions ne!otiatin! panel, and that durin! the first&eetin!, Diono stated that the ne!otiation be ept a Hfa&il# affair.H

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%itin! the cases of %.

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not, shall have the ri!ht to self1or!ani4ation and to for&, >oin, or assist laboror!ani4ations of their o"n choosin! for purposes of collective bar!ainin!. $&bulant,inter&ittent and itinerant "orers, self1e&plo#ed people, rural "orers and those"ithout an# definite e&plo#ers &a# for& labor or!ani4ations for their &utual aid andprotection.

and $rticles ?=' and ?=) respectin! 05P of e&plo#ers and labor or!ani4ations.

The said I5O %onventions "ere ratified on Dece&ber ?), ()8. @o"ever, even as earl# as the ()8%onstitution,==the State had alread# epressl# besto"ed protection to labor as part of the !eneralprovisions. The ()78 %onstitution,=on the other hand, declared it as a polic# of the state to affordprotection to labor, specif#in! that the "orers ri!hts to self1or!ani4ation, collective bar!ainin!,securit# of tenure, and >ust and hu&ane conditions of "or "ould be assured. For its part, the ()'7%onstitution, aside fro& &ain! it a polic# to Hprotect the ri!hts of "orers and pro&ote their"elfare,H=9devotes an entire section, e&phasi4in! its &andate to afford protection to labor, andhi!hli!hts Hthe principle of shared responsibilit#H bet"een "orers and e&plo#ers to pro&oteindustrial peace.=7

$rticle ?='+a of the 5abor %ode, considers it an unfair labor practice "hen an e&plo#er interferes,restrains or coerces e&plo#ees in the eercise of their ri!ht to self1or!ani4ation or the ri!ht to for&association. The ri!ht to self1or!ani4ation necessaril# includes the ri!ht to collective bar!ainin!.

Parentheticall#, if an e&plo#er interferes in the selection of its ne!otiators or coerces the 0nion toeclude fro& its panel of ne!otiators a representative of the 0nion, and if it can be inferred that thee&plo#er adopted the said act to #ield adverse effects on the free eercise to ri!ht to self1or!ani4ation or on the ri!ht to collective bar!ainin! of the e&plo#ees, 05P under $rticle ?='+a inconnection "ith $rticle ?=8 of the 5abor %ode is co&&itted.

In order to sho" that the e&plo#er co&&itted 05P under the 5abor %ode, substantial evidence isre:uired to support the clai&. Substantial evidence has been defined as such relevant evidence as areasonable &ind &i!ht accept as ade:uate to support a conclusion.='In the case at bar, the 0nionbases its clai& of interference on the alle!ed su!!estions of Diono to eclude 0&ali fro& the0nions ne!otiatin! panel.

The circu&stances that occurred durin! the ne!otiation do not sho" that the su!!estion &ade b#Diono to Divina!racia is an anti1union conduct fro& "hich it can be inferred that the -anconsciousl# adopted such act to #ield adverse effects on the free eercise of the ri!ht to self1or!ani4ation and collective bar!ainin! of the e&plo#ees, especiall# considerin! that such "asundertaen previous to the co&&ence&ent of the ne!otiation and si&ultaneousl# "ithDivina!racias su!!estion that the ban la"#ers be ecluded fro& its ne!otiatin! panel.

The records sho" that after the initiation of the collective bar!ainin! process, "ith the inclusion of0&ali in the 0nions ne!otiatin! panel, the ne!otiations pushed throu!h. The co&plaint "as &ade

onl# on $u!ust (9, ())8 after a deadloc "as declared b# the 0nion on ;une (, ())8.

It is clear that such 05P char!e "as &erel# an afterthou!ht. The accusation occurred after thear!u&ents and differences over the econo&ic provisions beca&e heated and the parties hadbeco&e frustrated. It happened after the parties started to involve personalities. $s the publicrespondent noted, passions &a# rise, and as a result, su!!estions !iven under less adversarialsituations &a# be colored "ith unintended &eanin!s.=)Such is "hat appears to have happened inthis case.

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The ut7 to Bargain

Collecti#el7

If at all, the su!!estion &ade b# Diono to Divina!racia should be construed as part of the nor&alrelations and innocent co&&unications, "hich are all part of the friendl# relations bet"een the 0nion

and -an.

The 0nion alle!es that the -an violated its dut# to bar!ainG hence, co&&itted 05P under $rticle?='+! "hen it en!a!ed in surface bar!ainin!. It alle!ed that the -an >ust "ent throu!h the &otionsof bar!ainin! "ithout an# intent of reachin! an a!ree&ent, as evident in the -ans counter1proposals. It eplained that of the 8= econo&ic provisions it &ade, the -an onl# &ade 9 econo&iccounterproposals. Further, as borne b# the &inutes of the &eetin!s, the -an, after indicatin! theecono&ic provisions it had re>ected, accepted, retained or "ere open for discussion, refused to&ae a list of ite&s it a!reed to include in the econo&ic paca!e.

Surface bar!ainin! is defined as H!oin! throu!h the &otions of ne!otiatin!H "ithout an# le!al intentto reach an a!ree&ent.*The resolution of surface bar!ainin! alle!ations never presents an eas#

issue. The deter&ination of "hether a part# has en!a!ed in unla"ful surface bar!ainin! is usuall# adifficult one because it involves, at botto&, a :uestion of the intent of the part# in :uestion, andusuall# such intent can onl# be inferred fro& the totalit# of the challen!ed part#s conduct both atand a"a# fro& the bar!ainin! table.(It involves the :uestion of "hether an e&plo#ers conductde&onstrates an un"illin!ness to bar!ain in !ood faith or is &erel# hard bar!ainin!.?

The &inutes of &eetin!s fro& March (?, ())8 to ;une (, ())8 do not sho" that the -an had an#intention of violatin! its dut# to bar!ain "ith the 0nion. Records sho" that after the 0nion sent itsproposal to the -an on Februar# (7, ())8, the latter replied "ith a list of its counter1proposals onFebruar# ?=, ())8. Thereafter, &eetin!s "ere set for the settle&ent of their differences. The &inutesof the &eetin!s sho" that both the -an and the 0nion echan!ed econo&ic and non1econo&icproposals and counter1proposals.

The 0nion has not been able to sho" that the -an had done acts, both at and a"a# fro& thebar!ainin! table, "hich tend to sho" that it did not "ant to reach an a!ree&ent "ith the 0nion or tosettle the differences bet"een it and the 0nion. $d&ittedl#, the parties "ere not able to a!ree andreached a deadloc. @o"ever, it is herein e&phasi4ed that the dut# to bar!ain Hdoes not co&peleither part# to a!ree to a proposal or re:uire the &ain! of a concession.H8@ence, the partiesfailure to a!ree did not a&ount to 05P under $rticle ?='+! for violation of the dut# to bar!ain.

/e can hardl# dispute this findin!, for it finds support in the evidence. The inference thatrespondents did not refuse to bar!ain collectivel# "ith the co&plainin! union because the# acceptedso&e of the de&ands "hile the# refused the others even leavin! open other de&ands for futurediscussion is correct, especiall# so "hen those de&ands "ere discussed at a &eetin! called b#respondents the&selves precisel# in vie" of the letter sent b# the union on $pril ?), ()9*=

In vie" of the findin! of lac of 05P based on $rticle ?='+!, the accusation that the -an &ade bad1faith provisions has no le! to stand on. The records sho" that the -ans counterproposals on thenon1econo&ic provisions or political provisions did not put Hup for !rabsH the entire "or of the 0nionand its predecessors. $s can be !leaned fro& the -ans counterproposal, there "ere &an#provisions "hich it proposed to be retained. The revisions on the other provisions "ere &ade afterthe parties had co&e to an a!ree&ent. Far fro& buttressin! the 0nions clai& that the -an &adebad1faith proposals on the non1econo&ic provisions, all these, on the contrar#, disprove suchalle!ations.

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/e, lie"ise, find that the 0nion failed to substantiate its clai& that the -an refused to furnish theinfor&ation it needed.

/hile the refusal to furnish re:uested infor&ation is in itself an unfair labor practice, and alsosupports the inference of surface bar!ainin!,in the case at bar, 0&ali, in a &eetin! dated Ma# (',())8, re:uested the -an to validate its guestimateson the data of the ran and file. @o"ever,

0&ali failed to put his re:uest in "ritin! as provided for in $rticle ?=?+c of the 5abor %ode3

$rticle ?=?. Ri!hts of 5e!iti&ate 5abor Or!ani4ation

+c To be furnished b# the e&plo#er, upon "ritten re:uest, "ith the annual auditedfinancial state&ents, includin! the balance sheet and the profit and loss state&ent,"ithin thirt# +8* calendar da#s fro& the date of receipt of the re:uest, after the unionhas been dul# reco!ni4ed b# the e&plo#er or certified as the sole and eclusivebar!ainin! representatives of the e&plo#ees in the bar!ainin! unit, or "ithin sit#+9* calendar da#s before the epiration of the eistin! collective bar!ainin!a!ree&ent, or durin! the collective ne!otiationG

The 0nion, did not, as the 5abor %ode re:uires, send a "ritten re:uest for the issuance of a cop# ofthe data about the -ans ran and file e&plo#ees. Moreover, as alle!ed b# the 0nion, the fact thatthe -an &ade use of the aforesaid !uesti&ates, a&ounts to a validation of the data it had used inits presentation.

+o Gra#e !use of iscretion

$n the *art of the *u!lic Respondent

The special civil action for certiorari &a# be availed of "hen the tribunal, board, or officer eercisin!>udicial or :uasi1>udicial functions has acted "ithout or in ecess of >urisdiction and there is no appealor an# plain, speed#, and ade:uate re&ed# in the ordinar# course of la" for the purpose of annullin!

the proceedin!.9

2rave abuse of discretion i&plies such capricious and "hi&sical eercise of>ud!&ent as is e:uivalent to lac of >urisdiction, or "here the po"er is eercised in an arbitrar# ordespotic &anner b# reason of passion or personal hostilit# "hich &ust be so patent and !ross as toa&ount to an invasion of positive dut# or to a virtual refusal to perfor& the dut# en>oined or to act atall in conte&plation of la". Mere abuse of discretion is not enou!h.7

/hile it is true that a sho"in! of pre>udice to public interest is not a re:uisite for 05P char!es toprosper, it cannot be said that the public respondent acted in capricious and "hi&sical eercise of

>ud!&ent, e:uivalent to lac of >urisdiction or ecess thereof. Neither "as it sho"n that the publicrespondent eercised its po"er in an arbitrar# and despotic &anner b# reason of passion orpersonal hostilit#.

/stoppel not pplica!le

In the Case at Bar

The respondent -an ar!ues that the petitioner is estopped fro& raisin! the issue of 05P "hen itsi!ned the ne" %-$.

$rticle (=8( of the %ivil %ode provides3

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Throu!h estoppel an ad&ission or representation is rendered conclusive upon theperson &ain! it, and cannot be denied or disproved as a!ainst the person rel#in!thereon.

$ person, "ho b# his deed or conduct has induced another to act in a particular&anner, is barred fro& adoptin! an inconsistent position, attitude or course of

conduct that thereb# causes loss or in>ur# to another.'

In the case, ho"ever, the approval of the %-$ and the release of si!nin! bonus do not necessaril#&ean that the 0nion "aived its 05P clai& a!ainst the -an durin! the past ne!otiations. $fter all,the conclusion of the %-$ "as included in the order of the SO56, "hile the si!nin! bonus "asincluded in the %-$ itself. Moreover, the 0nion t"ice filed a &otion for reconsideration respectin! its05P char!es a!ainst the -an before the SO56.

The %nion id +ot /ngage

In Blue-