GALVADORES, ET AL. v. TRAJANO G.R. No. 70067. September 15, 1986

Petitioner employees of PLDT Company Respondent Free Telephone Workers Union (FIWU) Union Respondent Atty. Espinas Respondent Counsel

Facts: Respondent counsel has been the legal counsel of FIWU since 1964. He received a letter from the Union President requesting him to appear as counsel in the on-

going labor dispute in PLDT and the union bound itself to compensate him of 10% of any improvement in the PLDTs last offer to the deadlock in CBA negotiations

PLDTs last offer referred to on the wage increases was:P230 first year of the proposed CBA; P100 for the 2nd year; and P90 for the 3rd year

The Minister of Labor assumed jurisdiction over all unresolved issues in the bargaining deadlock between PLDT and Union and proceeded to resolve the same by compulsory arbitration.

The Minister awarded across-the-board wage increases of P330/month for 1985; P155/month for 1983 and P155/month for 1984 and other fringe benefits. As noted, there were improvements obtained from PLDTs last offer.

The Executive Board of the Union passed a resolution requesting PLDT to deduct P115.00 per employee for the legal services of Respondent counsel.

Petitioners filed a letter-complaint before the MOLE assailing the imposition of P130.00 (later corrected to P155.00) per employee as attorneys fees for being unreasonable and violative of Art. 242 (o) of the Labor Code

o They were also saying that deductions cannot be given legal effect by a mere Board resolution but needs the ratification by the general membership of the Union.

Respondent Union and Counsel proferred the argument that the attorneys fees being exacted pertained to his services during compulsory arbitration proceedings and cannot be considered as negotiation fees or attorney's fees within the context of Article 242(o) of the Labor Code

o Respondent Counsel also posits that he surfaced only as lawyer of the Union when the employees themselves engaged in mass action to force a solution to the deadlock in their negotiations

Minister of Labor referred to the BLR the dispute for being intra-union in nature. Meanwhile, the Union held a plebiscite ratifying the Executive Board resolution. Petitioners questioned the plebiscite on the ground that one of the questions was misleading and

deceptive as it assumed that there was no dispute regarding the deduction of attorneys fees from the monetary benefits awarded to PLDT employees.

Issue: W/N the individual written authorization of the employees must first be obtained before any assessment can be made against monetary benefits awarded to them pursuant to Art. 242 (o) of the Labor Code

Held & Ratio: YES. The required individual authorizations in this case are wanting

The Omnibus Rules Implementing the Labor Code provide that deductions from wages of the employees may only be made by the employer in cases authorized by law.

The provisions are clear. No check-offs from any amounts due employees may be effected without individual written authorizations duly signed by the employee specifically stating the amount, purpose and beneficiary of the deduction.

The benefits awarded to PLDT employees still formed part of the collective bargaining negotiations although placed already under compulsory arbitration.

o This is not the "mandatory activity" under the Code which dispenses with individual written authorizations for check-offs, notwithstanding its "compulsory" nature. It is a judicial process of settling disputes laid down by law.

RCPI v. SECRETARY of LABOR G.R. No. 77959. January 9, 1989

QUICK DIGEST: RCPI filed to be exempted from coverage of Wage Order 1, and URCPILA-FUR, as representative of the employees, opposed. The NWC ruled against RCPI and ordered the payment of backpay. URCPILA wanted to get 15% of the amount due as union service fees (actually, attys fees.) RCIP opposed. Later on, RCPI entered into a compromise agreement with another union, BMRCPI, for the settlement of the amounts due, and stipulated that 10% attorneys fees will be given to one Atty. Capocyan. RCPI and BMRCPI wanted the case (appeal from the NWC order) dismissed in view of the compromise agreement. URCPILA opposed. A decision was issued saying that RCPI should pay the 15% union service fees claimed by URCPILA. Despite, this, RCPI paid the employees in full. SOLE held that RCPI is solely responsible for the union service fees claimed by URCPILA. RCPI alleged GADALEJ on the part of SOLE. The SC ruled against RCPI, saying that (1) while the NWC decision did not contemplate attorneys fees in its decision, RCPI itself admitted its obligation to pay such attys fees in the compromise agreemen; (2) while URCPILA is not a member of the Bar, it is nonetheless entitled to attys fees because the Labor Code allows labor federations and unions to appear as counsel in labor proceedings; (3) the alleged lack of individual written authorization from employees invoked by RCPI to deduct attys fees from their claims is of no moment since such lack is cured by the compromise agreement, and the fees are deductable under the law even w/o individual check-off authorizations. See the detailed version for juicy stuff that Sir might ask about.

DETAILED DIGEST:

FACTS: Petitioner Radio Communications of the Philippines filed with the National Wages Council an

application for exemption from coverage of Wage Order No.1 United RCPI Communications Labor Association, a labor organization affiliated with the Federation

of Unions of Rizal (URCPILA-FUR) opposed the application. The NWC disapproved the application for exemption and ordered the petitioner to pay its covered

employees the mandatory living allowance of P2.00 daily. The letter-decision was affirmed by the Office of the President.

Before the case was elevated on certiorari to the SC, respondent union filed for issuance of a writ of execution, asserting its claim to 15% of total backpay due to all its members as union service fee for successfully prosecuting the members claims and for reimbursement of expenses. The union later on reiterated its claim for the union service fee but for the increased rate of 20% of total backpay.

Petitioner RCPI filed its opposition asserting that there is no legal basis for the union to have the 20% service fee deducted from the amount due to every recipient member.

An alias writ of execution was issued Later, without the knowledge and consent of respondent union, petitioner entered into a compromise

agreement with Buklod ng Manggagawa sa RCPI-NFL (BMRCPI-NFL) as the new bargaining agent of RCPI employees. [Basically, the agreement says that RCPI acknowledges its liabilities under Wage Order 1 and that it will first pay 30% of whats due, then the balance of 70% shall be subject of re-opening/negotiation by the parties on a latter date. 10% of the total amount due to each employee will be deducted as attorneys fees of Atty. Capocyan will be deducted from the 70%]

Then, the parties to the compromise agreement filed a joint Motion to Dismiss on the ground that the NCW decision had already been novated by the agreement. Respondent union countered by opposing the motion, alleging that BMRCPI-NFL is not a party in interest since it was URCPILA that represented RCPI employees. Respondent filed an urgent motion for lien of the 15% union service fee. An order was issued by the Regional Director granting this motion for lien.

Despite the order, RCPI paid in full the covered employees w/o deducting the union service fees. In its MR, RCPI argued that the issue has been moot and academic since it had already paid in full the award in the NWC decision. It suggested that URCPILA-FUR should collect from the employees instead.

URCPILA filed a petition for the garnishment of petitioners funds. RCPI moved to dismiss. Regional Director issued an order declaring the NWC decision fully satisfied.

HOWEVER, NCR Officer-in-charge Romeo Young found that RCPI and it employees were jointly and severally liable for the payment of the 15% union service fees and consequently ordered the garnishment of RCPIs bank account. The order also noted that the compromise agreement was entered into in fraud of URCPILAs rights.

Secretary of DOLE, on reconsideration, modified the order, holding that it is only RCPI (and not the employees) that is liable to URCPILA for 10% of the award as attorneys fees.

ISSUE: W/N SOLE acted in GADALEJ in holding RCPI solely liable for the union service fees.

RULING: NO, SOLE did not act in GADALEJ. RCPI contends that the order imposed an additional obligation in the form of attys fees not contemplated in the NWC decision. While this is true, the SC said that that particular aspect or deficiency is deemed to have been supplied, if not modified pro tanto, by the compromise agreement subsequently executed between the parties. The agreement shows an unqualified admission by RCPI that 10% shall be taken from what is due to each employee to be considered as attorneys fees (although they wanted to withhold said fees from URCPILA).

Also, RCPIs position that URCPILA is not entitled to attys fees since it is not a member of the bar is erroneous and in disregard of the liberalized scheme and theory of representation of labor adopted in the Code. The appearance of labor federations and local unions as counsel in labor proceedings has been given legal sanction and we need only cite Art. 222 of the Labor Code which allows non-lawyers to represent their organization or members thereof. Hence, the union had a valid claim to attys fees.

Also, on the compromise agreement: it was concluded behind the bank of respondent and with another labor union and a lawyer neither of whom had a hand in the recovery of the benefits for the RCPI employees, casting doubts on the motives of RCPI. (The SOLGEN even revealed that the Atty. Capocyan mentioned in the compromise agreement is a fictitious character,)

Also, petitioner cannot invoke the lack of individual written authorization from the employees as excuse for refusal to pay the fees claimed since the lack of individual authorizations was remedied and supplanted by the compromise agreement. Also, the deductions for the union service fee in question are authorized by law and do not require individual check-off authorizations.

WHEREFORE, the order of the Secretary of Labor of August 16, 1986 is hereby AFFIRMED and the petition at bar is DISMISSED, with double costs against petitioner. The temporary restraining order issued pursuant to the Resolution of the Court of June 22, 1987 is LIFTED and declared of no further force and effect.

VENGCO v. TRAJANO G.R. No. 74453. May 5, 1989

FACTS: Sometime in the latter part of 1981, the Management of the Anglo-American Tobacco

Corporation and the Kapisanan ng Manggagawa sa Anglo-American Tobacco Corporation (FOITAF) entered into a compromise agreement whereby the company will pay to the union members the sum of P150,000.00 for their claims arising from the unpaid emergency cost of living allowance (ECOLA) and other benefits which were the subject of their complaint before the Ministry of Labor.

Respondent Timbungco, union president, received the money which was paid in installments. Thereafter, he distributed the amount among the union members.

Petitioners Ambrocio Vengco, Ramon Moises, Rafael Wagas and 80 others who are union members noted that Timbungco was not authorized by the union workers to get the money; and that ten percent (10%) of the P150,000.00 had been deducted to pay for attorney's fees without their written authorization in violation of Article 242 (o) of the Labor Code.

They demanded from Timbungco an accounting of how the P150,000.00 was distributed to the members. Timbungco did not give in to their demand.

Thus Vengco, et al. filed a complaint with the Ministry of Labor praying for the expulsion of Emmanuel Timbungco as president of the union, for an order requiring an accounting of how the P150,000.00 was distributed; and for an order to require private respondent to publish in the bulletin board the list of the members and the corresponding amount they each received.

Timbungco alleged that he was authorized by a resolution signed by the majority of the union members to receive and distribute the money; that the computation of the benefits was based on the payroll of the company; that the ten percent (10%) attorney's fees was in relation to the claim of the local union; and that the ten percent (10%) deduction was in accordance with Section II, Rule No. VIII, Book No. III of the Rules and Regulations implementing the Labor Code.

The Director of the Bureau of Labor Relations Trajano set aside the decision of the Med Arbiter and ordered the full accounting and the publication in the union's bulletin board the list of all recipient union members and the respective amounts they have received.

ISSUE: W/N Timbungco is guilty of illegally deducting 10% attorneys' fees from petitioners' backwages.

HELD: Article 241 of the Labor Code provides:

Other than for mandatory activities under the Code, no special assessment, attorney's fees, negotiation fees or any other extraordinary fees may be checked off from any amount due an employee without an individual written authorization duly signed by an employee. The authorization should specifically state the amount, purpose and beneficiary of the deduction.

It is very clear from the above-quoted provision that attorney's fees may not be deducted or checked off from any amount due to an employee without his written consent except for mandatory activities under the Code. A mandatory activity has been defined as a judicial process of settling dispute laid down by the law.

In the instant case, the amicable settlement entered into by the management and the union cannot be considered as a mandatory activity under the Code. It is true that the union filed a claim for emergency

cost of living allowance and other benefits before the Ministry of Labor. But this case never reached its conclusion in view of the parties' agreement. It is not also shown from the records that Atty. Benjamin Sebastian was instrumental in forging the said agreement on behalf of the union members.

Timbungco maintains that the "Kapasiyahan" gave him the authority to make the deduction This contention is unfounded. Contrary to his claim, the undated "Kapasiyahan" or resolution did not confer upon him the power to deduct 10% of the P150,000.00 despite the alleged approval of the majority of the union workers. A reading of the said resolution yields the same conclusion arrived at by Trajano who declared it defective. The resolution was not dated, nor was it captioned and failed to state the very purpose for which it was prepared.

Moreover, the law is explicit. It requires the individual written authorization of each employee concerned, to make the deduction of attorney's fees valid. Absent such authority, Timbungco should not have kept the money to himself but should have turned it over to the Union Treasurer. He, therefore, exceeded his authority as President of the Union.

Moreover, Book III, Rule VIII, Section II of the Implementing Rules cited by Timbungco which dispenses with the required written authorization from the employees concerned does not apply in this case. This provision envisions a situation where there is a judicial or administrative proceedings for recovery of wages. Upon termination of the proceedings, the law allows a deduction for attorney's fees of 10% from the total amount due to a winning party. In the herein case, the fringe benefits received by the union members consist of back payments of their unpaid emergency cost of living allowances which are totally distinct from their wages. Allowances are benefits over and above the basic salaries of the employees. We have held that such allowances are excluded from the concept of salaries or wages. In addition, the payment of the fringe benefits were effected through an amicable settlement and not in an administrative proceeding.

ACCORDINGLY, the petition is granted. The assailed Orders dated May 23, 1983 of Officer-in-Charge Victoriano R. Calaycay of the Bureau of Labor Relations, and April 2, 1986 of respondent Director Cresenciano B. Trajano of the same Bureau are REVERSED and SET ASIDE and the latter's decision dated December 29, 1982 is hereby reinstated. No costs.

CARMELITO L. PALACOL, ET AL., PETITIONERS, v.

PURA FERRER-CALLEJA, DIRECTOR OF THE BUREAU OF LABOR RELATIONS, MANILA CCBPI SALES FORCE UNION, AND COCA-COLA BOTTLERS (PHILIPPINES), INC.,

RESPONDENTS G.R. NO. 85333. February 26, 1990

FACTS: On October 12, 1987, the respondent Manila CCBPI Sales Force Union (hereinafter referred to as

the Union), as the collective bargaining agent of all regular salesmen, regular helpers, and relief helpers of the Manila Plant and Metro Manila Sales Office of the respondent Coca-Cola Bottlers (Philippines), Inc. (hereinafter referred to as the Company) concluded a new collective bargaining agreement with the latter.

On the same day, the president of the Union submitted to the Company the ratification by the union members of the new CBA and authorization for the Company to deduct union dues equivalent to P10.00 every payday or P20.00 every month and, in addition, 10% by way of special assessment, from the CBA lump-sum pay granted to the union members. The last one among the aforementioned is the subject of the instant petition.

As embodied in the Board Resolution of the Union dated September 29, 1987, the purpose of the special assessment sought to be levied is "to put up a cooperative and credit union; purchase vehicles and other items needed for the benefit of the officers and the general membership; and for the payment for services rendered by union officers, consultants and others." There was also an additional proviso stating that the "matter of allocation ... shall be at the discretion of our incumbent Union President.

This "Authorization and CBA Ratification" was obtained by the Union through a secret referendum held in separate local membership meetings on various dates. (Total membership = 800. 672 members originally authorized the 10% special assessment, while 173 opposed the same.)

However, one hundred seventy (170) members of the Union submitted documents to the Company stating that although they have ratified the new CBA, they are withdrawing or disauthorizing the deduction of any amount from their CBA lump sum.

Later, 185 other union members submitted similar documents expressing the same intent. These members, numbering 355 in all (170 + 185), added to the original oppositors of 173, turned the tide in favor of disauthorization for the special assessment, with a total of 528 objectors and a remainder of 272 supporters.

On account of the above-mentioned disauthorization, the Company, filed an action for interpleader with the Bureau of Labor Relations.

Petitioners, who are regular rank-and-file employees of the Company and bona fide members of the Union, filed a motion/complaint for intervention.

Petitioners cited Galvadores v. Trajano, wherein it was ruled that no check-offs from any amount due employees may be effected without individual written authorizations duly signed by the employees specifically stating the amount, purpose, and beneficiary of the deduction.

The Union countered that the deductions not only have the popular indorsement and approval of the general membership, but likewise complied with the legal requirements of Article 241 (n) and (o) of the Labor Code in that the board resolution of the Union imposing the questioned special assessment had been duly approved in a general membership meeting and that the collection of a special fund for labor education and research is mandated.

Med-Arbiter Manases T. Cruz ruled in favor of petitioners in an order dated February 15, 1988 whereby he directed the Company to remit the amount it had kept in trust directly to the rank-and-file personnel without delay.

On appeal to the Bureau of Labor Relations, however, the order of the Med-Arbiter was reversed and set aside by the respondent-Director in a resolution dated August 19, 1988 upholding the claim of the Union that the special assessment is authorized under Article 241 (n) of the Labor Code, and that the Union has complied with the requirements therein.

ISSUE: W/N a special assessment be validly deducted by a labor union from the lump-sum pay of its members, granted under a collective bargaining agreement (CBA), notwithstanding a subsequent disauthorization of the same by a majority of the union members?

HELD/RATIO: NO. We are convinced that the deduction of the 10% special assessment by the Union was not made in accordance with the requirements provided by law.

Petitioners are correct in citing the ruling of this Court in Galvadores which is applicable to the instant case. The principle "that employees are protected by law from unwarranted practices that diminish their compensation without their known edge and consent" is in accord with the constitutional principle of the State affording full protection to labor.

The respondent-Union brushed aside the defects pointed out by petitioners in the manner of compliance with the legal requirements as "insignificant technicalities." On the contrary, the failure of the Union to comply strictly with the requirements set out by the law invalidates the questioned special assessment. Substantial compliance is not enough in view of the fact that the special assessment will diminish the compensation of the union members. Their express consent is required, and this consent must be obtained in accordance with the steps outlined by law, which must be followed to the letter. No shortcuts are allowed.

The applicable provisions are clear. The Union itself admits that both paragraphs (n) and (o) of Article 241 apply. Paragraph (n) refers to "levy" while paragraph (o) refers to "check-off" of a special assessment. Both provisions must be complied with. Under paragraph (n), the Union must submit to the Company a written resolution of a majority of all the members at a general membership meeting duly called for the purpose. In addition, the secretary of the organization must record the minutes of the meeting which, in turn, must include, among others, the list of all the members present as well as the votes cast.

As earlier outlined by petitioners, the Union obviously failed to comply with the requirements of paragraph (n). It held local membership meetings on separate occasions, on different dates and at various venues, contrary to the express requirement that there must be a general membership meeting. The contention of the Union that "the local membership meetings are precisely the very general meetings required by law" is untenable because the law would not have specified a general membership meeting had the legislative intent been to allow local meetings in lieu of the latter.

Moreover, it is well-settled that "all doubts in the implementation and interpretation of the provisions of the Labor Code ... shall be resolved in favor of labor.

The Court, therefore, stakes down the questioned special assessment for being a violation of Article 241, paragraphs (n) and (o), and Article 222 (b) of the Labor Code.

WHEREFORE, the instant petition is hereby GRANTED. The Order of the Director of the Bureau of Labor Relations dated August 19, 1988 is hereby REVERSED and SET ASIDE, while the order of the Med-Arbiter dated February 17, 1988 is reinstated, and the respondent Coca-Cola Bottlers (Philippines), Inc. is hereby ordered to immediately remit the amount of P1,267,863.39 to the respective union members from whom the said amount was withheld. No pronouncement as to costs. This decision is immediately executory.

ABS-CBN SUPERVISORS EMPLOYEES UNION MEMBERS v. ABS-CBN March 11, 1999

DOCTRINE: Requisites for a valid special assessment for Unions incidental expenses (according to Art. 241):

1. Authorization by a written resolution of the majority of all the members at the general membership meeting duly called for the purpose.

2. Secretary's record of the minutes of the meeting 3. Individual written authorization for check-off duly signed by the employee concerned.

FACTS: The ABS-CBN Supervisors Union entered into a CBA with ABS-CBN in which ABS-CBN will

advance 10% of the sum total of all the salary increases and signing bonuses granted to the supervisors and to cover the Unions incidental expenses (e.g. Attys fees, representation expenses). Such advance shall be deducted from the benefits granted as they accrue.

The Union Members filed a complaint against the Union Officers and ABS-CBN praying that the special assessment of 10% be declared illegal for failure to comply with Art. 241 (g) (n) and (o) of the Labor Code.

Med-Arbiter declared it illegal. DOLE Undersecretary affirmed the decision. On MR, the DOLE Undersecretary reversed, declaring the assessment VALID.

ISSUE: Did the public respondent act with grave abuse of discretion in issuing the challenged Order reversing his own Decision of July 1,1991? NO.

HELD: Petitioners also argued that the check-off provision in question is illegal because it was never

submitted for consideration and approval to "all the members at a general membership meeting called for the purpose"; and further alleged that the formalities mandated by Art. 241, paragraphs (n) and (o) of the Labor Code, as amended, were not complied with.

Art. 241 of the Labor Code, as amended, must be read in relation to Article 222, paragraph (b) of the same law, which states:

No attorney's fees, negotiation fees or similar charges of any kind arising from collective bargaining negotiations or conclusion of the collective agreement shall be imposed on any individual member of the contracting union: Provided, however, that attorney's fees may be charged against union funds in an amount to be agreed upon by the parties. Any contract, agreement or arrangement of any sort to the contrary shall be null and void.

The Court reads the afore-cited provision (Article 222 [b] of the Labor Code) as prohibiting the payment of attorney's fees only when it is effected through forced contributions from the workers from their own funds as distinguished from the union funds.

In this case the three (3) requisites for the validity of the ten percent (10%) special assessment for Union's incidental expenses, attorney's fees and representation expenses were met.

Eighty-five (85) members of the same Union executed individual written authorizations for check-off. Petitioners further contend that Article 241 (n) contemplates a general meeting after the conclusion of

the collective bargaining agreement. Subject Article does not state that the general membership meeting should be called after the

conclusion of a collective bargaining agreement. Even granting ex gratia argumenti that the general meeting should be held after the conclusion of the CBA, such requirement was complied with since the

May 24, 1991 General Membership Meeting was held after the conclusion of the Collective Bargaining Agreement

Records do not indicate that the aforesaid check-off authorizations were executed by the eighty-five (85) Union members under the influence of force or compulsion. There is, then, the presumption that such check-off authorizations were executed voluntarily by the signatories thereto.

The petitioners also cited a case Palacol v. Ferrer-Calleja, but it is inapplicable because in that case majority of the members withdrew their individual authorizations.

The SC also did not apply the BPIEU-ALU v. NLRC because in that case no similar deductions were taken from the other workers who did not sign the resolution and so were not bound by it.

JOHNSON AND JOHNSON LABOR UNION-FFW, DANTE JOHNSON MORANTE, MYRNA OLOVEJA AND ITS OTHER INDIVIDUAL UNION MEMBERS, petitioners

v. DIRECTOR OF LABOR RELATIONS, AND OSCAR PILI, respondents.

G.R. No. 76427. February 21, 1989

FACTS: Oscar Capili was a member of the Union JOHNSON AND JOHNSON LABOR UNION-FFW. He was dismissed from his employment in Johnson & Johnson (Phil) Inc for non-disclosure in his

job application form of the fact that he had a relative in the company in violation of company policies.

He filed a complaint against the officers of the petitioner-union alleging that, despite demands, they have refused to deliver the financial aid as provided in the unions constitution: A member who have been suspended or terminated without reasonable cause shall be extended a financial aid from the compulsory contributions in the amount of Php 0.75 from each member weekly.

The petitioner-union and its officers counter-alleged: a) that the said financial aid was to be given only in cases of termination or suspension without any reasonable cause; b) that the union's executive board had the prerogative to determine whether the suspension or termination was for a reasonable cause or not; c) and that the union, in a general membership meeting, had resolved not to extend financial aid to the private respondent.

Note: While the grievance procedure was pending, Capili filed a case for unfair labor practice and illegal dismissal against his employer (Johnson&Johnson Inc), in the NLRC.

Med-Arbiter dismissed the complaint (UNION complaint) for lack of merit. On appeal, the public respondent reversed with modifications and granted the appeal. He ordered

that the union pay the complainant the sum of Php0.75 as provided in the unions constitution, provided however that should his complaint for illegal dismissal pending in the NLRC be dismissed, the union be absolved from paying as well.

Both parties moved for reconsideration. Capili then, stated in a Manifestation that he was being discriminated against, considering that one Jerwin Taguba, another union member, was terminated for dishonesty and loss of confidence but was granted financial aid by the petitioners while Taguba's complaint against the company was still pending with the NLRC.

The Director then modified his decision. Resolving that Capili was similarly situated with Taguba, He ordered that the union immediately pay Capili, without prejudice to refund in case the pending NLRC be resolved against Capili.

A writ of execution with regard to this was thereafter issued.

ISSUE: W/N the public respondent committed grave abuse of discretion in ruling that the private respondent is entitled to the financial aid from the compulsory contributions of the petitioner-union afforded to its members who have been suspended or terminated from work without reasonable cause

HELD: No, the public respondent did not commit grave abuse of discretion. The Court said that Petitioner-unions claim that the questioned decision is contrary to law is unmeritorious. (Unions Contention: that the orders of the Director are tantamount to compelling the union to disburse it funds without the authority of the general membership and to collect from its members without the benefit of individual payroll authorization, contrary to law) Petitioner-union's provision in their constitution and by-laws as earlier aforequoted is self-executory. The financial aid extended to any suspended or terminated union member is realized from the contributions declared to be compulsory under the said provision. The nature of the said contributions

being compulsory and the fact that the purpose as stated is for financial aid clearly indicate that individual payroll authorizations of the union members are not necessary. The petitioner-union's constitution and by-laws govern the relationship between and among its members. As in the interpretation of contracts, if the terms are clear and leave no doubt as to the intention of the parties, the literal meaning of the stipulations shall control. Thus, there is no doubt that the petitioner-union can be ordered to release its funds intended for the promotion of mutual assistance in favor of the private respondent. The union constitution is a covenant between the union and its members and among the members. There is nothing in their constitution which leaves the legal interpretation of its terms unilaterally to the union or its officers or even the general membership. It is noteworthy to quote the ruling made by the public respondent in this respect, to wit:

The union constitution and by-laws clearly show that any member who is suspended or terminated from employment without reasonable cause is entitled to financial assistance from the union and its members. The problem, however, is that the constitution does not indicate which body has the power to determine whether a suspension or dismissal is for reasonable cause or not. To our mind, the constitution's silence on this matter is a clear recognition of the labor arbiter's exclusive jurisdiction over dismissal cases. After all, the union's constitution and by-laws is valid only insofar as it is not inconsistent with existing laws. ... . (BLR decision, p. 2; p. 115, Records)

WHEREFORE, PREMISES CONSIDERED, the instant petition is hereby DISMISSED in the absence of a showing of grave abuse of discretion on the part of the public respondent. The decision of the public respondent dated April 17, 1986 as modified in a resolution dated August 17, 1986 is AFFIRMED. The temporary restraining order issued by the Court on December 24,1986 is SET ASIDE.

UST FACULTY UNION, ET AL. v. BITONIO ET AL. G.R. No. 131235. Nov. 16, 1999

FACTS: Private Respondents are duly elected officers of the UST Faculty Union (USTFU) The secretary general of USTFU posted a notice addressed to all USTFU members announcing a

general assembly to be held on 05 October 1996 o Among others, the general assembly was called to elect USTFU's next set of officers.

On 02 October 1996, the secretary general of UST, upon the request of the various UST faculty club presidents, issued notices allowing all faculty members to hold a convocation on 04 October 1996 o Denominated as a general faculty assembly, the convocation was supposed to discuss the "state

of the unratified USTUSTFU CBA" and "status and election of USTFU officers" The convocation was held as scheduled (Oct. 4, 1996)

o The general assembly was attended by members of the USTFU and, as admitted by the appellants, also by "nonUSTFU members who are members in good standing of the UST Academic Community Collective Bargaining Unit"

o On this occasion, appellants were elected as USTFU's new set of officers by acclamation and clapping of hands

o Upon a motion of one Atty. Lopez, admittedly not a member of USTFU, that the USTFU Constitution and By-Laws (CBL) and "the rules of the election be suspended and that the election be held [on] that day"

Respondents filed the instant petition seeking injunctive reliefs and the nullification of the results Subsequently, petitioners and UST allegedly entered into another CBA covering the period from 01

June 1996 to 31 May 2001 The med-arbiter issued a TRO against petitioners Public respondent, director of the BLR agreed with the med-arbiter that the Oct. 4 election was void

ISSUE: 1. W/N the October 4 election was valid. 2. W/N the suspension of the CBL was valid.

HELD: 1. NO. The election was not valid.

a) The right to vote in the union is enjoyed only by union members A union election should be distinguished from a certification election, which is the process of

determining, through secret ballot, the sole and exclusive bargaining agent of the employees in the appropriate bargaining unit, for purposes of collective bargaining Specifically, the purpose of a certification election is to ascertain whether or not a majority of the

employees wish to be represented by a labor organization and, in the affirmative case, by which particular labor organization In a certification election, all employees belonging to the appropriate bargaining unit can vote A union member who likewise belongs to the appropriate bargaining unit is entitled to vote in said

election. However, the reverse is not always true; an employee belonging to the appropriate bargaining unit but who is not a member of the union cannot vote in the union election, unless otherwise authorized by the constitution and bylaws of the union. In this case, non-members participated in the assembly and in the voting

b)The election did not follow the procedures imposed by the CBL The union's CBL is the fundamental law that governs the relationship between and among

the members of the union. It is where the rights, duties and obligations, powers, functions and authority of the officers as well as the members are defined First, the assembly was not called by the USTFU. It was merely a convocation of faculty clubs, It

was not convened in accordance with the provision on general membership meetings. It was in fact a gathering that was called and participated in by management and nonunion members Second, there was no commission on elections to oversee the election, as mandated by Sections 1

and 2 of Article IX of the USTFU's CBL Third, the purported election was not done by secret balloting, in violation of Section 6, Article IX

of the USTFU's CBL, as well as Article 241 (c) of the Labor Code

2. NO. The suspension of the CBL was not valid. Petitioners contend that the October 4, 1996 assembly "suspended" the union's CBL. They aver

that the suspension and the election that followed were in accordance with their "constituent and residual powers as members of the collective bargaining unit to choose their representatives for purposes of collective bargaining."

The general faculty assembly was not the proper forum to conduct the election of USTFU officers. Not all who attended the assembly were members of the union; some, apparently, were even disqualified from becoming union members, since they represented management

The person who moved for the suspension of USTFU's CBL was not a member of USTFU. Allowing a nonunion member to initiate the suspension of a union's CBL, and nonunion members to participate in a union election on the premise that the union's CBL had been suspended in the meantime, is incompatible with the freedom of association and protection of the right to organize

The grievances of the petitioners could have been brought up and resolved in accordance with the procedure laid down by the union's CBL

HOLY CROSS OF DAVAO COLLEGE, INC. v. JOAQUIN October 18, 1996 Ponente: Narvasa

FACTS: Holy Cross of Davao College, Inc. (hereinafter Holy Cross) and its affiliate labor organization

Holy Cross Davao College Union-KAMAPI (hereinafter KAMAPI) entered into a collective bargaining agreement (CBA) effective from 1 June 1986 to 31 May 1989.

Before the CBA expired, KAMAPI President Jose Lagahit wrote Holy Cross to seek extension for two months for renewing the CBA since the employees are still on vacation. Holy Cross allowed the extension.

KAMAPI held an election for a new set of union officers, wherein Rodolfo Galera won as president.

Galera initiated discussion for the unions disaffiliation from KAMAPI federation. His group formed a separate organization called Holy Cross of Davao College Teachers Union(hereainafter Teachers Union) and elected their own officers.

KAMAPI sent Holy Cross the proposal for the new collective bargaining contract within the two-month extension it sought.

Holy Cross stopped deducting from its employees wages the corresponding union dues and agency fees provided in the check-off clause of the CBA.

Meanwhile, full-blown action on the issue of representation ensued between KAMAPI and Teachers Union. The issue was resolved in favor of KAMAPI.

After its success, KAMAPI presented revised bargaining proposals, which Holy Cross refused to take action without a definitive ruling on the proper interpretation of Article 1 of the CBA (i.e. automatic renewal of the CBA for three years if the parties fail to agree on the renewal or modification).

KAMAPI filed a notice of strike and accused Holy Cross for unfair labor practice. The case was submitted for voluntary arbitration. The Arbitrator ruled in favor of KAMAPI and

ordered Holy Cross to (1) negotiate and conclude an agreement with KAMAPI and (2) pay to the Union the amount equivalent to the uncollected union dues up to the time a new CBA is concluded.

Dissatisfied, Holy Cross filed the instant petition contending the Voluntary Arbitrator acted with GADALEJ. It argued that it could not comply with the check-off provision because KAMAPI failed to submit to the college comptroller every 8th day of the month, a list of employees from the union dues and agency fees are to be deducted this was already an established practice.

ISSUE: W/N Holy Cross should be held liable to pay the uncollected union dues and agency fees to KAMAPI.

HELD/RATIO: NO.

No provision of law makes the employer directly liable for the payment to the labor organization of union dues and assessments that the former fails to deduct from its employees salaries and wages pursuant to a check-off stipulation. The employers failure to make the requisite deductions may constitute a violation of a contractual commitment for which it may incur liability for unfair labor practice. But it does not by that omission, incur liability to the union for the aggregate of dues or assessments uncollected from the union members, or agency fees for non-union employees.

The obligation to pay union dues and agency fees obviously devolves not upon the employer, but the individual employee. It is a personal obligation not demandable from the employer upon default or refusal of the employee to consent to a check-off. The only obligation of the employer under a check-off is to effect the deductions and remit the collections to the union.

Where the employer fails or refuses to implement a check-off agreement, logic and prudence dictate that the union itself undertake the collection of union dues and assessments from its members (and agency fees from non-union employees); this, of course, without prejudice to suing the employer for unfair labor practice.

LITTON MILLS EMPLOYEES ASSOCIATION-KAPATIRAN v. FERRER-CALLEJA (1988)

FACTS: On 14 August 1986, without the knowledge and approval of the general membership of

LMEA-K, Umali "Affiliated" petitioner-union with the federation of GATCORD. Umali then caused mimeographed leaflets to be distributed to the union-members, urging them

to continue affiliating with GATCORD, at the same time maligning petitioner union's legal counsel Paterno D. Menzon, as well as Messrs. Badillo and Abong, the former and incumbent vice-president of petitioner-union.

As a consequence, a majority of the union-members (725 out of a total membership 1,100) opposed the affiliation of LMEA-K with GATCORD, and expressly manifested their intention to remain as an independent-union, in a statement, "Sama-Samang Kapasiyahan", which also authorized Abong to take appropriate steps against Umali, including impeachment, should the latter continue the affiliation of the petitioner-union with GATCORD.

Despite the opposition of a majority of the union membership to the petitioner- union's affiliation with GATCORD, Umali continued with it.

Abong and the majority of the elected union officers signed a letter, addressed to Umali, accusing him of disloyalty by reasons of his affiliation with GATCORD, and advising him to appear before them on August 1986 at 2:00 p.m. in the company canteen, to refute the charge of disloyalty against him.

The letter also warned Umali that his failure to attend said meeting would be interpreted as an admission on his part of the charge levelled against him. Umali did not show up at the appointed confrontation.

Consequently, the majority of the union officers, led by Abong, voted to impeach Umali, who was informed of this fact by letter addressed to him.

LMI required the petitioners to first thresh out the matter with the proper office of the Department of Labor and Employment, before it could act on petitioners' request to terminate Umali from his employment with LMI.

On 25 September 1986, petitioners lodged a complaint against Umali and LMI before the med-arbiter section of the NCR of the DOLE, praying that, after notice and hearing, an order be issued declaring as valid the impeachment of Rodolfo Umali and that respondent company be ordered to comply with Sec. 5, par. b Article IV of the CBA, by terminating the employment of Umali, and proclaiming Rogelio Abong, the union's vice-president, as the new president of the union.

The Med-Arbiter ruled in favor of Umali and found no valid ground to sustain the impeachment of Rodolfo Umali as president of the petitioner union, since Umali was not afforded his right to due process, his impeachment having been approved without compliance with the procedure laid down in the petitioner-union's constitution and by-laws.

Petitioners appealed the Med-Arbiter's order to the public respondent, which dismissed the appeal for lack of merit, and affirmed in toto the order of the Med-Arbiter.

Petitioner's MR was denied Hence, the present recourse

ISSUE: W/N the impeachment of Umali for disloyalty was proper.

HELD: ISSUE HAS BECOME MOOT AND ACADEMIC. 1) One of the grounds for losing membership in the union based on their constitution and

by-laws, is by joining a federation. 2) Evidence presented that that GATCORD is a labor federation, to which respondent Umali

affiliated the petitioner-union a. Mimeographed leaflets he caused to be distributed among the union-members,

urging them to continue affiliating with GATCORD, b. Pledge of Allegiance of newly-appointed Shop Steward Norberto David, c. Letter of Umali to LMI, the last two (2) being attested to by GATCORD's

National President Timoteo Aranjuaez and the fact that the letter was written on paper with GATCORD's letterhead

d. Also, the affiliation of the petitioner union with GATCORD was affirmed by Umali himself, when he presented the alleged 700 signatures of union-members who supported his move of affiliating the union LMEAK with GATCORD.

3) The CBA of the LMEAK with LMI was to expire only on 31 October 1987, whereas, Umali affiliated the union around August 1986, or about 14 months before the expiration of said CBA. The affiliation of the petitioner-union with GATCORD converted the former's status from that of an independent union to that of a local of a labor federation. Such change in status not only affects the Identity of the petitioner union but also its powers, duties and privileges, for as a local, it will have to contend with and consult the federation, in matters affecting the union.

4) The act of affiliating with a federation is a major modification in the status of the petition union. And such act is a violation of the rule that no modification of the CBA can be made during its existence, unless either party serves written notice to terminate or modify the agreement at least sixty (60) days prior to its expiration date. Hence, there was a violation of the existing CBA, on the part of Umali.

5) As to the impeachment of a union officer it clearly appears that their constitution procedure was not followed by the petitioners when they impeached Umali.

6) Petitioners should have shown substantial compliance with said impeachment procedure, by giving Umali ample opportunity to defend himself, as contrasted to an outright impeachment, right after he failed to appear before the first and only investigation scheduled on 27 August 1986 in the Litton Canteen.

7) The Court believes that the union-members themselves know what is best for them, i.e., whether they still want respondent Umali as their Union President, and whether they wish to affiliate their union with GATCORD.

8) It appears from from the record that a group of employees headed by Abong broke away from the petitioner-union and formed a new union, called Litton Mills Workers Union, and that in a certification election that followed, said Litton Mills Workers Union, headed by petitioner Abong, was chosen as the collective bargaining agent.

9) Because of this supervening event, it now appears clear that the majority of the members of LMEAK do not wish respondent Umali to continue as their president; neither do they wish their union to be affiliated with the GATCORD federation. Consequently, the issues in this petition have become moot and academic.

10) The Manifestation of the petitioners, after informing the Court of the election of the Litton Mills Workers union headed by Abong, as the collective bargaining representative in LMI, reiterates the prayer that respondent Umali be considered and declared as impeached.

11) This issue has, to the mind of the Court, likewise become moot and academic for it is inconceivable that Umali will be retained as president of the new collective bargaining agent, the Litton Mills Workers Union, while Umali's continued presidency of LMEAIC as a minority union if still existing in LMI, has ceased to be of any moment in the instant case.

MARIO v. GAMILLA G.R. No. 149763. July 7, 2009

FACTS: Case 1:

Atty. Mario, et al. were among the executive officers and directors (collectively called the Mario Group) of the UST Faculty Union (USTFU), a labor union duly registered and the bargaining representative of the UST faculty members.

Gamilla, et al. were UST professors and USTFU members. The 1986 Collective Bargaining Agreement (CBA) between UST and USTFU expired.

Thereafter, bargaining negotiations ensued between UST and the Mario Group. As the parties were not able to reach an agreement, a bargaining deadlock was declared and USTFU filed a notice of strike.

DOLE Secretary Franklin Drilon issued an Order laying the terms and conditions for a new CBA. In accordance with said Order, the UST and USTFU entered into a CBA.

UST and USTFU executed a Memorandum of Agreement (MOA), whereby UST faculty members belonging to the collective bargaining unit were granted additional economic benefits. The majority of USTFU members signed individual instruments of ratification. Said instruments recited that in consideration of the efforts of the UST Faculty Union in obtaining P42 million package of economic benefits, a check-off of 10% covering union dues, and special assessment for Labor Education Fund and attorney's fees from USTFU members and agency fee from non-members for the period of the agreement was authorized to be made in one lump sum.

USTFU, through its President, Mario, wrote a letter to the UST Treasurer requesting the release to the union of the sum of P4.2 million, the 10% of the P42 million economic benefits package.

Respondents filed with the Med-Arbiter, DOLE-NCR a Complaint for the expulsion of the Mario Group as USTFU officers and directors, alleging that the Mario Group violated the rights and conditions of membership in USTFU, particularly by: 1) investing the unspent balance of the P42 million economic benefits package given by UST without prior approval of the general membership; 2) simultaneously holding elections viva voce; 3) ratifying the CBA involving the P42 million economic benefits package; and 4) approving the attorney's/agency fees worth P4.2 million in the form of check-off.

Case 2: Respondents filed with the Med-Arbiter another Complaint against the Mario Group for

violation of the rights and conditions of union membership. The Complaint primarily sought to invalidate certain provisions of the CBA negotiated by the Mario Group for USTFU and the registration of CBA with the DOLE.

Case 3: Norma Collantes, USTFU Secretary-General, posted notices in some faculty rooms at

UST, informing the union members of a general assembly. Part of the agenda was the election of new USTFU officers.

The following day, respondents wrote a letter to the USTFU Committee on Elections, urging the latter to re-schedule the elections to ensure an honest and orderly election and to afford the union members the time to prepare. The USTFU Committee failed to act positively on respondents' letter, and neither did they adopt and promulgate the rules and regulations for the conduct of the scheduled election.

Thus respondents filed with the Med-Arbiter an Urgent Ex-Parte Petition/Complaint, alleging that the general membership meeting called by the USTFU Board of Directors with the agenda which included the election of union officers, was in violation of the provisions of the Constitution and By-Laws of USTFU. Respondents prayed that the DOLE supervise the conduct of the USTFU elections.

Case 4: UST Secretary General headed a general faculty assembly attended by USTFU members,

as well as USTFU non-members, but who were members of the collective bargaining unit. During said assembly, respondents were among the elected officers of USTFU (Gamilla Group).

Petitioners filed with the Med-Arbiter, a Petition seeking injunctive reliefs and the nullification of the results.

Med-Arbiter DOLE-NCR nullified the election of the Gamilla Group for having been conducted in violation of the Constitution and By-Laws of the union. This ruling of was affirmed on appeal by the Bureau of Labor Relations (BLR) in a Resolution. Respondents were, thus, prompted to file a Petition for Certiorari.

While case was pending, the term of office of the Gamilla Group expired. The Gamilla Group then scheduled the next election of USTFU officers.

Court promulgated its Decision affirming the BLR Resolution which ruled that the purported election of USTFU officers was void.

Case 5: Respondents filed before the Med-Arbiter a fourth Complaint/Petition against the Mario

Group, as well as the Philippine Foundation for the Advancement of the Teaching Profession, Inc., Security Bank Corporation, and Bank of the Philippine Islands, claiming that they were the legitimate USTFU officers.

DOLE-NCR Regional Director rendered a Decision in the consolidated cases in respondents' favor, and adjudged the Mario Group as guilty of violating the provisions of the USTFU Constitution and By-laws by failing to collect union dues and to conduct a general assembly every three months. The DOLE-NCR Regional Director also ruled that the Mario Group violated Article 241 (c) and (l) of the Labor Code when they did not submit a list of union officers to the DOLE; when they did not submit/provide DOLE and the USTFU members with copies of the audited financial statements of the union; and when they invested in a bank, without prior consent of USTFU members, which formed part of the P42 million economic benefits package. Additionally, the DOLE-NCR Regional Director declared that the check-off of P4.2 million was invalid.

Petitioners interposed an appeal before the BLR. In the meantime, the election of USTFU officers was held as scheduled in which the

Gamilla Group claimed victory. Gamilla group, as the new officers, entered into a Memorandum of Agreement with the UST, which provided for the economic benefits to be granted to the faculty members of the UST. Said Agreement was ratified.

BLR promulgated its Decision where the appeal was granted in part. It ordered the case be remanded to the Regional Office for the immediate conduct of election of officers of USTFU. The BLR, however, agreed in the finding of the Regional Director that the P42 million economic benefits package was sourced from the faculty members' share in the tuition fee increases under Republic Act No. 6728. Under said law, 70% of tuition fee increases shall go to the payment of salaries, wages, allowances, and other benefits of teaching and non-teaching personnel. Also, the exception to charging against union funds was not applicable because the P42 million economic benefits package was not union

fund, as the same was intended not for the union coffers, but for the members of the entire bargaining unit.

Petitioners filed with the Court of Appeals a Petition for Certiorari. CA rendered decision favoring respondents.

ISSUES: 1. What is the nature of the P42 million economic benefits package granted by UST to

USTFU? 2. W/N the 10% check off collected by Marino Group from the P42 million economic

benefits package is legal. 3. W/N the BLR order for USTFU to conduct election of union officers under the control of

DOLE-NCR Regional Director is valid.

HELD/RATIO: (1)

Petitioners argue that the P42 million economic benefits package granted to the covered faculty members were additional benefits, which resulted from a long and arduous process of negotiations between the Mario Group and UST.

The Court disagrees with petitioners' stance. The provisions of Republic Act No. 6728 were not arbitrarily applied, considering that the parties

themselves stipulated in Section 7 of the MOA they signed that it would be clearly understood and agreed upon that the aggregate sum of P42 million is chargeable against the share of the faculty members in the incremental proceeds of tuition fees collected and still to be collected.

The "law" in Section 7 of the MOA can only refer to Republic Act No. 6728, otherwise known as the "Government Assistance to Students and Teachers in Private Education Act".

Given the lack of evidence to the contrary, it can be conclusively presumed that the entire P42 million economic benefits package extended to USTFU came from the 70% allotment from tuition fee increases of UST. Preceding from this presumption, any deduction from the P42 million economic benefits package, such as the P4.2 million claimed by the Mario Group as attorney's/agency fees, should not be allowed, because it would ultimately result in the reduction of the statutorily mandated 70% allotment from the tuition fee increases of UST.

(2) NO. The pertinent legal provisions on a check-off are found in Articles 222 (b) and 241 (n) and (o) of

the Labor Code. Article 222 (b) prohibits the payment of attorney's fees only when it is effected through forced

contributions from the employees from their own funds as distinguished from union funds. Hence, the general rule is that attorney's fees, negotiation fees, and other similar charges may only be collected from union funds, not from the amounts that pertain to individual union members. As an exception to the general rule, special assessments or other extraordinary fees may be levied upon or checked off from any amount due an employee for as long as there is proper authorization by the employee.

A check-off is a process or device whereby the employer, on agreement with the Union, recognized as the proper bargaining representative, or on prior authorization from the employees, deducts union dues or agency fees from the latter's wages and remits them directly to the Union. Its desirability in a labor organization is quite evident. The Union is assured thereby of continuous funding. As this Court has acknowledged, the system of check-off is primarily for the benefit of the Union and, only indirectly, for the individual employees.

The Court finds that, in the instant case, the P42 million economic benefits package granted by UST did not constitute union funds from whence the P4.2 million could have been validly deducted as attorney's fees. The P42 million economic benefits package was not intended for the USTFU coffers, but for all the members of the bargaining unit USTFU represented, whether members or non-members of the union. A close reading of the terms of the MOA reveals that after the satisfaction of the outstanding obligations of UST under the 1986 CBA, the balance of the P42 million was to be distributed to the covered faculty members of the collective bargaining unit in the form of salary increases, returns on paycheck deductions; and increases in hospitalization, educational, and retirement benefits, and other economic benefits.

The Court further determines that the requisites for a valid levy and check-off of special assessments, laid down by Article 241 (n) and (o), respectively, have not been complied with in the case at bar. These requisites are: (1) an authorization by a written resolution of the majority of all the union members at the general membership meeting duly called for the purpose; (2) secretary's record of the minutes of the meeting; and (3) individual written authorization for check-off duly signed by the employee concerned.

The inclusion of the authorization for a check-off of union dues and special assessments for the Labor Education Fund and attorney's fees, in the same document for the ratification of the MOA granting the P42 million economic benefits package, necessarily vitiated the consent of USTFU members. For sure, it is fairly reasonable to assume that no individual member of USTFU would casually turn down the substantial and lucrative award of P42 million in economic benefits under the MOA. However, there was no way for any individual union member to separate his or her consent to the ratification of the MOA from his or her authorization of the check-off of union dues and special assessments.

(3) Having been overtaken by subsequent events, the Court need no longer pass upon the issue of the validity of the order of BLR for USTFU to conduct its long overdue election of union officers, under the control and supervision of the DOLE-NCR Regional Director.

Neither the Decision of the BLR nor of the Court of Appeals took into account the fact that an election of USTFU officers was already conducted on 14 January 2000, which was won by the Gamilla Group. There is nothing in the records to show that the said election was contested or made the subject of litigation. The Gamilla Group had exercised their powers as USTFU officers during their elected term. Since the term of union officers under the USTFU Constitution and By-Laws was only for three years, then the term of the Gamilla Group already expired in 2003. It is already beyond the jurisdiction of this Court, in the present Petition, to still look into the subsequent elections of union officers held after 2003.

PETITION DENIED.

ACEDERA v. INTERNATIONAL CONTAINER TERMINAL SERVICES, INC. January 13, 2003

FACTS: Acedera et. al. are employees of respondent ICTSI and are officers/members of

Associated Port Checkers & Workers Union- ICTSI (APCW-ICTSI), a labor organization duly registered as a local affiliate of the Associated Port Checkers Union(APCWU).

When ICTSI started its operation in 1988, it determined the rate of pay of employees by using 304 days a year as the divisor.

1990: ICTSI entered into its first CBA with APCWU for a term of five years and which was subsequently renewed.

o CBA contained that the regular working days in a week is 5 days from Monday to Sunday as may be scheduled by the company with seven days prior notice.

Because of the CBA, employees work days was reduced to 250 days a year. 1990:RTWPB decreed an increase in the daily wage for all workers in the NCR. President of APCWU went to the Human Resource Department of the company to

compute the actual increase in the employees wage by multiplying the RTWPB mandated increase by 365 days and dividing the product by 12 months.

o Following the implementation of such decree, ICTSI stopped using the 304 days as divisor and started using 365 days in determining the daily wage of its employees even if the employees work week consisted of only five days as agreed upon in the CBA.

1997: ICTSI retrenchment program and laid off its on-call employees. o This prompted APCWU-ICTSI to file a notice of strike which included as cause

of action not only the retrenchment but also the use of 365 days as divisor in the computation of daily wage.

APCWU filed a complaint before the Labor Arbiter and the petitioners filed a Complaint-in-Intervention with Motion to Intervene.

Labor Arbiter rendered a decision in favor of APCWU and said that 250 days should be used as the divisor and denied the Complaint-in-Intervention of the petitioners because they are already well represented by APCWU.

NLRC reversed the decision of the Labor Arbiter and affirmed the denial of the motion to intervene by the petitioners.

APCWU filed a petitioner for certiorari before the CA while petitioners filed with SC. Petitioners petition was, however, referred to the CA.

CA dismissed the petition of APCWU and the petitioners petition was dismissed as well because petitioners are already well represented by APCWU.

ISSUE: W/N petitioner may intervene.

HELD: NO. A labor union is one such party authorized to represent its members under Article 242(a) of the Labor Code which provides that a union may act as the representative of its members for the purpose of collective bargaining. This authority includes the power to represent its members for the purpose of enforcing the provisions of the CBA. That APCWU acted in a representative capacity for and in behalf of its Union members and other employees similarly situated, the title of the case filed by it at the Labor Arbiters Office so expressly states.

While a party acting in a representative capacity, such as a union, may be permitted to intervene in a case, ordinarily, a person whose interests are already represented will not be permitted to do the same28 except when there is a suggestion of fraud or collusion or that the representative will not act in good faith for the protection of all interests represented by him.

The dismissal of the case does not, however, by itself show existence of fraud or collusion. Petitioner also alleged that APCWU would not prosecute their case diligently because of its sweetheart relationship with ICTSI. There is nothing on record to support such allegation.

To reiterate, for a member of a class to be permitted to intervene in a representative action, fraud or collusion or lack of good faith on the part of the representative must be proven. It must be based on facts borne on record. Mere assertions, as what petitionersappellants proffer, do not suffice.