Case Summary (G.R. No. 94929-30)
Factual Background
The petitioner is engaged in construction and fabrication and operates a Steel and Marine Structures Group at its Batangas Marine and Fabrication Yard in Bauan, Batangas. The petitioner maintained a practice of hiring project employees when fabrication capacity could not absorb increased job orders. Those project employees worked under Project Worker/Reliever Employment Agreements specifying the project assignment and duration, and their employment automatically terminated upon completion of the project unless rehired for the remainder of the project. The positions occupied by regular rank-and-file employees and the project employees were substantially similar and directly related to the petitioner’s main business.
Collective Bargaining Agreement
On June 8, 1990 petitioner executed a Collective Bargaining Agreement with AG&P United Rank & File Association (URFA) which was subsequently registered on July 9, 1990 as Certificate of Registration No. BLR-90-0131. Article II, Section 1 of that agreement defined the appropriate bargaining unit as “those regular rank-and-file employees of the COMPANY who have remained as such up to the date of execution of this Agreement, as well as those who may hereafter acquire the same status,” and expressly excluded workers “hired by the COMPANY as project employees as contemplated by existing laws including relievers of regular employees who are sent abroad.”
Petition for Certification Election
On June 29, 1990 LAKAS-NFL filed a Petition for Certification Election with the Med-Arbitration Unit seeking certification as the sole and exclusive bargaining agent of the regular non-project employees of the Steel and Marine Structures Group at the BMFY, representing approximately 1,000 employees, or that a certification election be conducted among those employees. On September 25, 1990 Med-Arbiter Tomas F. Falconitin ordered that a certification election among the regular project workers/employees of AG&P-SMSG be conducted immediately with the usual pre-election conference and with choices of LAKAS-NFL and No Union.
Administrative Proceedings and Regularizations
Petitioner filed an administrative appeal with the Department of Labor and Employment on October 11, 1990. On October 26, 1990 petitioner formally issued regular employment appointments to 691 alleged project employees, effective November 1, 1990, which the employees accepted. The Department, through Undersecretary Bienvenido E. Laguesma, denied petitioner’s appeal in a Resolution dated November 22, 1990. A strike by project employees who were not given regular appointments began November 28, 1990 and paralyzed operations. The strike was settled in conciliation on December 8, 1990 with an agreement that petitioner would formally regularize remaining alleged project employees with at least one year of service pending the certification election. Pursuant to that agreement, petitioner regularized an additional 686 employees effective December 1, 1990. URFA informed petitioner by letter dated December 6, 1990 of the admission into URFA of the membership of 410 regular project employees formally regularized effective November 1, 1990.
Petitioner's Contentions
Petitioner sought certiorari and prohibition to annul and set aside the Department’s Resolution dated November 22, 1990 and the Order dated December 11, 1990 which had affirmed the Med-Arbiter’s directive to hold a certification election. Petitioner argued that the Undersecretary acted with grave abuse of discretion amounting to lack of jurisdiction by failing to apply the contract-bar rule and by failing to consider the supervening fact that the bargaining unit LAKAS-NFL sought to represent had ceased to exist because the alleged project employees had been regularized and were included in the existing registered collective bargaining agreement with URFA.
Issues Presented
The salient issues were whether the Department and the Med-Arbiter erred in ordering a certification election among the alleged project employees despite the existence of a duly registered collective bargaining agreement between the petitioner and URFA, and whether the regularization of the project employees and their admission into URFA removed them from the pool of employees susceptible of certification by another labor organization outside the limited period allowed by law.
Ruling of the Supreme Court
The Supreme Court, through Nocon, J., found the petition meritorious. The Court annulled and set aside the assailed Resolution dated November 22, 1990 and the Order dated December 11, 1990. The temporary restraining order previously issued was made permanent. Costs were imposed against the respondents.
Legal Basis and Reasoning
The Court reviewed Article II, Section 1 of the registered Collective Bargaining Agreement which excluded project employees from the appropriate bargaining unit, but noted that the regularization of the project employees with at least one year of service and their subsequent admission into URFA meant that those employees were regular employees by contemplation of law and therefore included in the appropriate bargaining unit of the registered agreement. The Court relied on Art. 232, Labor Code, which prohibits the Bureau from entertaining any petition for certification election or any other action that may disturb the administration of duly registered existing collective bargaining agreements affecting the parties, except under specified exceptions. T
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Case Syllabus (G.R. No. 94929-30)
Parties and Procedural Posture
- ATLANTIC, GULF AND PACIFIC COMPANY OF MANILA, INC. was the petitioner that sought certiorari and prohibition with a prayer for injunctive relief to annul orders of the Department of Labor and Employment and the Med-Arbiter.
- HON. BIENVENIDO E. LAGUESMA, Undersecretary, Department of Labor & Employment was the administrative respondent who issued the Resolution dated November 22, 1990 and the Order dated December 11, 1990 denying reconsideration.
- HON. TOMAS F. FALCONITIN, Med-Arbiter, Bureau of Labor Relations, Department of Labor & Employment was the Med-Arbiter who ordered a certification election among the petitioner’s project employees.
- LAKAS NG MANGGAGAWA SA AG & P-SMSG-NATIONAL FEDERATION OF LABOR (LAKAS-NFL) was the private respondent and labor organization that filed the petition for certification election.
- The petitioner appealed the Med-Arbiter’s order to the Department of Labor and Employment on October 11, 1990, and the appeal was denied in a Resolution dated November 22, 1990 and in an Order dated December 11, 1990.
- The petition to the Court assailed the administrative Resolution and Order on grounds of grave abuse of discretion and asserted application of the contract-bar rule and a supervening fact of mass regularization.
Key Factual Allegations
- The petitioner conducted fabrication operations through its Steel and Marine Structures Group at the Batangas Marine and Fabrication Yard where it employed both regular rank-and-file employees and project employees.
- The petitioner hired project employees under Project Worker/Reliever Employment Agreements specifying project assignment and employment duration with automatic termination at project completion.
- The positions of regular rank-and-file employees and project employees were substantially similar and directly related to the petitioner’s main business.
- On June 8, 1990, the petitioner executed a Collective Bargaining Agreement with AG&P United Rank & File Association (URFA), which was registered on July 9, 1990 as Certificate No. BLR-90-0131.
- On June 29, 1990, LAKAS-NFL filed a Petition for Certification Election to be certified as the sole and exclusive bargaining agent of approximately 1,000 employees at the BMFY.
- On September 25, 1990, the Med-Arbiter ordered that a certification election among the regular project workers/employees of AG&P-SMSG be conducted immediately.
- On October 26, 1990, the petitioner formally issued regular employment appointments effective November 1, 1990 to 691 alleged project employees, which appointments were accepted.
- On November 28, 1990, project employees who had not been regularized went on strike and operations were paralyzed, leading to a conciliation agreement on December 8, 1990 to regularize remaining alleged project employees with at least one year of service pending certification.
- Pursuant to the conciliation agreement, 686 additional project employees were regularized effect