Laguesma, Abrillius Raffy C.Labor Relations

San Miguel Corporation Employees Union vs. Honorable Ma. Nieves D. Confesor262 SCRA 81

FACTS:On June 28, 1990, San Miguel Corporation Employees Union entered into a Collective Bargaining Agreement with San Miguel Corporation to take effect upon the expiration of the previous CBA on June 30, 1989. San Miguel Corporation (SMC) was formerly composed of four (4) business divisions namely: (1) Beer, (2) Packaging, (3) Feeds and Livestock, (4) Magnolia and Agri-business. On August 13, 1991, San Miguel Corporation informed its employees that it would undergo restructuring effective October 1, 1991. Magnolia and Feed and Livestock Division became two separate and distinct corporations: Magnolia Corporation and San Miguel Foods Incorporated. Despite the restructuring, the CBA previously entered into by the Union and San Miguel Corporation remained in force and effect. On June 30, 1992, the CBA was renegotiated. The Union contends that the bargaining unit of San Miguel Corporation should still include the employees of Magnolia and San Miguel Foods Inc. despite the restructuring and that the CBA shall be effective for the remaining period of two (2) years or until June 30, 1994.However, San Miguel Corporation argued that the employees who had moved to Magnolia and San Miguel Foods Inc. automatically ceased to be part of the bargaining unit at San Miguel Corporation and the CBA should be effective for three (3) years in accordance with Article 253-A of the Labor Code. Since the Union and San Miguel Corporation were unable to agree on the issues, the Union declared a deadlock on September 29, 1990 and a Notice of Strike was filed against San Miguel Corporation two (2) years after. To avert a strike, San Miguel Corporation enlisted the intervention of the National Conciliation and Mediation Board to conduct preventive mediation. Still, no settlement was arrived at. Subsequently, the Secretary of Labor assumed jurisdiction over the case and issued the assailed order directing that the renegotiated terms of the CBA shall be effective for the period of three (3) years from June 30, 1992 and that the CBA shall cover only the employees of San Miguel Corporation and not of Magnolia and San Miguel Foods Inc.ISSUES:1. Whether or not the duration of the renegotiated terms of the CBA is to be effective for three years or for only two years?; and2. Whether or not the bargaining unit of SMC includes also the employees of Magnolia and SMFI?RULING:1. The renegotiated terms of the CBA is to be effective for three (3) years following the rule under Article 253-A of the Labor Code. As held by the Court, the representation aspect refers to the identity and majority status of the union that negotiated the CBA as the exclusive bargaining representative and this is given a period of five (5) years. On the other hand, the Court also held that the phrase all other provisions simply refers to the rest of the CBA, economic as well as non-economic provisions which should be renegotiated not later than three (3) years before expiration. 2. No. Magnolia and San Miguel Foods Inc. became distinct entities with separate juridical personalities. Thus, they cannot belong to a single bargaining unit. Furthermore, to determine the appropriate bargaining unit, the test of grouping is mutuality or commonality of interest. The employees sought to be represented must have substantial mutual interest in terms of employment and working conditions as evinced by the type of work they perform. The interest of the employees in the different companies differ not only on the nature of the products produced and skills required but also they have different volumes of work and different working conditions.

Laguesma, Abrillius Raffy C.Labor Relations

San Miguel Corporation Supervisors v. Honorable Bienvenido Laguesma277 SCRA 370

FACTS:San Miguel Corporation Supervisors and Exempt Union filed before DOLE a Petition for Direct Certification or Certification Election among the supervisors and exempt employees of the SMC Magnolia Poultry Products Plants of Cabuyao, San Fernando and Otis. Med-Arbiter Danilo L. Reynante issued an Order ordering the conduct of certification election among the abovementioned employees of the different plants as one bargaining unit.San Miguel Corporation filed a Notice of Appeal with Memorandum on Appeal, pointing out, among others, the Med-Arbiters error in grouping together all three (3) separate plants, into one bargaining unit, and in including supervisory levels 3 and above whose positions are confidential in nature. The public respondent, Undersecretary Laguesma, granted respondent companys Appeal and ordered the remand of the case to the Med-Arbiter of origin for determination of the true classification of each of the employees sought to be included in the appropriate bargaining unit. Upon petitioner-unions motion, Undersecretary Laguesma granted the reconsideration prayed for and directed the conduct of separate certification elections among the supervisors ranked as supervisory levels 1 to 4 (S1 to S4) and the exempt employees in each of the three plants at Cabuyao, San Fernando and Otis.ISSUE:1. Whether Supervisory employees 3 and 4 and the exempt employees of the company are considered confidential employees, hence ineligible from joining a union?2. If they are not confidential employees, do the employees of the three plants constitute an appropriate single bargaining unit?RULING:

1. No. The Court ruled that said employees do not fall within the term confidential employees who may be prohibited from joining a union. They are not also qualified to be classified as managerial employees who, under Article 245 of the Labor Code, are not eligible to join, assist or form any labor organization. In the very same provision, they are not allowed membership in a labor organization of the rank-and-file employees but may join, assist or form separate labor organizations of their own.

Furthermore, the Court said that confidential employees are those who (1) assist or act in a confidential capacity, (2) to persons who formulate, determine, and effectuate management policies in the field of labor relations. The two criteria are cumulative, and both must be met if an employee is to be considered a confidential employee that is, the confidential relationship must exist between the employee and his supervisor, and the supervisor must handle the prescribed responsibilities relating to labor relations. The exclusion from bargaining units of employees who, in the normal course of their duties, become aware of management policies relating to labor relations is a principal objective sought to be accomplished by the confidential employee rule. The broad rationale behind this rule is that employees should not be placed in a position involving a potential conflict of interests. Management should not be required to handle labor relations matters through employees who are represented by the union with which the company is required to deal and who in the normal performance of their duties may obtain advance information of the companys position with regard to contract negotiations, the disposition of grievances, or other labor relations matters. The Court held that if these managerial employees would belong to or be affiliated with a Union, the latter might not be assured of their loyalty to the Union in view of evident conflict of interest. The Union can also become company-dominated with the presence of managerial employees in Union membership.An important element of the confidential employee rule is the employees need to use labor relations information. Thus, in determining the confidentiality of certain employees, a key question frequently considered is the employees necessary access to confidential labor relations information.

2. Yes. The fact that the three plants are located in three different places, namely, in Cabuyao, Laguna, in Otis, Pandacan, Metro Manila, and in San Fernando, Pampanga is immaterial. Geographical location can be completely disregarded if the communal or mutual interests of the employees are not sacrificed. An appropriate bargaining unit may be defined as a group of employees of a given employer, comprised of all or less than all of the entire body of employees, which the collective interest of all the employees, consistent with equity to the employer, indicate to be best suited to serve the reciprocal rights and duties of the parties under the collective bargaining provisions of the law.A unit to be appropriate must effect a grouping of employees who have substantial, mutual interests in wages, hours, working conditions and other subjects of collective bargaining.