Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-49677 May 4, 1989
TRADE UNIONS OF THE PHILIPPINES AND ALLIED SERVICES, petitioner,
vs.
NATIONAL HOUSING CORPORATION a! ATT". VIRGILIO S", a# O$$%&'(-%-C)a(*' o$ +)'
,-('a- o$ La.o( R'/a+%o#, respondents.
Bonifacio V. Tupaz for petitioner.
The Government Corporate Counsel for respondent NHC.
Raul E. Espinosa for intervenor PAC!".

REGALADO, J.:
The employees of the public sector comprise the larest bloc of !or"ers in our national !or" force.
#overnmental bureaucracy is continually bein reorani$ed to cope !ith the ro!in comple%ity of
the problems and needs of political and administrative overnance. As the increase in the number of
overnment employees ro!s space, the need to enhance their !elfare correspondinly becomes
more imperative. &hile it may be assumed that the #overnment is e%ertin efforts to advance the
interests of its employees, it is 'uite understandable that the employees themselves should actively
see" arranements !here by they can participate more meaninfully in manaement and
employment relationships. There is, thus, a proliferation of unions or employees( orani$ations, each
see"in concomitant representational reconition.
The antecedent facts !hich led to the filin of this special civil action for certiorari are clear and
undisputed. The )uridical status and relevant circumstances of respondent corporation have been
established in a case of illeal dismissal filed aainst it, as previously decided by the Court and
hereinafter discussed. *o!ever, submitted this time for +ur resolution is a controversy on the
propriety of and re'uirements for certification elections in overnment,o!ned or controlled
corporations li"e the respondent.
Respondent National *ousin Corporation -hereinafter referred to as N*C. is a corporation
orani$ed in /010 in accordance !ith E%ecutive +rder No. 200, other!ise "no!n as the 3niform
Charter of #overnment Corporations, dated 4anuary /, /01/. 5ts shares of stoc" are and have been
one hundred percent -/667. o!ned by the #overnment from its incorporation under Act 810, the
former corporation la!. The overnment entities that o!n its shares of stoc" are the #overnment
9ervice 5nsurance 9ystem, the 9ocial 9ecurity 9ystem, the :evelopment Ban" of the Philippines,
the National 5nvestment and :evelopment Corporation and the People(s *omesite and *ousin
Corporation.
1
Petitioner Trade 3nions of the Philippines and Allied 9ervices -T3PA9, for brevity. is a
leitimate labor orani$ation !ith a chapter in N*C.
+n 4uly /2, /0;;, T3PA9 filed a petition for the conduct of a certification election !ith Reional
+ffice No. 5< of the :epartment of =abor in order to determine the e%clusive barainin
representative of the !or"ers in N*C. 5t !as claimed that its members comprised the ma)ority of the
employees of the corporation.
0
The petition !as dismissed by med,arbiter Eusebio M. 4imene$ in an
order, dated November ;, /0;;, holdin that N*C >bein a overnment,o!ned and?or controlled
corporation its employees?!or"ers are prohibited to form, )oin or assist any labor orani$ation for
purposes of collective barainin pursuant to 9ection /, Rule 55, Boo" < of the Rules and
Reulations 5mplementin the =abor Code.>
1
@rom this order of dismissal, T3PA9 appealed to the Bureau of =abor Relations
4
!here, actin
thereon in B=R Case No. A,0A8,;; -R+8,ME:,/606,;;., :irector Carmelo C. Noriel reversed the
order of dismissal and ordered the holdin of a certification election.
2
This order !as, ho!ever, set
aside by +fficer,in,Chare <irilio 9.4. 9y in his resolution of November B/, /0;A
6
upon a motion for
reconsideration of respondent N*C.
5n the instant petition for certiorari, T3PA9 see"s the reversal of the said resolution and prays that a
certification election be held amon the ran" and file employees of N*C.
5n retrospect, it !ill be recalled that in a former case of illeal dismissal involvin the same
respondent corporation,
7
&e had ruled that the employees of N*C and of other overnment o!ned
or controlled corporations !ere overned by civil service la!s, rules and reulations pursuant to the
/0;2 Constitution !hich provided that >the civil service embraces every branch, aency, subdivision
and instrumentality of the overnment, includin overnment,o!ned or controlled corporations.>
8
5t !as therein stressed that to allo! subsidiary corporations to be e%cluded from the civil service
la!s !ould be to permit the circumvention or emasculation of the above,'uoted constitutional
provision. As perceptively analy$ed therein, >-i.t !ould be possible for a reular ministry of
overnment to create a host of subsidiary corporations under the Corporation Code funded by a
!illin leislature. A overnment,o!ned corporation could create several subsidiary corporations.
These subsidiary corporation rations !ould en)oy the best of t!o !orlds. Their officials and
employees !ould be privileed individuals, free from the strict accountability re'uired by the Civil
9ervice :ecree and the reulations of the Commission on Audit. Their incomes !ould not be sub)ect
to the competitive restraints of the open mar"et nor to the terms and conditions of civil service
employment.>
The rule, ho!ever, !as modified in the /0A; Constitution, the correspondin provision !hereof
declares that >-t.he civil service embraces all branches, subdivisions, instrumentalities and aencies
of the overnment, includin overnment,o!ned or controlled corporations !ith oriinal charters.>
9
Conse'uently, the civil service no! covers only overnment o!ned or controlled corporations !ith
oriinal or leislative charters, that is those created by an act of Conress or by special la!, and not
those incorporated under and pursuant to a eneral leislation. As &e recently held C
..., the situations souht to be avoided by the /0;2 Constitution and e%pressed by this
Court in the National Housin# Corporation case ... appear releated to relative
insinificance by the /0A; Constitutional provision that the Civil 9ervice embraces
overnment,o!ned controlled corporations $ith ori#inal charters and therefore, by clear
implication, the Civil 9ervice does not include overnment,o!ned or controlled
corporations !hich are orani$ed as subsidiaries of overnment,o!ned or controlled
corporations under the eneral corporation la!.
13
&hile the aforecited cases souht different reliefs, that is, reinstatement conse'uent to illeal
dismissal, the samelis mota determinative of the present special civil action !as involved therein.
The !or"ers or employees of N*C undoubtedly have the riht to form unions or employees(
orani$ations. The riht to unioni$e or to form orani$ations is no! e%plicitly reconi$ed and ranted
to employees in both the overnmental and the private sectors. The Bill of Rihts provides that >-t.he
riht of the people, includin those employed in the public and private sectors, to form unions,
associations or societies for purposes not contrary to la! shall not be abrided>
11
This uarantee is reiterated in the second pararaph of 9ection 2, Article D555, on 9ocial 4ustice and
*uman Rihts, !hich mandates that the 9tate >shall uarantee the rihts of all !or"ers to self,
orani$ation, collective barainin and neotiations, and peaceful concerted activities, includin the
riht to stri"e in accordance !ith la! ....>
9pecifically !ith respect to overnment employees, the riht to unioni$e is reconi$ed in Pararaph
-1., 9ection B, Article 5D B
10
!hich provides that >-t.he riht to self,orani$ation shall not be denied to
overnment employees.> The rationale of and )ustification for this innovation !hich found e%pression
in the aforesaid provision !as e%plained by its proponents as follo!sE
... The overnment is in a sense the repository of the national sovereinty and, in that
respect, it must be held in reverence if not in a!e. 5t symboli$es the unity of the nation,
but it does perform a mundane tas" as !ell. 5t is an employer in every sense of the !ord
e%cept that terms and conditions of !or" are set forth throuh a Civil 9ervice
Commission. The overnment is the biest employer in the Philippines. There is an
employer,employee relationship and !e all "no! that the accumulated rievances of
several decades are no! beinnin to e%plode in our faces amon overnment !or"ers
!ho feel that the rihts afforded by the =abor Code, for e%ample, to !or"ers in the private
sector have been effectively denied to !or"ers in overnment in !hat loo"s li"e a
rotes'ue, -sic. a caricature of the e'ual protection of the la!s. @or e%ample, ... there
!ere many occasions under the old overnment !hen !aes and cost of livin
allo!ances !ere ranted to !or"ers in the private sector but denied to !or"ers in the
overnment for some reason or another, and the overnment did not even state the
reasons !hy. The overnment employees !ere bein discriminated aainst. As a eneral
rule, the ma)ority of the !orld(s countries no! entertain public service unions. &hat they
really add up to is that the employees of the overnment form their o!n association.
#enerally, they do not barain for !aes because these are fi%ed in the budet but they
do ac'uire a forum !here, amon other thins, professional and self,development is -sic.
promoted and encouraed. They also act as !atchdos of their o!n bosses so that !hen
raft and corruption is committed, enerally, it is the unions !ho are no loner afraid by
virtue of the armor of self,orani$ation that become the public(s o!n allies for detectin
raft and corruption and for e%posin it....
11
There is, therefore, no impediment to the holdin of a certification election amon the !or"ers of
N*C for it is clear that they are covered by the =abor Code, the N*C bein a overnment,o!ned
and?or controlled corporation !ithout an oriinal charter. 9tatutory implementation of the last cited
section of the Constitution is found in Article B88 of the =abor Code, as amended by E%ecutive +rder
No. ///, thusE
... Ri#ht of emplo%ees in the pu&lic service ' Employees of the overnment
corporations established under the Corporation Code shall have the riht to orani$e
and to barain collectively !ith their respective employers. All other employees in the
civil service shall have the riht to form associations for purposes not contrary to la!.
The records do not sho! that supervenin factual events have mooted the present action. 5t is meet,
ho!ever, to also call attention to the fact that, insofar as certification elections are concerned,
subse'uent statutory developments have rendered academic even the distinction bet!een the t!o
types of overnment,o!ned or controlled corporations and the la!s overnin employment relations
therein, as hereinbefore discussed. @or, !hether the employees of N*C are covered by the =abor
Code or by the civil service la!s, a certification election may be conducted.
@or employees in corporations and entities covered by the =abor Code, the determination of the
e%clusive barainin representative is particularly overned by Articles B11 to B10 of said Code.
Article B1F provides for the procedure !hen there is a representation issue in orani$ed
establishments, !hile Article B1; covers unorani$ed establishments. These =abor Code provisions
are fleshed out by Rules < to <55, Boo" < of the +mnibus 5mplementin Rules.
&ith respect to other civil servants, that is, employees of all branches, subdivisions, instrumentalities
and aencies of the overnment includin overnment,o!ned or controlled corporations !ith oriinal
charters and !ho are, therefore, covered by the civil service la!s, the uidelines for the e%ercise of
their riht to orani$e is provided for under E%ecutive +rder No. /A6. Chapter 5< thereof, consistin
of 9ections 0 to /B, reulates the determination of the >sole and e%clusive employees
representative>G 3nder 9ection /B, >!here there are t!o or more duly reistered employees(
orani$ations in the appropriate orani$ation unit, the Bureau of =abor Relations shall, upon petition
order the conduct of certification election and shall certify the !inner as the e%clusive representative
of the ran",and,file employees in said orani$ational unit.>
Parenthetically, note should be ta"en of the specific 'ualification in the Constitution that the 9tate
>shall uarantee the rihts of all !or"ers to self,orani$ation, collective barainin, and peaceful
concerted activities, includin the riht to stri"e in accordance $ith la$> and that they shall also
participate in policy and decision,ma"in processes affectin their rihts and benefits as ma% &e
provided &% la$.>
14
-Emphasis supplied..
+N T*E @+RE#+5N# C+N95:ERAT5+N9, the assailed resolution of the Bureau of =abor
Relations, dated November B/, /0;A, is ANN3==E: and 9ET A95:E and the conduct of a
certification election amon the affected employees of respondent National *ousin Corporation in
accordance !ith the rules therefor is hereby #RANTE:.
9+ +R:ERE:.
(ernan) C.*.) Narvasa) +elencio,Herrera) Gutierrez) *r.) Cruz) Paras) (eliciano) Padilla) Bidin)
-armiento) Cortes Gri.o A/uino and +edialdea) **.) concur.
Ganca%co) *.) on leave.

Foo+o+'#
/ Rollo, /0/G National *ousin Corporation vs. 4uco, et al., /28 9CRA /;B -/0A1..
B l&id., /8G Anne% A.
2 &id., B6, Anne% B.
8 l&id., B/, Anne% C.
1 l&id., B;, Anne% :.
F l&id., 2/, Anne% E.
; National *ousin Corporation vs. 4uco et al., ante.
A 9ec. /, Art. D55 B.
0 9ection B -/., Art. 5D B.
/6 National 9ervice Corporation, et al. vs. The *on. Third :ivision, National =abor
Relations Commission, etc., et al., #.R. No. F0A;6, Nov. B0, /0AAG see also Bliss
:evelopment Corporation vs. National =abor Relations Commission, et al., #.R. No.
ABAB8, Resolution, 4an. /A, /0A0.
// 9ec. A, Art. 555, /0A; Constitution.
/B Constitutional CommissionsG B. The Civil 9ervice Commission.
/2 Records of the Constitutional Commission, <ol. /, 1F;.
/8 9ec. 2 -Bnd par.., Art. D555.
The =a!phil Pro)ect , Arellano =a! @oundation