Notre Dame of Greater Manila vs. Laguesma

An employer that has not filed a petition for certification election under Article 258 of the Labor Code has no standing to question a certification election or the exclusion of employees from the voters' list; only the employees, as real parties-in-interest, may do so. Likewise, an appeal from a med-arbiter's interlocutory order on the list of voters does not stay the certification election, because Article 259 refers to the order or results of the election, not to incidental orders.

Notre Dame of Greater Manila (NDGM) is the employer of the rank-and-file employees whom the Notre Dame of Greater Manila Teachers and Employees Union (NGMTEU) sought to represent. NGMTEU is a legitimate labor organization duly accredited and registered with the Department of Labor and Employment under Registration Certificate No. 9989. The dispute concerns the conduct of a certification election in an unorganized establishment and the employer's role in, and standing to question, that election under the Labor Code.

On October 14, 1991, the Notre Dame of Greater Manila Teachers and Employees Union (NGMTEU), a legitimate labor organization registered with the Department of Labor and Employment under Registration Certificate No. 9989, filed with the Med-Arbitration Branch, National Capital Region, DOLE, a petition for direct certification as the sole and exclusive bargaining agent or certification election among the rank-and-file employees of Notre Dame of Greater Manila (NDGM). On November 18, 1991, Med-Arbiter Tomas F. Falconitin issued an order granting the petition for certification election instead of direct certification, directing Adelayda C. Francisco, Representation Officer, to undertake a pre-election conference, and listing the choices as NGMTEU and No Union. On January 8, 1992, a pre-election conference was conducted wherein the parties agreed that the certification election would be held on January 18, 1992 from 10:00 o'clock in the morning to 2:00 o'clock in the afternoon and that the eligible voters would be those employees appearing in the list submitted by management as agreed upon by the parties by affixing their signatures on said list.

On January 13, 1992, NDGM registered a motion to include probationary and substitute employees in the list of qualified voters. On the same day, Med-Arbiter Falconitin denied the motion by handwritten notation on the motion itself: "1/13/92 – The Rep. officer allow[s] only regular employees to vote." On January 17, 1992, NDGM filed an appeal from the handwritten notation, which in effect excluded probationary and substitute employees from the list of voters. On January 18, 1992, the certification election was conducted with the following results: YES — 56; NO — 23; number of segregated ballots — 4; number of spoiled ballots — 1; total — 84. On the same day, NDGM filed a written notice of protest against the conduct and results of the certification election, which NGMTEU opposed. On January 27, 1992, a motion to certify NGMTEU as the exclusive bargaining agent of NDGM was filed.

On March 16, 1992, Med-Arbiter Falconitin issued an order certifying NGMTEU as the sole and exclusive bargaining agent of all the rank-and-file employees of NDGM and dismissing NDGM's protest. On March 30, 1992, NDGM lodged an appeal from the March 16, 1992 Order. On July 23, 1992, Undersecretary Laguesma rendered a decision dismissing the appeal for lack of merit. NDGM filed a motion for reconsideration, which was rejected by an order dated October 12, 1992.

NDGM then filed a petition with the CA in CA-GR SP No. 51287; the CA dismissed the petition on March 31, 2000, and denied reconsideration on August 28, 2001. NDGM filed the present Petition for Review under Rule 45.

• Stay of Certification Election: Petitioner argued that the med-arbiter's January 13, 1992 handwritten notation denying its Motion to Include Probationary and Substitute Employees in the List of Qualified Voters was the "order" referred to by Article 259 of the Labor Code; hence, its January 17, 1992 appeal should have stayed the holding of the certification election.
• Exclusion of Probationary and Substitute Employees: Petitioner maintained that the exclusion of probationary and substitute employees from the Qualified Voters List was arbitrary, whimsical, and capricious, contrary to law and established jurisprudence.
• Locus Standi: Petitioner argued that it had standing to question the certification election because it had the support of all the excluded employees, whose desire to participate in the election was made known to the representation officer in a letter; it cited Monark International vs. Noriel, Eastland Manufacturing Company vs. Noriel, and Confederation of Citizens Labor Union vs. Noriel as instances where management was allowed to interfere in certification elections.

• Stay of Certification Election: Whether the holding of the certification election was stayed by petitioner's appeal from the med-arbiter's January 13, 1992 handwritten notation denying the motion to include probationary and substitute employees in the list of qualified voters.
• Employer Locus Standi: Whether petitioner-employer has legal standing to question the certification election and the exclusion of probationary and substitute employees from the voters' list.

• Stay of Certification Election: No. The appeal from the med-arbiter's January 13, 1992 handwritten notation did not stay the January 18, 1992 certification election; Article 259 refers to the order or results of the election, not to an interlocutory order on the list of voters.
• Employer Locus Standi: No. Unless it filed a petition for certification election under Article 258, the employer is a stranger to the certification election and has no standing to question it; only the employees, as real parties-in-interest, may question their removal from the voters' list.

• Stay of Certification Election: Article 259 of the Labor Code allows any party to an election to appeal the order or results of the election as determined by the Med-Arbiter directly to the Secretary of Labor and Employment on the ground that the rules and regulations for the conduct of the election were violated, with the appeal to be decided within fifteen calendar days. Section 10, Rule V, Book Five of the 1992 Omnibus Rules provides that the filing of an appeal from the decision of the Med-Arbiter stays the holding of any certification election. The SC held that Article 259 speaks of the "order x x x of the election," not just any med-arbiter order like the January 13, 1992 handwritten notation; the appealable order is the order granting the petition for certification election, which in this case was issued on November 18, 1991. Sections 6 and 7 of the implementing rules confirm that the Med-Arbiter shall immediately order the conduct of a certification election in an unorganized establishment and that an aggrieved party may appeal the Med-Arbiter's order to the Secretary on the ground that the rules were violated. Section 12, Rule XI, Book Five of the Omnibus Rules further provides that interlocutory orders issued by the med-arbiter prior to the grant or denial of the petition, including orders granting motions for intervention issued after an order calling for a certification election, are not appealable, although issues arising therefrom may be raised in the appeal on the decision granting or denying the petition. The intention of the law is to limit the grounds for appeal that may stay a certification election; Department Order No. 40, the amendatory rules pertaining to Book Five issued on February 17, 2003, provides that an appeal of a med-arbiter's order to hold a certification election will not stay the holding thereof where the employer company is an unorganized establishment and no union has yet been duly recognized or certified as a bargaining representative. This limits appeals that impede the selection of a bargaining representative and advances the State policy in Article 211 A (a) and (g) of the Labor Code to promote and emphasize the primacy of free collective bargaining and to ensure workers' participation in decision and policy-making processes affecting their rights, duties, and welfare. Consequently, the appeal of the January 13, 1992 handwritten notation, which pertained to the incidental matter of the list of voters, should not stay the holding of the certification election.
• Employer Locus Standi: Unless it has filed a petition for a certification election pursuant to Article 258 of the Labor Code, an employer has no standing to question the certification election or to interfere therein; the election is the sole concern of the workers and must be free from the influence or reach of the company. Article 259 allows "any party to an election" to appeal the decision of the med-arbiter, but petitioner was not such a party; it was a stranger with no right to interfere in the proceedings. Legal standing means a personal and substantial interest in the case such that the party has sustained or will sustain direct injury as a result of the act being challenged; the interest must be material, an interest in issue and to be affected by the decree, as distinguished from mere interest in the question involved or a mere incidental interest, and must be personal and not based on a desire to vindicate the constitutional right of a third and unrelated party (Joya vs. PCGG). Petitioner did not and will not sustain direct injury as a result of the non-inclusion of some of its employees in the certification election; only the employees themselves, being the real parties-in-interest, may question their removal from the voters' list. Petitioner's claim that it had the support of all the excluded employees and that their desire to participate was made known to the representation officer in a letter did not clothe it with personality. The cases it cited—Monark International vs. Noriel, Eastland Manufacturing Company vs. Noriel, and Confederation of Citizens Labor Union vs. Noriel—state precisely the opposite. In Monark International, where the employer questioned incidents of a certification election, the SC held that the petition suffered from the infirmity of being filed by the employer, the adversary in the collective bargaining process; collective bargaining is designed to assure that labor is free to choose its representative, and a certification election is the most appropriate means of ascertaining its will. The employer may be heard where it invokes the contract-bar rule, but that exception did not apply. Sound policy dictates that management maintain a strictly hands-off policy; otherwise, it may lend itself to the legitimate suspicion that it is partial to one of the contending choices. The SC would be the last agency to support an attempt to interfere with a purely internal affair of labor. The Labor Code provisions on certification elections were enacted to protect the employees' right to determine their own bargaining representative; employers are strangers to these proceedings, are forbidden from influencing or hampering the employees' rights, and should not affect, much less stay, a certification election by the mere convenience of filing an appeal with the labor secretary. To allow them to do so would do violence to the letter and spirit of welfare legislations intended to protect labor and promote social justice.

• Employer's lack of standing in certification elections — Unless the employer has filed a petition for certification election under Article 258 of the Labor Code, it has no standing to question the election or interfere therein; the election is the sole concern of the workers and must be free from company influence. In this case, NDGM was a stranger to the certification election and could not question the exclusion of probationary and substitute employees from the voters' list; only the employees, as real parties-in-interest, could do so.
• Appealable orders in certification election and stay — Under Article 259 of the Labor Code, the appeal that may stay a certification election is from the order or results of the election as determined by the Med-Arbiter, not from an interlocutory order on an incidental matter such as the list of voters. The SC applied this by holding that NDGM's appeal from the January 13, 1992 handwritten notation did not stay the January 18, 1992 certification election.
• Locus standi — Legal standing requires a personal and substantial interest in the case such that the party has sustained or will sustain direct injury as a result of the act challenged; the interest must be material and in issue, not mere interest in the question or an incidental interest, and must be personal rather than based on vindicating a third party's rights. The SC applied this by holding that NDGM would not suffer direct injury from the exclusion of some employees and therefore lacked material interest.
• Hands-off policy in certification elections — Management must maintain a strictly hands-off policy in certification elections; otherwise, it may lend itself to the legitimate suspicion that it is partial to one of the contending choices. The SC applied this by rejecting NDGM's attempt to question the election and by stressing that employers are strangers to the proceedings.
• Primacy of free collective bargaining — The Labor Code policy is to promote and emphasize the primacy of free collective bargaining and to ensure workers' participation in decision and policy-making processes affecting their rights, duties, and welfare; appeals that impede the selection of a bargaining representative are limited. The SC applied this by holding that an appeal from an interlocutory notation on the voters' list should not stay the certification election.

• "Unless it has filed a petition for a certification election pursuant to Article 258 of the Labor Code, an employer has no standing to question such election or to interfere therein. Being the sole concern of the workers, the election must be free from the influence or reach of the company." — This states the core rule on employer standing and the workers' sole concern in certification elections.
• "Article 259 clearly speaks of the "order x x x of the election." Hence, the Article pertains, not just to any of the med-arbiter’s orders like the subject notation, but to the order granting the petition for certification election -- in the present case, that which was issued on November 18, 1991." — This limits the appeal that may stay a certification election to the order granting the petition, not an interlocutory notation on the voters' list.
• "Only the employees themselves, being the real parties-in-interest, may question their removal from the voters’ list." — This identifies the proper parties to challenge exclusion from the voters' list and supports the ruling that the employer lacked standing.

• Joya vs. PCGG, 225 SCRA 568, August 24, 1993 — Explained the requirement of legal standing: personal and substantial interest, direct injury, material interest in issue, and not mere incidental interest or third-party vindication; relied on to deny NDGM standing.
• Monark International vs. Noriel, 83 SCRA 114, May 11, 1978 — Held that an employer's petition questioning incidents of a certification election suffered from the infirmity of being filed by the employer, the adversary in collective bargaining; relied on to reject NDGM's claim of standing.
• Eastland Manufacturing Company vs. Noriel, 197 Phil. 624, February 10, 1982 — Cited in support of the policy that the SC would be the last agency to support an attempt to interfere with a purely internal affair of labor; relied on for the hands-off policy.
• Confederation of Citizens Labor Union vs. Noriel, 202 Phil. 249, September 21, 1982 — Cited by petitioner as an instance where management was allowed to interfere, but the SC held that the cases cited state precisely the opposite; distinguished/rejected as authority for NDGM's standing.
• Philippine Telegraph & Telephone Corp. vs. Laguesma, 223 SCRA 452, June 17, 1993 — Cited in support of the rule that an employer has no standing to question a certification election unless it filed a petition for certification election under Article 258 of the Labor Code.
• Philippine Scout Veterans Security and Investigation Agency vs. Torres, 224 SCRA 682, July 21, 1993 — Cited in support of the same rule on the employer's lack of standing absent a petition for certification election under Article 258.
• R. Transport Corporation vs. Laguesma, 227 SCRA 826, November 16, 1993 — Cited in support of the same rule on the employer's lack of standing absent a petition for certification election under Article 258.

• Article 258, Labor Code — Requires an employer to file a petition for certification election if it wishes to question the election; absent such a petition, the employer has no standing. Applied: NDGM did not file such a petition and was a stranger to the certification election.
• Article 259, Labor Code — Allows any party to an election to appeal the order or results of the election as determined by the Med-Arbiter directly to the Secretary of Labor and Employment on the ground that the rules and regulations for the conduct of the election were violated, with the appeal decided within fifteen calendar days. Applied: the appealable order is the order or results of the election, not the January 13, 1992 handwritten notation on the voters' list.
• Section 10, Rule V, Book Five, 1992 Omnibus Rules Implementing the Labor Code — Provides that the filing of an appeal from the decision of the Med-Arbiter stays the holding of any certification election, and the Secretary's decision is final and inappealable. Applied: no stay resulted because the appeal was not from the decision/order granting the petition but from an interlocutory notation.
• Sections 6 and 7, Rule V, Book Five, 1992 Omnibus Rules Implementing the Labor Code — Section 6 directs the Med-Arbiter to immediately order a certification election in an unorganized establishment; Section 7 allows an aggrieved party to appeal the Med-Arbiter's order to the Secretary on the ground that the rules were violated. Applied: the appealable order was the November 18, 1991 order granting the certification election, not the January 13, 1992 notation.
• Section 12, Rule XI, Book Five, Omnibus Rules Implementing the Labor Code — Provides that interlocutory orders issued by the med-arbiter prior to the grant or denial of the petition, including orders granting motions for intervention after an order calling for a certification election, are not appealable, but issues arising therefrom may be raised in the appeal on the decision granting or denying the petition. Applied: the January 13, 1992 notation was interlocutory and did not stay the election.
• Department Order No. 40 — Amendatory rules pertaining to Book Five of the Labor Code, issued on February 17, 2003; under the new rules, an appeal of a med-arbiter's order to hold a certification election will not stay the holding thereof where the employer company is an unorganized establishment and no union has yet been duly recognized or certified as a bargaining representative. Applied: the SC cited it to show the intent to limit appeals that impede the selection of a bargaining representative.
• Article 211 A (a) and (g), Labor Code — States the policy to promote and emphasize the primacy of free collective bargaining and to ensure the participation of workers in decision and policy-making processes affecting their rights, duties, and welfare. Applied: supports the ruling that the appeal from the notation should not stay the certification election.
• Article 243, Title V, Book Five, Labor Code — Provides that all employees should be given an opportunity to make known their choice of bargaining representative. Applied: this does not clothe the employer with personality to question the certification election.
• Section 2, Rule 3, Rules of Court — Defines real parties-in-interest. Applied: only the employees themselves are real parties-in-interest to question their removal from the voters' list.