PROGRESSIVE DEVELOPMENT CORP. v. SECRETARY OF LABOR G.R. No. 96425 / 205 SCRA 802

Topic: Government Regulation: Union Registration Requirements

FACTS:

1.     Respondent Pambansang Kilusan ng Paggawa (KILUSAN) -TUCP filed with the Department of Labor and Employment (DOLE) a petition for certification election among the rank-and-file employees of the petitioner alleging that it is a legitimate labor federation and its local chapter, Progressive Development Employees Union, was issued charter certificate No. 90-6-1-153.

2.     Respondent Pambansang Kilusan ng Paggawa (KILUSAN) -TUCP claimed that there was no existing collective bargaining agreement and that no other legitimate labor organization existed in the bargaining unit.

3.     Petitioner PDC filed its motion to dismiss contending that the local union failed to comply with Rule II Section 3, Book V of the Rules Implementing the Labor Code, as amended, which requires the submission of: (a) the constitution and by-laws; (b) names, addresses and list of officers and/or members; and (c) books of accounts.

4.     Respondent KILUSAN-TUCP submitted a rejoinder to PDC's motion to dismiss claiming that it had submitted the necessary documentary requirements for registration, such as the constitution and by-laws of the local union, and the list of officers/members with their addresses. Kilusan further averred that no books of accounts could be submitted as the local union was only recently organized.

5.     Petitioner PDC insisted that upon verification with the Bureau of Labor Relations (BLR), it found that the alleged minutes of the organizational meeting was unauthenticated, the list of members did not bear the corresponding signatures of the purported members, and the constitution and by-laws did not bear the signature of the members and was not duly subscribed. It argued that the private respondent KILUSAN-TUCP therefore failed to substantially comply with the registration requirements provided by the rules.

6.     MED-ARBITER Dela Cruz: held that there was substantial compliance with the requirements for the formation of the chapter. He further stated that mere issuance of the charter certificate by the federation was sufficient compliance with the rules. Considering that the establishment was unorganized, he maintained that a certification election should be conducted to resolve the question of representation.

7.     Petitioner filed an MR to the Office of the Secretary.

8.     SECRETARY Laguesma: denied the MR.

9.     Hence, this petition for certiorari.

ISSUE: Whether or not the petitioner was correct that a labor organization such as the respondent (KILUSAN)-TUCP may not validly invest the status of legitimacy upon a local or chapter through the mere expedient of issuing a charter certificate and submitting such certificate to the BLR and as such local or chapter must at the same time comply with the requirement of submission of duly subscribed constitution and by-laws, list of officers and books of accounts

RULING:

1.     YES, because, the failure of the secretary of PDEU-Kilusan to certify the required documents under oath is fatal to its acquisition of a legitimate status.

In the case of union registration, the rationale for requiring that the submitted documents and papers be certified under oath by the secretary or treasurer, as the case may be, and attested to by president is apparent.

The submission of the required documents (and payment of P50.00 registration fee) becomes the Bureau's basis for approval of the application for registration. Upon approval, the labor union acquires legal personality and is entitled to all the rights and privileges granted by law to a legitimate labor organization. The employer naturally needs assurance that the union it is dealing with is a bona fide organization, one which has not submitted false statements or misrepresentations to the Bureau. The inclusion of the certification and attestation requirements will in a marked degree allay these apprehensions of management. Not only is the issuance of any false statement and misrepresentation a ground for cancellation of registration (see Article 239 (a), (c) and (d)); it is also a ground for a criminal charge of perjury.

In the case of the union affiliation with a federation, the documentary requirements are found in Rule II, Section 3(e), Book V of the Implementing Rules, which we again quote as follows:

(c) The local chapter of a labor federation or national union shall have and maintain a constitution and by-laws, set of officers and books of accounts. For reporting purposes, the procedure governing the reporting of independently registered unions, federations or national unions shall be observed. (Emphasis supplied)

Since the "procedure governing the reporting of independently registered unions" refers to the certification and attestation requirements contained in Article 235, paragraph 2, it follows that the constitution and by-laws, set of officers and books of accounts submitted by the local and chapter must likewise comply with these requirements. The same rationale for requiring the submission of duly subscribed documents upon union registration exists in the case of union affiliation. Moreover, there is greater reason to exact compliance with the certification and attestation requirements because, as previously mentioned, several requirements applicable to independent union registration are no longer required in the case of formation of a local or chapter. The policy of the law in conferring greater bargaining power upon labor unions must be balanced with the policy of providing preventive measures against the commission of fraud.

DISPOSITIVE: Petitioner Progressive Development Corporation won.

DOCTRINE: Article 212(h) defines a legitimate labor organization as "any labor organization duly registered with the DOLE and includes any branch or local thereof."

Rule I, Section 1 (j), Book V of the Implementing Rules likewise defines a legitimate labor organization as "any labor organization duly registered with the DOLE and includes any branch, local or affiliate thereof.

Ordinarily, a labor organization acquires legitimacy only upon registration with the BLR. A local or chapter therefore becomes a legitimate labor organization only upon submission of the following to the BLR:

1) A charter certificate, within 30 days from its issuance by the labor federation or national union, and

2) The constitution and by-laws, a statement on the set of officers, and the books of accounts all of which are certified under oath by the secretary or treasurer, as the case may be, of such local or chapter, and attested to by its president.

Absent compliance with these mandatory requirements, the local or chapter does not become a legitimate labor organization.

The certification and attestation requirements are preventive measures against the commission of fraud. They likewise afford a measure of protection to unsuspecting employees who may be lured into joining unscrupulous or fly-by-night unions whose sole purpose is to control union funds or to use the union for dubious ends.