G.R. No. L-45513-14 - Firestone Tire and Rubber Employees Union vs. Estrella

On June 21, 1973, the National Labor Relations Commission (NLRC) certified a three-year collective bargaining agreement between the Associated Labor Union (ALU) and Firestone Tire & Rubber Company of the Philippines.
The agreement was effective from February 1, 1973, to January 31, 1976.

On February 1, 1974, the respondents entered into a "Supplemental Agreement" extending the life of the collective bargaining agreement for one year, making the new expiry date January 31, 1977.
The extension was not ratified by the covered employees nor submitted to the Department of Labor for certification.

Within the sixty-day period prior to the initial expiry of the agreement, a substantial number of employees (initially 233, later rising to 276 out of about 400 employees) resigned from the ALU.
These employees, dissatisfied with their current representation, expressed their desire for a new union and petitioned for the registration of the Firestone Tire & Rubber Company Employees’ Union (FEU).
On January 28, 1976, Registration Permit No. 8571-IP was issued to petitioner FEU.

On February 10, 1976, FEU filed a petition with the Bureau of Labor Relations for direct certification or a certification election, supported by the written consent of 308 employees (77% of the 400-man bargaining unit).
This petition was submitted shortly after the expiry of the original collective bargaining agreement, though before the extended expiry date could be properly validated.

On February 20, 1976, ALU filed a petition with the Bureau for the cancellation of FEU’s registration certificate, contending that FEU’s registration was improper since ALU was the recognized bargaining agent and FEU failed to submit a sworn statement affirming that no recognized or certified bargaining agent existed in the unit.
Additionally, respondent Company opposed the certification petition on the ground that the petition was filed late, as it came ten days after the original expiry of the collective bargaining agreement.
On April 6, 1976, a Med-Arbiter issued an order granting the certification petition, a decision later appealed by ALU and the Company.

Director Carmelo C. Noriel initially affirmed the Med-Arbiter’s order on September 23, 1976.
On January 25, 1977, Acting BLR Director Francisco L. Estrella issued a resolution reversing the Med-Arbiter’s order, arguing that:

A prejudicial issue existed regarding FEU’s legal personality.
There was an existing collective bargaining agreement (extended to January 31, 1977) in place, which supposedly barred the holding of a certification election.

The reversal was based on the contention that FEU’s registration and certification petition were premature given the existence of a certified collective bargaining agreement.

Meanwhile, the petition for direct certification continued in another case (BLR Case No. 2160-76), where Director Noriel ruled against revoking FEU’s registration despite the absence of the required sworn statement.
Respondents ALU and the Company maintained that FEU had no legal personality and that any certification election should be barred by the existing contract, which they argued fostered industrial stability.
The petition eventually reached the Supreme Court via certiorari, challenging the resolutions of Acting Director Estrella and the administrative decisions that had denied FEU’s registration on technical and substantive grounds.

Whether the existence of a supposedly valid collective bargaining agreement (including its uncertified one-year extension) serves as a bar to filing a petition for direct certification or a certification election by FEU.

Does the extension, not ratified by employees or certified by the Department of Labor, have legal effect in barring a new certification petition?

Whether FEU possesses legal personality as a registered union despite non-compliance with the requirement to submit a sworn statement affirming that no recognized or certified collective bargaining agent exists in the bargaining unit.

Is the failure to comply with Section 4, Rule II, Book V of the Rules Implementing the Labor Code sufficient to void FEU’s registration?

Whether the timing of FEU’s petition, filed within the “sixty-day freedom period” despite the existence of an uncertified extension of the collective bargaining agreement, qualifies as premature or valid under the law.

Does the “contract bar” rule apply when the supplemental agreement lacks certification and ratification?

Whether the eventual resolution that supported holding a certification election overrides the technical deficiencies pointed out by the Acting Director regarding FEU’s registration.