June 23 Labor Arbitration

In labor relations, we frequently encounter the initials "LMC"

3 meanings:

1. Labor management cooperation
2. Labor management committee
3. Labor managemnt commission

-but it really doesn't matter. LMC, we have in mind labor and management and of necessity, we recall the provisions found in the labor code and rules and regulations implementing the labor code mandating the department of labor, specifically the NCMB, to conduct awareness campaigns

What do you think is the rationale/justification for encouraging labor and management to form LMCs w/ n the work place?

>To achieve industrial peace

How to determine employee membership in the LMC?

Section 2, IRR (Rule XXI)

• If organized establishment: nominated by the exclusive bargaining representative
• If unorganized establishment: workers at large directly elects the members of the LMCs

*don't you find it weird that an LMC exists in an organized establishment?
No, LMCs complements the union

>but usually, Unions don't want LMCs on the notion that it replaces the unions…based on the old notion/traditional notion of an adversarial relationship between management and labor

>makes it appear on some notion that the UNION is incompetent to serve the interests of its members

Issues in LMCs usually different with what the Union usually deals with:

-in the article, LMCs are allowed to deal with policies of the company as to solicit proposals from the side of labor to promote the productivity of the establishment

-in reality, all too often, disagreements arise between ER and union when the union submits a set of proposals in the course of CB negotiations. The ER would defer it to another forum, maybe in the LMC. When that happens, the union does not look to kindly on such move of the employer.

-Unions are not fully aware that they can put up LMCs

-the perception was that the NCMB grabs the business of the Union: delivers a message that one don't need a union, LMCs are enough. As a result, DOLE's campaign for LMCs became nill…bumagal. (as featured in Foz's article)

AZUCENA ARTICLE:

-written in the 1980s, at a time when the NCMB was promoting the concept of LMCs, among others

-highlighted the importance of values: he mentioned the Filipino values of cooperation vs. confrontation: Filipinos are nonadversarial, as opposed to the traditional notion of the relationship between management and employees which is adversarial

FOZ ARTICLE:

-traced the roots of worker's participation in the determination of policy and decision-making processes affecting their rights and benefits as may be provided by law: from the concon records to congress

-emphasized the fact that, as born out of the deliberations of the Concon, what they had in mind were processes like the grievance procedure, conciliation, mediation, voluntary arbitration - all of which are integral parts of the so-called alternative modes of dispute resolution

-comments on PAL v. NLRC: the court misapplied the constitutional and labor code provisions on worker's participation.

• Overlooked or ignored Art 255 as to LMCs
• Misread Art 211(d) policy on education and enlightenment of union members as employees
• LMC's sphere of intervention, in accordance w/ Art255, does not cover areas covered by the CBA or collective bargaining areas
• The court could have just invoked management prerogatives: so not try to discuss the consti provision on participation of workers in policy and decision-making processes?

Article 255. Exclusive bargaining representation and workers' participation in policy and decision-making. - The labor organization designated or selected by the majority of the employees in an appropriate collective bargaining unit shall be the exclusive representative of the employees in such unit for the purpose of collective bargaining. However, an individual employee or group of employees shall have theright at any time to present grievances to their employer.

"Any provision of law to the contrary notwithstanding, workers shall have the right, subject to such rules and regulations as the Secretary ofLabor and Employment may promulgate, to participate in policy and decision-making processes of the establishment where they are employed insofar as said processes will directly affect their rights, benefits and welfare. For this purpose, workers and employers may formlabor-management councils: Provided, That the representatives of the workers in such labor-management councils shall be elected by at least the majority of all employees in said establishment."

-"However, an individual employee or group of employees shall have theright at any time to present grievances to their employer." Does an ER have the same right?

-no?  Because of the inherent relationship between the employer and employee where the employer stand in a higher level vis a vis the employee

-when an ER deals directly to the Ees, to the exclusion of the EBR, it is committing ULP

PAL v. NLRC

SUMMARY: PAL revised its 1966 Code of Discipline in 1985, without sufficient notice to its employees, thereby subjecting some of its employees to disciplinary measures and even dismissing some of them. PALEA filed a ULP case before NLRC. LA was for PAL, though she did not find any ULP or BF bargaining on PAL’s part. NLRC affirmed said decision. SC upheld the said decisions, saying that PAL should have involved the employees in the revision of the Code of Discipline as it is not purely management prerogative, the act involving repercussions to the employees’ security of tenure. Shared responsibility between management and labor also highlighted as already an existing state policy even before the amendment of the LC.

-if you were the personnel manager, HR director and you want to change some policy which would involve the rights and welfare (tardiness, absences…) of the employees. What steps should you undertake?

• If these would affect the security of tenure of the employees, due process should be observed
• Even before you start touching any of the provisions, consult with the union or the employees, make known to them what you desire to achieve, furnish them copy of the specific changes. Give them then the opportunity to comment thereon. Here them out. If you were able to resolve it, reach an agreement, furnish union leadership a copy of the final draft. It is always safe to post it on the bulletin board for all to see. Give the employees a certain period of time to comment, to study it. After a lapse of a reasonable period of time, advise them of the effectivity date of the changes.
• If the parties are unable to reach an agreement on the proposed changes, the union will challenge the management to go through grievance, then voluntary arbitration

When you become lawyers and you handle a case where the employee or union questions certain rights that, to the thinking of the employer, falls within the bundle of rights called management prerogative, always invoke the case of SAN MIGUEL BREWERY SALES FORCE UNION V. OPLE, 170 SCRA 25 (1989):

SUMMARY: PTGWO and SMC entered into a CBA in April 1978 (effective May 1, 1978-January 31, 1981) which provided that employees would receive an additional commission based on their respective sales. However, in 1979, SMC adopted the “Complementary Distribution System” (CDS) wherein beer products were sold directly to wholesalers, thereby removing any chance for the employees to gain commission. PTGWO filed a case for ULP. Minister of Labor absolved SMC. SC upheld the CDS, ruling that it was a valid exercise of management prerogative. Besides, SMC offered to compensate those who would be affected by paying them “back adjustment commission”.

-So long as a company's management prerogatives are exercised in good faith for the advancement of the employer's interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements, this Court will uphold them - HIGHLIGHTED BY SIR

-what does CDS mean: where its beer products were offered for sale directly to wholesalers through SMC offices.

GTE DIRECTORIES CORP V. SANCHEZ, 197 SCRA 452 (1991)

SUMMARY: GTE through the years adopted several Sales evaluation policies. Pursuant to the latest sales policy, GTE issued 6 memoranda to its employees which required the Premise Sales Reps (PSRs) to submit individual reports reflecting target revenues as of deadlines set. None of these memoranda were followed by the employees, arguing that they were not consulted. As a result, 14 employees (some of them Union officers) were dismissed. Union also filed notice of strike before the 4th memo was issued. Court held that GTE’s sales policy was pursuant to the valid exercise of management prerogatives and that its implementation is not suspended merely because of pending negotiations initiated by the Union.

HOW DOES THE LABOR CODE DEFINE A LABOR DISPUTE - MEMORIZE BECAUSE IT'S USUALLY A BAR QUESTION

LABOR DISPUTE INCLUDES

ANY CONTROVERSY OR MATTER CONCERNING

TERMS AND CONDITIONS OF EMPLOYMENT OR

THE ASSOCIATION OR REPRESENTATION OF PERSONS

IN NEGOTIATING,

FIXING,

MAINTAINING,

CHANGING OR ARRANGING THE TERMS AND CONDITIONS OF EMPLOYMENT,

REGARDLESS OF WHETHER THE DISPUTANTS STAND IN THE PROXIMATE RELATION OF EMPLOYER AND EMPLOYEE

SMC Employees Union vs. Bersamira, 186 SCRA 496 (1990)

SUMMARY: RTC issued Writ of Preliminary Injunction, on the assumption that it had jurisdiction over the dispute between SMC and the Union, there being no EER. Court held that even if there is no EER, there can still be a labor dispute.

(note: Sir must be interested in this case, he wrote "Lipercon" on the board eh - Later on, we found out that sir handled this case for SMC!)

-break up essential ingredients of a labor arbitration

1. Terms and conditions of employement
2. THE ASSOCIATION OR REPRESENTATION OF PERSONS

IN NEGOTIATING,

FIXING,

MAINTAINING,

CHANGING OR ARRANGING THE TERMS AND CONDITIONS OF EMPLOYMENT,

3. REGARDLESS OF WHETHER THE DISPUTANTS STAND IN THE PROXIMATE RELATION OF EMPLOYER AND EMPLOYEE

-SC found for the union in this case. How did the supreme court point out the applicability of Art 212 (l)

-history:

*prior to the promulgation of this San Miguel case, in cases involving regularization (when the employees seek to be regular employees of the company), all the ER had to do was to prove that there was no EER, especially exercise of control over the employees:

1. Power to hire
2. Power to fire
3. Power to control and supervision
4. Power to pay wages

-AL-Lagathan v. PIGAN (1956? Case decided by ROBERTO CONCEPCION): SC enumerated the attributes of EER (4-pronged test)

-VIANA v. AL-lagathan:

-right after the war, there were many vessels of the navy.  There was a small fishing boat fishing in Manila Bay between Manila and province of Bataan. US ship rammed through the fishing boat, killing the persons on the small fishing boat. The issue was who would be liable: the owner of the fishing boat or wala? Claim was under Workmen's Compensation Act

• Owner of the fishing boat argued that there was no EER

-SC held that the workmen's compensation bureaucrats did not do their homework. Based on the essential elements of the EER, there was no EER?

-BUT IN THIS CASE, even if SMC was able to convince the regular court that there was no EER, SC still held that there was a labor dispute even if there was no EER between the parties, following Art212

Why: the issues raised by the union and the employees were:

• Representation and association
• Terms and conditions of employment

GOLD CITY INTEGRATED PORT SERVICE V. NLRC, 245 SCRA 627 (1995)

SUMMARY: Workers of INPORT staged a strike, filing individual notice of strike w/ MOLE (which EEs alleged to have been done through fraud on part of the union officers), expressing grievances regarding wages, 13th month pay, and hazard pay. INPORT complained that the strike was illegal. NLRC issued TRO, return-to-work order (majority of workers returned to work). LA declared strike as illegal (failed to comply w/ Art 264-265,LC). NLRC affirmed w/ modification, characterizing the strike as a “protest action”. Court held that there was a strike – stemming from a labor dispute – but it was illegal for not complying w/ the cooling-off period, 7-day strike ban after the strike vote report. Main issue of the petition for review is actually the separation pay and backwages which Court recalled the payment of backwages, reduced separation pay.

-A strike, considered as the most effective weapon of labor, is defined as any temporary stoppage of work by the concerted action of employees as a result of an industrial or labor dispute. A labor dispute includes any controversy or matter concerning terms or conditions of employment or the association or representation of persons in negotiating, fixing, maintaining, changing or arranging the terms and conditions of employment, regardless of whether or not the disputants stand in the proximate relation of employers and employees.

-Employees stopped working and held the mass action on April 30, 1985 to press for their wages and other benefits. What transpired then was clearly a strike, for the cessation of work by concerted action resulted from a labor dispute.

2 types of labor dispute

1. Rights dispute

-includes a violation of a right based on Law or the CBA or an existing employer practice or employment contract

2. Interest dispute

-involves an economic or bargaining dispute

What if you were suspended by the ER w/o any cause, what dispute arises?

-rights dispute because right to due process violated, right to security of tenure

UNITED EMPLOYEES UNION OF GELMART INDUSTRIES PHILIPPINES V. NORIEL, 67 SCRA 267 (1975)

SUMMARY: Union wants to nullify the certification election held due to the allegation that its name was misspelled in the ballot, thus the other union won by landslide. Court held that one needs competent and credible proof – not general allegation of duress – to invalidate a certification election. Highlighted on the importance of Certification election. Importance of CB merely introduction to Certification election.

-statement of Archibald Cox: The institution of collective bargaining is, to recall Cox, a prime manifestation of industrial democracy at work. The two parties to the relationship, labor and management, make their own rules by coming to terms. That is to govern themselves in matters that really count. As labor, however, is composed of a number of individuals, it is indispensable that they be represented by a labor organization of their choice. Thus may be discerned how crucial is a certification election.

-a droplet of support vs. a raging torrent of support

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