G.R. No. L-70067 September 15, 1986
CARLOS P. GALVADORES, ET AL., petitioners, vs. CRESENCIANO B. TRAJANO, Director of the Bureau of Labor Relations, MANGGAGAWA NG KOMUNIKASYON SA PILIPINAS (FIWU), PHILIPPINE LONG DISTANCE COMPANY (PLDT), and JOSE C. ESPINAS, respondents.

FACTS

Petitioners are employees of PLDT and members of the respondent union. The union engaged respondent counsel on a contingent fee basis to represent it in a collective bargaining deadlock with PLDT. The agreement stipulated a fee of ten percent of any improvement over PLDT’s last offer. The Minister of Labor assumed jurisdiction and, through compulsory arbitration, awarded wage increases exceeding PLDT’s last offer. The union’s executive board then passed a resolution requesting PLDT to deduct P115.00 per employee from the awarded benefits as attorney’s fees for respondent counsel.
Petitioners, numbering 5,258, filed a complaint assailing the check-off. They argued it violated Article 242(o) of the Labor Code, requiring individual written authorizations for such deductions, and that the fees were unreasonable. The union later conducted a plebiscite where members purportedly ratified the board resolution. The Bureau of Labor Relations Director dismissed the complaint, relying on this plebiscite. Petitioners challenged this, arguing the plebiscite question was misleading as it assumed no dispute existed over the attorney’s fees.

ISSUE

Whether the check-off for attorney’s fees from the employees’ monetary benefits, without individual written authorizations, is valid under the Labor Code.

RULING

The Supreme Court ruled the check-off was invalid. The legal logic rests on the clear mandate of Articles 222(b) and 242(o) of the Labor Code. Article 222(b) explicitly states that attorney’s fees for collective bargaining negotiations shall be paid from union funds, and any contrary agreement is void. Article 242(o) further provides that no special assessment or attorney’s fees may be checked off from any amount due an employee without an individual written authorization specifying the amount, purpose, and beneficiary.
The Court rejected the respondents’ argument that the compulsory arbitration proceedings constituted a “mandatory activity” exempt from these requirements. The benefits awarded still emanated from the collective bargaining process, albeit resolved through arbitration, and such a judicial or quasi-judicial process is not the “mandatory activity” contemplated by the Code that dispenses with individual authorizations. The plebiscite did not cure the defect, as the question asked was not an explicit, individual authorization as required by law and was deemed misleading. The cardinal principle is the protection of employees from unwarranted deductions without their knowledge and consent. Consequently, the assailed decision was set aside. The attorney’s fees, if payable, must be charged against union funds as provided by Article 222(b).