Divine Word University of Tacloban vs. Secretary of Labor and Employment

An employer that in bad faith refuses to bargain with the duly certified exclusive bargaining agent forfeits the right to insist on mutual consent and may have the union's CBA proposals imposed as the collective agreement, while its petition for certification election is properly dismissed. The duty to bargain collectively requires prompt, expeditious good-faith meeting and response, including making a counter-proposal when the union submits proposals and requests negotiation.

Divine Word University of Tacloban is a private educational institution employing academic and non-academic rank-and-file personnel represented for collective bargaining purposes by Divine Word University Employees Union, later affiliated with the Associated Labor Union. Philippine labor law vests the Secretary of Labor with extraordinary powers to assume jurisdiction over labor disputes in industries indispensable to the national interest and to resolve all incidents subsumed therein, while regulating when an employer requested to bargain may seek a certification election and prescribing the procedure for collective bargaining.

On September 6, 1984, Med-Arbiter Bienvenido C. Elorcha certified the Divine Word University Employees Union as the sole and exclusive bargaining agent of Divine Word University of Tacloban. On March 7, 1985, the union submitted its collective bargaining proposals. On March 26, 1985, the University, through counsel, replied and requested a preliminary conference on May 28, 1985. Two days before the scheduled conference, on May 26, 1985, the union's resigned vice-president Brigido Urminita wrote the University unilaterally withdrawing the CBA proposals, causing cancellation of the conference.

Thereafter, no bargaining agreement was concluded for almost three years. On February 9, 1988, DWUEU affiliated with the Associated Labor Union upon issuance of Charter Certificate No. 347. On March 11, 1988, DWUEU-ALU requested a conference to continue collective bargaining negotiations, followed on March 23, 1988 by a reiteration warning against interference through meetings with academic and non-academic employees regarding union affiliation. The University maintained silence. On April 25, 1988, DWUEU-ALU filed with the National Conciliation and Mediation Board a notice of strike on grounds of bargaining deadlock and unfair labor practice acts, specifically refusal to bargain, discrimination and coercion of employees.

Conferences after the notice led to a May 10, 1988 agreement under which the union would submit CBA proposals on May 13, 1988, the parties would sit down to determine the bargaining unit, conciliation was temporarily suspended, the discrimination issues concerning Ms. Colinayo and Ms. Cinco Flores were settled, and coercion and refusal to bargain would be subject to continuing dialogue. An hour before that agreement was concluded, however, the University had filed a petition for certification election with the Region VIII office. On May 19, 1988, DWUEU-ALU submitted its collective bargaining proposals pursuant to the agreement, which the University ignored. Marathon conciliation conferences through the NCMB failed. On August 25, 1988, the Secretary assumed jurisdiction, ordered striking workers to return within twenty-four hours and management to accept them under prevailing terms, and designated the NCMB to hear the case and report. The same day, Med-Arbiter Milado ordered a certification election between DWUEU-ALU and "no union." On September 20, 1988, the Secretary enjoined further certification election proceedings pending resolution of the dispute.

Hearings were conducted by the NCMB on October 17-18, 1988. On October 26, 1988, the Divine Word University Independent Faculty and Employees Union, registered that day, moved to intervene claiming at least 20% of rank-and-file employees. On May 23, 1989, the Secretary consolidated the certification election case and the parties' NLRC unfair labor practice complaints into the assumed dispute, found no merit in the unfair labor practice charges for failure of proof, directed adoption of the union's May 19, 1988 proposals, and dismissed the certification election petition. The University moved for reconsideration, opposed by the union. Meanwhile, on May 5, 1989, DWUEU-ALU filed a second notice of strike for violation of the return-to-work order, dismissal of union officers, coercion and illegal suspension. Conciliation conferences were called; the University agreed on July 5, 1989 to submit settlement proposals by July 17, 1989 but twice failed to appear, first citing lack of board quorum. DWUEU-ALU pursued the second strike on November 24, 1989. Four days later the University asked assumption of jurisdiction or certification to the NLRC, joined by a December 4, 1989 student resolution urging assumption. On December 29, 1989, the Secretary reiterated assumption, ordered return to work, deemed the second strike subsumed, and directed the Regional Director to hear those issues. On January 17, 1990, the Acting Secretary affirmed the May 23, 1989 Order, finding the 1985 withdrawal unauthorized, the University in bad faith, and the motion for intervention effectively denied.

• Premature Resolution and Subsumption: Petitioner argued that the January 17, 1990 denial of reconsideration could not validly issue while the second notice of strike remained subsumed and pending recommendation by the Regional Director under the December 29, 1989 Order, since the Regional Director was an extension of the Secretary who should have awaited the recommendation on both notices of strike.
• Mandatory Certification Election: Petitioner maintained that in the absence of a certified CBA and with no certification election held in more than five years, a certification election was mandatory, and the assumption order merely held the election in abeyance without consolidating the representation issue.
• Disregard of Evidence, Law and Jurisprudence: Petitioner argued that the May 23, 1989 and January 17, 1990 Orders disregarded evidence on record, provisions of law and established jurisprudence, including its claim that consent of both parties is indispensable to a collective bargaining agreement and that the union's proposals could not be unilaterally imposed.
• Due Process and Intervention: Petitioner argued that it was denied due process and that the motion for intervention of DWU-IFEU was left unresolved.

• Timing of Reconsideration vs. Subsumed Second Strike: Whether the Acting Secretary could resolve the motion for reconsideration of the May 23, 1989 Order on January 17, 1990 before termination of proceedings on the second notice of strike subsumed by the December 29, 1989 Order.
• Intervention: Whether failure to expressly resolve the DWU-IFEU motion for intervention invalidated the May 23, 1989 Order.
• Certification Election: Whether a certification election was mandatory in the absence of a CBA for more than five years, or was properly dismissed where the employer filed the petition in bad faith.
• Imposed CBA Proposals: Whether the Secretary could direct adoption of the union's May 19, 1988 CBA proposals as the collective bargaining agreement despite lack of employer consent.
• Due Process: Whether petitioner was denied due process by the imposition of the union's proposals and the dismissal of its petition.

• Timing of Reconsideration vs. Subsumed Second Strike: No. Separate resolution ahead of the second strike was permitted by exigency and Art. 263(g), to settle the first strike, election and unfair labor practice issues without delay.
• Intervention: No. The motion was in effect denied by dismissal of the certification election in which the intervenor sought to participate, there being no necessity for an election.
• Certification Election: No election required. Although no deadlock in the strict sense existed for lack of good-faith bargaining, granting annulment would reward bad-faith bargaining and the employer was estopped from disputing majority status.
• Imposed CBA Proposals: Yes. Where the union is certified, requested bargaining and submitted proposals, and the employer made no counter-proposal, the union draft may be imposed following Kiok Loy vs. NLRC.
• Due Process: No violation. The University's reluctance, reneging on the May 10, 1988 agreement, and resort to delay forfeited objections and justified default treatment.

• Timing of Reconsideration vs. Subsumed Second Strike: Ideally one order settles all controversies to avoid multiplicity, but exigencies may require threshing out manageable aspects ahead of others. Resolution of the first notice of strike, certification election and unfair labor practice cases was urgently needed given the University's nature affecting students and parents, while the second notice was still under conciliation before Regional Director Teddy S. Cabeltes pursuant to the December 1989 directive. Setting aside second-strike issues was therefore within discretion and not an abuse.
• Intervention: The sub silencio treatment did not mean oversight; findings showed no necessity for an election wherein DWU-IFEU could participate. Once an employer files a certification election petition its active role ceases and it becomes a mere bystander, so undue employer interest in the intervenor suggests batting for a company union.
• Certification Election: Under Art. 258 and Sec. 3, Rule V, Book V, an employer requested to bargain may petition anytime absent a registered CBA except (a) within one year from a final election result or (b) when a deadlock involving the incumbent agent was submitted to conciliation or arbitration or became subject of a valid strike or lockout notice. Timeliness was undisputed after almost four years, but no genuine deadlock or impasse existed because deadlock presupposes reasonable good-faith effort and counteraction of opposed forces. The University showed indifference, ignored March 11 and 23, 1988 letters and May 19, 1988 proposals, and filed the petition surreptitiously an hour before committing to sit down on May 10, 1988, violating the Art. 252 duty to meet promptly in good faith and Art. 19 of the Civil Code. Belated challenge to majority status was also estopped by agreeing to determine the bargaining unit, and the May 10, 1988 agreement functioned as the Art. 250(a) notice setting bargaining in motion.
• Imposed CBA Proposals: Consent is normally indispensable, but Kiok Loy vs. NLRC permits imposing the union draft where (a) the union is duly certified, (b) it made a definite request and submitted proposals, and (c) the employer made no counter-proposal. Refusal to counter-propose, viewed against the entire process, indicates bad faith, especially when the request is left unanswered. Neither side must precipitately accept the other's proposals, but schemes feigning negotiation through empty gestures are intolerable. By inaction and insincerity the University forfeited employer rights, warranting warning that further delay would be unfair labor practice.
• Due Process: The March 7, 1985 proposals subsisted because withdrawal by only three of eight executive board members led by a resigned vice-president was unauthorized; in any event the May 10, 1988 agreement and May 19, 1988 renewed proposals restarted bargaining. Default declaration for reneging and delay did not deprive due process given ample opportunities to respond, confer and conciliate.

• Secretary's Assumption Power and Consolidation — Under Art. 263(g) of the Labor Code, the Secretary may assume jurisdiction over a labor dispute and subsume therein all incidents arising therefrom or necessarily related thereto, including representation questions and unfair labor practice cases, to prevent split jurisdiction and multiplicity of proceedings. Applied to consolidate the certification election petition and NLRC cases with the strike dispute and to hold the election in abeyance pending resolution.
• Bar to Certification Election During Deadlock Conciliation — Sec. 3, Rule V, Book V bars entertaining a representation question if, before the certification petition, a bargaining deadlock involving the incumbent or certified agent was submitted to conciliation or arbitration or became subject of a valid strike or lockout notice. Invoked by the Secretary to bar the Med-Arbiter from entertaining the University's May 10, 1988 petition, though the Court ultimately found no true deadlock for lack of good-faith bargaining.
• Deadlock or Impasse — A deadlock is a complete stoppage from counteraction of equal and opposed forces, synonymous with impasse, which presupposes reasonable effort at good-faith bargaining that despite noble intentions fails to produce agreement. No deadlock was found because only the union exerted efforts while the University remained indifferent and refused to respond.
• Duty to Bargain Collectively — Art. 250 prescribes written notice with proposals, reply within ten calendar days, conference within ten days if differences arise, and full participation in Board conciliation without disruptive acts; Art. 252 defines the duty as mutual obligation to meet and convene promptly and expeditiously in good faith. The University breached this by silence, ignoring proposals, and surreptitious filing of the election petition while agreeing to confer.
• Imposition of Union CBA Draft for Bad-Faith Refusal to Bargain — Following Kiok Loy vs. NLRC, where the union is the certified agent, made a definite request with proposals, and the employer made no counter-proposal, refusal to counter-propose indicates bad faith and the union draft may be declared the governing agreement; feigned negotiation through empty gestures is not tolerated. Applied to impose the May 19, 1988 proposals and warn that delay constitutes unfair labor practice.
• Employer as Bystander in Certification Election — Once an employer files a petition for certification election, its active role ceases and it becomes a mere bystander, since the election is the sole concern of employees except where the employer must file. The University's undue interest in DWU-IFEU's intervention thus raised suspicion of favoring a company union.
• Estoppel on Majority Status — An employer that recognizes the certified union by agreeing to sit down and determine the bargaining unit is estopped from belatedly questioning majority status when it had ample prior opportunity in communications. Applied to reject the University's belated representation challenge.

• "the performance of a mutual obligation to meet and convene promptly and expeditiously in good faith." — Defines under Art. 252 the duty to bargain collectively breached by the University's surreptitious election petition and refusal to confer.
• "(e)very person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith." — States the Art. 19 Civil Code mandate violated by filing the certification petition while committing to bargain on May 10, 1988.
• "it is not obligatory upon either side of a labor controversy to precipitately accept or agree to the proposals of the other. But an erring party should not be tolerated and allowed with impunity to resort to schemes feigning negotiations by going through empty gestures." — Articulates the Kiok Loy vs. NLRC limit on consent, justifying imposition of the union's CBA proposals for bad-faith bargaining.

• Bulletin Today cases, G.R. Nos. 79276 and 79883 — Followed as settled doctrine that strong disagreement on representation is subsumed in a labor dispute certified for compulsory arbitration to prevent split jurisdiction and multiplicity.
• Trade Unions of the Philippines and Allied Services vs. Trajano, G.R. No. 61153, January 17, 1983, 120 SCRA 64, 66 — Cited for the rule that once the employer files a certification election petition it becomes a mere bystander and uncalled-for concern suggests support for a company union.
• Kiok Loy vs. NLRC, G.R. No. 54334, January 22, 1986, 141 SCRA 179 — Followed as controlling for imposing the union's draft CBA where the certified union requested bargaining and the employer made no counter-proposal, indicating bad faith.
• N.L.R.B. vs. Bancroft, 635 F.2d 492 (1981) — Cited for the American federal definition of impasse as presupposing reasonable good-faith bargaining effort that fails to conclude agreement.

• Art. 263(g), Labor Code — Grants the Secretary extraordinary power to assume jurisdiction over labor disputes and resolve subsumed incidents; used to assume jurisdiction on August 25, 1988 and December 29, 1989, enjoin the election, and consolidate related cases.
• Art. 258, Labor Code — Allows an employer requested to bargain to petition for election absent a certified CBA, with decision and election periods; invoked to assess timeliness of the University's petition filed almost four years after certification.
• Sec. 3, Rule V, Book V, Implementing Rules — Bars a representation question if a deadlock involving the incumbent agent was submitted to conciliation or subject of valid strike or lockout notice, and bars elections within one year from final result; relied upon to bar the Med-Arbiter from entertaining the petition.
• Art. 250(a)-(e), Labor Code — Prescribes notice, ten-day reply, ten-day conference, Board conciliation with duty to participate fully, and prohibition on disruptive acts; used to find the May 10, 1988 agreement as notice setting bargaining in motion and the University in breach for non-response.
• Art. 252, Labor Code — Defines duty to bargain as mutual obligation to meet promptly in good faith; violated by surreptitious election filing while agreeing to sit down.
• Art. 19, Civil Code — Requires exercise of rights with justice, honesty and good faith; violated by preempting the May 10, 1988 conference through simultaneous election petition.
• Art. 231, Labor Code — Referred to for registration of CBA governing when certification petitions or interventions may be entertained within sixty days prior to expiry.

Bidin, Davide, Jr. and Melo, JJ., concur. Gutierrez, Jr., J., is on leave.