Title
Republic vs. Namboku Peak, Inc.
Case
G.R. No. 169745
Decision Date
Jul 18, 2014
Namboku Peak and Phil-Japan cases challenged Section 17 of DO 40-03's constitutionality, barring appeals in unorganized establishments. SC ruled Section 17 unconstitutional, upheld CA's decision excluding project employees from bargaining units, and denied Secretary of Labor's standing to appeal.

Case Summary (G.R. No. 169745)

Applicable Law

The prevailing law in consideration of the decisions in these cases is the 1987 Philippine Constitution, along with relevant provisions of the Labor Code. Key issues include the constitutionality of Department Order No. 40-03, particularly Section 17, Rule VIII, which restricts the right to appeal decisions regarding certification elections in unorganized establishments.

Factual Antecedents - Namboku Case (G.R. No. 169745)

Namboku, engaged in providing manpower services primarily to various airline companies at Ninoy Aquino International Airport, resisted a petition filed by PALCEA-SUPER for direct certification election, arguing that its members are project employees and thus ineligible for bargaining representation. However, the Med-Arbiter ruled that these employees were regular employees and ordered a certification election. Namboku's subsequent appeal was denied by the Secretary of Labor, who affirmed the Med-Arbiter's decision.

Factual Antecedents - Phil-Japan Case (G.R. No. 170091)

Phil-Japan, a manufacturing company, faced a similar situation with the PJWU-SUPER, which also sought a certification election on behalf of its members. Phil-Japan contended that the members listed were not its employees due to various circumstances such as contract fulfillment. The Med-Arbiter ruled in favor of PJWU-SUPER, allowing a certification election to proceed, which Phil-Japan challenged.

Rulings of the Court of Appeals

In both cases, the Court of Appeals initially granted the petitions from the respondents, ruling that the respective labor unions' members were ineligible for representation based on their employment status. The Court further declared Section 17, Rule VIII of Department Order No. 40-03 unconstitutional, arguing that it conflicted with the rights secured under Article 259 of the Labor Code.

Issues Raised by the Secretary of Labor

The Secretary of Labor's petitions sought to overturn the Court of Appeals' rulings and argued that Section 17, Rule VIII was not in conflict with the Labor Code but aimed to uphold the smooth conduct of elections, asserting that appeals could be lodged post-election as protests.

Arguments from Namboku and Phil-Japan

Both companies contended that Section 17 unjustly limited the right of employers to appeal decisions affecting their operations. Namboku insisted that project employees could not be part of a bargaining unit of regular employees, while Phil-Japan argued that the existence of an employer-employee relationship should be resolved prior to the conduct of a certification election.

Court's Ruling

The Supreme Court denied the petitions from the Secretary of Labor, asserting that she lacked the standing to

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