ABS-CBN Supervisors Employees Union Members vs. ABS-CBN Broadcasting Corp., et al.

A decision of the Secretary of Labor that is “final and inappealable” may still be reconsidered, because a motion for reconsideration is a condition sine qua non before a petition for certiorari under Rule 65; and a special assessment for union incidental expenses, attorney’s fees, and representation expenses stipulated in a CBA is valid when the three requisites under Article 241 of the Labor Code are met, but deductions may not be taken from workers who did not give individual written check-off authorization.

Petitioners are members of the ABS-CBN Supervisors Employees Union, which had a collective bargaining relationship with ABS-CBN Broadcasting Corporation; the other respondents are union officers. The governing statutory framework includes Article 241 of the Labor Code, as amended, which regulates special assessments and check-offs, and Article 222(b), which limits attorney’s fees arising from collective bargaining negotiations. The case also involves Section 8, Rule VIII, Book V of the Omnibus Rules Implementing the Labor Code, which makes the Secretary’s decision on appeal final and inappealable.

On December 7, 1989, the ABS-CBN Supervisors Employees Union, represented by respondent Union Officers, and ABS-CBN Broadcasting Corporation signed a Collective Bargaining Agreement containing Article XII. Under Article XII, the Company agreed to advance to the Union a sum equivalent to 10% of the sum total of all salary increases and signing bonuses granted to Supervisors under the CBA, upon signing, to cover the Union’s incidental expenses, including attorney’s fees and representation expenses for its organization and preparation and conduct of the CBA, with the advance to be deducted from the benefits granted as they accrue.

On September 19, 1990, petitioners filed with the Bureau of Labor Relations, DOLE-NCR, Quezon City, a Complaint against the Union Officers and ABS-CBN, praying that the special assessment of 10% of the sum total of all salary increases and signing bonuses granted by the Company to Union members be declared illegal for failure to comply with Article 241, paragraphs (g), (n), and (o) of the Labor Code, and for violating the Union’s Constitution and By-Laws; they also sought an order suspending further deductions from their salaries for their shares. In their Answers, the Union Officers and the Company prayed for dismissal for lack of merit, arguing that the check-off provision was in accordance with law because a majority of the Union members individually executed written authorization giving the Union officers and the Company blanket authority to deduct the subject amount.

The records showed that on July 14, 1989, the ABS-CBN Supervisors Employee Union held a general meeting where it was agreed that a 10% special assessment from the total economic package due to every member would be checked off to cover expenses for negotiation, other miscellaneous expenses, and attorney’s fees. The minutes of that meeting were recorded by Union Secretary Ma. Carminda M. Munoz and noted by Union President Herbert Rivera. On May 24, 1991, the Union held another General Membership Meeting, where the majority agreed that, because the Union had already paid Atty. P. Pascual P500,000, the amount must be shared by all members until fully liquidated. Eighty-five members of the Union executed individual written authorizations for check-off, authorizing the Management and/or Cashier of ABS-CBN Broadcasting Corporation to deduct P30.00 per month as regular union dues and to deduct a sum equivalent to 10% of all and whatever benefits that would become due under the CBA, to be applied to the advance that Management would make to the Union for incidental expenses such as attorney’s fees, representations, and other miscellaneous expenses pursuant to Article XII of the proposed CBA. The records did not indicate that these authorizations were executed under force or compulsion.

The amount to be deducted was not fixed but was determinable, because the check-off authorization stated that the sum was equivalent to 10% of all and whatever benefits might accrue under the CBA. The majority of the Union members gave their individual written check-off authorizations for the 10% special assessment and never withdrew them. It also appeared from the records that twenty of the forty-two petitioners executed a Compromise Agreement ratifying the controversial check-off provision in the CBA.

• Finality and Remedy: Petitioners claimed that the Decision of the Secretary of Labor and Employment dated July 1, 1991, affirming in toto the Med-Arbiter’s Order, could not be subject of a motion for reconsideration because it is final and unappealable pursuant to Section 8, Rule VIII, Book V of the Omnibus Rules Implementing the Labor Code; the only remedy of respondent Union Officers was to file a petition for certiorari with the Supreme Court.
• Non-Compliance with Article 241: Petitioners argued that the check-off provision was illegal because it was never submitted for consideration and approval to all the members at a general membership meeting called for the purpose, and because the formalities mandated by Article 241, paragraphs (n) and (o) of the Labor Code, as amended, were not complied with.
• Uncertain Amount: Petitioners contended that the amount to be deducted was uncertain.
• Timing of General Membership Meeting: Petitioners further contended that Article 241(n) of the Labor Code contemplates a general meeting after the conclusion of the collective bargaining agreement.

• Validity of Check-Off: Respondent Union Officers and Company argued that the check-off provision is in accordance with law because a majority of the Union members individually executed a written authorization giving the Union officers and the Company a blanket authority to deduct the subject amount.
• BPIEU-ALU Precedent: In their Motion for Reconsideration, respondents argued that the questioned 10% special assessment is valid pursuant to the ruling in Bank of the Philippine Islands Employees Union-ALU vs. NLRC.

• Grave Abuse of Discretion: Whether public respondent acted with grave abuse of discretion in issuing the challenged Order reversing his own Decision of July 1, 1991.
• Validity of the 10% Special Assessment and Check-Off: Whether the 10% special assessment and check-off provision in Article XII of the CBA is valid under Article 241 and Article 222(b) of the Labor Code.
• Deductions from Non-Signatories: Whether deductions may be taken from workers who did not give individual written check-off authorization.

• Grave Abuse of Discretion: No. The Secretary’s decision, although final and inappealable, may be reconsidered because a motion for reconsideration is a condition sine qua non before certiorari under Rule 65; petitioners were also estopped from questioning the reconsideration after filing a Motion for Early Resolution and raising the issue only after an adverse Order.
• Validity of the 10% Special Assessment and Check-Off: Yes. The three requisites under Article 241 of the Labor Code were met: authorization by written resolution of the majority at a duly called general membership meeting, the secretary’s record of the minutes, and individual written authorization for check-off signed by the employee concerned.
• Deductions from Non-Signatories: No deductions may be taken from workers who did not give their individual written check-off authorization, following BPIEU-ALU vs. NLRC.

• Grave Abuse of Discretion: Section 8, Rule VIII, Book V of the Omnibus Rules Implementing the Labor Code provides that the Secretary shall have fifteen calendar days to decide the appeal and that the decision shall be final and inappealable. This does not mean the decision cannot be reconsidered, because it is reviewable by certiorari under Rule 65. A motion for reconsideration is required to enable the public respondent to correct mistakes and is a condition sine qua non before certiorari, as held in Pearl S. Buck Foundation, Inc. vs. NLRC. Since the Secretary’s decision is subject to judicial review only through certiorari and cannot be resorted to without exhausting administrative remedies through a motion for reconsideration, the aggrieved party must be allowed to move for reconsideration. Petitioners also filed a Motion for Early Resolution dated June 24, 1992, averring that private respondents’ Motion for Reconsideration did not contain substantial factual or legal grounds; they were thus estopped from raising the issue, and their belated objection after an adverse Order was a patent afterthought. Alfredo Marquez vs. Secretary of Labor was cited on active participation as invocation of jurisdiction.
• Validity of the 10% Special Assessment and Check-Off: Check-off is a process or device whereby the employer, on agreement with the Union recognized as the proper bargaining representative, or on prior authorization from its employees, deducts union dues or agency fees from wages and remits them directly to the union. Its legal basis is found in statutes or contracts. Article 241 of the Labor Code, read with Article 222(b), governs. Article 222(b) prohibits attorney’s fees, negotiation fees, or similar charges arising from collective bargaining negotiations from being imposed on any individual member of the contracting union, but allows attorney’s fees to be charged against union funds. BPIEU-ALU vs. NLRC held that this prohibition applies only when payment is effected through forced contributions from the workers from their own funds, as distinguished from union funds. Article 241 requires three requisites for a valid special assessment for union incidental expenses, attorney’s fees, and representation expenses: (1) authorization by a written resolution of the majority of all members at a general membership meeting duly called for the purpose; (2) the secretary’s record of the minutes of the meeting; and (3) individual written authorization for check-off duly signed by the employee concerned. The Court found these requisites met: the July 14, 1989 general meeting agreed on the 10% special assessment, with minutes recorded by Secretary Munoz and noted by President Rivera; the May 24, 1991 General Membership Meeting majority agreed that the P500,000 already paid to Atty. P. Pascual must be shared by all members until fully liquidated; and eighty-five members executed individual written authorizations for check-off. No force or compulsion was indicated, so voluntariness was presumed. The amount, though not fixed, was determinable as 10% of all benefits that might accrue under the CBA. Article 241(n) does not require the general membership meeting to be held after the conclusion of the CBA; even if it did, the May 24, 1991 meeting was held after the December 7, 1989 CBA. Thus the 10% special assessment authorized in Article XII of the CBA was valid.
• Deductions from Non-Signatories: BPIEU-ALU vs. NLRC also held that no deductions must be taken from workers who did not sign the check-off authorization. The public respondent overlooked this qualification. Palacol vs. Ferrer-Calleja was inapropos because there the majority of union members had withdrawn their individual authorizations, and a withdrawal is equivalent to no authorization at all. Here, the majority of the Union members gave their individual written check-off authorizations and never withdrew them. Moreover, twenty of the forty-two petitioners executed a Compromise Agreement ratifying the controversial check-off provision. Accordingly, the assailed Order was upheld, except that no deductions could be taken from workers who did not give individual written check-off authorization.

• Check-off — A check-off is a process or device whereby the employer, on agreement with the Union recognized as the proper bargaining representative, or on prior authorization from its employees, deducts union dues or agency fees from the latter’s wages and remits them directly to the union. Its legal basis is found in statutes or contracts. In this case, the check-off for the 10% special assessment was upheld for members who gave individual written authorizations.
• Requisites for a Valid Special Assessment under Article 241 — Article 241 of the Labor Code requires: (1) authorization by a written resolution of the majority of all the members at a general membership meeting duly called for the purpose; (2) the secretary’s record of the minutes of the meeting, including the list of members present, votes cast, purpose of the special assessment or fees, and recipient, attested to by the president; and (3) individual written authorization for check-off duly signed by the employee, specifically stating the amount, purpose, and beneficiary of the deductions. The Court found all three requisites met.
• Attorney’s Fees under Article 222(b) — The prohibition against attorney’s fees, negotiation fees, or similar charges arising from collective bargaining negotiations applies only when payment is effected through forced contributions from the workers from their own funds, as distinguished from union funds. The Court applied this ruling from BPIEU-ALU vs. NLRC.
• Finality of the Secretary of Labor’s Decision and Motion for Reconsideration — A decision of the Secretary of Labor that is final and inappealable may still be reconsidered, because it is reviewable by certiorari under Rule 65 and a motion for reconsideration is a condition sine qua non before such petition. The Court applied this to uphold the public respondent’s authority to reconsider his July 1, 1991 Decision.
• Estoppel by Active Participation — Active participation in a proceeding, coupled with failure to object to jurisdiction or the propriety of the motion, is tantamount to an invocation of jurisdiction and a willingness to abide by the resolution, barring the party from later impugning the body’s jurisdiction. The Court applied this against petitioners, who filed a Motion for Early Resolution and raised the issue only after an adverse Order.
• Withdrawal of Check-Off Authorization — A withdrawal of individual authorization is equivalent to no authorization at all, rendering a check-off invalid. Palacol vs. Ferrer-Calleja was distinguished because there the majority had withdrawn their authorizations, whereas here the majority gave and never withdrew theirs.

• “The Court reads the aforecited provision as prohibiting the payment of attorney’s fees only when it is effected through forced contributions from the workers from their own funds as distinguished from the union funds.” — This is the Court’s interpretation of Article 222(b) of the Labor Code, quoted from BPIEU-ALU, and is central to upholding the validity of the 10% special assessment for attorney’s fees.
• “Noticeably, Article 241 speaks of three (3) requisites that must be complied with in order that the special assessment for Union’s incidental expenses, attorney’s fees and representation expenses, as stipulated in Article XII of the CBA, be valid and upheld namely: 1) authorization by a written resolution of the majority of all the members at the general membership meeting duly called for the purpose; (2) secretary’s record of the minutes of the meeting; and (3) individual written authorization for check-off duly signed by the employee concerned.” — This states the controlling requisites for validity of the special assessment, which the Court found satisfied.
• “Clearly, before a petition for certiorari under Rule 65 of the Rules of Court may be availed of, the filing of a motion for reconsideration is a condition sine qua non to afford an opportunity for the correction of the error or mistake complained of.” — This procedural ruling underpins the holding that the public respondent did not commit grave abuse of discretion in reconsidering his own final decision.
• “Even assuming that the special assessment was validly levied pursuant to paragraph (n), and granting that individual written authorizations were obtained by the Union, nevertheless there can be no valid check-off considering that the majority of the Union members had already withdrawn their individual authorizations. A withdrawal of individual authorization is equivalent to no authorization at all.” — The Court distinguished Palacol because here the majority gave and never withdrew their authorizations; this quote defines the withdrawal rule.

• Bank of the Philippine Islands Employees Union - ALU vs. NLRC, 171 SCRA 556 — Controlling precedent. The Court adopted its rulings that Article 222(b) prohibits attorney’s fees only when paid through forced contributions from workers’ own funds, and that no deductions may be taken from workers who did not sign the check-off authorization.
• Pearl S. Buck Foundation, Inc. vs. NLRC, 182 SCRA 446 — Followed. Cited to hold that a motion for reconsideration is a condition sine qua non before a petition for certiorari under Rule 65.
• Palacol vs. Ferrer-Calleja, 182 SCRA 710 — Distinguished. The check-off there was invalid because the majority of union members had withdrawn their individual authorizations; here, the majority gave and never withdrew theirs.
• Alfredo Marquez vs. Secretary of Labor, 171 SCRA 337 — Cited. Used to support the ruling that active participation and failure to object to jurisdiction estops a party from later impugning the body’s jurisdiction.
• Holy Cross of Davao College, Inc. vs. Joaquin, 263 SCRA 358 — Cited. Used for the definition of check-off.
• Salazar vs. NLRC, 256 SCRA 273 — Cited in footnote. The Court treated the ambiguous petition as one under Rule 65 in the interest of justice, equity, and fairplay.

• Article 241, Labor Code (as amended), paragraphs (g), (n), and (o) — Regulates rights and conditions of membership in a labor organization. Paragraph (g) requires authorization pursuant to the constitution and by-laws for collecting fees, dues, or contributions; paragraph (n) requires a written resolution of a majority of all members at a general membership meeting duly called for the purpose for special assessments; paragraph (o) requires individual written authorization for check-off, specifically stating the amount, purpose, and beneficiary. The Court found these requisites met.
• Article 222, paragraph (b), Labor Code — Prohibits attorney’s fees, negotiation fees, or similar charges arising from collective bargaining negotiations from being imposed on any individual member of the contracting union, but allows attorney’s fees to be charged against union funds. The Court read it, following BPIEU-ALU, as prohibiting only forced contributions from workers’ own funds, not charges against union funds.
• Section 8, Rule VIII, Book V, Omnibus Rules Implementing the Labor Code — Provides that the Secretary shall have fifteen calendar days to decide an appeal and that the decision shall be final and inappealable. The Court held this did not preclude a motion for reconsideration, which is a condition sine qua non before certiorari under Rule 65.
• Rule 65, Rules of Court — Governs petitions for certiorari. The Court held that a labor case may reach the Supreme Court through certiorari alleging lack or excess of jurisdiction or grave abuse of discretion, but only after a motion for reconsideration.

Romero, Vitug, Panganiban, and Gonzaga-Reyes, JJ., concurred.