Philippine Fruits and Vegetable Industries, Inc. vs. Torres

A certification election protest must be filed with the representation officer before the close of election proceedings and formalized before the Med-Arbiter within five days after the close of election proceedings; "close of election proceedings" refers to the period from the closing of the polls to the counting and tabulation of votes, not the final determination and canvass of challenged votes. An employer is a mere bystander in a certification election and has no right to interfere, except when it files a petition for certification election under Article 258 of the Labor Code because it is requested to bargain collectively.

Philippine Fruits and Vegetable Industries, Inc. (PFVII) is an employer, while the Trade Union of the Philippines and Allied Services (TUPAS) is a labor union that sought to represent PFVII's regular rank-and-file and seasonal workers. The Secretary of Labor is the public respondent whose resolutions are challenged. The dispute arises under the Labor Code and its Implementing Rules, which govern certification elections and the procedure for election protests.

PFVII operated with regular rank-and-file and seasonal workers. On October 13, 1988, Med-Arbiter Danilo T. Basa granted the petition for certification election filed by TUPAS and directed that an election be held among PFVII's regular and seasonal workers. After a series of pre-election conferences, all issues relative to the conduct of the election were resolved except the voting qualifications of 194 workers whose names appeared in the list of qualified voters submitted by TUPAS. Following the late submission of position papers, Med-Arbiter Basa issued an Order dated December 9, 1988 allowing 184 of the 194 questioned workers to vote, subject to challenge, in the certification election scheduled for December 16, 1988. Copies of the order were furnished to the parties, and on December 12, 1988 the notice of certification election was posted. On election day, 168 of the questioned workers voted.

During the certification election, PFVII objected through a Manifestation filed with the Representation Officer before the close of the election proceedings. The Manifestation alleged that the posting of the list of eligible voters was short of the five-day requirement because it was posted only on December 12, 1988, while the election was held on December 16, 1988, only four days later. By agreement of PFVII and TUPAS, workers whose names were inadvertently omitted from the list of qualified voters were allowed to vote, subject to challenge; 38 of them voted. The initial tally excluding challenged votes showed 40 yes votes, 38 no votes, 7 spoiled votes, and 38 challenged votes, for a total of 123 votes cast. On January 6, 1989, Management and TUPAS agreed to open the challenged votes of the regular rank-and-file employees; the canvass showed 20 yes votes, 14 no votes, and 4 spoiled votes, for a total of 38. Added to the initial results, the canvass showed 60 yes votes, 52 no votes, and 11 spoiled votes, for a total of 123. Because the yes votes failed to obtain a majority of the votes cast, it became necessary to open the 168 challenged votes to determine the true will of the employees.

On January 20, 1989, PFVII filed a position paper arguing against the opening of the 168 challenged votes, mainly on the ground that the voters were not regular employees or seasonal workers because they had allegedly rendered work for less than 180 days. TUPAS argued that the employment status of those employees had already been resolved when Labor Arbiter Ricardo N. Martinez, in a Decision dated November 26, 1988 in NLRC Case No. Sub-Rab-01-09-7-0087-88, declared them illegally dismissed. In an Order dated February 2, 1989, Med-Arbiter Basa ordered the opening of the 168 challenged votes, observing that the employees had been illegally dismissed in accordance with Labor Arbiter Martinez's Decision. The canvassed results showed 165 yes votes, 0 no votes, and 3 spoiled votes, for a total of 168.

On February 23, 1989, PFVII formally filed a Protest claiming that the required five-day posting of notice was not complied with, that the posted list of qualified voters failed to include 55 regular workers whom the parties had agreed were qualified to vote, and that voters who were ineligible to vote were allowed to vote. Med-Arbiter Basa dismissed the Protest in an Order dated March 7, 1989. On appeal, the Secretary of Labor affirmed the Med-Arbiter's Order in a Resolution dated December 12, 1989 and certified TUPAS as the sole and exclusive bargaining agent of all regular rank-and-file and seasonal workers at PFVII. PFVII's motion for reconsideration was denied for lack of merit. The Secretary found that TUPAS obtained a majority of the valid votes cast—60 plus 165, or a total of 225 votes out of a possible total of 291.

• Grave Abuse of Discretion and Erroneous Reglementary Period: Petitioner argued that the Secretary of Labor acted with grave abuse of discretion amounting to lack of jurisdiction and committed manifest error in upholding the certification of TUPAS as sole bargaining agent mainly on the erroneous ruling that the protest against the canvassing of the votes cast by 168 dismissed workers was filed beyond the reglementary period.
• Disregard of Voting Eligibility: Petitioner maintained that the Secretary committed an abuse of discretion in completely disregarding the issue of whether non-regular seasonal workers who had long been separated from employment prior to the filing of the petition for certification election should be allowed to vote and participate in the certification election.
• Posting Defect: Petitioner claimed that the required five-day posting of notice was not complied with because the notice was posted only on December 12, 1988, four days before the December 16, 1988 election.
• Ineligible and Omitted Voters: Petitioner's Protest alleged that the posted list of qualified voters failed to include 55 regular workers agreed upon by the parties as qualified to vote and that voters who were ineligible were allowed to vote; its position paper also argued that the 168 challenged voters were not regular employees or seasonal workers because they had rendered work for less than 180 days.
• Election Proceedings Include Canvass: Petitioner argued that election proceedings include not only the casting of votes but necessarily also the canvassing and appreciation of votes cast, and that because the canvassing and appreciation of all votes cast were terminated only on February 16, 1989, its formal protest filed on February 20, 1989 was within the five-day reglementary period.

• Employment Status Already Resolved: TUPAS argued that the employment status of the questioned employees had been resolved when Labor Arbiter Ricardo N. Martinez, in his Decision dated November 26, 1988 in NLRC Case No. Sub-Rab-01-09-7-0087-88, declared that said employees were illegally dismissed.
• Close of Election Proceedings: The Solicitor General explained that the phrase "close of election proceedings" in Sections 3 and 4, Rule VI, Book V of the Implementing Rules refers to the period from the closing of the polls to the counting and tabulation of the votes; it does not include the period for the final determination of the challenged votes and the canvass thereof, because that may take a very long period and would cause undue delay in affirming the employees' choice of bargaining representative.

• Timeliness of Formal Protest: Whether the Secretary of Labor acted with grave abuse of discretion in upholding the certification of TUPAS as sole bargaining agent on the ground that petitioner's protest against the canvassing of the votes cast by 168 dismissed workers was filed beyond the reglementary period.
• Voting Eligibility of Separated Workers: Whether the Secretary of Labor abused his discretion in disregarding the issue of whether non-regular seasonal workers who had long been separated from employment prior to the filing of the petition for certification election should be allowed to vote and participate in the certification election.
• Posting of Notice: Whether the lack of one day in the five-day posting requirement for the notice of certification election nullified the election.
• Bystander Rule: Whether the employer-petitioner had the right to interfere in the certification election.

• Timeliness of Formal Protest: No. The formal protest was filed beyond the five-day period after the close of election proceedings; under Sections 3 and 4, Rule VI, Book V, a protest must be filed with the representation officer before the close of proceedings and formalized before the Med-Arbiter within five days after such close.
• Voting Eligibility of Separated Workers: No. The Secretary did not disregard the issue; he affirmed the Med-Arbiter's finding that TUPAS obtained 225 votes out of a possible 291. Employees improperly laid off but with a present, unabandoned right to or expectation of re-employment are eligible to vote in certification elections.
• Posting of Notice: No. The one-day shortfall in posting did not nullify the election because 291 of 322 qualified voters were informed and voted, and labor laws are construed liberally in favor of the exercise of labor rights.
• Bystander Rule: No. A certification election is the sole concern of the workers; the employer is a mere bystander with no right to interfere, except when it files a petition for certification election under Article 258 of the Labor Code because it is requested to bargain collectively.

• Timeliness of Formal Protest: The Court applied Sections 3 and 4, Rule VI, Book V of the Implementing Rules of the Labor Code, which require that a protest be filed with the representation officer and made of record in the minutes before the close of election proceedings, and that it be formalized before the Med-Arbiter within five days after the close of election proceedings. Protests not so raised are deemed waived, and if not formalized within the prescribed period, the protest is deemed dropped. The records showed that petitioner filed a manifestation of protest on December 16, 1988, election day, but formalized the same only on February 20, 1989, more than two months after the close of election proceedings on December 16, 1988. The Court rejected petitioner's argument that the election proceedings included the canvassing and appreciation of votes and that the five-day period began only after the canvassing terminated on February 16, 1989. The Solicitor General's explanation was adopted: "close of election proceedings" refers to the period from the closing of the polls to the counting and tabulation of the votes, not the final determination of challenged votes and the canvass thereof, because including the latter would cause undue delay in affirming the employees' expressed choice of bargaining representative.
• Voting Eligibility of Separated Workers: The Court found that the Secretary did not completely disregard the issue of the voting rights of the alleged separated employees. The Secretary affirmed the Med-Arbiter's findings and ruled that TUPAS obtained a majority of the valid votes cast—60 plus 165, or 225 votes out of a possible 291. The Court also held that employees who have been improperly laid off but who have a present, unabandoned right to or expectation of re-employment are eligible to vote in certification elections. Where the dismissal is under question, as in this case where a case of illegal dismissal and/or unfair labor practice was filed, the employees concerned could still qualify to vote. The 168 challenged voters had been declared illegally dismissed by Labor Arbiter Martinez, so their votes were properly opened and canvassed.
• Posting of Notice: The Court acknowledged that the notice of certification election was posted only on December 12, 1988, four days before the scheduled election on December 16, 1988, instead of the five-day period required under Section 1, Rule VI, Book V. However, it was not disputed that a substantial number—291 of 322 qualified voters—were informed through the notices and actually voted on election day. In light of the substantial participation and the settled rule that the Supreme Court adopts a liberal approach in interpreting the Constitution's protection to labor and social justice provisions and the labor laws and rules implementing the constitutional mandate, the lack of one day in the posting of notices was insignificant and not a compelling reason to nullify the election.
• Bystander Rule: The Court stressed the rule consistently pronounced in earlier cases that a certification election is the sole concern of the workers and the employer is regarded as nothing more than a bystander with no right to interfere at all in the election. The only exception is where the employer has to file a petition for certification election pursuant to Article 258 of the Labor Code because it is requested to bargain collectively. Because PFVII was not acting under that exception, the petition would have been dismissed outright on the score alone of the bystander rule.

• Close of Election Proceedings and Protest Formalization — Under Sections 3 and 4, Rule VI, Book V of the Implementing Rules of the Labor Code, a certification election protest must satisfy two procedural requirements: (1) it must be filed with the representation officer and made of record in the minutes of the proceedings before the close of election proceedings; and (2) it must be formalized before the Med-Arbiter within five days after the close of election proceedings. A protest not so raised is deemed waived, and one not formalized within the prescribed period is deemed dropped. The Court defined "close of election proceedings" as the period from the closing of the polls to the counting and tabulation of the votes, not the period for the final determination of challenged votes and the canvass thereof. Applied to the case, petitioner's formal protest on February 20, 1989 was more than two months after the December 16, 1988 close of election proceedings and was therefore late.
• Substantial Compliance with the Posting Requirement — The five-day posting requirement for the notice of certification election under Section 1, Rule VI, Book V is not so absolute that a one-day shortfall invalidates the election where a substantial number of qualified voters were informed and actually voted. The Court applied this doctrine because 291 of 322 qualified voters participated, and the liberal approach favoring the exercise of labor rights made the lack of one day insignificant.
• Eligibility of Improperly Laid-Off Employees — Employees who have been improperly laid off but who have a present, unabandoned right to or expectation of re-employment are eligible to vote in certification elections. Where the dismissal is under question, as where an illegal dismissal and/or unfair labor practice case has been filed, the employees concerned may still qualify to vote. The Court applied this rule to the 168 challenged voters who had been declared illegally dismissed, making their votes proper for opening and canvassing.
• Bystander Rule — A certification election is the sole concern of the workers; the employer is regarded as nothing more than a bystander with no right to interfere at all in the election. The only exception is where the employer has to file a petition for certification election pursuant to Article 258 of the Labor Code because it is requested to bargain collectively. The Court applied this rule to hold that PFVII's petition would have been dismissed outright on the bystander rule alone.
• Liberal Approach in Labor Law — In interpreting the Constitution's protection to labor and social justice provisions and the labor laws and rules implementing the constitutional mandate, the Supreme Court adopts the liberal approach which favors the exercise of labor rights. The Court applied this approach in treating the one-day posting deficiency as insignificant rather than as a ground to nullify the certification election.

• "The records before Us quite clearly disclose the fact that petitioner, after filing a manifestation of protest on December 16, 1988, election day, only formalized the same on February 20, 1989, or more than two months after the close of election proceedings (i.e., December 16, 1988)." — This passage states the factual basis for the ruling that the formal protest was filed beyond the five-day reglementary period.
• "As explained correctly by the Solicitor General, the phrase "close of election proceedings" as used in Sections 3 and 4 of the pertinent Implementing Rules refers to that period from the closing of the polls to the counting and tabulation of the votes as it could not have been the intention of the Implementing Rules to include in the term "close of the election proceedings" the period for the final determination of the challenged votes and the canvass thereof, as in the case at bar which may take a very long period." — This passage defines the controlling phrase "close of election proceedings" for purposes of protest formalization.
• "At any rate, it is now well-settled that employees who have been improperly laid off but who have a present, unabandoned right to or expectation of re-employment, are eligible to vote in certification elections." — This passage states the doctrine on the voting eligibility of improperly laid-off employees.
• "And finally, the Court would wish to stress once more the rule which it has consistently pronounced in many earlier cases that a certification election is the sole concern of the workers and the employer is regarded as nothing more than a bystander with no right to interfere at all in the election." — This passage articulates the bystander rule, which the Court said would have warranted outright dismissal of the petition.

• Manila Electric Company vs. NLRC, G.R. No. 78763, July 12, 1989 — Cited for the rule that in interpreting the Constitution's protection to labor and social justice provisions and the labor laws and rules implementing the constitutional mandate, the Supreme Court adopts the liberal approach favoring the exercise of labor rights.
• Samahang Manggagawa ng Via Mare vs. Noriel, 98 SCRA 507 — Cited for the rule that if the dismissal is under question, the employees concerned could still qualify to vote in certification elections.

• Sections 3 and 4, Rule VI, Book V, Implementing Rules of the Labor Code — These provisions require that a protest be filed with the representation officer and made of record in the minutes before the close of election proceedings, and that it be formalized before the Med-Arbiter within five days after the close of election proceedings; otherwise, the protest is deemed waived or dropped. The Court applied these provisions to hold that petitioner's formal protest was late.
• Section 1, Rule VI, Book V, Implementing Rules of the Labor Code — This provision requires the posting of the notice of certification election at least five days before the election. The Court applied it by acknowledging the one-day shortfall but holding that it did not nullify the election given substantial voter participation and the liberal approach favoring labor rights.
• Article 258, Labor Code — Cited as the exception to the bystander rule: the employer may file a petition for certification election because it is requested to bargain collectively. The Court noted that PFVII did not fall under this exception.
• Constitution — protection to labor and social justice provisions — Cited generally as the constitutional basis for the liberal approach favoring the exercise of labor rights, which the Court applied to the posting defect.

Narvasa, C.J., Padilla, Regalado and Nocon, JJ., concur.