Title
San Jose City Electric Service Cooperative, Inc. vs. Ministry of Labor and Employment
Case
G.R. No. 77231
Decision Date
May 31, 1989
Employees of an electric cooperative who are also member-consumers cannot form labor unions for collective bargaining, as they are co-owners; non-member-consumer employees retain the right to organize.

Case Summary (G.R. No. 77231)

Relevant Background

The case involves a petition for certiorari filed by SAJELCO against an order that affirmed the decision to conduct a certification election among its rank-and-file employees. The private respondent, MAGKAISA-ADLO, claimed to represent a sufficient number of employees to warrant the election, asserting they were a legitimate labor organization registered with the Ministry of Labor and Employment.

Facts of the Case

On July 29, 1986, MAGKAISA-ADLO initiated a petition to conduct a direct certification election, contending that a significant majority of the employees supported union representation and highlighting the absence of a certification election in the preceding twelve months. SAJELCO opposed this, arguing that many employees were also member-consumers of the cooperative, complicating their ability to effectively represent conflicting interests. They claimed that these dual roles rendered collective bargaining impractical because member-consumers would essentially be negotiating with themselves.

Med-Arbiter's Issuance

On September 5, 1986, the Med-Arbiter granted MAGKAISA-ADLO's petition, recognizing that while some union members were also member-consumers, they remained employees entitled to labor rights, including the right to organize. This ruling was contested by SAJELCO, which pointed to the complexities of merging the roles of employee and consumer in cooperative governance.

Bureau of Labor Relations' Ruling

Following SAJELCO's appeal to the Bureau of Labor Relations, the Director upheld the Med-Arbiter's decision. The conflict centered on whether the dual membership status would hinder the employees' rights under labor law, and whether organization for collective bargaining was consistent with their dual identities as employees and member-consumers.

Supreme Court Decision and Central Issues

On review, the Supreme Court evaluated whether electric cooperative employees who were also members could organize for collective bargaining. This inquiry drew on previous rulings affirming that cooperatives function distinctly from typical businesses; hence, owners (members) could not collectively bargain as they were negotiating with themselves.

The Court reiterated that employees who were also member-consumers were not entitled to form unions for collective bargaining purposes, as the principle that an owner cannot bargain with themselves applies firmly in cooperative contexts.

Implications and Conclusion

The Supreme Court allowed the petition, determining that only those SAJELCO employees who were not member-consumers could exercis

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