PROGRESSIVE DEVELOPMENT CORP. v. SECRETARY OF LABOR G.R. No. 96425 / 205 SCRA 802

 

Topic: Government Regulation: Union Registration Requirements

 

FACTS:

1.     Respondent Pambansang Kilusan ng Paggawa (KILUSAN) -TUCP filed with the Department of Labor and Employment (DOLE) a petition for certification election among the rank-and-file employees of the petitioner alleging that it is a legitimate labor federation and its local chapter, Progressive Development Employees Union, was issued charter certificate No. 90-6-1-153.

2.     Respondent Pambansang Kilusan ng Paggawa (KILUSAN) -TUCP claimed that there was no existing collective bargaining agreement and that no other legitimate labor organization existed in the bargaining unit.

3.     Petitioner PDC filed its motion to dismiss contending that the local union failed to comply with Rule II Section 3, Book V of the Rules Implementing the Labor Code, as amended, which requires the submission of: (a) the constitution and by-laws; (b) names, addresses and list of officers and/or members; and (c) books of accounts.

4.     Respondent KILUSAN-TUCP submitted a rejoinder to PDC's motion to dismiss claiming that it had submitted the necessary documentary requirements for registration, such as the constitution and by-laws of the local union, and the list of officers/members with their addresses. Kilusan further averred that no books of accounts could be submitted as the local union was only recently organized.

5.     Petitioner PDC insisted that upon verification with the Bureau of Labor Relations (BLR), it found that the alleged minutes of the organizational meeting was unauthenticated, the list of members did not bear the corresponding signatures of the purported members, and the constitution and by-laws did not bear the signature of the members and was not duly subscribed. It argued that the private respondent KILUSAN-TUCP therefore failed to substantially comply with the registration requirements provided by the rules.

6.     MED-ARBITER Dela Cruz: held that there was substantial compliance with the requirements for the formation of the chapter. He further stated that mere issuance of the charter certificate by the federation was sufficient compliance with the rules. Considering that the establishment was unorganized, he maintained that a certification election should be conducted to resolve the question of representation.

7.     Petitioner filed an MR to the Office of the Secretary.

8.     SECRETARY Laguesma: denied the MR.

9.     Hence, this petition for certiorari.

 

ISSUE: Whether or not the petitioner was correct that a labor organization such as the respondent (KILUSAN)-TUCP may not validly invest the status of legitimacy upon a local or chapter through the mere expedient of issuing a charter certificate and submitting such certificate to the BLR and as such local or chapter must at the same time comply with the requirement of submission of duly subscribed constitution and by-laws, list of officers and books of accounts

 

RULING:

1.     YES, because, the failure of the secretary of PDEU-Kilusan to certify the required documents under oath is fatal to its acquisition of a legitimate status.

 

In the case of union registration, the rationale for requiring that the submitted documents and papers be certified under oath by the secretary or treasurer, as the case may be, and attested to by president is apparent.

 

The submission of the required documents (and payment of P50.00 registration fee) becomes the Bureau's basis for approval of the application for registration. Upon approval, the labor union acquires legal personality and is entitled to all the rights and privileges granted by law to a legitimate labor organization. The employer naturally needs assurance that the union it is dealing with is a bona fide organization, one which has not submitted false statements or misrepresentations to the Bureau. The inclusion of the certification and attestation requirements will in a marked degree allay these apprehensions of management. Not only is the issuance of any false statement and misrepresentation a ground for cancellation of registration (see Article 239 (a), (c) and (d)); it is also a ground for a criminal charge of perjury.

 

In the case of the union affiliation with a federation, the documentary requirements are found in Rule II, Section 3(e), Book V of the Implementing Rules, which we again quote as follows:

(c) The local chapter of a labor federation or national union shall have and maintain a constitution and by-laws, set of officers and books of accounts. For reporting purposes, the procedure governing the reporting of independently registered unions, federations or national unions shall be observed. (Emphasis supplied)

 

Since the "procedure governing the reporting of independently registered unions" refers to the certification and attestation requirements contained in Article 235, paragraph 2, it follows that the constitution and by-laws, set of officers and books of accounts submitted by the local and chapter must likewise comply with these requirements. The same rationale for requiring the submission of duly subscribed documents upon union registration exists in the case of union affiliation. Moreover, there is greater reason to exact compliance with the certification and attestation requirements because, as previously mentioned, several requirements applicable to independent union registration are no longer required in the case of formation of a local or chapter. The policy of the law in conferring greater bargaining power upon labor unions must be balanced with the policy of providing preventive measures against the commission of fraud.

 

DISPOSITIVE: Petitioner Progressive Development Corporation won.

 

DOCTRINE: Article 212(h) defines a legitimate labor organization as "any labor organization duly registered with the DOLE and includes any branch or local thereof."

Rule I, Section 1 (j), Book V of the Implementing Rules likewise defines a legitimate labor organization as "any labor organization duly registered with the DOLE and includes any branch, local or affiliate thereof.

Ordinarily, a labor organization acquires legitimacy only upon registration with the BLR. A local or chapter therefore becomes a legitimate labor organization only upon submission of the following to the BLR:

1) A charter certificate, within 30 days from its issuance by the labor federation or national union, and

2) The constitution and by-laws, a statement on the set of officers, and the books of accounts all of which are certified under oath by the secretary or treasurer, as the case may be, of such local or chapter, and attested to by its president.

Absent compliance with these mandatory requirements, the local or chapter does not become a legitimate labor organization.

 

The certification and attestation requirements are preventive measures against the commission of fraud. They likewise afford a measure of protection to unsuspecting employees who may be lured into joining unscrupulous or fly-by-night unions whose sole purpose is to control union funds or to use the union for dubious ends.

Reference: lexphil.blogspot.com

 

 

 

SAN MIGUEL CORP EMPLOYEES UNION VS SAN MIGUEL PACKING EMPLOYEES UNION . G.R. No. 171153

 

Topic: Union Registration Requirements

 

QUICKIE SUMMARY: SM Packing Employees Union is a LOCAL or CHAPTER of PDMP which seeks to be an INDEPENDENT LABOR ORGANIZATION. For its registration AS A CHAPTER, the applicable law to them is the D.O. No. 9 which no longer requires the submission of the names of at least 20% of all its employees in the bargaining unit. San Mig Corp Union claims that SM Packing failed to meet the requirements set forth by Art 234 of the Labor Code which mandates the submission of the 20% names and that the Implementing Rules of D.O. No. 9 is violative of Art 234 of the Labor Code because it provides a less stringent rule (which does not require the submission of the 20% names). SC ruled that the requirements for the registration of an INDEPENDENT LABOR UNION and the requirements for the creation of a LOCAL or CHAPTER are different. Since SM Packing seeks to be a legitimate labor organization, D.O No. 9 is not the one applicable, but Art 234 of the Labor Code.

 

FACTS:

 

Petitioner is the incumbent bargaining agent for the bargaining unit comprised of the regular monthly-paid rank and file employees of the three divisions of San Miguel Corporation namely San Miguel Corporate Staff Unit (SMCSU), San Miguel Brewing Philippines (SMBP), and the San Miguel Packaging Products (SMPP)

 

Respondent is registered as a chapter of Pambansang Diwa ng Manggagawang Pilipino.Thereafter, respondent filed three separate petitions for certification election to represent SMPP, SMCSU, and SMBP. All three petitions were dismissed, on the ground that the separate petitions fragmented a single bargaining unit.

 

Petitioner filed with the DOLE-NCR a petition seeking the cancellation of respondent’s registration and its dropping from the rolls of legitimate labor organizations. Petitioner accused respondent of committing fraud and falsification, and non-compliance with registration requirements in obtaining its certificate of registration. It raised allegations that respondent violated Articles 239(a), (b) and (c) and 234(c) of the Labor Code.

 

DOLE-NCR Regional Director Maximo B. Lim found that respondent did not comply with the 20% membership requirement and, thus, ordered the cancellation of its certificate of registration and removal from the rolls of legitimate labor organizations

 

Bureau of Labor Relations: Reversed DOLE NCR and declared that SM Packing Employees shall hereby remain in the roster of legitimate labor organizations

 

CA affirmed BLR

 

·      Petitioner’s contention: Petitioner posits that respondent is required to submit a list of members comprising at least 20% of the employees in the bargaining unit before it may acquire legitimacy, citing Article 234(c) of the Labor Code. Petitioner also insists that the 20% requirement for registration of respondent must be based not on the number of employees of a single division, but in all three divisions of the company in all the offices and plants of SMC since they are all part of one bargaining unit. Petitioner thus maintains that respondent, in any case, failed to meet this 20% membership requirement since it based its membership on the number of employees of a single division only, namely, the SMPP.

 

ISSUE: W/N SM Packing Employees met the requirements and thus, must remain a legitimate labor organization

 

 

RULING: NO, SM Packing Employees failed to meet the requirement. Hence, they cannot be declared as a legitimate labor organization

 

RATIO: A perusal of the records reveals that respondent is registered with the BLR as a local or chapter of PDMP. The applicable Implementing Rules (Department Order No. 9) enunciates a two-fold procedure for the creation of a chapter or a local. The first involves the affiliation of an independent union with a federation or national union or industry union. The second, finding application in the instant petition, involves the direct creation of a local or a chapter through the process of chartering. The Implementing Rules stipulate that a local or chapter may be directly created by a federation or national union.

 

Petitioner insists that Section 3 of the Implementing Rules, as amended by Department Order No. 9, violated Article 234 of the Labor Code when it provided for less stringent requirements for the creation of a chapter or local. Article 234 of the Labor Code provides that an independent labor organization acquires legitimacy only upon its registration with the BLR: xxx 3) The names of all its members comprising at least twenty percent (20%) of all the employees in the bargaining unit where it seeks to operate; xxx

 

It is emphasized that the foregoing pertains to the registration of an independent labor organization, association or group of unions or workers.

 

However, the creation of a branch, local or chapter is treated differently. This Court, in the landmark case of Progressive Development Corporation v. Secretary, Department of Labor and Employment, declared that when an unregistered union becomes a branch, local or chapter, some of the aforementioned requirements for registration are no longer necessary or compulsory. Whereas an applicant for registration of an independent union is mandated to submit, among other things, the number of employees and names of all its members comprising at least 20% of the employees in the bargaining unit where it seeks to operate, as provided under Article 234 of the Labor Code and Section 2 of Rule III, Book V of the Implementing Rules, the same is no longer required of a branch, local or chapter. The intent of the law in imposing less requirements in the case of a branch or local of a registered federation or national union is to encourage the affiliation of a local union with a federation or national union in order to increase the local unions bargaining powers respecting terms and conditions of labor.

 

DISPOSITIVE: San Miguel Corp Union won. The Certificate of Registration of San Miguel Packaging Union is ORDERED CANCELLED, and DROPPED from the rolls of legitimate labor organizations.

 

 

DOCTRINE: When an unregistered union becomes a branch, local or chapter, some of the requirements for registration are no longer necessary or compulsory. Whereas an applicant for registration of an independent union is mandated to submit, among other things, the number of employees and names of all its members comprising at least 20% of the employees in the bargaining unit where it seeks to operate.

Reference: lexphil.blogspot.com

 

 

 

 

 

 

Electromat v Lagunzad (Labor Relations)

ELECTROMAT MANUFACTURING and RECORDING CORPORATION v LAGUNZAD G. R. No. 172699 July 27, 2011  

 

Validity of DO 40‐03  

 

FACTS:  

 

The private respondent Nagkakaisang Samahan ng Manggagawa ng Electromat‐Wasto (union), a charter affiliate of the Workers Advocates for Struggle, Transformation and Organization (WASTO), applied for registration with the Bureau of Labor Relations (BLR). The BLR thereafter issued the union a Certification of Creation of Local Chapter (equivalent to the certificate of registration of an independent union), pursuant to Department Order No. (D.O.) 40‐03.[4]  

 

On October 1, 2003, the petitioner Electromat Manufacturing and Recording Corporation (company) filed a petition for cancellation of the union's registration certificate, for the union's failure to comply with Article 234 of the Labor Code. It argued that D.O. 40‐03 is an unconstitutional diminution of the Labor Code's union registration requirements under Article 234. Specifically, it assails as unconstitutional Section 2(E), Rule III of D.O. 40‐03 which provides:  

 

The report of creation of a chartered local shall be accompanied by a charter certificate issued by the federation or national union indicating the creation or establishment of the chartered local.   

 

DECISION OF LOWER COURTS: * DOLE: dismissed the petition. * BLR Director: affirmed the decision of the DOLE. * CA: affirmed BLR Director.  

 

ISSUE: WON the Department order is constitutional or whether D.O. 40‐03 is a valid exercise of the rule‐making power of the DOLE.  

 

APPLICABLE LAWS: Article 234 states:  

 

ART. 234. Requirements of Registration.[13] Any applicant labor organization, association or group of unions or workers shall acquire legal personality and shall be entitled to the rights and privileges granted by law to legitimate labor organizations upon issuance of the certificate of registration based on the following requirements:  

 

(a)    Fifty pesos (P50.00) registration fee;  

 

(b)   The names of its officers, their addresses, the principal address of the labor organization, the minutes of the organizational meetings and the list of the workers who participated in such meetings;  

 

(c)    The names of all its members comprising at least twenty percent (20%) of all the employees in the bargaining unit where it seeks to operate;  

 

(d)   If the applicant union has been in existence for one or more years, copies of its annual financial reports; and  

 

(e)    Four (4) copies of the constitution and by‐laws of the applicant union, minutes of its adoption or ratification, and the list of the members who participated in it.  

 

RULING: YES, constitutional.  

 

D.O. 40‐03 represents an expression of the government's implementing policy on trade unionism.  It builds upon the old rules by further simplifying the requirements for the establishment of locals or chapters. As in D.O. 9, we see nothing contrary to the law or the Constitution in the adoption by the Secretary of Labor and Employment of D.O. 40‐03 as this department order is consistent with the intent of the  

 

government to encourage the affiliation of a local union with a federation or national union to enhance the local's bargaining power. If changes were made at all, these were those made to recognize the distinctions made in the law itself between federations and their local chapters, and independent unions; local chapters seemingly have lesser requirements because they and their members are deemed to be direct members of the federation to which they are affiliated, which federations are the ones subject to the strict registration requirements of the law.

 

Reference: http://victormorvis.blogspot.com 

 

 

 

 

 

 

CEBU SEAMEN'S ASSOCIATION, INC. VS. FERRER-CALLEJA G.R No.83190

 

Topic: Legitimate workers association

 

FACTS:

1.     On October 23, 1950, a group of deck officers and marine engineers on board vessels plying Cebu and other ports of the Philippines organized themselves into an association and registered it as a non-stock corporation known as Cebu Seamen’s Association, Inc (CSAI) with the Securities and Exchange Commission (SEC). Later, the same group registered its association with the Bureau of Labor  Relations as a labor union known as the Seamen’s Association of the Philippines, Incorporated (SAPI).

 

2.     SAPI had an existing collective bargaining agreement with Aboitiz Shipping Corporation and had been remitting checked-off union dues to said union until a group of union members headed by Manuel Gabayoyo, introducing themselves as the new set of officers elected under the supervision of the SEC, claimed that they are entitled to the remittance and custody of such union dues.

 

3.     Subsequently, another group headed by Dominica Nacua, claiming as the duly elected set of officers of the union, filed a complaint, for and in behalf of the union, against CSAI to restrain them from acting on behalf of the union and directing Aboitiz to remit the checked-off union dues.

 

4.     CSAI filed its answer alleging that the union and the former are one and the same and that Nacuahas already been expelled as member/officer of the union through two resolutions its Board of Directors.

 

5.     The Med-Arbiter issued an order holding that the set of officers of SAPI headed by Nacua, was the lawful set of officers entitled to the release and custody of the union dues as well as agency fees of the said association.

 

6.     On appeal, the Bureau of Labor Relations affirmed the decision of the Med-Arbiter and after the Secretary of Labor denied CSAI’s appeal/motion for reconsideration for lack of merit, filed a petition with the Supreme Court.

 

ISSUE: Who is entitled to the collection and custody of the union dues?

 

RULING: SAPI.

 

It is the set of officers headed by Dominica Nacua that is the lawful set of officers of SAPI and is, therefore, entitled to the release and custody of the union dues as well as the as the agency fees. As stated in the findings of fact, CSAI, a non-stock corporation was registered with the SEC. The same group was registered with the BLR as SAPI. It is the registration of the organization with the BLR and not with the SEC which made it a legitimate labor organization with rights and privileges granted under the Labor Code.

 

The Supreme Court also stated that BLR correctly ruled on the basis of the evidence presented by the parties that SAPI, the legitimate labor union, registered with its office, is not the same association as CSAI, the corporation, insofar as their rights under the Labor Code are concerned. 

 

A record check with the BLR shows that SAPI has submitted to it for files the list of this new set of officers, in compliance with second paragraph of Art 242 (c) of the Labor Code [now Art. 242-A (b)]. This list sufficiently sustains the view that said officers were lawfully elected, in the absence of clear and convincing proof to the contrary.

 

DISPOSITIVE: SAPI won. Petition denied

 

DOCTRINE:  Art. 242-A (b) of the Labor Code

 Art.242-A. Reportorial Requirement  – the following are documents to besubmitted to the Bureau by the legitimate labor organization concerned:

xxx xxx xxx

 (b) Its list of officers, minutes of the election of officers and list of voters within 30 days from election.

xxx xxx xxx

 

Failure to comply with the above requirements shall not be a ground for cancellation of union registration but shall subject the erring officers or membersto suspension, expulsion from membership, or any appropriate penalty.

 

Reference: lexphil.blogspot.com

 

PLASLU VS CIR L-2222 FEB 27, 1969

Reference:http://www.chanrobles.com

 

PAFLU VS. SECRETARY OF LABOR

NOVEMBER 13, 2013 ~ VBDIAZ

G.R. No. L-22228 February 27, 1969
PHILIPPINE ASSOCIATION OF LABOR UNIONS (PAFLU) SOCIAL SECURITY SYSTEM EMPLOYEES ASSOCIATION-PAFLU, AL FAJARDO AND ALL THE OTHER MEMBERS AND OFFICERS OF THE SOCIAL SECURITY AND EMPLOYEES ASSOCIATION-PAFLU v. THE SECRETARY OF LABOR, THE DIRECTOR OF LABOR RELATIONS and THE REGISTRAR OF LABOR ORGANIZATIONS

 

FACTS:

The Registration of Labor Organization (Registrar) rendered a decision cancelling the SSSEA’s Registration Certificate No. 1-IP169 for failure to submit the following:

1. Failure to furnish the Bureau of Labor Relations with copies of the reports on the finances of that union duly verified by affidavits which its treasurer or treasurers rendered to said union and its members covering the periods from September 24, 1960 to September 23, 1961 and September 24, 1961 to September 23, 1962, inclusive, within sixty days of the 2 respective latter dates, which are the end of its fiscal year; and

2. Failure to submit to this office the names, postal addresses and non-subversive affidavits of the officers of that union within sixty days of their election in October (1st Sunday), 1961 and 1963, in conformity with Article IV (1) of its constitution and by-laws.

On the following day, Manuel Villagracia, Assistant Secretary of the SSSEA filed with the Office of the Registrar, a letter enclosing documents that supposed to comply with the abovementioned requirements, but the Registrar found out that the following are still not complied with:

1. Non-subversive affidavits of Messrs. Teodoro Sison, Alfonso Atienza, Rodolfo Zalameda, Raymundo Sabino and Napoleon Pefianco who were elected along with others on January 30, 1962.

2. Names, postal addresses and non-subversive affidavits of all the officers who were supposedly elected on October (1st Sunday), of its constitution and by-laws.

Alfredo Fajardo, president of the SSSEA moved for a reconsideration of said decision and prayed for time, up to November 15, within which to submit the requisite papers and data. An opposition thereto having been filed by one Paulino Escueta, a member of the SSSEA, upon the ground that the latter had never submitted any financial statement to its members, said motion was heard on November 27, 1963. Subsequently, or on December 4, 1963, the Registrar issued an order declaring that the SSSEA had “failed to submit the abovementioned requirements and granting the SSSEA 15 days from notice to comply with said requirements, as well as meanwhile holding in abeyance the resolution of its motion for reconsideration.

 

ISSUE:

Whether or not the effect of Section 23 of Republic Act No. 875 (“Any labor organization, association or union of workers duly organized for the material, intellectual and moral well being of its members shall acquire legal personality and be entitled to all the rights and privileges granted by law to legitimate labor organizations within thirty days of filing with the office of the Secretary of Labor notice of its due organization and existence and the following documents, together with the amount of five pesos as registration fee, except as provided in paragraph “d” of this section:”) unduly curtails the freedom of assembly and association guaranteed in the Bill of Rights.

 

RULING:

There is no incompatibility between Republic Act No. 875 and the Universal Declaration of Human Rights. Upon the other hand, the cancellation of the SSSEA’s registration certificate would not entail a dissolution of said association or its suspension. The existence of the SSSEA would not be affected by said cancellation, although its juridical personality and its statutory rights and privileges — as distinguished from those conferred by the Constitution — would be suspended thereby.

To be registered, pursuant to Section 23(b) of Republic Act No. 875, a labor organization, association or union of workers must file with the Department of Labor the following documents:

(1) A copy of the constitution and by-laws of the organization together with a list of all officers of the association, their addresses and the address of the principal office of the organization;

(2) A sworn statement of all the officers of the said organization, association or union to the effect that they are not members of the Communist Party and that they are not members of any organization which teaches the overthrow of the Government by force or by any illegal or unconstitutional method; and

(3) If the applicant organization has been in existence for one or more years, a copy of its last annual financial report.

Moreover, paragraph (d) of said-Section ordains that:

The registration and permit of a legitimate labor organization shall be cancelled by the Department of Labor, if the Department has reason to believe that the labor organization no longer meets one or more of the requirements of paragraph (b) above; or fails to file with the Department Labor either its financial report within the sixty days of the end of its fiscal year or the names of its new officers along with their non-subversive affidavits as outlined in paragraph (b) above within sixty days of their election; however, the Department of Labor shall not order the cancellation of the registration and permit without due notice and hearing, as provided under paragraph (c) above and the affected labor organization shall have the same right of appeal to the courts as previously provided.

Reference: vbdiaz.wordpress.com

 

 

Samahan ng Manggagawa sa Hanjin Shipyard vs Bureau of Labor Relations

 

 

 

PURIFICACION G. TABANG vs. NATIONAL LABOR RELATIONS COMMISSION and PAMANA GOLDEN CARE MEDICAL CENTER FOUNDATION, INC

D E C I S I O N

REGALADO, J.:

FACTS:

On October 30, 1990, the Board of Trustees issued a memorandum appointing petitioner as Medical Director and Hospital Administrator of private respondents Pamana Golden Care Medical Center in Calamba, Laguna.

Although the memorandum was silent as to the amount of remuneration for the position, petitioner claims that she received a monthly retainer fee of five thousand pesos (P5,000.00) from private respondent, but the payment thereof was allegedly stopped in November, 1991.

As medical director and hospital administrator, petitioner was tasked to run the affairs of the aforesaid medical center and perform all acts of administration relative to its daily operations.

On May 1, 1993, petitioner was allegedly informed personally by Dr. Ernesto Naval that in a special meeting held on April 30, 1993, the Board of Trustees passed a resolution relieving her of her position as Medical Director and Hospital Administrator, and appointing the latter and Dr. Benjamin Donasco as acting Medical Director and acting Hospital Administrator, respectively. Petitioner averred that she thereafter received a copy of said board resolution.

On June 6, 1993, petitioner filed a complaint for illegal dismissal and non-payment of wages, allowances and 13th month pay before the labor arbiter.

Respondent corporation moved for the dismissal of the complaint on the ground of lack of jurisdiction over the subject matter. It argued that petitioners position as Medical Director and Hospital Administrator was interlinked with her position as member of the Board of Trustees, hence, her dismissal is an intra-corporate controversy which falls within the exclusive jurisdiction of the Securities and Exchange Commission (SEC).

Petitioner opposed the motion to dismiss, contending that her position as Medical Director and Hospital Administrator was separate and distinct from her position as member of the Board of Trustees. She claimed that there is no intra-corporate controversy involved since she filed the complaint in her capacity as Medical Director and Hospital Administrator, or as an employee of private respondent.

On April 26, 1994, the labor arbiter issued an order dismissing the complaint for lack of jurisdiction. He ruled that the case falls within the jurisdiction of the SEC, pursuant to Section 5 of Presidential Decree No. 902-A. [1]

Petitioners motion for reconsideration was treated as an appeal by the labor arbiter who consequently ordered the elevation of the entire records of the case to public respondent NLRC for appellate review. [2]

On appeal, respondent NLRC affirmed the dismissal of the case on the additional ground that the position of a Medical Director and Hospital Administrator is akin to that of an executive position in a corporate ladder structure, hence, petitioners removal from the said position was an intra-corporate controversy within the original and exclusive jurisdiction of the SEC. [3]

Aggrieved by the decision, petitioner filed the instant petition which we find, however, to be without merit.

 

ISSUE: Whether or not case at bar constitutes inta-corporate controversy

 

RULING:

We agree with the findings of the NLRC that it is the SEC which has jurisdiction over the case at bar. The charges against herein private respondent partake of the nature of an intra-corporate controversy. Similarly, the determination of the rights of petitioner and the concomitant liability of private respondent arising from her ouster as a medical director and/or hospital administrator, which are corporate offices, is an intra-corporate controversy subject to the jurisdiction of the SEC.

Contrary to the contention of petitioner, a medical director and a hospital administrator are considered as corporate officers under the by-laws of respondent corporation. Section 2(i), Article I thereof states that one of the powers of the Board of Trustees is (t)o appoint a Medical Director, Comptroller/Administrator, Chiefs of Services and such other officers as it may deem necessary and prescribe their powers and duties. [4]

The president, vice-president, secretary and treasurer are commonly regarded as the principal or executive officers of a corporation, and modern corporation statutes usually designate them as the officers of the corporation.[5] However, other offices are sometimes created by the charter or by-laws of a corporation, or the board of directors may be empowered under the by-laws of a corporation to create additional offices as may be necessary.[6]

It has been held that an office is created by the charter of the corporation and the officer is elected by the directors or stockholders.[7] On the other hand, an employee usually occupies no office and generally is employed not by action of the directors or stockholders but by the managing officer of the corporation who also determines the compensation to be paid to such employee.[8]

In the case at bar, considering that herein petitioner, unlike an ordinary employee, was appointed by respondent corporations Board of Trustees in its memorandum of October 30, 1990,[9] she is deemed an officer of the corporation. Perforce, Section 5(c) of Presidential Decree No. 902-A, which provides that the SEC exercises exclusive jurisdiction over controversies in the election or appointment of directors, trustees, officers or managers of corporations, partnerships or associations, applies in the present dispute. Accordingly, jurisdiction over the same is vested in the SEC, and not in the Labor Arbiter or the NLRC.

Moreover, the allegation of petitioner that her being a member of the Board of Trustees was not one of the considerations for her appointment is belied by the tenor of the memorandum itself. It states: We hope that you will uphold and promote the mission of our foundation,[10] and this cannot be construed other than in reference to her position or capacity as a corporate trustee.

A corporate officers dismissal is always a corporate act, or an intra-corporate controversy, and the nature is not altered by the reason or wisdom with which the Board of Directors may have in taking such action.[11]Also, an intra-corporate controversy is one which arises between a stockholder and the corporation. There is no distinction, qualification, nor any exemption whatsoever. The provision is broad and covers all kinds of controversies between stockholders and corporations. [12]

With regard to the amount of P5,000.00 formerly received by herein petitioner every month, the same cannot be considered as compensation for her services rendered as Medical Director and Hospital Administrator.The vouchers[13] submitted by petitioner show that the said amount was paid to her by PAMANA, Inc., a stock corporation which is separate and distinct from herein private respondent. Although the payments were considered advances to Pamana Golden Care, Calamba branch, there is no evidence to show that the Pamana Golden Care stated in the vouchers refers to herein respondent Pamana Golden Care Medical Center Foundation, Inc.

Pamana Golden Care is a division of Pamana, Inc., while respondent Pamana Golden Care Medical Center Foundation, Inc. is a non-stock, non-profit corporation. It is stated in the memorandum of petitioner that Pamana, Inc. is a stock and profit corporation selling pre-need plan for education, pension and health care. The health care plan is called Pamana Golden Care Plan and the holders are called Pamana Golden Care Card Holders or, simply, Pamana Members. [14]

It is an admitted fact that herein petitioner is a retained physician of Pamana, Inc., whose patients are holders of the Pamana Golden Care Card. In fact, in her complaint[15] filed before the Regional Trial Court of Calamba, herein petitioner is asking, among others, for professional fees and/or retainer fees earned for her treatment of Pamana Golden Care card holders.[16] Thus, at most, said vouchers can only be considered as proof of payment of retainer fees made by Pamana, Inc. to herein petitioner as a retained physician of Pamana Golden Care.

Moreover, even assuming that the monthly payment of P5,000.00 was a valid claim against respondent corporation, this would not operate to effectively remove this case from the jurisdiction of the SEC. In the case of Cagayan de Oro Coliseum, Inc. vs. Office of the Minister of Labor and Employment, etc., et al.,[17] we ruled that (a)lthough the reliefs sought by Chavez appear to fall under the jurisdiction of the labor arbiter as they are claims for unpaid salaries and other remunerations for services rendered, a close scrutiny thereof shows that said claims are actually part of the perquisites of his position in, and therefore interlinked with, his relations with the corporation. In Dy, et al., vs. NLRC, et al., the Court said: (t)he question of remuneration involving as it does, a person who is not a mere employee but a stockholder and officer, an integral part, it might be said, of the corporation, is not a simple labor problem but a matter that comes within the area of corporate affairs and management and is in fact a corporate controversy in contemplation of the Corporation Code.

WHEREFORE, the questioned resolution of the NLRC is hereby AFFIRMED, without prejudice to petitioners taking recourse to and seeking relief through the appropriate remedy in the proper forum.

SO ORDERED.

Romero, Puno, Mendoza, and Torres, Jr., JJ., concur.

 

DILY DANY NACPIL vs. INTERNATIONAL BROADCASTING CORPORATION G.R. No. 144767. March 21, 2002

 

Facts:

Petitioner was the Assistant General Manager for Finance/Administration and Comptroller of private respondent Intercontinental Broadcasting Corporation (IBC) from 1996 until April 1997. Upon assumption of Emiliano Templo as the IBC President, petitioner was forced to retire. Templo refused to pay him his retirement benefits. Hence, in 1997, petitioner filed with the Labor Arbiter a complaint for illegal dismissal and non-payment of benefits.

IBC alleged that the Labor Arbiter had no jurisdiction over the case, that the petitioner was a corporate officer who was duly elected by the Board of Directors of IBC; hence, the case qualifies as an intra-corporate dispute falling within the jurisdiction of the Securities and Exchange Commission (SEC).

Petitioner argues that he is not a corporate officer of the IBC but an employee thereof since he had not been elected nor appointed as Comptroller and Assistant Manager by the IBC's Board of Directors. He pointed out that he had actually been appointed on January 11, 1995 by the IBC's General Manager, Ceferino Basilio.

Issue:

Whether or not the Labor Arbiter had jurisdiction over the case for illegal dismissal and non-payment of benefits filed by petitioner.

Ruling:

Dismissal or non-appointment of a corporate officer is clearly an intra-corporate matter and jurisdiction over the case properly belongs to the SEC, not to the NLRC. Under Presidential Decree No. 902-A (the Revised Securities Act), Controversies in the election or appointment of directors, trustees, officers, or managers of such corporations, partnerships or associations fall under the exclusive of the SEC. Two elements are to be considered in determining whether the SEC has jurisdiction over the controversy, to wit: (1) the status or relationship of the parties; and (2) the nature of the question that is the subject of their controversy.

Since complainant's appointment was approved unanimously by the Board of Directors of the corporation, he is therefore considered a corporate officer and his claim of illegal dismissal is a controversy that falls under the jurisdiction of the SEC as contemplated by Section 5 of P.D. 902-A. That the position of Comptroller is not expressly mentioned among the officers of the IBC in the By-Laws is of no moment, because the IBC's Board of Directors is empowered under Section 25 of the Corporation Code and under the corporation's By-Laws to appoint such other officers as it may deem necessary.

 

 

 

 

 

 

 

 

CARABAO, INC. vs. AGRICULTURAL PRODUCTIVITY COMMISSION

G.R. No. L-29304 September 30, 1970

 

FACTS:

Plaintiff Carabao, Inc. filed in the Court of First Instance of Rizal its complaint to recover money from defendant Agricultural Productivity Commission for the unpaid price of 300 units of fire extinguishers.

 

Carabao, Inc. alleged that it presented a claim for payment of the sum with the Auditor General who failed to decide the claim within two (2) months from date of its presentation.

 

Because of this, the plaintiff further alleged that it had acquired the right under Act No. 3083 to file the original action for collection in the lower court.

 

Defendant moved for the dismissal of the case on the ground of the lower court's lack of jurisdiction over the subject matter alleging that the settlement of money claims against the State has been placed under the exclusive original jurisdiction of the Auditor General to the exclusion of courts of first instance.

 

The lower court sustained defendants' dismissal motion and declared itself without jurisdiction to hear the case.

 

Plaintiff filed an appeal to the Supreme Court on questions of law from the lower Court's order of dismissal of the case for lack of jurisdiction.

 

ISSUE:

Whether or not Act 8083 gives plaintiff the right to file an action for collection in the lower court upon the Auditor General’s failure to decide on money claim

 

HELD:

The Supreme Court held that inaction by the Auditor General for the sixty-day period now provided by Commonwealth Act 327 no longer entitles the claimant to file a direct suit in the lower court.

 

The exclusive original jurisdiction under Commonwealth Act 327 is vested in the Auditor General, and appellate jurisdiction is vested in the President in cases of accountable officers, and in the Supreme Court in cases of private persons and entities upon proper and timely petitions for review.

 

A claimant's remedy is to institute mandamus proceedings to compel the rendition of a decision by the Auditor General in the event of such inaction.

 

Claimants have to prosecute their money claims against the Government under Commonwealth Act 327, stating that Act 3083 stands now merely as the general law waiving the State's immunity from suit, subject to the general limitation expressed in Section 7 thereof that "no execution shall issue upon any judgment rendered by any Court against the Government of the (Philippines), and that the conditions provided in Commonwealth Act 327 for filing money claims against the Government must be strictly observed.

 

The Supreme Court fails to see any substantial conflict or inconsistency between the provisions of CA 327 and the Labor Code with respect to money claims against the State. The Labor Code, in relation to Act No. 3083, provides the legal basis for the State liability but the prosecution, enforcement or satisfaction thereof must still be pursued in accordance with the rules and procedures laid down in CA 327, as amended by PD No. 1445.

 

 

BRIAD AGRO DEVELOPMENT CORPORATION, vs. HONORABLE DIONISIO DELA SERNA

G.R. No. 82805 June 29, 1989

 

FACTS:

Trade Union of the Philippines and Allied Services (TUPAS) filed a complaint against respondent Briad Agro Development Corporation to recover unpaid wages and wage supplements.

 

Consequently, Labor Standards and Welfare Officer (LSWO) of DOLE Regional Office in San Fernando, La Union conducted a routine inspection on subject establishment but no records were presented for examination.

 

Despite LSWO’s advisory to respondent agricultural firm, still no records were presented for verification.

 

With the respondent's repeated failure to appear during the scheduled conferences despite due notices and its failure to present the required employment records, the Regional Director then ordered Briad Agro Dev’t. Corp. to pay the money claims of its employees amounting to P5,369,909.30.

 

In its appeal to the National Labor Relations Commission, Briad Agro Development contended that the Regional Director has no authority to entertain pecuniary claims of workers following the Court's ruling in Zambales Base Metals, Inc. v. Minister of Labor, in which it was held that money claims are the exclusive domain of the labor arbiters.

 

NLRC dismissed the appeal on the strength of Executive Order No. 111, amending Article 128(b) of the Labor Code.

 

Briad Agro Development filed a petition in the Supreme Court challenging the jurisdiction of the Regional Director.

 

ISSUE:

Whether or not the jurisdiction over money claims is exclusive on the Labor Arbiters of the National Labor Relations Commission.

 

HELD:

The Supreme Court sustained the jurisdiction of the respondent Regional Director.

 

The Court ruled that, in view of the promulgation of Executive Order No. 111, Zambales Base Metals v. Minister of Labor is no longer good law. Executive Order No. 111 was meant to make both the Secretary of Labor (or the various Regional Directors) and the Labor Arbiters share jurisdiction.

 

Executive Order No. 111 was intended to make the jurisdiction to pass upon money claims, among the other cases mentioned by Article 217 of the Labor Code, concurrent between the Secretary of Labor (or Regional Directors) and the Labor Arbiters.  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MANILA MANDARIN EMPLOYEES UNION v. NLRC and MELBA C.BELONCIO

G.R. No. 76989,

1987 Sep 29

GUTIERREZ, JR., J.

FACTS:

Private respondent, Melba C. Beloncio, assistant head waitress at the hotel's coffee shop, was expelled from the Manila Mandarin Employees Union for acts allegedly inimical to the interests of the union. The charge of disloyalty against Beloncio arose from her emotional remark to a waitress who happened to be a union steward, "Wala akong tiwala sa Union ninyo." The remark was made in the course of a heated discussion regarding Beloncio's efforts to make a lazy and recalcitrant waiter adopt a better attitude towards his work. The union demanded the dismissal from employment of Beloncio on the basis of the union security clause of their collective bargaining agreement and the Hotel acceded by placing Beloncio on forced leave. the Labor Arbiter held that the union was guilty of unfair labor practice when it demanded the separation of Beloncio and the employer was ordered to reinstate her.

 

ISSUES:

Is petitioner union is guilty of ULP by reason of the arbitrary use of the union security clause in the CBA?

 

HELD:

 Yes. The Hotel would not have compelled Beloncio to go on forced leave were it not for the union's insistence and demand to the extent that because of the failure of the hotel to dismiss Beloncio as requested, the union filed a notice of strike with the Ministry of Labor and Employment on the issue of unfair labor practice. Although the CBA contained a union security clause or closed-shop agreement, it is, however, stressed that such are also governedby law and by principles of justice, fair play, and legality. Union securityclauses cannot be used by union officials against an employer, much less their own members, except with a high sense of responsibility, fairness, prudence, and judiciousness.A union member may not be expelled from her union, and consequently from her job, for personal or impetuous reasons or for causes foreign to the closed-shop agreement and in a manner characterized by arbitrariness andwhimsicality. Beloncio was merely trying her best to make a hotel bus boy do his work promptly and courteously so as to serve hotel customers in the coffee shop expeditiously and cheerfully. Union membership does not entitle waiters, janitors, and other workers to be sloppy in their work, inattentive tocustomers, and disrespectful to supervisors. The Union should have disciplined its erring and troublesome members instead of causing so much hardship to a member who was only doing her work for the best interests of the employer, all its employees, and the general public whom they serve.

 

 

 

NATIONAL UNION OF BANK EMPLOYEES V. LAZARO (1998)

L-56431,

January 19, 1988

 

FACTS:

- The Commercial Bank and Trust Company entered into a collective bargaining agreement with Commercial Bank and Trust Company Union, representing the file and rank of the bank with a membership of over 1,000 employees- In 1980, the union, together with the National Union of Bank EEs submitted to bank management proposals for the negotiation of a

new collective bargaining agreement.

The following day, however, the bank suspended negotiations with the union. The bank entered into a merger with BPI which assumed all assets and liabilities.

 

- The Union went to the CFI Manila, presided over by respondent Judge Lazaro, and filed a complaint for specific performance, damages, and preliminary injunction against private respondents.-

Private Respondent filed a “Motion to Dismiss” on the ground of lack of jurisdiction of the

court. Respondent Judge dismissed the case on the ground that the complaint partook of unfair labor is vested in the labor arbiter.

 

ISSUE:

Whether or not the courts may take cognizance of claims for damages arising from a labor controversy.

 

HELD:

NO.

 It shall be an unfair labor practice:

1. To interfere with, restrain or coerce employees in the exercise of their right to self-organization;

g. To violate the duty to bargain collectively as prescribed by this Code; As correctly held by the respondent court, an unfair labor practice controversy is within the original and exclusive jurisdiction of the labor arbiters and the exclusive appellate jurisdiction of NLRC.

Under Art.247 of the Labor Code, “the civil aspects of all cases involving unfair labor practices,which may include claims for damages and other affirmative relief, shall be under the jurisdiction of the labor arbiters.” Jurisdiction is conferred by law and not necessarily by the nature of the action.