Unfair Labor Practices
Title VI
It Shall Be Unlawful For Any Person To:
1. Restrain
2. Coerce
3. Discriminate against; or
4. Unduly interfere with employees and workers in their
exercise of the right to self-organization (LABOR CODE, Art.
257).
Concept of Unfair Labor Practices (Art. 258)
1. Violate the constitutional right of workers and employees to
self-organization;
2. 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;
3. Disrupt industrial peace;
4. Hinder the promotion of healthy and stable LM Relations
5. Criminal offenses against the State;
6. Violation of civil rights of both labor and management;
Elements of Unfair Labor Practice:
Employer-employee relationship
Act is expressly defined in the code as an act of unfair labor
practice
ULPs are all related to the workers’ self-
organization right and the observance of
a CBA, except Art. 259 (f) of the Labor
Code, dismissing or prejudicing an
employee for giving testimony under the
Code.
(General Santos Coca-Cola Plant Free Workers Union-
Tupas v. Coca-Cola Bottlers PHL, Inc. (General Santos
City), G.R. No. 178647, February 13, 2009);
Some Principles of ULP:
ULP has a technical meaning, and is exclusive to what is
enumerated in the Labor Code;
It is a practice unfair to labor, although the offender may
either be an employer or a labor organization;
It refers to acts opposed to workers' right to organize
(Anti-unionism acts);
It also refers to gross violation of CBA provisions. Gross
means the act is malicious and flagrant.
A ULP charge allegedly committed during a given period of
time should include all acts of ULP committed against any
and all members of the union during that period
Generally, not subject to compromise (reason: impressed
with public interest)
ULP and Compromise Agreements
The relation between capital and While the Court does not abandon
labor are not merely contractual the rule that unfair labor practice
but are impressed with public acts are beyond and outside the
interest that labor contracts must sphere of compromises,
yield to the common good (in agreements that are voluntarily
view of the public interest entered into by parties that
involved). represent a reasonable settlement
are allowed. See cases
General Rule: ULP cases are not
Exception
subject to compromise.
Civil Case of ULP v. Criminal Case of ULP
Civil Case Criminal Case
As To Persons Liable
1. Officers and agents of employer; or 1. Agents and officers who participated or
2. Labor organization, officers and agents authorized or ratified the act; and
2. Agents, representatives, members of the
government board, including ordinary
members (Art. 304 & Art. 260).
As to Jurisdiction
Labor Arbiters of the NLRC MTC or RTC, as the case may be (Art. 303)
As to Quantum of Proof
Substantial evidence Beyond reasonable doubt
Civil Case of ULP v. Criminal Case of ULP
Civil Case Criminal Case
As to Prescriptive Period
One year from the occurrence of ULP One year from occurrence of ULP
Period will be suspended once administrative
case has been filed, and resumes once the
administrative case has attained finality.
Final judgment in the
administrative proceeding not binding in the criminal case, nor considered as
finding that ULP has been PROOF OF
an evidence of guilt, but merely as a
committed prerequisite in COMPLIANCE OF THE REQUIREMENTS
filing a criminal case for prescribed by the Code.
ULP.
Unfair Labor Practices of Employers (Art. 259)
1. Interference
2. Yellow Dog Condition
3. Contracting Out
4. Company Unionism
5. Discrimination
6. Discrimination because of testimony;
7. Violation of duty to bargain
8. Paid negotiation; or
9. Gross violation of CBA
Unfair Labor Practices of
Employers
Articles 259, 273, 277
1. Interference
To INTERFERE with, RESTRAIN or COERCE employees in the
exercise of their right to self-organization.
Test: Does the act tend to interfere with the free exercise of the
right?
Direct evidence of intimidation or coercion not necessary, if there
is reasonable inference that employers’ statements has adverse
effect on right to self-organize and collective bargaining.
Totality of Conduct Doctrine
Totality of Conduct Doctrine
The culpability of employer's
remarks is to be evaluated
not only on the basis of their
implications, but against the
background of and in
conjunction with collateral
circumstances
(The Insular Life Assurance
Co., Ltd., Employees Assoc.
--NATU v. The Insular Life
Assurance Co., Ltd., supra).
Examples of Interference
1. Outright and unconcealed intimidation by the employer.
2. Coercive questioning or interrogation
3. Hostility to union officers, members
4. Expression of opinions in intimidating manner
Is questioning an employee barred or
discouraged?
NO, provided that
1. The employer must communicate to the
employee the purpose of questioning;
2. Assure him that no reprisal would take
place; and
Cases on Interference
The Court held that from the employer's refusal to bargain to
its acts of economic inducements resulting in the promotion
of those who withdrew from the union, the use of armed
guards to prevent the organizers to come in, and the
dismissal of union officials and members, one cannot but
conclude that the employer did not want a union in its
hacienda—a clear interference in the right of the workers to
self-organization (Hacienda Fatima v. National Federation of
Sugarcane Workers-Food and General Trade, G.R. No.
149440, January 28, 2003).
Cases on Interference
An employer who interfered with the right to self-organization before a
union is registered can be held guilty of ULP (Samahan ng Manggagawa
sa Bandolino-LMLC v. NLRC, G.R. No. 125195, July 17, 1997).
It is the prerogative of the company to promote, transfer, or even
demote its employees to other positions when the interests of the
company reasonably demand it. Unless there are circumstances which
directly point to interference by the company with the employees' right
to self-organization, the transfer of an employee should be considered
as within the bounds allowed by law (e.g. despite transfer to a lower
position, his original rank and salary remained undiminished)
(Rubberworld (PHL), Inc. V. NLRC, G.R. No. 75704, July 19, 1989).
2. Yellow Dog, or Iron Clad Contract
Requires as a
condition for
employment that a
person or an
employee shall not
join a labor
organization or
shall withdraw
from one to which
he belongs.
Reason for its illegality
Contrary to public policy (involuntary servitude).
Contemplates the waiving waiving of
employees’ right to self-organization; and
Contract is disadvantageous to workers’ families,
since they cannot negotiate reasonable terms of
employment.
3. Contracting out services performed by union
officers or employees
Considered ULP only when the intention is to interfere with,
restrain or coerce employees in the exercise of their right to
self-organization
Dismissal of Union
• Cost-cutting officers or members
• Streamlining Discourage union
Operations activities
• Other valid Other forms of
exercise of interference to the
prerogative right to self
organization
Outsourcing not ULP
Conditions for valid outsourcing: When the "contracting out"
a. Motivated by good faith; and
b. Must not have been committed
is being done for business
to circumvent the law, or must reasons such as decline in
not have been the result of business, inadequacy of
malicious or arbitrary action
(Manila Electric Company v.
equipment or to
Quisumbing, G.R. No. 127598, reduce cost, then it is a
January 27, 1999). valid exercise of
management prerogative
(48 Am. Jur. 2d 1101).
4. Company-Dominated 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 officers
Company Unionism/Captive Yun bang …
Unionism is considered as
Company-
ULP because the officers Emplo
dominated
will be beholden to the yer
union
employers and they will not
look after the interest of di ka makapalag dahil may
whom they represent. utang na loob ka!
Forms of Company Unions
Outright formation by employer or his representatives;
◦ Employee formation on outright demand or influence by employer; or
◦ Managerially motivated formation by employees.
Financial support to the union by:
◦ Employer defraying union expenses; or
◦ Paying attorney's fees to the attorney who drafted the Constitution or
by-laws of the union;
Forms of Company Unions
Employer encouragement and assistance – Immediately
granting of exclusive recognition as bargaining agent without
determining whether the union represents majority of the
employees.
Supervisory Assistance - Soliciting membership, permitting
union activities during work time or coercing employees to
join the union by threats of dismissal or demotion
5. Discrimination to interfere with Self-
Organization Right
wages, hours of work, and other terms and
conditions of employment in order to encourage or
discourage membership in any labor organization;
Test: Did the employer deprive employees of
benefits or privileges because of their union
affiliation or activities?
Three Components of Discrimination:
Discrimination in terms and conditions of employment in
order to encourage or discourage membership in the union;
It gives validity to union security agreements; and
It allows an agency shop arrangement whereby agency fees
may be collected from non-union members.
Discrimination, applied
Discrimination occurs when there is:
◦ Variance in terms and conditions of employment
◦ Among workers who belong to the same classification or category
◦ The variance is a sanction imposed by reason of a worker’s union activities or
membership
◦ Direct or circumstantial evidence to show that employer’s motive was anti-
unionism
While discrimination is considered an unfair labor practice,
classification is not because it merely differentiates the employees in
accordance with their respective jobs and accords them the appropriate
levels of pay or benefits due them by reason thereof – AZUCENA.
Examples of Discrimination
Constructive Discharge. ULP where employer prohibits
employees from exercising their rights under the Code, on
pain of discharge, and the employee quits as a results of the
prohibition AZUCENA.
Security Arrangements. Stipulations in the CBA requiring
membership in the contracting union as a condition for
employment or retention of employment in the company.
Union Security Clause is a valid “discrimination”
Protection. To shield union members from whimsical and
abusive exercise of management prerogatives.
Benefits. additional membership will insure additional source
of income for the union in the form of union dues and special
assessments.
Self-preservation. It strengthens the union through selective
acceptance of new members on the basis of commitment and
loyalty.
Alabang Country
Invoking Union Security Clause Club, Inc. V. NLRC,
G.R. No. 170287,
February 14, 2008
Employer must prove that:
1. The union security clause is applicable;
2. The union is requesting for the enforcement of the union
security provision of the CBA;
3. There is sufficient evidence to support the union's
decision to expel the employee from the union; and
4. Employer must comply with due process:
a) Notify the employees that dismissal is being requested by
union;
b) The employees' explanations are heard
Union Security Clauses: Kinds
1. Closed-Shop Agreement. Only union members can be hired
by the company and they must remain as union members to
retain employment in the company;
Exceptions:
1. Religious objectors;
2. Members of Minority Unions;
3. Confidential Employees; and
4. Employees expressly excluded by CBA stipulations
Union Security Clauses: Kinds
Semi-Closed Shop Agreement. The prospective employee must be
a member of the union as a condition of employment and has no
requirement for the employee to remain as member of the
contracting union in good standing as a condition for continued
employment.
Union Shop Agreement. Non-members may be hired but to retain
employment, must become union members after a certain period
Maintenance of Membership Shop Agreement. No employee is
compelled to join the union, but all present or future members
must, as a condition of employment remain in good standing in
the union
Union Security Clauses: Kinds
Preferential Shop Agreement. The employer merely agrees to give
preference to the members of the bargaining union in hiring,
promotion or filing vacancies and retention in case of lay-off. The
employer has the right to hire from the open market if union
members are not available.
Agency Shop Agreement or Maintenance of Treasury Shop. Employees
must either join the union or pay to the union as exclusive bargaining
agent a sum equal to that paid by the members (agency fee).
Modified Union Shop: Employees who are not union members at the
time of signing the contract need not join the union, but all the
workers hired thereafter must join;
Purpose of Security Clause
Discourage "free rider" employees who benefit from union
activities without contributing support to the union
to prevent a situation of non-union members enriching
themselves at the expense of union members.
Employee members of another/rival
union are not considered free riders
since when the union (agent) bids to
be the bargaining agent, it
voluntarily assumed the
responsibility of representing ALL
the employees in the appropriate
Valid Termination under Closed Shop
Agreement
Employer must establish that there are sufficient bases for the
1. Due termination request ofDue
theProcess
union
Process The procedural requirements for employee dismissal should be
complied
2. Cannot be applied to employees who are members of a rival union or to
employees who are not members because of their religious beliefs;
3. Closed shop agreement is applied prospectively, not retroactively;
4. Agreement must clearly and unequivocally stated. Purpose – to eliminate
susceptibility for varying interpretation;
5. Ambiguity resolved against the application of the Closed-Shop agreement.
6. Discrimination because of testimony
Dismissal, discharge or discrimination against a particular
employee who is about to give or has given a testimony under
the Labor Code.
Testimony can pertain to anything under the labor code, not
only labor-relations topics. The employer's retaliatory act is
the ULP.
7. Violation of Duty to Bargain
A. Alleging that the union is irresponsible;
B. Closure of the business and subsequent opening of the
same in bad faith for the purpose of circumventing the
union's right to collective bargaining;
C. Transferring operations to elude the union (Run-Away
Shop);
(Complex Electronics Employees
Association v. NLRC, G.R. No. 121315,
July 19, 1999).
Unfair labor practice of management which
usually takes place by effecting the transfer of
ownership, the plant itself, or its equipment, or
by temporarily closing its business purposely to
bust the union or to evade the payment of
Violation of Duty to Bargain
D. Refusal to make a counter-proposal to the union's
proposal for CBA negotiation Delaying negotiations by
discussing unrelated matters;
E. Rejecting a union's offer to prove its majority claim;
F. Engaging in surface bargaining;
Standard Chartered Bank Employees
Union v. NLRC, G.R. No. 114974, June
16, 2004
Going through the motions of negotiating
without any legal intent to reach an agreement.
It involves the question of whether or not the
employer's conduct demonstrates an
unwillingness to bargain in good faith or is
Violation of Duty to Bargain
G. Employer proceeds to negotiate with a splinter union despite
the existence of its valid CBA with the duly certified and
exclusive bargaining agent (Employees Union of Bayer PHL.
FFW v. Bayer PHL, Inc., G.R. No. 162943, December 6, 2010).
H. Boulwarism (Take-it-or-Leave-it stance)
Adamant Stance is not ULP
An employer's steadfast There is no ULP on the part of the
insistence to exclude a employer because its adamant
particular substantive provision insistence on a bargaining position
to the point where the negotiations
from the union's proposal is no
reach an impasse does not establish
different from a bargaining bad faith. It is but natural that at
representative's perseverance to negotiations, management and
include one that they deem of labor adopt positions or make
absolute necessity (Union demands and offer proposals and
Filipino Employees v. NestlePHL, counterproposals (General Milling
Inc., G.R. Nos. 158930-31, Corp. V. Union of Filipro Employees,
March 3, 2008). G.R. No. 79255, January 20, 1992).
8. Paid Negotiation
To pay negotiation or attorney's fees to the union or its
officers or agents as part of the settlement of any issue in
collective bargaining or any other disputes (LABOR CODE, Art.
259 (h)).
Gross Violation of CBA
Flagrant and/or malicious refusal by a party to the CBA to
comply with its economic provisions.
The phrase "grossly violate" is an amendment by R.A. No.
6715. Hence, if the violation is not gross, it is not ULP but
only a grievance under the CBA.
If the violation pertains to a non-economic provision, then it
is not ULP but merely a grievable dispute.
Some important reminders
ULPs committed by employers must have a relation to the
employee's exercise of their right to self-organization. The
motive to restrain, coerce or interfere with the right must be
proved because it is an essential element of ULP.
The union (or worker) that alleges ULP bears the burden of
presenting substantial evidence to support its claim.
Apart from Art. 259, employers also commit ULP under Art.
273 (gross violations of the CBA), and Article 277(c) (union
busting)
Unfair Labor Practices of Labor
Organizations
Article 260
Unfair Labor Practices of Labor Organizations (Art.
260)
1. To grossly violate a collective bargaining agreement;
2. 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 (compare to similar
provision in Article 259);
Interference by a labor organization in itself is a
function of self-organization. However, if
the interference amounts to restraint or coercion
then it becomes ULP (AZUCENA).
Coercion in Strikes
Prohibited
Unfair Labor Practices of Labor Organizations
3. To ask for or accept negotiation or Attorney's fees from
employers as part of the settlement of any issue in collective
bargaining or any other dispute;
4. 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 round other than the usual terms and conditions
under which membership or continuation of membership is
made available to other members;
The Sweetheart Doctrine
A labor organization commits ULP when it to asks for or
accepts negotiation or attorney's fees from the employer in
settling a bargaining issue or dispute.
The CBA is considered a "sweetheart contract"-- an
agreement that does not substantially improve the employees'
wages and benefits and whose benefits are far below those
that are provided by law.
This is a betrayal of trust on the part of the union officers and
representatives, because they put their self-interests ahead of
the members’.
Capricious use of union security clause
A union member may not be expelled from the union, and
consequently from his job, for personal or impetuous reasons or
for causes foreign to the closed-shop agreement (Manila
Mandarin Employees Union v. NLRC, G.R. No. L-76989,
September 29, 1987).
Expulsion for Disloyalty
Seeking help from another federation is not disloyalty, if the
union refused to act on the members’ requests for relief.
Any attempt to cause the expulsion of disloyal workers
should undergo the proceedings prescribed in the union’s
constitution and by-laws (due process).
Unfair Labor Practices of Labor Organizations
5. To cause or attempt to cause an Featherbedding: (make-work
employer to pay or deliver or
agree to pay or deliver any money
agreements): A union practice
or other things of value in the which creates employment by
nature of an exaction, for services compelling the employer to
which are not performed or not to
increase the number of
be performed, including the
demand for a fee for union employees, or the amount of
negotiations; time consumed, to work on a
6. To violate the duty or refuse to particular job even if
bargain collectively with the
unnecessary. A position is
employer provided that it is the
representative of the employees. created, but no work is
rendered.
Unfair Labor Practices: Persons Liable
Officersand agents of the employer;
Labor organization’s officers and agents; and
Agents and officers who participated or
authorized or ratified the act.
Blue Sky Bargaining
making exaggerated or
unreasonable proposals. Whether
or not the union is engaged in
blue-sky bargaining is determined
by the evidence presented by the
union as to its economic demands.
Standard Chartered Bank
Employees Union v. Hon.
Confesor, G.R. No. 114974,
June 16, 2004
Employer’s Remedy to Blue Sky Bargaining
1. Employer should not close down the establishment on the
ground of excessive demands of the union.
2. Submit the dispute for voluntary or compulsory arbitration,
or
3. File a complaint for ULP against the union for bargaining in
bad faith.
4. Implement a lockout.
Cases
1. Dionela v. CIR, G.R. No. L-18334, August 31, 1963 (no splitting of causes of action)
2. CLLC E.G. Gochango Workers Union v. NLRC, G.R. No. L-67158, May 30, 1988; AFP Mutual
Benefit Assoc., Inc. V. AFP Mutual Benefit Assoc., Inc. Employees' Union, G.R. No. L-39140, May
17, 1980 (No compromise in ULP); Reformist Union of R.B. Liner, Inc. V. NLRC, G.R. No. 120482,
January 27, 1997 (Exception).
3. Insular Life Assurance Co., Ltd, Employees Assoc. --the NATU v. The Insular Life Assurance Co.,
Ltd., G.R. No. L-25291, January 30, 1971 (Test of interference).
4. Bankard v. NLRC, et. Al., G.R. No. 171664, March 6, 2013 (outsourcing not ULP)
5. PHL Americal Cigar & Cigarette Factory Workers Union v. PHL American Cigar & Cigarette Mfg.
Co., Inc., G.R. No. L-18364, February 28, 1963 (company unionism).
6. Malayang Samanahan ng mga Manggagawa sa M. Greenfield v. Ramos et. Al., G.R. No. 113907,
February 28, 2000 (due process and union security clause).
7. Mabeza v. NLRC, G.R. No. 118506, April 18, 1997 (Dismissal by reason of testimony).
Cases
1. Philcom Employees Union v. PHGlobal Communications, G.R. No. 144315, July 17, 2006
2. General Milling Corp. V. CA, G.R. No. 146728, February 11, 2004 (refusal to make counter-proposal);
3. St. John Colleges, Inc. V. St. John Academy Faculty and Employees Union, G.R. No. 167892, October
27, 2006 (Closure and reopening as ULP)
4. UST Faculty Union v. University of Sto. Tomas, G.R. No. 180892, April 7, 2009 (Burden of proof to
substantiate ULP)
5. Salunga vs. CIR, 21 SCRA 216 (Arbitrary use of union security clause)
6. Rance, et al., vs. NLRC, Polybag Manufacturing Corp., Polybag Workers Union, et al., GR No. 68147,
June 30, 1988;
7. If found guilty, this gives rise to civil and criminal liabilities and allows the employer to implement a
lockout but not the closure of the establishment resulting to the permanent loss of employment of
the whole workforce (St. John Colleges, Inc. V. St. John Academy Faculty and Employees Union, G.R.
No. 167892, October 27, 2006).
References
• Azucena, Everyone’s Labor Code (2019 ed.)
• Alcantara and Alcantara, Reviewer on Labor Laws and Social
Legislation (2008 ed.)
• CHAN, Pre-week Notes on Labor Law, (2016)
