G.R. No. L-21484 November 29, 1969
THE AGRICULTURAL CREDIT and COOPERATIVE FINANCING ADMINISTRATION (ACCFA), petitioner, vs. ACCFA SUPERVISORS’ ASSOCIATION, ACCFA WORKERS’ ASSOCIATION, and THE COURT OF INDUSTRIAL RELATIONS, respondents.

FACTS

The Agricultural Credit and Cooperative Financing Administration (ACCFA), a government agency created under Republic Act No. 821 , entered into a collective bargaining agreement with the ACCFA Supervisors’ Association (ASA) and the ACCFA Workers’ Association (AWA) on September 4, 1961, effective for one year from July 1, 1961. The Unions later protested alleged violations of the agreement and declared a strike on October 25, 1962. On October 30, 1962, the Unions, with their mother union CUGCO, filed an unfair labor practice complaint (Case No. 3450-ULP) with the Court of Industrial Relations (CIR) against ACCFA, alleging violations of the collective bargaining agreement, discrimination in promotions, and refusal to bargain. The CIR, in a decision dated March 25, 1963, ordered ACCFA to cease unfair labor practices, implement the collective bargaining agreement including a P30 monthly living allowance, and bargain in good faith. ACCFA appealed, questioning CIR jurisdiction, the validity and expiration of the bargaining agreement, and the factual basis for the unfair labor practice finding. Subsequently, under Republic Act No. 3844 (Agricultural Land Reform Code), ACCFA was reorganized and renamed the Agricultural Credit Administration (ACA). The Unions then filed a petition for certification election (Case No. 1327-MC) with the CIR to be certified as exclusive bargaining agents for ACA supervisors and rank-and-file employees. The CIR, in an order dated May 21, 1964, certified the Unions. ACA challenged this order, again contesting the CIR’s jurisdiction.

ISSUE

The principal issue is whether the Court of Industrial Relations has jurisdiction over the labor disputes involving ACCFA/ACA, which depends on whether the agency exercises governmental or proprietary functions.

RULING

The Supreme Court ruled that the ACCFA (and its successor ACA) exercises governmental functions. The Court examined the provisions of the Agricultural Land Reform Code, noting that the ACA was established to implement state policy on land reform and agricultural development, including extending credit to agriculture and farmers’ cooperatives, and was endowed with powers such as auditing cooperatives, issuing subpoenas, and prosecuting erring officials. These functions are governmental in character, as they are carried out pursuant to a declared state policy and involve the exercise of sovereign powers. Consequently, the ACCFA/ACA is a government agency performing governmental functions, and its employees are therefore government employees. As such, labor disputes involving them fall under the jurisdiction of the Civil Service Commission and the ordinary courts, not the Court of Industrial Relations. The CIR thus had no jurisdiction over the unfair labor practice case and the petition for certification election. The appealed decision and order of the CIR were set aside.