Describing and Delineating Unfair Labor Practice: Revisiting the Rule from Royal Interocean Lines to T&H Shopfitters
There is a well-known Latin maxim: Respice, Adspice, Prospice (Examine the past, examine the present, examine the future). Guided by this wise saying, the present article will briefly examine some selected cases and attempt to trace the inception and development of the doctrine that unfair labor practice (ULP) relates to the commission of acts that transgress the workers’ right to organize. In law school, we learned that a ULP is an unlawful act by the employer or labor union, defined as such under the Labor Code, which unduly interferes with one another’s rights and prerogatives. As specified in Articles 248 and 249 of the Labor Code, the prohibited acts must necessarily relate to the workers’ right to self-organization and to the observance of a collective bargaining agreement (CBA). Without the said vital element, “the acts, even if unfair, are not unfair labor practices.”
On February 26, 2014, our Supreme Court promulgated its decision in T&H Shopfitters Corp., et al. v. T&H Shopfitters Corp. Workers Union, et al., holding that the employer committed ULP upon a showing that the latter perpetrated the following acts during the pendency of a petition for certification election : (i) sponsoring a field trip to Zambales for its employees, to the exclusion of union members, before the scheduled certification election; (ii) the active campaign by the sales officer of the company against the union prevailing as a bargaining agent during the field trip; (iii) escorting its employees after the field trip to the polling center; (iv) the continuous hiring of subcontractors performing the functions of the employees; (v) assigning union members to the Cabangan site to work as grass cutters; and (vi) the assignment of work on a rotational basis for union members. The high tribunal found that these acts, taken together, reasonably support an inference that such were all orchestrated to restrict the employees’ free exercise of their right to self-organization. It stated that the employer’s actions prior and immediately before the scheduled certification election, while seemingly innocuous, unduly meddled in the affairs of its employees in selecting their exclusive bargaining representative. It likewise stressed that a certification election is the sole concern of the workers and, consequently, the employer had no business persuading and/or assisting its employees in this legally protected independent process of selecting their exclusive bargaining representative. In so deciding the T&H Shopfitters case, the Supreme Court relied on jurisprudence that it had established more than fifty (50) years ago when it declared, for the first time, that a complaint for ULP will prosper if, and only if, the act complained of is related to union activities and directed against the use of the right to employ or discharge as an instrument of discrimination, interference or oppression because of one’s labor or union activities.
In Royal Interocean Lines v. Court of Industrial Relations, the employee sent a letter to the company’s office in Hongkong, complaining against the latter’s manager in the Philippine for his “inconsiderate and untactful attitude” towards the employees under him and the clients of the company in the Philippines. The employee was terminated and she then charged the company and the manager with ULP under section 4(a) subsection 5 of Republic Act No. 875, otherwise known as the Industrial Peace Act (IPA). Construing the aforeqouted rule as including all cases where an employee is dismissed, discharged or otherwise prejudiced or discriminated against by reason of the filing by the employee with the court or elsewhere of any charge against her employer, the Court of Industrial Relations (CIR) found the company and its manager guilty of ULP and ordered the employee’s reinstatement, with backwages from the date of her dismissal.
The case was elevated to the Supreme Court and the issue squarely presented was whether or not the company committed ULP for having dismissed the employee because the latter had filed charges against the manager not connected with or necessarily arising from union activities.
Relying on American jurisprudence, the Supreme Court exonerated the company from the charge of ULP. Thus said the high tribunal:
The Court of Industrial relations has construed the foregoing as including all cases where an employee is dismissed, discharged or otherwise prejudiced or discriminated against by reason of the filing, by the latter with the court or elsewhere of any charge against his employer.
Section 4 (a) subsection 5, is part of the Magna-Charta of Labor which has these underlying purposes:
‘The experience under Commonwealth Act No. 213 which now regulates the subject, has shown the need for further safeguards to the rights of workers to organize. The attached bill seeks to provide these safeguards, following the pattern of United States National Labor Relations Act with suitable modifications demanded by local conditions. (Secs. 4-8.).
‘The bill will prevent unfair labor practices on the part of the employers including not only acts of anti-union discrimination but also those which are involved in the making of company unions.
‘The bill protects the workers in the process of organization and before as well as after the union is registered with the Department of Labor. Under Commonwealth Act No. 213, protection comes only after such registration.
‘The bill will prevent unfair labor practices expeditiously by direct orders which exercises (sic) a continuing restraint upon the employers to whom they are issued. Commonwealth Act No. 103 requires criminal prosecution which usually involves delay. Under this Act, by discharge of the penalty, an employer is free to commit the act again.’
Considering the policy behind the enactment of the statute, it is readily discoverable that the provisions of sections 1 and 3 are the bases for the protection of the laborers’ right to self-organization, and the enumeration in section 4 (of unfair labor practices), are nothing more than a detailed description of an employer’s acts that may interfere with the right to self-organization and collective bargaining.
The American courts, in interpreting the provision of the Wagner Act similar to section 4 (a), subsection 5, said:
‘The statute goes no further than to safeguard the right of employees to self-organization and to select representatives of their own choosing for collective bargaining or other mutual protection without restraint or coercion by their employer.
‘That is fundamental right. Employees have as clear a right to organize and select their representatives for lawful purpose as the respondent has to organize its business and select its own officers and agents. See Case of National Relations Board vs. Jones & Laughlin Steel Corp. 301 U. S. 1.).’
Consequently, with the above fundamental objective, the following judicial pronouncements give adequate panoply to the rights of the employer.
‘The protection of workers’ right to self-organization in no way interfere (sic) with employer’s freedom to enforce such rules and orders as are necessary to proper conduct of his business, so long as employer’s supervision is not for the purpose of intimidating or coercing his employees with respect to their self-organization and representation. (National Labor Relations Board v. Hudson Motor Car Co. C. C. A., 1942, 123 F. 2d. 528.)
‘It is the function of the court to see that the rights of self- organization and collective bargaining guaranteed by the Act are amply secured to the employee, but in its effort to prevent the prescribed unfair labor practices, the court must be mindful of the welfare of the honest employer. (Martel Mills Corp. vs. M. L.R. L., C. C. A. 1940, 11471 2d 264.).’
Despite the employee’s right to self-organization, the employer therefore still retains his inherent right to discipline his employees, his normal prerogative to hire or dismiss them. The prohibition is directed only against the use of the right to employ or discharge as an instrument of discrimination, interference or oppression because of one’s labor or union activities. (See Rotenberg on Labor Relations, pp. 398-399.) Even from a literal and grammatical point of view, the provision in dispute has to be interpreted in the sense that the charges, the cause of the dismissal of the employee, must be related to his right to self-organization, in order to give rise to unfair labor practice on the part of the employer. Under subsection 5 of section 4 (a), the employee’s (1) having filed charges or (2) having given testimony or (3) being about to give testimony, are modified by “under this Act” appearing after the last item. In other words, the three acts must have reference to the employees’ right to self-organization and collective bargaining, because the element of unfair labor practice is interference in such right. It would be redundant to repeat ‘under this Act’ after each enumeration connected by the disjunctive conjunction ‘or’.
As the respondent’s dismissal has no relation to union activities and the charges filed by her against the petitioner had nothing to do with or did not arise from her union activities, the appealed decision is hereby reversed and the directive for the respondent’s reinstatement with back pay revoked.”
Subsequently, in a related case, the company was ordered to pay the employee her salary for six (6) months considering that “the dismissal of the [employee] was without cause, because her inefficiency as the ground or reason for her dismissal as claimed by the [company] is belied by the successive increases of her compensation.”
About three (3) years following promulgation of Royal Interocean Lines and Mariano, the Supreme Court resolved the case of Sterling Products International, Inc. v. Sol and therein made this announcement:
In 1997, a pronouncement was made in one case that a complaint for ULP is not an ordinary dispute and, therefore, it requires a more thorough analysis, evaluation and appreciation of the factual and legal issues involved. This is so because by the very nature of a ULP, it is not only a violation of the civil rights of both labor and management but also a criminal offense against the State which is subject to prosecution and punishment.
Two (2) years later, in Great Pacific Life Employees Union v. Great Pacific Life Assurance Corp., the Supreme Court acknowledged that “[w]hile an act or decision of an employer may be unfair, certainly not every act or decision constitutes unfair labor practice… as defined and enumerated under Article 248 of the Labor Code.”
In 2003, the Supreme Court stated that the act complained of as ULP must have a direct relationship to the exercise of the employees’ right to self-organization and collective bargaining. Without this connection, the unfair acts will not qualify as ULP. The Court likewise clarified that if the prohibited acts bear no relationship to self-organization and to the observance of a CBA, then the acts, no matter how unfair, are not unfair labor practices. This was followed by Bisig Manggagawa sa Tryco v. NLRC, where it was reiterated that to be considered as ULP, the act must have been motivated by an intention to interfere with the workers’ right to organize. Absent any showing that the prohibited acts are related to the workers’ right to self-organization and to the observance of a CBA, “the acts, no matter how unfair, are not unfair labor practices.” In General Santos Coca-Cola Plant Free Workers Union – Tupas v. Coca-Cola Bottlers Phils., Inc., the rule was reaffirmed that without the presence of a crucial consideration, namely, that the prohibited acts are related to the workers’ right to self-organization and to observance of a CBA, “the acts, even if unfair, are not unfair labor practices.”
The Court was even more forthright in Central Azucarera de Bais Employees Union – NFL v. Central Azucarera de Bais, where it acknowledged that “anti-unionism [is] the evil sought to be punished in cases of unfair labor practices.” A year later, in 2011, the high tribunal remarked in Prince Transport, Inc. v. Garcia, that an act sought to be declared as ULP must be designed “as a subterfuge to foil the [workers’] right to organize themselves into a union. Under Article 248 (a) and (e) of the Labor Code, an employer is guilty of unfair labor practice if it interferes with, restrains or coerces its employees in the exercise of their right to self-organization or if it discriminates in regard to wages, hours of work and other terms and conditions of employment in order to encourage or discourage membership in any labor organization.” Thereafter, the Court declared illegal in another case the unceremonious dismissal of the workers by reason of their intent to form and organize a union even as it quoted with approval the Labor Arbiter’s finding that the organizers were terminated “to cripple the union at sight, to frustrate attempts of employees [to join or support it], preventing them, at all cost and to frustrate the employees’ bid to exercise their right to self-organization.”
The later case of Baptista v. Villanueva, once more focused on the primary concept of ULP insofar as it relates to the commission of acts that transgress the workers’ right to organize. Affirming that the prohibited acts must necessarily relate to the worker’s right to self-organization and to the observance of a CBA, the Court concluded by saying that “[a]bsent the said vital elements, the acts complained, although seemingly unjust, would not constitute ULP.”
And so, too, in T&H Shopfitters, did the Supreme Court readily recall the rule that ULP relates to the commission of acts that transgress the workers’ right to form a union. As mentioned in Articles 248 and 249 of the Labor Code, the prohibited acts must necessarily relate to the workers’ right to self-organization. Reminding us of the test in determining whether or not the employer has interfered with, restrained, or coerced the workers in the exercise of their right to self-organization, the Court contended:
As already seen, because it was convinced that the acts committed by the employer against the workers “all reek of interference on the part of [the employer]”, the Court did not hesitate to affirm the lower court’s ruling that the employer in T&H Shopfitters committed ULP. In fact, the Supreme Court emphatically stated that the various acts committed by the employer were all intended to prevent the workers’ free exercise of their right to self-organization. In the Court’s own words:
By way of conclusion, there is a common thread that weaves through and ties the cases that we have just reviewed and it is this: the Supreme Court has consistently confirmed and applied the doctrine it had first articulated in the case of Royal Interocean that for an act to be considered as ULP, it must be inextricably linked to, or connected with, the workers’ right to self-organization and the observance of a CBA. Without this causality, there can be no ULP at all.
