G.R. No. 160352; July 23, 2008
Republic of the Philippines, represented by Department of Labor and Employment (DOLE), Petitioner, vs. Kawashima Textile Mfg., Philippines, Inc., Respondent.

FACTS

Kawashima Free Workers Union-PTGWO Local Chapter No. 803 (KFWU) filed a petition for certification election among the rank-and-file employees of Kawashima Textile Mfg. Phils., Inc. The respondent company moved to dismiss the petition, alleging that KFWU had no legal personality because its membership included supervisory employees, violating Article 245 of the Labor Code, and it failed to submit its books of account. The Med-Arbiter dismissed the petition, ruling that the inclusion of at least two supervisory employees in the union’s membership meant it had not attained the status of a legitimate labor organization and thus lacked the personality to file the petition.
The union appealed to the DOLE Secretary, who reversed the Med-Arbiter’s order. The DOLE held that while Article 245 prohibits supervisory employees from joining rank-and-file unions, such mixed membership is not among the exclusive grounds for dismissing a certification election petition under the applicable rules, nor is it a ground for cancellation of union registration. The DOLE ordered the immediate conduct of a certification election. The Court of Appeals, however, reinstated the Med-Arbiter’s dismissal, prompting the Republic, through DOLE, to elevate the case via a Petition for Review on Certiorari.

ISSUE

Whether a local chapter, whose membership includes supervisory employees, is barred from filing a petition for certification election for rank-and-file employees.

RULING

The Supreme Court granted the petition, reversing the Court of Appeals and reinstating the DOLE Secretary’s decision. The Court clarified the legal logic by distinguishing between the right to file a certification election and the legitimacy of a labor organization. The requisites for filing a certification election are specifically enumerated in the Labor Code and its implementing rules. The only grounds for dismissing such a petition based on lack of legal personality are: (1) the union is not listed in the registry of legitimate labor organizations, or (2) its legal personality has been revoked with finality.
Here, KFWU was duly listed and held a valid certificate of creation; its registration had not been cancelled. The alleged inclusion of supervisory employees in its membership, while a violation of Article 245, pertains to a ground for cancellation of registration in a separate proceeding. It does not automatically negate its legal personality for the purpose of filing a certification election. The policy of the law is to encourage collective bargaining and allow workers to choose their representative freely. Dismissing the petition on this ground would unduly frustrate this policy. The proper remedy for the employer is to file a petition for cancellation of the union’s registration, but pending such cancellation, the union retains its legitimate status and the right to seek a certification election. The books of account issue was also deemed a matter for cancellation proceedings, not a bar to the petition.