Case Digest: NUBE v. PEMA

G.R. No. 174287 : August 12, 2013

NATIONAL UNION OF BANK EMPLOYEES (NUBE), Petitioner, v. PHILNABANK EMPLOYEES ASSOCIATION (PEMA) AND PHILIPPINE NATIONAL BANK, Respondents.

FACTS:

Respondent Philippine National Bank (PNB) used to be a government-owned and controlled banking institution established under Public Act 2612, as amended by Executive Order No. 80 dated December 3, 1986 (otherwise known as The 1986 Revised Charter of the Philippine National Bank). Its rank-and-file employees, being government personnel, were represented for collective negotiation by the Philnabank Employees Association (PEMA), a public sector union.

In 1996, the Securities and Exchange Commission approved PNBs new Articles of Incorporation and By-laws and its changed status as a private corporation. PEMA affiliated with petitioner National Union of Bank Employees (NUBE), which is a labor federation composed of unions in the banking industry, adopting the name NUBE-PNB Employees Chapter (NUBE-PEC).

Later, NUBE-PEC was certified as the sole and exclusive bargaining agent of the PNB rank-and-file employees. A collective bargaining agreement (CBA) was subsequently signed between NUBE-PEC and PNB covering the period of January 1, 1997 to December 31, 2001.

Pursuant to Article V on Check-off and Agency Fees of the CBA, PNB shall deduct the monthly membership fee and other assessments imposed by the union from the salary of each union member, and agency fee (equivalent to the monthly membership dues) from the salary of the rank- and-file employees within the bargaining unit who are not union members. Moreover, during the effectivity of the CBA, NUBE, being the Federation union, agreed that PNB shall remitP15.00 of theP65.00 union dues per month collected by PNB from every employee, and that PNB shall directly credit the amount to NUBEs current account with PNB.

Following the expiration of the CBA, the Philnabank Employees Association-FFW (PEMA-FFW) filed on January 2, 2002 a petition for certification election among the rank-and-file employees of PNB. The petition sought the conduct of a certification election to be participated in by PEMA-FFW and NUBE-PEC.

While the petition for certification election was still pending, two significant events transpired the independent union registration of NUBE- PEC and its disaffiliation with NUBE.

With a legal personality derived only from a charter issued by NUBE, NUBE-PEC, under the leadership of Mariano Soria, decided to apply for a separate registration with the Department of Labor and Employment (DOLE). On March 25, 2002, it was registered as an independent labor organization under Registration Certificate No. NCR-UR-3-3790-2002.

Thereafter, on June 20, 2003, the Board of Directors of NUBE-PEC adopted a Resolutiondisaffiliating itself from NUBE.

The duly notarized Resolution was signed by the officers. It is claimed that said Resolution was overwhelmingly ratified by about eighty-one percent (81%) of the total union membership.

On June 25, 2003, NUBE-PEC filed a Manifestation and Motionbefore the Med-Arbitration Unit of DOLE, praying that, in view of its independent registration as a labor union and disaffiliation from NUBE, its name as appearing in the official ballots of the certification election be changed to "Philnabank Employees Association (PEMA)" or, in the alternative, both parties be allowed to use the name "PEMA" but with PEMA-FFW and NUBE-PEC be denominated as "PEMA-Bustria Group" and "PEMA-Serrana Group," respectively.

On the same date, PEMA sent a letter to the PNB management informing its disaffiliation from NUBE and requesting to stop, effective immediately, the check-off of theP15.00 due for NUBE.

Acting thereon, on July 4, 2003, PNB informed NUBE of PEMAs letter and its decision to continue the deduction of theP15.00 fees, but stop its remittance to NUBE effective July 2003. PNB also notified NUBE that the amounts collected would be held in a trust account pending the resolution of the issue on PEMAs disaffiliation.

On July 11, 2003, NUBE replied that : it remains as the exclusive bargaining representative of the PNB rank-and-file employees; by signing the Resolution (on disaffiliation), the chapter officers have abandoned NUBE-PEC and joined another union; in abandoning NUBE-PEC, the chapter officers have abdicated their respective positions and resigned as such; in joining another union, the chapter officers committed an act of disloyalty to NUBE-PEC and the general membership; the circumstances clearly show that there is an emergency in NUBE-PEC necessitating its placement under temporary trusteeship; and that PNB should cease and desist from dealing with Serrana, Roma, Latorre, Garcia, Medrano, and Magtibay, who are expelled from NUBE-PEC.With regard to the issue of non-remittance of the union dues, NUBE enjoined PNB to comply with the union check-off provision of the CBA; otherwise, it would elevate the matter to the grievance machinery in accordance with the CBA.

Despite NUBEs response, PNB stood firm on its decision. Alleging unfair labor practice (ULP) for non-implementation of the grievance machinery and procedure, NUBE brought the matter to the National Conciliation and Mediation Board (NCMB) for preventive mediation.In time, PNB and NUBE agreed to refer the case to the Office of the DOLE Secretary for voluntary arbitration. They executed a Submission Agreement on October 28, 2003.

Meantime, the DOLE denied PEMAs motion to change its name in the official ballots. The certification election was finally held on October 17, 2003.

On April 28, 2004, PEMA filed before the voluntary arbitrator an Urgent Motion for Intervention,alleging that it stands to be substantially affected by whatever judgment that may be issued, because one of the issues for resolution is the validity of its disaffiliation from NUBE. It further claimed that its presence is necessary so that a complete relief may be accorded to the parties. Only NUBE opposed the motion, arguing that PEMA has no legal personality to intervene, as it is not a party to the existing CBA; and that NUBE is the exclusive bargaining representative of the PNB rank-and-file employees and, in dealing with a union other than NUBE, PNB is violating the duty to bargain collectively, which is another form of ULP.

Barely a month after, DOLE Acting Secretary Manuel G. Imson denied PEMAs motion for intervention and ordered PNB to release all union dues withheld and to continue remitting the same to NUBE.

Aggrieved, PEMA filed before the CA a petition under Rule 43 of the Rules on Civil Procedure with prayer for the issuance of a temporary restraining order (TRO) or writ of preliminary injunction (WPI). On November 2, 2004, the CA denied the application for WPI.PEMAs motion for reconsideration was also denied on February 24, 2005, noting PNBs manifestation that it would submit to the judgment of the CA as to which party it should remit the funds collected from the employees.

On June 21, 2005, however, petitioner again filed an Urgent Motion for the Issuance of a TRO against the June 10, 2005 Resolution of DOLE Acting Secretary Imson, which ordered PNB to properly issue a check directly payable to the order of NUBE covering the withheld funds from the trust account.Considering the different factual milieu, the CA resolved to grant the motion.

Subsequent to the parties submission of memoranda, the CA promulgated its May 22, 2006 Decision, declaring the validity of PEMAs disaffiliation from NUBE and directing PNB to return to the employees concerned the amounts deducted and held in trust for NUBE starting July 2003 and to stop further deductions in favor of NUBE.

As to the impropriety of denying PEMAs motion for intervention, the CA noted

Among the rights of the [PEMA] as an affiliate of a federation is to disaffiliate from it. Any case in which this is an issue is then one in which the union has a significant legal interest and as to which it must be heard, irrespective of any residual rights of the members after a decision that might deny a disaffiliation. It is a non-sequitur to make the intervention of the union in this case dependent on the question of whether its members can pursue their own agenda under the same constraints.

NUBE filed a motion for reconsideration, but it was denied;hence, this petition.

ISSUE: Whether or not there was effective disaffiliation of PEMA from NUBE?

HELD: Court of Appeals decision is affirmed.

LABOR LAW


Whether there was a valid disaffiliation is a factual issue.It is elementary that a question of fact is not appropriate for a petition for review on certiorari under Rule 45 of the Rules of Court. The parties may raise only questions of law because the Supreme Court is not a trier of facts. As a general rule, We are not duty-bound to analyze again and weigh the evidence introduced in and considered by the tribunals below. When supported by substantial evidence, the findings of fact of the CA are conclusive and binding on the parties and are not reviewable by this Court, except : (1) When the conclusion is a finding grounded entirely on speculation, surmises and conjectures; (2) When the inference made is manifestly mistaken, absurd or impossible; (3) Where there is a grave abuse of discretion; (4) When the judgment is based on a misapprehension of facts; (5) When the findings of fact are conflicting; (6) When the CA, in making its findings, went beyond the issues of the case and the same is contrary to the admissions of both parties; (7) When the findings are contrary to those of the trial court; (8) When the findings of fact are conclusions without citation of specific evidence on which they are based; (9) When the facts set forth in the petition as well as in the petitioners main and reply briefs are not disputed by the respondents; and (10) When the findings of fact of the CA are premised on the supposed absence of evidence and contradicted by the evidence on record.The Court finds no cogent reason to apply these recognized exceptions.

Even a second look at the records reveals that the arguments raised in the petition are bereft of merit.

The right of the local union to exercise the right to disaffiliate from its mother union is well settled in this jurisdiction. In MSMG-UWP v. Hon. Ramos,We held -

A local union has the right to disaffiliate from its mother union or declare its autonomy. A local union, being a separate and voluntary association, is free to serve the interests of all its members including the freedom to disaffiliate or declare its autonomy from the federation which it belongs when circumstances warrant, in accordance with the constitutional guarantee of freedom of association.

The purpose of affiliation by a local union with a mother union [or] a federation.

"is to increase by collective action the bargaining power in respect of the terms and conditions of labor. Yet the locals remained the basic units of association, free to serve their own and the common interest of all, subject to the restraints imposed by the Constitution and By-Laws of the Association, and free also to renounce the affiliation for mutual welfare upon the terms laid down in the agreement which brought it into existence."

Thus, a local union which has affiliated itself with a federation is free to sever such affiliation anytime and such disaffiliation cannot be considered disloyalty. In the absence of specific provisions in the federation's constitution prohibiting disaffiliation or the declaration of autonomy of a local union, a local may dissociate with its parent union.

Likewise, Philippine Skylanders, Inc. v. National Labor Relations Commissionrestated

The right of a local union to disaffiliate from its mother federation is not a novel thesis unillumined by case law. In the landmark case of Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc., we upheld the right of local unions to separate from their mother federation on the ground that as separate and voluntary associations, local unions do not owe their creation and existence to the national federation to which they are affiliated but, instead, to the will of their members. The sole essence of affiliation is to increase, by collective action, the common bargaining power of local unions for the effective enhancement and protection of their interests. Admittedly, there are times when without succor and support local unions may find it hard, unaided by other support groups, to secure justice for themselves.

Yet the local unions remain the basic units of association, free to serve their own interests subject to the restraints imposed by the constitution and by-laws of the national federation, and free also to renounce the affiliation upon the terms laid down in the agreement which brought such affiliation into existence.

Such dictum has been punctiliously followed since then.

And again, in Coastal Subic Bay Terminal, Inc. v. Department of Labor and Employment Office of the Secretary,this Court opined

Under the rules implementing the Labor Code, a chartered local union acquires legal personality through the charter certificate issued by a duly registered federation or national union, and reported to the Regional Office in accordance with the rules implementing the Labor Code. A local union does not owe its existence to the federation with which it is affiliated. It is a separate and distinct voluntary association owing its creation to the will of its members. Mere affiliation does not divest the local union of its own personality, neither does it give the mother federation the license to act independently of the local union. It only gives rise to a contract of agency, where the former acts in representation of the latter. Hence, local unions are considered principals while the federation is deemed to be merely their agent. As such principals, the unions are entitled to exercise the rights and privileges of a legitimate labor organization, including the right to seek certification as the sole and exclusive bargaining agent in the appropriate employer unit.

Finally, the recent case of Cirtek Employees Labor Union-Federation of Free Workers v. Cirtek Electronics, Inc. ruled -

[A] local union may disaffiliate at any time from its mother federation, absent any showing that the same is prohibited under its constitution or rule. Such, however, does not result in it losing its legal personality altogether. Verily, Anglo-KMU v. Samahan Ng Mga Manggagawang Nagkakaisa Sa Manila Bar Spinning Mills At J.P. Coats enlightens

A local labor union is a separate and distinct unit primarily designed to secure and maintain an equality of bargaining power between the employer and their employee-members. A local union does not owe its existence to the federation with which it is affiliated. It is a separate and distinct voluntary association owing its creation to the will of its members. The mere act of affiliation does not divest the local union of its own personality, neither does it give the mother federation the license to act independently of the local union. It only gives rise to a contract of agency where the former acts in representation of the latter.

These and many more have consistently reiterated the earlier view that the right of the local members to withdraw from the federation and to form a new local union depends upon the provisions of the union's constitution, by-laws and charter and, in the absence of enforceable provisions in the federation's constitution preventing disaffiliation of a local union, a local may sever its relationship with its parent.In the case at bar, there is nothing shown in the records nor is it claimed by NUBE that PEMA was expressly forbidden to disaffiliate from the federation nor were there any conditions imposed for a valid breakaway. This being so, PEMA is not precluded to disaffiliate from NUBE after acquiring the status of an independent labor organization duly registered before the DOLE.

Also, there is no merit on NUBEs contention that PEMAs disaffiliation is invalid for non-observance of the procedure that union members should make such determination through secret ballot and after due deliberation, conformably with Article 241 (d) of the Labor Code, as amended.Conspicuously, other than citing the opinion of a "recognized labor law authority," NUBE failed to quote a specific provision of the law or rule mandating that a local unions disaffiliation from a federation must comply with Article 241 (d) in order to be valid and effective.

Granting, for arguments sake, that Article 241 (d) is applicable, still, We uphold PEMAs disaffiliation from NUBE. First, non-compliance with the procedure on disaffiliation, being premised on purely technical grounds cannot rise above the employees fundamental right to self-organization and to form and join labor organizations of their own choosing for the purpose of collective bargaining.Second, the Article nonetheless provides that when the nature of the organization renders such secret ballot impractical, the union officers may make the decision in behalf of the general membership. In this case, NUBE did not even dare to contest PEMAs representation that "PNB employees, from where [PEMA] [derives] its membership, are scattered from Aparri to Jolo, manning more than 300 branches in various towns and cities of the country," hence, "[to] gather the general membership of the union in a general membership to vote through secret balloting is virtually impossible."It is understandable, therefore, why PEMAs board of directors merely opted to submit for ratification of the majority their resolution to disaffiliate from NUBE. Third, and most importantly, NUBE did not dispute the existence of the persons or their due execution of the document showing their unequivocal support for the disaffiliation of PEMA from NUBE. Note must be taken of the fact that the list of PEMA members (identifying themselves as "PEMA-Serrana Group") who agreed with the board resolution was attached as Annex "H" of PEMAs petition before the CA and covered pages 115 to 440 of the CA rollo. While fully displaying the employees printed name, identification number, branch, position, and signature, the list was left unchallenged by NUBE. No evidence was presented that the union members ratification was obtained by mistake or through fraud, force or intimidation. Surely, this is not a case where one or two members of the local union decided to disaffiliate from the mother federation, but one where more than a majority of the local union members decided to disaffiliate.

Consequently, by PEMA's valid disaffiliation from NUBE, the vinculum that previously bound the two entities was completely severed. As NUBE was divested of any and all power to act in representation of PEMA, any act performed by the former that affects the interests and affairs of the latter, including the supposed expulsion of Serrana et al., is rendered without force and effect.

LABOR LAW

Also, in effect, NUBE loses it right to collect all union dues held in its trust by PNB. The moment that PEMA separated from and left NUBE and exists as an independent labor organization with a certificate of registration, the former is no longer obliged to pay dues and assessments to the latter; naturally, there would be no longer any reason or occasion for PNB to continue making deductions.As we said in Volkschel Labor Union v. Bureau of Labor Relations

In other words, ALUMETAL [NUBE in this case] is entitled to receive the dues from respondent companies as long as petitioner union is affiliated with it and respondent companies are authorized by their employees (members of petitioner union) to deduct union dues. Without said affiliation, the employer has no link to the mother union. The obligation of an employee to pay union dues is coterminous with his affiliation or membership. "The employees' check-off authorization, even if declared irrevocable, is good only as long as they remain members of the union concerned." A contract between an employer and the parent organization as bargaining agent for the employees is terminated bv the disaffiliation ofthe local of which the employees are members.

On the other hand, it was entirely reasonable for PNB to enter into a CBA with PEMA as represented by Serrana et al. Since PEMA had validly separated itself from NUBE, there would be no restrictions which could validly hinder it from collectively bargaining with PNB.

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