LABOR RELATIONS
ART. 258. [247] Concept of Unfair Labor Practice and Procedure for Prosecution Thereof.
Concept:
1. Unfair labor practices violate the constitutional right of workers and employees to self-
organization, are inimical to the legitimate interests of both labor and management,
including their right to bargain collectively and otherwise deal with each other in an
atmosphere of freedom and mutual respect, disrupt industrial peace and hinder the
promotion of healthy and stable labor management relations.
2. Consequently, unfair labor practices are not only violations of the civil rights of both
labor and management but are also criminal offenses against the State which shall be
subject to prosecution and punishment as herein provided.
Jurisdiction: Labor Arbiters
1. Subject to the exercise by the President or by the Secretary of Labor and Employment of
the powers vested in them by Articles 263 and 264 of this Code, the civil aspects of all
cases involving unfair labor practices, which may include claims for actual, moral,
exemplary, and other forms of damages, attorney’s fees and other affirmative relief,
shall be under the jurisdiction of the Labor Arbiters.
2. They shall resolve such cases within thirty (30) calendar days from the time they are
submitted for decision.
Procedure for Prosecution
1. Recovery of civil liability in the administrative proceedings shall bar recovery under the
Civil Code.
2. No criminal prosecution under this Title may be instituted without a final judgment
finding that an unfair labor practice was committed, having been first obtained in the
preceding paragraph.
3. During the pendency of such administrative proceeding, the running of the period of
prescription of the criminal offense herein penalized shall be considered interrupted:
Provided, however, That the final judgment in the administrative proceedings shall not
be binding in the criminal case nor be considered as evidence of guilt but merely as
proof of compliance of the requirements therein set forth.
Elements of Unfair Labor Practice
1. Employer-employee relationship between the offender and offended
2. The act done is expressly defined in the Code as an act of unfair labor practice. (Art.
259-260)
Prescription of actions for ULP- The offense prescribes in 1 year (Art. 290).
ART. 259. [248] Unfair Labor Practices of Employers.
It shall be unlawful for an employer to commit any of the following unfair labor practices:
(a) INTERFERENCE: To interfere with, restrain or coerce employees in the exercise of their right
to self-organization;
EXAMPLE:
Interference with employee organizational rights were found where the superintendent of
the employer threatened the employees with cutting their pay, increasing rent of the company
houses, or closing the plant if they supported the union and where the employer encouraged the
employees to sign a petition repudiating the union
(b)YELLOW DOG CONDITION: To require as a condition of employment that a person or an
employee shall not join a labor organization or shall withdraw from one to which he belongs; a
promise exacted from workers as a condition of employment that they are not to belong to, or
attempt to foster, a union during their period of employment
3 Usual Provisions under the Yellow Dog Contract
1. a representation by the employee that he is not a member of a labor union
2. a promise by the employee not to join a labor union
3. a promise by the employee that, upon joining a labor union, he will quit his
employment
(c) CONTRACTING OUT: To contract out services or functions being performed by union
members when such will interfere with, restrain or coerce employees in the exercise of their
right to self-organization; However, an employer is not guilty of an unfair labor practice in
contracting work out for business reasons such as decline in business, the inadequacy of his
equipment, or the need to reduce the cost, even if the employer’s estimate of his cost is based on a
projected increase attributable to unionization.
Runaway shop: An industrial plant moved by its owners from one location to another
to escape union labor regulations or state laws or to discriminate against employees at
the old plant because of their union activities.
Resorting to runaway shop is ULP.
Where a plant removal is for business reasons but the relocation is hastened by anti –
union motivation, the early removal is unfair labor practice. It is immaterial that the
relocation is accompanied by a transfer of title to a new employer who is an alter ego
of the original employer.
Mere ownership by a single stockholder or by another corporation of all or nearly all
of the capital stock of a corporation is not of itself sufficient ground for disregarding
the separate corporate personality. [Sunio v. NLRC, 127 SCRA 390 (1984)
(d) COMPANY DOMINATION OF UNION: To initiate, dominate, assist or otherwise interfere
with the formation or administration of any labor organization, including the giving of financial or
other support to it or its organizers or supporters;
Manifestations of Domination of a Labor Union
1. Initiation of the company union idea. This may further occur in three styles:
a. outright formation by the employer or his representatives
b. employee formation on outright demand or influence by employer
c. managerially motivated formation by employees
2. Financial support to the union. By defraying the union expenses or pays the attorney’s fees
to the attorney who drafted the constitution and by – laws of the union.
3. Employer encouragement and assistance. Immediately granting the union exclusive
recognition as a bargaining agent without determining whether the union represents the
majority of employees.
4. Supervisory assistance. This takes the form of soliciting membership, permitting union
activities during working time or coercing employees to join the union by threats of dismissal
or demotion (Philippine American Cigar & Cigarette Factory Workers Union v. Philippine
American Cigar & Cigarette Mfg. Co., Inc., 7 SCRA 375).
Example:
Oceanic Air Products, Inc. v. CIR, GR No. L- 18704, 31 January 1963
A labor union is company – dominated where it appears that key officials of the company
have been forcing employees belonging to rival labor union to join the former under pain of dismissal
should they refuse to do so; that key officials of the company, as well as its legal counsel, have
attended the election of officers of the former union; that officers and members of the rival union
were dismissed allegedly pursuant to a retrenchment policy of the company, after they had presented
demands for the improvement of the working conditions despite its alleged retrenchment policy; and
that, after dismissal of the aforesaid officers of the rival labor union, the company engages the
services of new laborers
(e) DISCRIMINATION: To discriminate in regard to wages, hours of work and other terms and
conditions of employment in order to encourage or discourage membership in any labor organization.
Example:
1. Pagkakaisang Itinataguyod ng mga Manggagawa sa Ang Tibay, et. al. v. Ang Tibay, et. al.,
GR No. L-22273, 16 May 1967
Under the Industrial Peace Act (as under the present Labor Code), to constitute an unfair
labor practice, the discrimination committed by the employer must be in regard to the hire or tenure
of employment or any term or condition of employment to encourage or discourage membership in
any labor organization. The exaction by the Company, from strikers returning to work, of a promise
not to destroy company property and no to commit acts of reprisal against the Union members who
did not participate in the strike, cannot be considered as intended to encourage or discourage Union
membership. Taking the circumstances surrounding the prescribing of that condition, the requirement
by the Company is actually an act of self – preservation and designed to inure the maintenance of
peace and order in the Company premises.
Discrimination in Bonus Allocation or Salary Adjustments: There is unfair and unjust
discrimination in the granting of salary adjustments where the evidence shows that:
o (a) the management paid the employees of the unionized branch;
o (b) where salary adjustments were granted to employees of one of its non - unionized
branches although it was losing in its operations; and
o (c) the total salary adjustments given every ten of its unionized employees would not
even equal the salary adjustments given one employee in the non – unionized branch.
(Manila Hotel Company v. Pines Hotel Employees Ass’n. (CUGCO) and CIR, G.R.
No. L-30818, 28 September 1972)
Discrimination in Layoff or Dismissal: Even where business conditions justified a layoff
of employees, unfair labor practices in the form of discriminatory dismissal were found where
only unionists were permanently dismissed while non – unionists were not.
Test of Discrimination:
For the purpose of determining whether or not a discharge is discriminatory, it is
necessary that the underlying reason for the discharge be established.
The fact that a lawful cause for discharge is available is not a defense where the
employee is actually discharged because of his union activities. If the discharge is
actually motivated by a lawful reason, the fact that the employee is
engaged in union activities at the time will not lie against the employer and prevent
him from the exercise of his business judgment to discharge an employee for cause.
(NLRB v. Ace Comb Co., 342 F. 2 841)
Discharge due to union activity, a question of fact : (Philippine Metal Foundries, Inc., v.
CIR, GR Nos. L-34948 – 49, 15 May 1979)The question of whether an employee was
discharged because of his union activities is essentially a question of fact as to which the
findings of the court of Industrial Relations are conclusive and binding if supported by
substantial evidence considering the record as a whole
o RULING ON CLOSED SHOP
When there is Valid Discrimination: Union Security Clause: Union security is a generic
term which is applied to and comprehends closed shop, union shop, maintenance of
membership or any other form of agreement which imposes upon employees the obligation to
acquire or retain union membership as a condition affecting employment. It is indeed
compulsory union membership whose objective is to assure continued existence of the union.
In a sense, there is discrimination when certain employees are obliged to join a particular
union. But it is discrimination favoring unionism; it is a valid kind of discrimination.
The employer is not guilty of unfair labor practice if it merely complies in good faith with
the request of the certified union for the dismissal of employees expelled from the union
pursuant to the union security clause in the collective bargaining agreement. (Soriano v.
Atienza, GR No. 68619, 16 March 1989)
Villar vs Inciong, 121 SCRA 444 (1983). It is true that disaffiliation from a labor union is
not open to legal objection. It is implicit in the freedom of association ordained by the
Constitution. But a closed shop is a valid form of union security, and such provision in a
collective bargaining agreement is not a restriction of the right of freedom of association
guaranteed by the Constitution.
o Victorias Milling Co., Inc. v. Victorias – Manapla Workers Organization – PAFLU, GR
No. L-18467, 30 September 196. Another reason for enforcing the closed – shop agreement
is the principle of sanctity or inviolability of contracts guaranteed by the Constitution. As a
matter of principle, the provision of the Industrial Peace Act granting freedom to employees
to organize themselves and select their representative for entering into bargaining
agreements, should be subordinated to the constitutional provision protecting the sanctity of
contracts.
Advantages of Closed Shop Agreement
1. increases the strength and bargaining power of labor organizations.
2. prevents non – union workers from sharing in the benefits of the union’s activities
without also sharing its obligations.
3. prevents the weakening of labor organizations by discrimination against union
members.
4. eliminates the lowering of standards caused by competition with non - union
workers.
5. enables labor organizations effectively to enforce collective agreements.
6. facilitates the collection of dues and enforcement of union rules.
7. creates harmonious relations between the employer and employee (NLU v.
Aguinaldo’s Echague, Inc., 51 O.G. 2898)
Disadvantages of a Closed Shop Agreement
1. results in monopolistic domination of employment by labor organizations
2. interferes with the freedom of contract and personal liberty of the individual worker
3. compels employers to discharge all non – union workers regardless of efficiency, length of
service, etc.
4. facilitates the use of labor organizations by unscrupulous union leaders for the purpose of
extortion, restraint of trade, etc.
5. denies to non – union workers equal opportunity for employment
6. enables union to charge exorbitant dues and initiation fees
Valid dismissal because of application of union security clause
1. Malayang Samahan ng mga Manggagawa sa M. Greenfield v. Ramos, GR No. 113907, 28
February 2000
Union security clauses in the collective bargaining agreements, if freely and voluntarily
entered into, are valid and binding. Thus, the dismissal of an employee by the company pursuant
to a labor union’s demand in accordance with a union security agreement does not constitute unfair
labor practice.
2. Manalang, et. al. v. Artex Development Co., et. al., GR No. L-20432, 30 October 1967
A union member who is employed under an agreement between the union and his employer is
bound by the provisions thereof since it is a joint and several contract of the members of the union
entered into by the union as their agent.
3. Villar v. Inciong, 121 SCRA 444 (1983)
Petitioners, although entitled to disaffiliation from their union and to form a new organization of
their own, must, however, suffer the consequences of their separation from the union under the
security clause.
Liability of union to pay wage and fringe benefits of illegally dismissed employee. Where the
employer compelled the employee to go on forced leave upon recommendation of the union for
alleged violation by the employee of the closed – shop agreement, the NLRC correctly ordered the
reinstatement of the employee and directed the union to pay the wages and fringe benefits which
employees failed to receive as a result of her forced leave and to pay attorney’s fees. The employer
would not have compelled the employee to go on forced leave were it not for the union’s insistence
and demand to the extent that because of the failure of the employer to dismiss the employee as
requested, the union filed a notice of strike on the issue of unfair labor practice. Moreover, under
the collective bargaining agreement between the union and the employer, the union holds the
company free and blameless from any liabilities that may arise should the employee question the
dismissal. (Manila Mandarin Employees Union v. NLRC, GR No. 76989,
29 September 1987)
Employer in good faith not liable. Where the employer dismissed his employees in the belief in
good faith that such dismissal was required by the closed – shop provisions of the collective
bargaining contract with the union, he may not be ordered to pay back compensation to such
employees although their dismissal is found to be illegal. (Confederated Sons of Labor v. Anakan
Lumber co., et. al., GR No. L-12503, 29 April 1960
Employees not covered by the closed shop provision
1. any employee who at the time the closed – shop agreement takes effect is a bona fide member of
a religious organization which prohibits its members from joining labor unions of religious
grounds
2. employees already in service and already members of a labor union or unions other than the
majority union at the time the closed – shop agreement took effect
3. confidential employees who are excluded from the rank and file bargaining unit
4. employees excluded from the closed – shop by express terms of the agreement
To hold that the employees in a company who are members of a minority union may
be compelled to disaffiliate from their union and join the majority or contracting union, would
render nugatory the right of all employees to self – organization and to form, join or assist labor
organizations of their own choosing, a right guaranteed by the Industrial Peace Act as well as by
the Constitution. (Kapisanan ng mga Manggagawa ng Alak (NAFLU) v. Hamilton Distellery Co.,
et. al., GR No. L-18112, 30 October 1962)
Agency fee instead of union membership. Under the agency – shop clause of a CBA, an
employee is not required to join the union as a condition of continued employment, but must pay
the union a service fee (usually equivalent to union dues and initiation fees). Since a union is
required by statute to act as the bargaining representative of all employees, both union and non –
union, within their bargaining unit, the justification for the clause is that the nonmember should
contribute towards the cost of collective bargaining process without supporting it financially. And
as long as a non-member has been benefiting to the CBA of the union, he is required to pay agency
fee.
(f) DISCRIMINATION BECAUSE OF TESTIMONY. The testimony or proceedings might
involve wages, employee’s benefits disciplinary rules, or organizational rights, or anything covered
by the Labor Code. What is chargeable as ULP is the employer’s retaliatory act regardless of the
subject of the employee’s complaint or testimony.
(g) VIOLATION OF DUTY TO BARGAIN
Four Forms of ULP in bargaining:
a. Failure or refusal to meet and convene
b. Evading the mandatory subjects of bargaining
c. Bad faith in bargaining, including failure or refusal to execute the collective agreement, if
requested
d. Gross violation of the CBA
(h) PAID NEGOTIATION. It is a punishable act of ULP for the employer to pay the union or any
of its officers or agents any negotiation fee or attorney’s fees as part of the settlement in collective
bargaining or any labor dispute. To do so is not only unlawful. It is ethically reprehensible.
(i) VIOLATION OF THE CBA. Implementation of the CBA is still part of the bargaining
process. The duty to bargain requires good faith, and good faith implies faithful observance of
what has been agreed upon. It logically follows that noncompliance with the agreement is non –
observance of good faith in bargaining; therefore, the noncompliance amounts to a ULP.
Violation of the CBA must be gross.
RELIEF IN ULP CASES
1. CEASE AND DESIST ORDER (denoting a legally enforceable order from a court or government
agency directing someone to stop engaging in a particular activity)
To support a cease and desist order, the record must show that the restrained misconduct
was an issue in the case; that there was a finding of fact of said misconduct and such
finding was supported by evidence.
The Court is not authorized to issue blank cease and desist orders, but must confine its
injunction orders to specific act or acts which are related to past misconduct.
2. AFFIRMATIVE ORDER
In addition to a cease and desist order, the court may issue an affirmative order to reinstate
the said employee with back pay from the date of the discrimination.
If other laborers have been hired, the affirmative order shall direct the respondent
to dismiss these hired laborers to make room for the returning employee.
3. COURT MAY ORDER THE EMPLOYER TO BARGAIN, CBA MAY BE IMPOSED
4. STRIKE BY UNION MEMBERS
ULP is not subject to compromise
1. CLLC E.G. Gochangco Workers Union, et. al. v. NLRC, GR No. 67158, 30 May 1988
ULP cases are not, in view of the public interest involved, subject to compromises. The
relation between capital and labor are not merely contractual. They are so impressed with
public interest that labor contracts must yield to the common good.
ULP in a given period should be included in a single charge
1. Dionela, et. al. v. CIR et. al., GR No. L-18334, 31 August 1963
When a labor union accuses an employer of acts of unfair labor practice allegedly
committed during a given period of time, the charges should include all acts of unfair labor practice
committed against any and all members of the union during that period. The union should not, upon
the dismissal of the charges first preferred, be allowed to split its cause of action and harass the
employer with subsequent charges, based upon acts committed during the same period of time.
ART. 260. [249] Unfair Labor Practices of Labor Organizations.
It shall be unfair labor practice for a labor organization, its officers, agents or representatives:
(a) To restrain or coerce employees in the exercise of their right to self organization. However, a
labor organization shall have the right to prescribe its own rules with respect to the acquisition or
retention of membership;
(b) To cause or attempt to cause an employer to discriminate against an employee, including
discrimination against an employee with respect to whom membership in such organization has
been denied or to terminate an employee on any ground other than the usual terms and conditions
under which membership or continuation of membership is made available to other members;
(c) To violate the duty, or refuse to bargain collectively with the employer, provided it is the
representative of the employees;
(d) To cause or attempt to cause an employer to pay or deliver or agree to pay or deliver any money
or other things of value, in the nature of an exaction, for services which are not performed or not to
be performed, including the demand for fee for union negotiations; the settlement of any issue in
collective bargaining or any other dispute; or
(f) To violate a collective bargaining agreement.
The provisions of the preceding paragraph notwithstanding, only the officers, members of
governing boards, representatives or agents or members of labor associations or organizations who
have actually participated in, authorized or ratified unfair labor practices shall be held criminally
liable.
Union cannot coerce employees to join a strike. Similarly, violation is committed when a union
threatens the employees with bodily harm in order to force them to strike. A union violates the law
when, to restrain or coerce nonstrikers from working during the strike, it:
o assaults or threatens to assault them
o threatens them with the loss of their jobs
o blocks their ingress to and egress from the plant
o damages nonstrikers’ automobiles or forces them off the highway
o physically preventing them from working
o sabotages the employer’s property in their presence, thereby creating an atmosphere of
fear or violence
o demonstrates loudly in front of a nonstrikers’ residence with signs and shouts accusing the
nonstriker of “scabbing”
o holding the nonstriker up to ridicule
o seeking public condemnation of the nonstriker
Union-Induced Discrimination; Arbitrary use of union security clause
The broad rule is that the union has the right to determine its membership and to prescribe
the conditions for the acquisition and retention thereof. Consequently, admission to membership
may not be compelled. This rule, however, is qualified in the case of labor unions holding a
monopoly in the supply of labor, either in a given locality, or as regards a particular employer by
reason of a closed – shop or similar agreements. In such case, qualified applicants may not be
barred by unreasonable rules.
Salunga v. Court of Industrial Relations, 21 SCRA 216 (1967)
Employee resigned from the union. The union requested the company to enforce the closed
shop provision of the CBA. Company deferred action and informed the employee of the possible
effects of his resignation from the union. Employee tried to revoke his resignation from the union
but this denied by the union. Company finally granted the request of the union and terminated the
employee. Employee complained of illegal dismissal.
Held:
Labor unions are not entitled to arbitrarily exclude qualified applicants for membership and a
closed –shop provision will not justify the employer in discharging, or a union in insisting upon the
discharge of, an employee whom the union thus refuses to admit to membership, without any
reasonable ground thereof. Having been dismissed from service owing to unfair labor practice on
the part on the part of the union, petitioner is entitled to reinstatement as member of the union and
to his former or substantially equivalent position in the company, without prejudice to his seniority
and/or rights and privileges, and with back pay.
Manila Mandarin Employees Union v. NLRC, 154 SCRA 369 (1987)
Union security clauses are also governed by law and by principles of justice, fair play, and legality.
Union security clauses cannot be used by union officials against an employer, much less their own
members, except with a high sense of responsibility, fairness, prudence and judiciousness.
Refusal To Bargain [Art. 249(c)]. A union violates its duty to bargain collectively by entering
negotiations with a fixed purpose of not reaching an agreement or signing a contract.
Featherbedding And Make – Work Arrangements [Art. 249 (d)]
Featherbedding – employee practices which create or spread employment by unnecessarily
maintaining or increasing the number of employees used, or the amount of time consumed, to work
on a particular job. It may take the form of minimum – crew regulations on the railroad, make –
work rules such as the setting of and prompt destruction of unneeded bogus type in the newspaper
industry, stand – by pay for musicians when a radio station broadcasts music from phonograph
records or production ceilings for work on the assembly lines or at the construction site
Title VII COLLECTIVE BARGAINING AND ADMINISTRATION OF
AGREEMENTS
(We Used Old Numbers Mids, Pls Refer To The 2016 Codal)
A. DUTY TO BARGAIN COLLECTIVELY (We used OLD NUMBERS MIDS, PLS REFER
TO THE 2016 CODAL)
Art. 250. Procedure in collective bargaining.
Art. 251. Duty to bargain collectively in the absence of collective bargaining agreements.
Art. 252. Meaning of duty to bargain collectively.
Art. 253. Duty to bargain collectively when there
exists a collective bargaining agreement.
Art. 253-A. Terms of a collective bargaining agreement.
Art. 254. Injunction prohibited.
Art. 231. Registry of unions and file of collective bargaining agreements.