G.R. No. 49677 . May 4, 1989.
TRADE UNIONS OF THE PHILIPPINES AND ALLIED SERVICES (TUPAS), petitioner, vs. NATIONAL HOUSING CORPORATION (NHC) and ATTY. VIRGILIO SY, as Officer-in-Charge of the Bureau of Labor Relations, respondents.

FACTS

Petitioner TUPAS, a legitimate labor organization, filed a petition for a certification election among the rank-and-file employees of respondent National Housing Corporation (NHC). The NHC is a government-owned or controlled corporation, with its shares entirely owned by government financial institutions. The Med-Arbiter dismissed the petition, ruling that employees of government corporations were prohibited from forming unions for collective bargaining under the implementing rules of the Labor Code. The Bureau of Labor Relations (BLR) initially reversed this dismissal and ordered an election. However, upon the NHC’s motion for reconsideration, BLR Officer-in-Charge Virgilio Sy set aside the order, prompting TUPAS to file this certiorari petition.
The core dispute centered on whether employees of a government-owned or controlled corporation like the NHC possess the right to form a union and seek a certification election for collective bargaining. This issue required a determination of the applicable constitutional and legal regime governing the civil service status and labor rights of such employees, particularly in light of the transition from the 1973 Constitution to the 1987 Constitution .

ISSUE

Whether the employees of the National Housing Corporation, a government-owned or controlled corporation, have the right to form a union and to hold a certification election for the purpose of collective bargaining.

RULING

Yes. The Supreme Court granted the petition, annulled the BLR resolution, and ordered the conduct of a certification election. The ruling hinges on the distinction made by the 1987 Constitution regarding the coverage of the civil service. Under the 1973 Constitution, the civil service embraced all government-owned or controlled corporations, which led the Court in a prior case involving NHC to hold that its employees were governed by civil service laws and regulations, which traditionally did not include the right to collective bargaining. However, the 1987 Constitution explicitly limits civil service coverage to government-owned or controlled corporations “with original charters,” meaning those created by a special law or act of Congress. Corporations like the NHC, which are organized under the general Corporation Law ( Act No. 1459 , the former corporation law), are excluded from the civil service system by clear implication.
Consequently, employees of government corporations without original charters, such as the NHC, are not subject to civil service rules but to the Labor Code. The 1987 Constitution guarantees the right of all workers, including those in the public sector, to self-organization. Therefore, the employees of NHC have the constitutional and statutory right to form unions. The procedure for determining their exclusive bargaining representative is governed by the pertinent articles of the Labor Code and its implementing rules, which include the holding of a certification election. The Court clarified that for civil service employees (those in corporations with original charters), the right to organize is governed by Executive Order No. 180, but for employees in corporations like NHC, the regular labor relations machinery applies.