When Can an Employer Be Held Liable for Unfair Labor Practices?

EMPLOYEES UNION OF BAYER PHILS., FFW AND JUANITO S. FACUNDO, IN HIS CAPACITY AS PRESIDENT, VS. BAYER PHILIPPINES, INC., DIETER J. LONISHEN (PRESIDENT), ASUNCION AMISTOSO (HRD MANAGER), AVELINA REMIGIO AND ANASTACIA VILLAREAL, RESPONDENTS. G.R. No. 162943, December 06, 2010

Imagine a company recognizing and negotiating with a group of employees who broke away from the official union, undermining the collective bargaining agreement (CBA). This scenario highlights the critical issue of unfair labor practices in the Philippines, specifically when an employer deals with a splinter union while a valid CBA with the legitimate union exists. The Supreme Court case of Employees Union of Bayer Phils. v. Bayer Philippines, Inc. delves into this very issue, clarifying the boundaries of permissible employer conduct in labor relations.

This case revolves around the question of whether the management of Bayer Philippines committed unfair labor practice by negotiating with a splinter group, the Reformed Employees Union of Bayer Philippines (REUBP), despite having a valid and existing CBA with the Employees Union of Bayer Philippines (EUBP). The decision provides valuable insights into the obligations of employers in maintaining fair labor practices and respecting the rights of legitimate labor organizations.

Understanding Unfair Labor Practices in the Philippines

The Labor Code of the Philippines defines unfair labor practices as actions by employers or labor organizations that violate the right of employees to self-organization and collective bargaining. These practices are considered unlawful and can lead to administrative and criminal penalties. Article 248 of the Labor Code lists specific acts that constitute unfair labor practices by employers, including:

• Interfering with, restraining, or coercing employees in the exercise of their right to self-organization.
• Dominating or assisting in the formation or administration of any labor organization.
• Discriminating in regard to wages, hours of work, or other conditions of employment to encourage or discourage membership in any labor organization.
• Dismissing, discharging, or otherwise prejudicing or discriminating against an employee for having given or being about to give testimony under the Labor Code.
• Violating a collective bargaining agreement.

Article 253 of the Labor Code further emphasizes the duty to bargain collectively, stating: “Where there is a collective bargaining agreement, the duty to bargain collectively shall also mean that neither party shall terminate or modify such agreement during its lifetime.” This provision underscores the importance of honoring existing CBAs to maintain stability and cooperation between labor and capital.

The Bayer Philippines Case: A Tug-of-War Between Unions

The Employees Union of Bayer Philippines (EUBP), affiliated with the Federation of Free Workers (FFW), was the exclusive bargaining agent for Bayer Philippines’ rank-and-file employees. After a bargaining deadlock in 1997, a strike ensued, leading the Secretary of the Department of Labor and Employment (DOLE) to assume jurisdiction over the dispute. While the dispute was pending, a faction of union members, led by Avelina Remigio, accepted Bayer’s wage-increase proposal without authorization from the union leadership.

This action created a rift within the union, culminating in Remigio soliciting signatures to disaffiliate from FFW and form a new union, the Reformed Employees Union of Bayer Philippines (REUBP). This led to a power struggle between EUBP and REUBP, with both seeking recognition from Bayer and demanding remittance of union dues.

Here’s a breakdown of the key events:

• August 3, 1998: Remigio’s group solicits signatures to disaffiliate from FFW and form REUBP.
• September 8, 1998: REUBP informs Facundo, FFW, and Bayer of the disaffiliation decision.
• September 15, 1998: EUBP files an unfair labor practice (ULP) complaint against Bayer for non-remittance of union dues.
• February 9, 1999: Bayer turns over collected union dues to REUBP.
• December 17, 1999: EUBP files a second ULP complaint, alleging Bayer negotiated with REUBP and violated the CBA.
• February 21, 2000: Bayer signs a new CBA with REUBP.

The case eventually reached the Supreme Court, which had to determine whether Bayer’s actions constituted unfair labor practice.

The Supreme Court emphasized the importance of respecting existing CBAs: “An employer should not be allowed to rescind unilaterally its CBA with the duly certified bargaining agent it had previously contracted with, and decide to bargain anew with a different group if there is no legitimate reason for doing so and without first following the proper procedure.”

The Court further stated that Bayer’s actions demonstrated an anti-EUBP sentiment: “The totality of respondents’ conduct, therefore, reeks with anti-EUBP animus.”

The Implications for Employers and Unions

This case serves as a stark reminder to employers of their obligations to respect and uphold existing collective bargaining agreements. Negotiating with a splinter union while a valid CBA is in place can be construed as an act of unfair labor practice, leading to legal repercussions. The ruling reinforces the principle that CBAs are binding contracts that must be honored by both employers and unions.

Key Lessons

• Respect Existing CBAs: Employers must adhere to the terms and conditions of valid CBAs.
• Avoid Dealing with Splinter Unions: Negotiating with a splinter union while a CBA with the legitimate union is in effect can be considered unfair labor practice.
• Maintain Neutrality: Employers should avoid actions that demonstrate bias or interference in internal union matters.

Frequently Asked Questions

What constitutes an unfair labor practice in the Philippines?

Unfair labor practices are actions by employers or labor organizations that violate the right of employees to self-organization and collective bargaining, as defined in the Labor Code.

Can an employer negotiate with a splinter union if there’s a valid CBA with the original union?

Generally, no. Negotiating with a splinter union while a valid CBA is in place can be considered an unfair labor practice.

What are the penalties for committing unfair labor practices?

Penalties can include administrative fines, cease and desist orders, and even criminal charges in certain cases.

What should a union do if the employer is negotiating with a splinter group?

The union should file an unfair labor practice complaint with the appropriate labor authorities.

What is the role of the DOLE in labor disputes?

The DOLE plays a crucial role in mediating and resolving labor disputes, ensuring compliance with labor laws, and protecting the rights of workers.

What is the importance of a Collective Bargaining Agreement (CBA)?

A CBA fosters stability and mutual cooperation between labor and capital and becomes the law between the parties during its period of duration.

What is the difference between inter-union and intra-union disputes?

Inter-union disputes are between two or more unions, while intra-union disputes are conflicts within a single union.

ASG Law specializes in labor law and employment disputes. Contact us or email hello@asglawpartners.com to schedule a consultation.