Labor Relations Law

Part 2

July 27, 2011

Labor Relations

 Refers to the interaction between

employer and employees or their
representatives and the mechanism
by which employment standards are
negotiated, adjusted and enforced.
State Policy on Collective Bargaining,
Trade Unionism and other matters
concerning Labor Relations…. (Article 211)

 Promote free collective bargaining,

including voluntary arbitration, as a mode
of settling labor or industrial disputes;
 Promote free trade unionism as an agent
of democracy,social justice and
development;
 Foster free and voluntary organization of a
strong and united labor movement;
 Promote the enlightenment of workers
concerning their rights and obligations as
union members and as employees;
State policy…

 Provide an adequate administrative

machinery for the expeditious settlement of
labor and industrial dispute;
 Ensure a stable but dynamic and just
industrial peace;
 Encourage representation of workers and
employers in policy-making bodies of the
government.
Definitions (Article 212)

 Labor Organizations- any union or

association of employees which exists in
whole or in part for the purpose of collective
bargaining or of dealing with employers
concerning terms and conditions of
employment.
 Legitimate Labor Organizations- any labor
organization duly registered with the DOLE,
and includes any branch or local thereof.
Definitions…
 Bargaining Representatives- a legitimate labor
organization or any officer of a labor organization
whether or not employed by the employer;
 Labor Dispute- any controversy or matter
concerning terms or conditions of employment or
the association or representation of persons
negotiating, fixing, maintaining, changing or
arranging the terms and conditions of employment,
regardless of whether the disputants stand in
proximate relation of employer or employee.
Definitions…
 Employee- any person in the employ of an
employer. Term shall not be limited to
employees of a particular employer, except
when the Labor Code explicitly states. It
shall include any individual whose work
has ceased as a result of or in
connection with any current labor
dispute, or because of any unfair labor if
he has not obtained any other substantially
equivalent and regular employment.
Definitions…

 Strike- any temporary stoppage if

work by the concerted action of
employees as a result of an industrial
or labor dispute.
 Lock-out - temporary refusal of an
employer to furnish work as a result of
an industrial or labor dispute.
Definitions…

 Bargaining unit- legal collectivity for

collective bargaining purposes whose
members have substantially mutual
bargaining interests in the terms and
conditions of employment as will
assure to all employees the exercise of
their right to collective bargaining.
Definitions…

 Elements:
 The will of the employees;
 Affinity and unity of employees’ interests,
such as similarities of duties and working
conditions;
 Prior collective bargaining history; and,
 Employment status, positions and
categories of work.
Kinds of Labor Dispute:

 Labor Standards Dispute –

 Compensation-
 Benefits-
 Working conditions-
Kinds of dispute…

 Labor Relations Disputes:

 Organizational Right
 Representation disputes
 Bargaining disputes
 Contract administration or personnel
policy disputes
 Employment tenure disputes
Remedies in Labor Dispute
 Grievance Procedure – in-house adjustment of
complaints;
 Conciliation – participation of disinterested third
party who aids in reaching an agreement;
 Mediation – a third party studies the issues
presented by both sides and proposes solutions;
 Arbitration – the submission of a dispute for the
consideration of an impartial third party whose
decision is binding upon the parties.
Bureau of Labor Relations
(Article 226)

 Has the original and exclusive

jurisdiction to act, at its own initiative or
upon request of either of both parties,
on:
 All inter-union and intra-union conflicts;
 All disputes and grievances arising from
or affecting labor-management relations.
Intra-union Dispute

 Any conflict between and among union

members and includes all disputes or
grievances arising from any violation of
the constitution and by-laws of the
union, including cases arising from
chartering or affiliation of labor
organization or from any violation of
the rights and conditions of union
membership.
Inter-union dispute

 Any conflict between and among

legitimate labor organizations involving
questions of representation for
purposes of collective bargaining. It
also includes all other conflicts which
legitimate labor organizations may
have against each other based on any
violations of their rights as labor
organizations.
Labor Organizations
(Article 234)

 The state shall guarantee the rights of all

workers to self-organization;
 All workers in commercial, industrial,
agricultural enterprises, religious, medical
and educational institutions, whether for
profit or not have the right to self-organize,
form, assist or join labor unions for purposes
of collective bargaining.
Labor organizations…

 Ambulant, intermittent, itinerant

workers, self-employed people, rural
workers and those without any definite
employer may form organizations for
their mutual aid and protection.
Requirements for the registration
of labor organizations…
(Article 234)

 Fifty pesos registration fee;

 Names of officers, their addresses, principal
address of the labor organization, minutes
of organizational meeting and the list of
participants;
 Names of members at least 20%;
 Annual financial reports;
 Constitution and by-laws; minutes of
adoption and ratification;
Registration….

 Sworn statement that there is no certified

bargaining agent; in case there is an
existing CBA, sworn statement that
application is filed during the 60 days of
agreement;
 Application and all accompanying
documents shall be verified under oath by
the secretary or treasurer as the case may
be and attested to by the President.
Registration…

 If federation, plus:
 Proof affiliation of 10 locals in the industry
where it operates;
 Names and addresses of companies
where they operate.
Significance of registration…
 Acquisition of legal personality;
 Represent its members for collective
bargaining;
 To be certified as exclusive representative
of all employees in appropriate bargaining
unit for collective bargaining;
 To be furnished by the employer with the
annual audited financial statements and
other similar records or documents;
Significance…

 To own property, real or personal, for the for

the use and benefit of the labor organization
and its members;
 To sue and be sued in its registered names;
and,
 To undertake all other activities designed to
benefit the organization and its members
including cooperatives, housing, welfare and
other projects not contrary to law;
Rights and conditions
of union membership…
(Article 241)

 No arbitrary or excessive initiation fees or

fines and forfeitures;
 Right to a copy of the financial reports on
transactions;
 Direct election of officers by secret ballot or
intervals of five years;
 Right to participate through secret balloting
in policy-making;
 Right against admission of subversives and
engagement on subversive activities;
Rights…

 Right against election of persons convicted

of crime involving moral turpitude to elective
and administrative positions;
 Rights against collection and disbursement
of money unless authorized by its
constitution and by-laws;
 Right to be issued receipts for fees, dues or
contributions paid;
Rights…

 Right against application of funds except

when expressly provided by the constitution
and by-laws or authorized by written
resolution of majority of the members;
 Right to inspect books of accounts and other
financial records;
 Rights against special assessments and
other fees unless authorized by the written
resolution of majority of the members;
Rights…

 Right against check-offs other than for

mandatory activities under the Labor
Code;
 Right to be informed of the constitution
and by-laws, CBA, prevailing labor
relations systems and all rights and
obligations under existing labor laws.
Employees entitled to join labor
unions…(Articles 243-246)

Rank-in-file employees
Government employees of GOCC’s without
original charter;
Supervisory employee among themselves;
Security personnel among themselves;
Aliens with valid employment permits but
subject to presence of reciprocity agreement
between Philippines and his country.
Employees NOT entitled to
join labor unions…

 Managerial employees;
 Subversives or members of subversive
organizations;
 Employees of cooperatives who are at
the same time members; and,
 Employees who may be excluded by a
CBA which classifies union and non-
union members.
Grounds for cancellation of union
registration…(Article 239)

 Misrepresentation in adoption, ratification of

constitution, false statements made in the by-laws;
 Failure to submit documents of ratification of
constitution;
 Misrepresentation, false statement and fraud in the
election of officers;
 Failure to submit financial reports;
 Acting as labor contractor;
 Entering into CBA with conditions below minimum;
 Asking, accepting attorney’s fees;
Grounds…

 Checking off assessment without

authorization;
 Failure to submit list of members; and,
 Failure to comply with requirements.
Rights of legitimate
labor unions…(Article 242)

 To act as the representative of its

members for the purpose of collective
bargaining;
 To be certified as the exclusive
bargaining representative;
 To be furnished by the employer, upon
its written request with annual audited
financial statements
Rights…

 To own property, real or personal, for the

use and benefit of the labor organization
and its members;
 To sue and be sued in its registered name;
and,
 To undertake all other activities designed to
benefit the organization and its members,
including cooperative housing, welfare and
other projects not contrary to law;
Unfair Labor Practice…
(Article 247)

 Violates the rights of workers and

employees to self-organization, are inimical
to the legitimate interests of both labor and
management, including their rights to
bargain collectively and otherwise deal with
each other in an atmosphere of freedom
and mutual respect, disrupt industrial peace
and hinder the promotion of a healthy and
stable labor-management relations.
ULP…

 Unfair labor practices are not only

violations of the civil rights of both
labor and management, but are also
criminal offenses against the state,
which shall be subject to prosecution
and punishment.
ULP committed by the
employer…(Article 248)
 To interfere, restrain, coerce right to organize;
 Require a person not to join a union or to withdraw from
the union;
 Contract services to unionists;
 Initiate, dominate, assist a union;
 Discriminate in terms of employment;
 Dismiss, discharge employee for having given testimony;
 Violate duty to bargain collectively;
 Pay negotiation or attorney’s fees as part of settlement;
 Flagrant refusal to comply with economic terms of CBA.
Unfair Labor Practice committed
by employees…(Article 249)

 To restrain or coerce right to organization;

 To cause employer to discriminate;
 Violate duty to bargain collectively;
 Cause employer to pay services not
performed;
 Ask for negotiation or attorney’s fees as part
of settlement;
 Violate CBA.
Some concepts on ULP…

 Featherbedding – when a union causes or

attempts to cause the employer to pay for
services not performed;
 Yellow dog contract – it is a promise
exacted from the workers as a condition of
employment that they are not to belong to,
or attempt to foster a union during their
period of employment.
Some…

 Runaway shop – ULP act whereby an

industrial plant is moved by its owners from
one location to another to escape the union,
labor regulations or state laws;
 Blacklist – list of persons marked out for
special avoidance, antagonism or enmity on
the part of those who prepared the list.
Certification election…

 Investigation on non-adversary, fact- finding

character to determine the exclusive
representative of employees in a bargaining
unit for the purpose of collective bargaining;
 Labor organizations exist primarily for the
purpose of collective bargaining or of
dealing with the employer concerning terms
and conditions of employment.
Consent election…

 The purpose is merely to determine

the issue of majority representation of
all workers in a bargaining unit.
Rules preventing the holding
of certification election

 Contract bar rule – that a valid and

existing CBA is a bar to a petition for
certification election.
 Exceptions:
 Made within 60 days before expiration of
the CBA;
 CBA is defective or inadequate in
substance;
 If CBA is not registered.
Rules…

 Certification year rule – within one year from

date of issuance of final certification result;
 Deadlock bar rule – where a bargaining
deadlock to which an incumbent or certified
bargaining agent is a party has bee
submitted to conciliation or arbitration or has
become the subject of a valid notice of
strike or lock-out;
Rules…

 Negotiation bar rule – if the duly

recognized or certified union has
commenced negotiation with the
employer within the one year period
and the negotiation is on-going;
 Charge of company unionism;
 Res judicata
Procedure in certification
elections…(Article 255 to 259)
 Election by secret-balloting;
 Conducted by the Labor Relations Division
of the Regional Office
 Representatives of the contending unions
have a right to attend balloting as
inspectors;
 Notice to be posted in two conspicuous
places of the establishment at least five
working days before election;
Procedure…

 Med-arbiter upon receipt and no protests

have been filed, shall certify the winner;
 For valid election, at least majority of all
eligible voters in the unit must have cast
their votes;
 Labor union receiving majority of the valid
votes cast shall be certified as the exclusive
bargaining agent of all the workers in the
unit;
Procedure…

 When an election which provides for

three or more choices results in no
choice receiving a majority of the valid
votes cast, a run-off election shall be
conducted between the labor unions
which received the two highest votes.
Requisites for run-off
election…
 A valid election took place because majority
of the CBU members voted;
 Election presented at least three choices,
including a no-union;
 Not one of the choices obtained the majority
of the valid votes;
 Total votes for the unions is at least 50% of
the votes cast;
 There is no unresolved challenge of voter or
election protest.
Collective bargaining…

 Right guaranteed by the Constitution

to enable workers to negotiate with the
employer on the same level and with
more persuasiveness that if they were
to bargain individually and
independently for the improvement of
the terms and conditions of
employment.
Duty to bargain collectively
(Article 250)

 The law imposes a duty on the employer

and the EBR of the employees and refusal
to do so shall constitute ULP;
 Performance of a mutual obligation to:
 Meet and convene promptly and expeditiously;
 In good faith for the purpose of:
 Bargaining for better terms and conditions of
employment.
ULP in bargaining

 Failure or refusal to meet and

convene;
 Evading the mandatory subjects of
bargaining;
 Bad faith in bargaining, including
failure or refusal to execute the
collective bargaining agreement;
 Gross violation of the CBA.
Matters considered mandatory
subject of collective bargaining
 Wages and other types of compensation;
 Working hours and days including work shift;
 Vacation and holidays;
 Bonuses;
 Pensions and retirement plans;
 Seniority;
 Transfer;
 Lay-offs;
 Employee workloads;
 Work rules and regulations;
 Rent of company houses; and,
 Union security arrangements
Procedure in collective
bargaining…(Article 250)

 Serve a written notice with the statement of

proposals to the other party;
 The other party shall make a reply within 10
days from receipt of the written notice;
 If no reply is made, the same may be a ULP;
 If differences arise, either party will request for a
conference within 10 days.
Procedure…

 If differences are not settled, NCMB shall

intervene moto proprio or upon request and
call of the parties to conciliation meeting;
 If it still fails, voluntary arbitration is resorted
to.
 If it fails, bargaining deadlock occurs which
could be a ground for strike and/or lockout.
Union security arrangement
 Agency fee-m
 Closed shop – only union members can be
hired and the workers must remain union
members as a condition of continued
employment;
 Union shop- those already hired become
union members within a prescribed period;
 Maintenance of membership – requires as a
condition of continued employment
membership in good standing in a
contracting union;
Some important points about
collective bargaining…
 The term of the CBA is five years;
 Economic provisions of the CBA may be
renegotiated not later than three years after its
execution;
 Any agreement reached within six months following
the expiration of the CBA is retroactive;
 If agreement is reached beyond six months, the
parties will agree on the period of retroactivity;
 In case of deadlock in renegotiation, parties may
resort to strike and/or lockout.
Strikes and lockouts
(Article 263)

 Characteristics of strike:
 There must be employer-employee
relations;
 Existence of industrial or labor dispute;
and,
 Despite work stoppage, employer-
employee relations continue.
Factors affecting
legality of strike
 When contrary to specific provisions of the
law;
 When it violates specific requirements of
law;
 When it is declared for an unlawful purpose;
 When it employs unlawful means in the
pursuit of its objectives;
 When it declared in violation of an existing
injunction;
 When its contrary to an existing agreement.
Important factors in
strikes and lockouts

 Cause:
 Bargaining deadlocks;
 ULP; and,

 Union busting – dismissal from

employment of union members and duly
elected officers in accordance with law
* No strike or lockout shall declared due to
inter-union or intra-union dispute.
Important…

 Party- may be:

 Certified bargaining agent due to ULP or
bargaining deadlock;
 Employer in case of lockout;
 Legitimate labor organization due to ULP
only;
Important…

 Notice – in case of :
 Bargaining deadlock: notice or lockout
filed with the regional branch of NCMB at
least 30 days before the intended date;
 ULP- period of notice shall be 15 days;
and,
 Union busting – the 15-day cooling off
period shall not apply and the union may
take action immediately
Important…

 Strike and lockout Vote:

 Strike – approval of the majority of the
total membership in bargaining unit
concerned by secret ballot in a meeting
called for that purpose;
 Lockout – approval of the majority of the
members of the board of directors or the
partners in a partnership by secret ballot
in a meeting called for that purpose.
Conciliation efforts…
(Article 265)

 Improved offer balloting – DOLE shall

conduct a referendum by secret balloting on
the improved offer of the employer on or
before the 30th day of the strike;
 Reduced offer balloting- DOLE shall likewise
conduct a referendum by secret balloting on
the reduced offer of the union on or before
the 30th day of the lockout.
Liabilities of striking workers in
an illegal strike…

 Union officers who knowingly participate in

illegal strike;
 Worker or union officer – who knowingly
participate in an illegal acts;
 May be declared to have lost their employment
status;
 Employer who dismissed an employees on
account of illegal lockout , liable to reinstate and
pay such employee backwages.
Post-employment (Article 278)

 Management prerogative-
 The right of the employer to regulate
according to his own discretion all
aspects of employment including
employment, hiring, time tools, transfers
of employees, lay-off and discipline,
dismissal and recall of employees.
Security of tenure (Article 279)

 Constitutional and statutory right of

workers;
 Applies to all kinds of employees.
Kinds of employees…
(Article 281)

 Regular employees – engaged to

perform activities which are usually
necessary and desirable in the usual
business and trade of the employer;
 Project employees – employment fixed
for a specific project, completion of
which has been determined at the time
of engagement;
Kinds…

 Project employees acquire regular

status when:
 There is a continuous rehiring of project
employees even after the cessation of a
project;
 The tasked performed by the alleged
project employee are vital, necessary and
indispensable to the usual business or
trade of the employer.
Kinds…

 Probationary employees –
 Subject to probation not exceeding six
months;
 Services may be terminated with just
cause or when failed to qualify as regular
employee in accordance with reasonable
standards previously set and made
known to him.
Just causes for termination
by employer (Article 282)

 Serious misconduct, willful

disobedience;
 Gross/habitual neglect of duty;
 Fraud or willful breach of trust;
 Commission of crime or offense;
 Other analogous circumstances.
Authorized causes
(Article 283 – 284)

 Reduction of personnel due to

installation of labor-saving devices;
 Reduction of personnel due to
redundancy;
 Retrenchment to prevent loss;
 Closure of establishment or cessation
of operations; and,
 Disease.
Dismissal under
authorized causes:
 Written notice to DOLE and to the employee
at least one month prior to the severance of
employer-employee relations;
 Separation pay of:
 One month pay or at least one month pay for
every year of service;
 In case of retrenchment, cessation of business
due to losses, one-half month pay for every year
of service;
 Fraction of at least six months is considered a
year.
Dismissal under the
just causes

 Twin notice rule;

 Compliance with due process; and,
 Decision without prejudice to the right
of the employee to contest the same.
Reliefs in illegal dismissal

 Reinstatement unless there are

already trained relations;
 Reinstatement not possible-
separation pay;
 Full backwages and benefits.
Constructive dismissal

 An employee who quits his work

because of the employer’s
unreasonable, humiliating or
demeaning actuations which render
continued work impossible is deemed
to have been constructively dismissed.
Just cause for termination
by the employee (Article 285)

 Serious insult;
 Inhuman and unbearable treatment;
 Commission of a crime or offense;
 Other analogous causes.
Just… (Article 286)

 Employment not deemed terminated

when:
 Bona fide suspension of the operations of
a business or undertaking for a period not
exceeding six months;
 Fulfillment by employer of a military or
civic duty.
Retirement from services
(Article 287)

 Controlling provisions:
 Pertinent provisions of the CBA;
 Other applicable employment contract;
 Retirable age:
 Optional – 60 years old or more than but not beyond
65 years of age and served at least five years;
 Compulsory: 65 years old;
 For underground mine workers: optional 50 years old
or more but not beyond 60 years and served at least
five years.
Retirement…

 Benefits:
 Retirement pay equivalent to at least
one0half month salary for every year of
service with a fraction of at least six
months being considered as one year;
 Retail, service and agricultural
establishments employing not more than
10 employees or workers are exempted
from this coverage.