G.R. No. 93117 - Lopez Sugar Corp. vs. Secretary of Labor and Employment

On 26 July 1989, NACUSIP-TUCP, a labor organization, filed a petition for direct certification (or a certification election) with the DOLE Regional Office No. VI in Bacolod City.
The petition sought to determine the exclusive collective bargaining representative of the supervisory employees of Lopez Sugar Corporation (LSC) at its sugar central in Fabrica, Sagay, Negros Occidental.
NACUSIP-TUCP asserted that it was a legitimate national labor organization, claimed that LSC employed 55 supervisory employees (most being union members), and contended that no other labor organization held a claim over the said employees.
It also alleged that there was no existing collective bargaining agreement covering these employees and no legal barrier to a direct certification or a certification election.

LSC opposed the petition, arguing that it lacked legal and factual basis, labeling it a mere instrument of harassment, and maintained that its supervisory employees were unaware of the petition.
On 18 August 1989, the Commercial and Agro-Industrial Labor Organization (CAILO) moved to intervene, asserting its own claim to represent substantial membership among LSC’s supervisory employees.
NACUSIP-TUCP subsequently submitted Charter Certificate No. 003-89 (dated 20 July 1989) to authenticate the local chapter’s status, while LSC furnished a list of relevant supervisory employees for inclusion/exclusion proceedings.
A motion by Carlos S. Gevero on 13 September 1989 to dismiss the petition for lack of supervisory interest was filed; however, hearings scheduled for 20 and 29 September 1989 saw non-appearance by both NACUSIP-TUCP and CAILO.

On 16 October 1989, Med-Arbiter Felizardo T. Serapio issued an Order mandating the conduct of a certification election pursuant to Article 257 of the Labor Code, as amended.
The Order provided the following choices for the supervisory representatives:

The Mandate directed the designated representation officer to set a pre-election conference to determine the mechanics of the election, using the employer-submitted list to decide eligible voters, with the election to be conducted within twenty (20) days.
LSC appealed this Order before the Department of Labor and Employment, claiming that the certification election order was a manifest nullity and that the Med-Arbiter had abused his discretion.

On 06 March 1990, the Secretary of Labor upheld the Med-Arbiter's Order, maintaining that:

The conduct of a certification election under Article 257 is mandatory.
Withdrawals or disaffiliations of union members did not affect the standing of the petition.

In a petition for certiorari challenging this affirmation, the petitioner contended that while the objectives of the law were commendable, the proper application of Article 257 required the filing of a genuine petition by a legitimate labor organization.
The court referenced its prior decision in Progressive Development Corporation vs. Secretary, which underscored that:

The automatic conduct of a certification election under Article 257 is conditioned upon the petition being filed by a legitimate labor organization.
Such legitimacy is defined in Article 242 and Article 212(h) of the Labor Code as well as the corresponding provisions in the Implementing Rules and Regulations.

It was emphasized that not only must the federation’s bona fide status be shown, but the local chapter (acting as its agent) must also comply with mandatory documentary requirements (e.g., charter certificate, constitution and by-laws, statement of officers, and certified books of accounts).

The only document on record attesting to the legitimacy of the NACUSIP-TUCP Lopez Sugar Central Supervisory Chapter was the charter certificate; no additional required documents were presented.
Given this deficiency, the petition did not satisfy the statutory requirement that a petition for certification election be filed by a fully legitimate labor organization.
Consequently, the petition for certification election was deemed flawed despite the mandatory character of the Med-Arbiter’s order under Article 257.

Whether the certification election order was mandatory under Article 257 of the Labor Code once a petition was filed, irrespective of subsequent withdrawals or disaffiliations of members.
Whether the petition was filed by a truly legitimate labor organization, considering that the NACUSIP-TUCP acted only as an agent of its local chapter, which was required to comply with additional documentary requirements.
Whether the Med-Arbiter and the Secretary of Labor committed grave abuse of discretion by failing to scrutinize the legitimacy of the petitioning labor organization prior to ordering the certification election.