(The case of South Cotabato Integrated Port Services vs. Romeo Montefalco, Jr., G.R. No. 235569, December 13, 2023)
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In a recent development in labor jurisprudence, the question of jurisdiction over complaints regarding non-remittance of union dues by employers has been decisively settled. A recent ruling emphasized that such complaints, arising from the failure of employers to remit collected union member dues as stipulated in a Collective Bargaining Agreement (CBA), do not fall under the purview of “intra-union disputes.” Instead, they constitute unfair labor practices, specifically interference with employees’ rights to self-organization.
This distinction is important as it clarifies the appropriate venue for resolving such disputes. While intra-union disputes typically fall under the jurisdiction of Mediator-Arbiters (Med-Arbiters), cases involving employer interference with union dues now squarely fall within the realm of the Labor Arbiter’s authority.
Doctrine of the case:
A complaint charging the employer for non-remittance of collected union member dues by virtue of a check-off provision in the CBA, does not fall under “intra-union disputes” over which the Mediator-Arbiter (Med-Arbiter) may exercise jurisdiction. The charge constitutes an unfair labor practice on the part of the employer, being in the nature of interference, as it curtails the employees’ right to self-organization. Hence, it is the Labor Arbiter who has jurisdiction to settle the controversy.
Facts:
In August 2010, Makar Port Labor Organization (MPLO), represented by its President Mario Marigon, filed a petition alleging unfair labor practice (ULP) against South Cotabato Integrated Port Services, Inc. (SCIPSI) at the Department of Labor and Employment (DOLE) Regional Office No. 12. MPLO had been the exclusive bargaining agent for SCIPSI’s rank-and-file employees from 1999 to 2007.
Marigon claimed that SCIPSI had ceased remitting monthly dues collected from MPLO members via salary deductions, despite demands and clarification from the DOLE Regional Director. He argued that SCIPSI’s withholding of dues constituted harassment and interference with union affairs. Marigon sought an order for SCIPSI to release the withheld amounts.
SCIPSI countered that Marigon, who was dismissed from employment in 2007, lacked the legal capacity to sue on behalf of MPLO and demand remittance of dues. Additionally, SCIPSI argued that the ULP charge had prescribed, as more than a year had passed since the dues were collected and Marigon filed the complaint in 2010.
Ruling of the Med-Arbiter
On December 13, 2010, Mediator-Arbiter Jasmin M. Demetillo issued an order in response to the petition filed by MPLO against SCIPSI. The order directed MPLO to specify the authorized person to receive unremitted union dues and instructed SCIPSI to release the withheld dues collected from August 2006 to February 2010, within specific timelines.
Med-Arbiter Demetillo reasoned that the existing collective bargaining agreement (CBA) between MPLO and SCIPSI remained in effect until February 11, 2007, as per Article 253 of the Labor Code. Therefore, MPLO, as the sole bargaining agent until the proclamation of a new agent, was entitled to the union dues collected during this period.
Ruling of the Bureau of Labor Relations
The BLR modified the decision of Mediator-Arbiter Demetillo, directing MPLO to submit a member list and designate a representative for unremitted union dues. SCIPSI was instructed to release dues to MPLO’s designated representative, unless evidence showed dues from February 2007 onwards had been remitted.
The BLR ruled that Saranggani Marine and General Workers Union – Trade Unions of the Philippines and Allied Services (SAMAGEWU-TUPAS) had no legal interest in the dues, considering they were collected from MPLO members. It viewed the case as an intra-union dispute, not an unfair labor practice.
Ruling of the Court of Appeals
On January 31, 2017, the CA rendered a Decision affirming the BLR. It sustained the BLR’s finding that the case involved an intra-union dispute since SCIPSI sought a determination of who has the right to receive the union dues. Hence, the Med-Arbiter has jurisdiction over the case.
Issue:
Whether or not the Court of Appeals committed serious errors of fact and law in affirming that the Med-Arbiter had jurisdiction over the unfair labor practice complaint filed.
Ruling:
The Med-Arbiter has no jurisdiction over the Petition filed by Marigon. It is a basic rule that jurisdiction over the subject matter is determined upon the allegations in the complaint, irrespective of whether the plaintiff is entitled to recover upon the claims being prayed for. In labor proceedings, the allegations made in the complaint and in the position paper may be considered in determining jurisdiction.
If the allegations in the complaint involve ULP, it is the Labor Arbiter who has jurisdiction pursuant to Article 224 of the Labor Code. ULP generally refers to acts that violate the worker’s right to self-organization. Article 259 of the Labor Code, enumerates the different types of ULP that may be committed by the employer, viz.:
ARTICLE 259. [248] Unfair Labor Practices of Employers. — It shall be unlawful for an employer to commit any of the following unfair labor practices:
(a) To interfere with, restrain or coerce employees in the exercise of their right to self-organization;
An employer incurs liability for ULP under Article 259(a) when it engages in acts that reasonably tend to interfere with the employees’ right to self-organization
Thus, an employer may be liable for ULP when it fails to deduct union dues and assessments from the employees’ salaries by virtue of a check-off provision in the CBA. An employer’s full compliance with the check-off provision in the CBA is vital to the union’s role of advocating for the interests of the members of the bargaining unit.
On the other hand, a Med-Arbiter is an officer in the DOLE Regional Office or BLR who is authorized to hear and decide representation cases, inter/intra-union disputes and other labor relations disputes, except cases involving cancellation of union registration. An “intra-union dispute” refers to any conflict between and among union members, including grievances arising from any violation of the rights and conditions of membership, violation of or disagreement over any provision of the union’s constitution and by-laws, or disputes arising from chartering or affiliation of union
Clearly, the allegations in Marigon’s Petition did not involve an intraunion dispute as ruled by the BLR and the CA. On the contrary, it was a case of ULP which had a direct connection to the alleged noncompliance of SCIPSI with the check-off provision in its CBA with MPLO. Such noncompliance of SCIPSI is in the form of an interference with the right of its rank-and-file employees to self-organization under Article 259(a) of the Labor Code.
It bears reiterating that the process of check-off, which involves the deduction of fees from the employees and the subsequent remittance of the collected amount to the bargaining representative, assures the latter of continuous funding. Without such funds, the union, in this case MPLO, would not be effective in discharging its duties and responsibilities as the exclusive bargaining representative of its members. Ineluctably, an allegation of unlawful withholding by the employer of the collected union members’ fees under a check-off provision in the CBA establishes a case of ULP. As such, the Med-Arbiter cannot exercise jurisdiction over the case since Article 224 of the Labor Code expressly vests jurisdiction over ULP cases on the Labor Arbiter.
Thus, it was erroneous for the CA and the BLR to declare that the case involved an intra-union dispute between two factions within MPLO. Both the CA and the BLR failed to consider that the issue as to which of the two groups had the right to receive the collected union dues only arose after Med-Arbiter Demetillo issued the December 13, 2010 Order or during its execution stage. Else stated, the matter of intra-union controversy would not have arisen if not for the December 13, 2010 Order of Med-Arbiter Demetillo.
In conclusion, Marigon’s petition alleged ULP stemming from SCIPSI’s non-remittance of union dues, a matter directly impacting the right of employees to self-organization. Such cases are explicitly within the purview of Labor Arbiters, as outlined in the Labor Code.
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G.R. No. 244695, 244752, 245294, February 14, 2024)
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