The Law On Labor Unions in The Philippines
The Law On Labor Unions in The Philippines
The Law On Labor Unions in The Philippines
PHILIPPINES*
A. INTRODUCTION
By the foregoing policy statements, the State has not only acknowl-
ledged the role of free trade unions in our society as an agent of democ-
racy, social justice and development but also committed itself to the pro-
motion thereof to assure to our people the continued benefits deri\:ed
therefrom. Nowhere in the past has this policy been so articulated than
under the aegis of the New Society upon which the workers repose their
hopes for a just, secure and rewarding future. In the words of the Honor-
able Secretary Bias F. Ople, "x x x the Code can be summed up in only
one sentence: it represents the updating of all our labor laws to make
them more responsive to the New Society priorities - development and
employment as well as social justice."3
In the light of the foregoing, the law, Republic Act No. 875 (1953)
which, until lately, governed the labor unions in our country has under-
gone re-examination in order that it could be re-aligned towards the goals
of development, employment and social justice.
Before the onset of the New Society, the trade union movement in
the Philippines had been characterized by fragmentation and disorientation.
While unions under Republic Act No. 875 (1953) may have multiplied
in number, several "flew by niglht", so to speak, depending upon whether
or not certain self-interests were satisfied. In fine, the viability and
stability of the unions were highly doubtful and instead of serving the
Although the Labor Code of the Philippines took effect last Novem-
ber 1, 1974 and the implementing Rules and Regulations thereof4 became
effective on February 3, 1975,6 most of the existing unions today are
still creations of tihe Industrial Peace Act,· otherwise known as the Magna
Carta of Labor. These unions are undergoing the current transition period
which is expected to culminate in the restructured trade union movement
in the country as envisioned by the Labor Code.
The applicable laws, rules and regulations governing labor unions under
the present labor relations system are:
(a) The (New) Constitution of the Philippines
(b) Labor Code of the Philippines
For the first time, such an express policy has now been constitutionally
provided. The right of workers to self-organization and collective bar-
gaining is no longer a mere statutory authority although it migiht be pointed
out that the old as well as the new Constitution provides that: "The right
to form associations or societies for purposes not contrary to law shall not
be abridged. "1
2. Labor Code 0/ tbe Philippines
Presidential Decree No. 442, which was signed by President Ferdinand
E. Marcos on May 1, 1974 took effect six months thereafter, i.e., on
November 1, 1974, and along with it, Title IV and Title V of Book V
thereof, which is the current law governing labor organizations in the
country.
It is now a settled question that Proclamation No. 1081 (1972)
declaring martial law in our country was a valid exercise of the consti-
tutional powers of the President;9 it is likewise settled that the new Consti-
tution became effective on January 17, 1973.10
Section 3 (2), Article XVII of the said Constitution provides:
"All proclamations, orders, decrees, instructions and acts promul-
gated, issued or done by the incumbent President, shall be part of
the law of the land, and shall remain after the lifting of martial
law or the ratification of this Constitution, unless modified, revoked
C. COVERAGE
1. Employers Covered
All commercial, industrial and agricultural enterprises, including
religious, charitable, medical or educational institutions operating for profit
are covered, as well as those enterprises and institutions aforenamed but
not operated for profit, wihich, on the date of the effectivity of the Code,
have existing collective bargaining agreements or duly recognized labor
organizations of their employees, and any employer who voluntarily recog-
nizes any labor organization of its employees for the purpose of collective
bargaining.12
11 RULESANDREGULATIONS IMPI..EMENTING
THE LAOOR CoDE,Book V, Rule IV,
sec. l.
12 UJooR CoDB, art. 243.
2. Employees Covered
All persons employed in the foregoing three categories shall have
the right to self-organization and to form, join or assist labor organiza-
tions for purposes of collective bargaining.13 Such employees as long as
they do not fall within the definition of "managerial employee" are con-
sidered rank and file employees for purposes of Book V of the Labor
CodeY
3. Employees Excluded
3.1 Security guards and other personnel employed for the pro-
tection and security of the person, properties and premises of the em-
ployer.IS " , ,.
D. REGISTRATION OF UNIONS
22 RULESANDREGULATIONS
IMPLEMENTING
THE LA'BOR
CODE,Book V. Rule II.
sec. 1.
union that is recognized as a collective bargaining agent within an enter-
prise and consequently reduces the possibilities of inter-union conflicts in
said establishment. The criticism against prior government policy in ef-
fecting indiscriminate registration of applicant labor organizations which,
in many instances, has contributed also to the continuing divisiveness and
fragmentation of the labor movement is thus positively met. Furthermore,
the "one union-one enterprise" concept is also fostered.
2.2 - Requirements regarding constitution and by-laws
The constitution and by-laws shall:
(a) Conform with Article 233 of the Code;
(b) Provide a definite procedure for settling internal disputes;
(c ) Provide for an education and research fund; and
(d) Provide for a three (3) year term of office for the officers.
Upon the effectivity of vhe Code, all incumbent officers of a
legitimate labor organization shall be allowed to complete their
terms of office. Thereafter, the election of union officers shall
be held once every three (3) years."3
2.3 - Additional Requirements for federations or national unions
Subject to Article 237 of the Labor Code, if the applicant for regis-
tration is a federation or a national union, it s:hall, in addition to the
aforementioned requirements submit the following:
(a) Proof of the affiliation of at least ten (10) locals or chapters,
each of which must be a duly recognized collective bargaining agent
in the establishment or industry in which it operates, supporting
the registrations of such applicant federations or na<tional union;
and (b) the names and addresses of the companies where the locals
or chapters operate and the list of all the members in each company
involved.24
2" RULES AND REGUlATIONS IMPLEMENTING rIlE L~OR CODE. Book V, Rule II.
see. 5.
2< LA'BOR CODE, art. 237.
union organizes such locals or chapters within its assigned organizational
field of activity as may be prescribed by the Secretary of Labor.
The Bureau shall see to it that federations and national unions shall
only organize locals and chapters witihin a specific industry or region.u
The foregoing provisions of law reinforce the restructuring objectives
of the labor movement and are geared towards the "one union-one industry"
concept.
Viewed under geographical considerations, industry and sub-industry
unions may be allowed to operate and organize within a defined regional
or national basis. Sudh industry or sub-industry union must perforce be
a federation or national union.
3. Where Application Filed
Any labor organization may file an application for registration with
the neares t Regional Office (of the Department of Labor). 28
30 RULES AND REGULATIONS IMPLEMENTING THE LABoR CODE, Book V, Rule II.
see. 7.
31 UBoo CoDE. art, 242.
32 LABOR CODE, art. 211(f).
bargaining unit is determined, it usually comprises members and non-mem-
bers of the union and it is incumbent upon the latter to prove that the
majority of the employees embraced within the unit are members thereof;
otherwise, the union will not have the legal standing to negotiate with
the employer.
The certification of a legitimate labor organization as the exclusive
representative of all the employees in an appropriate collective bargaining
unit for purposes of collective bargaining becomes necessary when the
employer refuses to extend voluntary recognition to the union. Such cer-
tification is issued by the med-arbiter of the appropriate Labor Relations
Division where the petition for certification election was filed.ss If the
petition covers an industry or sub-group it shall be filed with the Bureau.3<
Although under the Industrial Peace Act,35 unions were not pro-
hibited from engaging in socio-economic programs or activities for ~
benefit of the organization and its members, the Code now specifically
mentions such activities to be undertaken by them. Whereas, the Industrial
Peace Act emphasizes the primary role of unions to represent its members
for purposes of collective bargaining and secondarily allowing unions to
engage in socio-economic activities, the Code, by express provision, now
vests upon unions the right to undertake all other activities designed to
benefit the organization and its members and therefore gives equal em-
phasis to these activities as any other. In fine, the Code not only recog-
nizes but also reinforces the role of "development unionism" in our
society.
a8 RUUlS AND RooULATlONSIMPIBMBNTING THE LAIloR CoDE, Book V, Rule VI, sec.
8(e).
84 RUlES AND Ra>ULATIONSIMPlEMENUNG THE LMIORCODE, Book V, Rule V, sec.
2. Notice 0/ Cancellation
The Regional Office shall serve a notice of the cancellation proceed-
ings on the labor organization concerned stating the grounds therefor, at
least three (3) working days before the scheduled date of hearing:. In
such hearing, the representative of the labor organization shall have the
right to present its side.ss
3. Appeal
The labor organization may, within ten (10) working days from
receipt of the decision cancelling or revoking its certificate of registration,
file an appeal to the Bureau on any of the following grounds:
(a) grave abuse of discretion; and
(b) gross incompetence.
The Bureau shall have twenty (20) working days from receipt of
the records of the case within which to decide the appeal. Its decision
shall be final and unappealable. s9
sa Ibid., see. 9.
39 Ibid., see. 10.
•0 RuUlS AND REGUlATIONS IMPlEMENTING THE LAOOR CoDE, Book V, Rule III, sec. 1.
taken either on a regional or national basis. The objective as aforemen-
tioned is clear but the strategies of accomplishing it are still to be plotted
out. So much effort has already been exerted along this direction but
so far, concrete results have yet to be produced. As a matter of fact,
labor leaders have been pre-occupied in these restructuring efforts for tne
past two years with the hope that, eventually, they will be able to come
up with a restructured labor movement.
2. "Equity of the Incumbent" Principle
To obviate initial obstacles towards the implementation of the "one
union - one industry" concept, the "equity of the incumbent" principle
was evolved. As circumscribed by the Code, "all existing federations and
national unions which meet the qualifications of a legitimate labor or-
ganization and none of the grounds for cancellation shaH continue to main-
tain their existing affiliates regardless of the nature of the industry and
the location of the affiliates!l
41 LABOR
CODE,
art. 240.
42 LABOR
CODE,art. 225.
ponding Labor Relations Division pursuant to Article 289 of the Labor
Code, the pertinent portion of which is hereby quoted as follows:
U Canlas v. Mindanao Federation of Labor, NLRC Case No. 509, April 22, lenS.
H Rep. Act No. 87S (1953), iec. 17.
of the union; secondly, if the issue affects a single member only, such
member may alone file his complaint; thirdly, tih,e venue of the com-
plaint is with the Labor Relations Division of the appropriate Regional
Office of the Department of Labor; and fourthly, the complaint is no
longer disposable like an "unfair labor practice" case.
Another modification is the term of office of elective union officials
which the Code, tlhrough the Implementing Rules and Regulations, has
now fixed at three (3) years instead of two (2) years under the In-
dustrial Peace Act.4c5
H. REPRESENTATION ISSUES
45 LABOR CODE, art. 241(c); RULES AND REGULAnONS IMPLEMENnNG THE LABOR CODE,
Book V, Rule II, sec. 5(d).
46 RuLES AND REGULATIONS IMPI..IL'MENTlNG THE LABOR CODE, Book V, Rule V, sec. 1.
(c) description of the bargaining unit which shall be the employer
unit unless circumstances otherwise require;
(d) approximate number of the employees in the alleged bargaining
unit;
(e) names and addresses of other legitimate labor organizations in
the bargaining unit;
(f) the signatures of at least 30% of the employees in the bargaining
unit supporting the petition; and
(g) other relevant facts.
4>7RuLES AND REGULATIONS IMPLEMENTING THE LABoR CODE, Book V, Rule V, sec. 2.
~8 RULES AND REGULATIONS IMPLEMENTING THE LABOR CODIl, Book: V, Rule V, sec. 4.
• 9 RULES AND REGVLATIONS IMPLEMENTING THE LABOR CODE, Book: V, Rule V, sec. 5.
1.6 Procedure
Upon receipt of a petition, the Regional Director shall assign the
case to a med-arbiter for hearing. The med.arbiter shall have twenty
(20) working days within wlhich to deny or grant the petition. In either
case, he shall state the grounds therefor. The decision shall contain the
following:
(a) names of the contending unions;
(b) name of the employer;
(c) description of the bargaining unit; and
(d) list of eligible voters.
The certification election shall be held within twenty (20) days from
receipt of the order by the parties.~o
1.7 Appeal
Any aggrieved party may appeal the order of the med-arbiter to the
Bureau only on any of the following grounds:
(a) grave abuse of discretion; and
(b) gross incompetence.
The appeal shall specifically state the grounds relied upon by the
appellant with supporting memorandum of arguments.51
50 RUl1lS AND REGULATIONS IMPLBMENTING THE LABOR CODE, Book V, Rule V, sec. 6.
51 RulllS AND REGULATIONS IMPLEMENTING THE LABOR Cooo, Book V, Rule V, sec. 7.
62 RUl1lS AND REGULATIONS IMPLEMENTING THE LABOR ConE, Book V, Rule V, sec. 8.
68 RUl1lS AND REGULATIONS IMPLEMENTING THE LABOR CoDE, Book V, Rule V, sec. 9.
64 RUIJ1S AND RB;ULATIONS IMPLEMENTING nIE LABOR CoDE, Book V, Rule V, sec. 10.
1.11 Execution Pending Appeal
The execution of the order of the med-arbiter shall not be stayed by
an appeal unless otherwise ordered by the Bureau.5~
1. Visitorial Power
The right or authority of the Secretary of Labor under Republic Act
No. 1941 (1957) is presently incorporated under the Labor Code, par-
ticularly Article 264 thereof, providing as follows:
"ART.264. Visitorwl power. - The Secretary of Labor or his duly
authorized representative is hereby empowered to inquire, from time
to time, into the financial activities of legitimate labor organizations
and to examine their books of accounts and other records to deter-
mine compliance or non-<:ompliance with the law and to prosecute
any violation of the law and the union constitution and by-laws."
In the case, the Supreme Court concluded that Republic Act No.
1941 (1957) is concerned with the authority of the Department of Labor
to inquire into the financial activities of said organization in order "to
determine compliance or noncompliance with the laws and to aid in the
prosecution for any violations thereof."
The Labor Code, however, embraces much more than what Republic
Act No. 1941 (1957) circumscribed, by virtue of Articles 225 and 264
of said Code.