G.R. No. 210773 , January 23, 2019
GSIS FAMILY BANK EMPLOYEES UNION, REPRESENTED BY ITS PRESIDENT MS. JUDITH JOCELYN MARTINEZ, Petitioner, vs. SEC. CESAR L. VILLANUEVA, MR. EMMANUEL L. BENITEZ, AND ATTY. GERALDINE MARIE BERBERABE-MARTINEZ, Respondents.

FACTS

GSIS Family Bank originated as the privately organized Royal Savings Bank. Following financial distress and a series of transactions culminating in the Government Service Insurance System (GSIS) acquiring 99.55% of its shares, it became a government-owned bank. The petitioner Union sought to negotiate a new collective bargaining agreement (CBA), arguing the bank was not covered by Republic Act No. 10149 (the GOCC Governance Act of 2011) as it was not created by a special charter but under the general corporation law.
The Governance Commission for GOCCs classified GSIS Family Bank as a government financial institution covered by RA 10149. Consequently, the bank’s management, citing the law and related executive orders imposing a compensation standardization policy and moratorium on salary increases for GOCCs, refused to negotiate on economic provisions in a new CBA. The Union filed this petition to compel CBA negotiations.

ISSUE

Whether GSIS Family Bank, a GOCC without an original charter, is exempt from the coverage of RA 10149, thereby obligating it to negotiate a complete CBA, including economic terms, with its employees’ union.

RULING

The Supreme Court denied the petition. The Court held that GSIS Family Bank is unequivocally a GOCC under RA 10149, as it is a stock corporation majority-owned by the government. The law’s definition is controlling and does not require a special charter for coverage; government ownership to the extent of at least a majority of the capital stock suffices.
The legal logic is clear: while employees of non-chartered GOCCs are covered by the Labor Code and may negotiate CBAs, RA 10149 and its implementing rules, particularly the Compensation and Position Classification System (CPCS) for the GOCC sector, impose a uniform standard for salaries and benefits. This system, established to rationalize compensation across all GOCCs, limits the scope of negotiable items. Economic terms such as salaries, incentives, and benefits are now primarily governed by this statutory classification system. Therefore, the bank cannot be compelled to negotiate on these standardized economic terms, as doing so would violate the law and undermine the uniform compensation policy mandated for all covered GOCCs. The right to bargain collectively remains but is constitutionally subject to limitations imposed by law for the common good, such as the fiscal discipline and standardization objectives of RA 10149.