DELA SALLE UNIVERSITY

vs.
DELA SALLE UNIVERSITY EMPLOYEES ASSOCIATION (DLSUEA) and
BUENAVENTURA MAGSALIN
G.R. No. 109002
April 12, 2000

Facts:
Dela Salle University (University) and Dela Salle University Employees Association —
National Federation of Teachers and Employees Union (DLSUEA-NAFTEU), which is
composed of regular non-academic rank and file employees, entered into a collective bargaining
agreement with a life span of three years. Days before the expiration of the said CBA, the union
initiated negotiations with the University for a new collective bargaining agreement which,
however, turned out to be unsuccessful, hence, the Union filed a Notice of Strike with the
NCMB. After several conciliation-mediation meetings, a partial collective bargaining agreement
was thereafter executed by the parties. The parties entered into a Submission Agreement,
identifying the remaining unresolved issues for arbitration which, among others, are the scope of
the bargaining unit and the union security clause.

The voluntary arbitrator rendered the assailed decision. On the first issue involving the
scope of the bargaining unit, the arbitrator ruled that the Computer Operators assigned at the
Computer Services Center, just like any other Computer Operators in other units, should be
included as members of the bargaining unit, after finding that these Computer Operators are
presently doing clerical and routinary work and had nothing to do with the setting of
management policies for the University. Regarding the discipline officers, the voluntary
arbitrator believed that this type of employees belong to the rank-and-file on the basis of the
nature of their job. With respect to the employees of the College of St. Benilde, the voluntary
arbitrator found that the College of St. Benilde has a personality separate and distinct from the
University; thus, the employees therein are outside the bargaining unit of the University’s rank-
and-file employees. On the second issue regarding the propriety of the inclusion of a union
shop clause in the collective bargaining agreement, in addition to the existing maintenance of
membership clause, the voluntary arbitrator opined that a union shop clause is not a restriction
on the employee’s right of freedom of association but rather a valid form of union security
while the CBA is in force and in accordance with the Constitutional policy to promote unionism
and collective bargaining and negotiations. Hence, the parties should incorporate such union
shop clause in their CBA. In its comment, the OSG agreed with the voluntary arbitrator’s
assailed decision on all points except that involving the employees of the College of St. Benilde.
According to the Solicitor General, the employees of the College of St. Benilde should have been
included in the bargaining unit of the rank-and-file employees of the University.

On the first issue, the University argues that they are confidential employees and that the
Union has already recognized the confidential nature of their functions when the latter agreed in
the parties’ 1986 CBA to exclude the said employees from the bargaining unit of rank-and-file
employees. Moreover, the Computer Operators are in fact the repository of the University’s
confidential information and data, including those involving and/or pertinent to labor relations.
As to the discipline officers, the University maintains that they are likewise excluded from the
bargaining unit of the rank-and-file employees under the parties’ 1986 CBA. The Discipline
Officers are clearly alter egos of management as they perform tasks which are inherent in
management. With regard to the employees of the College of St. Benilde, the Union, supported
by the Solicitor General at this point, asserts that the veil of corporate fiction should be pierced,
thus, according to the Union, the University and the College of St. Benilde should be considered
as only one entity because the latter is but a mere integral part of the University.

On the second issue, the University avers that it is in the spirit of the exercise of the
constitutional right to self-organization that every individual should be able to freely choose
whether to become a member of the union or not. The right to join a labor organization should
carry with it the corollary right not to join the same. The University assails the union’s demand
for a union shop clause as definitely unjust and amounts to oppression. Such a demand is
repugnant to democratic principles and the constitutionally guaranteed freedom of individuals to
join or not to join an association. The Union, on the other hand, counters that Article 248 of the
Labor Code, as amended, recognizes the validity of a union shop agreement.

Issues:
1. Whether the university’s computer operators and discipline officers may be considered as
confidential employees and should therefore be excluded from the bargaining unit of the
rank-and-file employees and whether the employees of the College of St. Benilde should
also be included in the same bargaining unit.
2. Whether a union shop clause should be included in the parties' collective bargaining
agreement, in addition to the existing maintenance of membership clause

Ruling:
1. The University’s arguments on the first issue fail to impress us. The Court agrees with the
Solicitor General that the express exclusion of the computer operators and discipline
officers from the bargaining unit of rank-and-file employees in the 1986 CBA does not
bar any re-negotiation for the future inclusion of the said employees in the bargaining
unit. During the freedom period, the parties may not only renew the existing collective
bargaining agreement but may also propose and discuss modifications or amendments
thereto. With regard to the alleged confidential nature of the said employees’ functions,
after a careful consideration of the pleadings filed before the Court, we rule that the said
computer operators and discipline officers are not confidential employees. As
carefully examined by the Solicitor General, the service record of a computer operator
reveals that his duties are basically clerical and non-confidential in nature. As to the
discipline officers, we agree with the voluntary arbitrator that based on the nature of their
duties, they are not confidential employees and should therefore be included in the
bargaining unit of rank-and-file employees. The Court also affirms the findings of the
voluntary arbitrator that the employees of the College of St. Benilde should be excluded
from the bargaining unit of the rank-and-file employees of Dela Salle University, because
the two educational institutions have their own separate juridical personality and no
sufficient evidence was shown to justify the piercing of the veil of corporate fiction. 

2. The Court affirmed the ruling of the voluntary arbitrator for the inclusion of a union shop
provision in addition to the existing maintenance of membership clause in the collective
bargaining agreement. As the Solicitor General asserted in his consolidated Comment,
the University’s reliance on the case of Victoriano vs. Elizalde Rope Workers' Union is
clearly misplaced. In that case, the Court ruled that the right to join a union includes the
right to abstain from joining any union. The right to refrain from joining labor
organizations recognized by Section 3 of the Industrial Peace Act is, however, limited.
The legal protection granted to such right to refrain from joining is withdrawn by
operation of law, where a labor union and an employer have agreed on a closed shop, by
virtue of which the employer may employ only members of the collective bargaining
union, and the employees must continue to be members of the union for the duration of
the contract in order to keep their jobs.

Art. 248. Unfair labor practices of employers. —

(e) To discriminate in regard to hire or tenure of employment or any term or condition of