Asian Institute Of Management Faculty Association v. Asian Institute Of Management
Asian Institute of Management Faculty Association v. Asian Institute of Management, G.R. Nos. 197089 & 207971, August 31, 2022
- Labor Law
- managerial employees
- faculty members
- certification election
- labor organization
- cancellation of registration
- collateral attack
- bystander rule
- self-organization
- inclusion-exclusion
- Asian Institute of Management
I. Facts of the Case
The Asian Institute of Management (AIM) is an unorganized establishment whose faculty members formed the Asian Institute of Management Faculty Association (AFA), which DOLE registered as a legitimate labor organization. AIM opposed AFA's petition for certification election and sought cancellation of its registration, claiming the faculty are managerial employees and that AFA misrepresented its members as rank-and-file. The consolidated cases ask whether the faculty are managerial employees, whether a union's legitimacy may be attacked in a certification election case, and whether AFA's registration should be cancelled.
1968
AIM has been an unorganized establishment since 1968, with no recognized union among its employees.
October 14, 2004
AIM faculty members formed and organized AFA to act for and on behalf of its members in matters affecting their rights and interests.
December 20, 2004
DOLE issued AFA a Certificate of Registration recognizing it as a legitimate labor organization. AIM opposed the registration, arguing that its faculty were managerial employees because the tenure-track faculty determined faculty standards subject to Board of Trustees approval.
May 16, 2007
AFA filed a Petition for Certification Election before DOLE-NCR to determine the exclusive bargaining agent of AIM's faculty members.
July 11, 2007
AIM filed a Petition for Cancellation of AFA's Certificate of Registration, alleging that AFA misrepresented that its members were rank-and-file employees. This gave rise to G.R. No. 207971.
August 30, 2007
Mediator-Arbiter Michael T. Parado denied the Petition for Certification Election, finding that all AFA members were managerial employees. AFA appealed to the Secretary of Labor and Employment.
February 16, 2009
DOLE-NCR granted AIM's Petition for Cancellation and directed that AFA be delisted from the roster of legitimate labor organizations.
February 20, 2009
The Secretary of Labor reversed the Mediator-Arbiter. He found the faculty were not managerial employees because their policymaking was merely recommendatory, they observed regular hours, and their responsibilities were academic. He ordered a certification election between AFA and No Union.
May 4, 2009
The Secretary denied AIM's Motion for Reconsideration. AIM filed a Petition for Certiorari before the Court of Appeals (CA-G.R. SP No. 109487).
October 16, 2009
After a pre-certification election conference, the certification election commenced.
December 29, 2009
On AFA's appeal, the Bureau of Labor Relations ordered AFA to remain in the roster of legitimate labor organizations. AFA informed the Court of Appeals of this through its August 19, 2010 Memorandum.
October 22, 2010
The Court of Appeals granted AIM's Petition for Certiorari, reversed the Secretary and reinstated the Mediator-Arbiter's Order. It held that the Secretary used the outdated test for managerial employees, relied on a mere footnote in the Policy Manual, confused managerial employees with managerial staff (by relying on rigid work hours), and overlooked that AFA was supposedly delisted. It also faulted reliance on Engineering Equipment because that case predated Republic Act No. 6715.
May 27, 2011
The Court of Appeals denied AFA's Motion for Reconsideration, stating that even if AFA were legitimate, about 90% of the faculty performed administrative functions and were managerial employees. AFA then filed a Petition for Review on Certiorari (G.R. No. 197089).
January 8, 2013
In the cancellation case, the Court of Appeals (CA-G.R. SP No. 114112) affirmed the Bureau of Labor Relations' ruling sustaining AFA's registration. It denied AIM's Motion for Reconsideration on June 27, 2013, and AIM filed a Petition for Review on Certiorari (G.R. No. 207971).
January 23, 2017
The Supreme Court consolidated G.R. No. 207971 with G.R. No. 197089, since the outcome of the former depended on whether AFA's members were managerial employees. AFA argued that union legitimacy cannot be collaterally attacked, the employer lacks standing, and the faculty are not managerial. AIM argued the faculty run the Institute operationally, hold most administrative posts, are not subject to rigid hours, and that AFA misrepresented itself as rank-and-file.
II. Issues
Whether or not the faculty members of the Asian Institute of Management are managerial employees who are ineligible to join a labor organization and participate in a certification election.
Whether or not the legitimacy of a labor organization may be attacked in a petition for certification election, and whether AIM, as employer, has the right to oppose the petition.
Whether or not the registration of the Asian Institute of Management Faculty Association as a legitimate labor organization should be cancelled.
III. Ruling
Whether or not the faculty members of the Asian Institute of Management are managerial employees who are ineligible to join a labor organization and participate in a certification election.
AIM's faculty members are not managerial employees. Their policymaking power is only recommendatory and concerns academic matters, so they may form a union and take part in a certification election.
How the Court reasoned
- A managerial employee is one vested with powers to lay down and execute management policies or to hire, transfer, suspend, lay off, recall, discharge, assign or discipline employees (Art. 212(m)). Managerial employees cannot join labor organizations of rank-and-file employees.
- Under University of the Philippines v. Ferrer-Calleja, powers that are merely recommendatory and subject to review by a higher body do not make faculty managerial employees. Policy-determining functions over academic matters do not create a conflict of interest with the institution.
- AIM's own Policy Manuals state that faculty-determined policies and recommendations on standards, appointments, promotions and contract renewals are subject to approval by the Board of Trustees, the ultimate policymaking body. The faculty's power is therefore only recommendatory.
- The faculty's policymaking concerns academic matters, not proprietary matters. AIM did not substantiate any actual delegation of management powers to the faculty.
- Some faculty members hold managerial posts, such as the President, Dean, Associate Deans and Executive Directors. This does not bar the petition and should be settled in inclusion-exclusion proceedings.
- Strict imposition of work hours and fixed deliverables is uncharacteristic of a managerial employee. Engineering Equipment remains applicable despite Republic Act No. 6715, so the Court of Appeals erred in rejecting it and in finding that the Secretary confused managerial employees with managerial staff.
“AIM' s faculty members are not managerial employees.”
Rule applied
Article 212(m) of the Labor Code (definition of managerial employee); University of the Philippines v. Ferrer-Calleja; Engineering Equipment, Inc. v. NLRC
Whether or not the legitimacy of a labor organization may be attacked in a petition for certification election, and whether AIM, as employer, has the right to oppose the petition.
A union's legitimacy cannot be collaterally attacked in a petition for certification election. It may be challenged only in an independent petition for cancellation, and the employer, a mere bystander, had no right to oppose the petition.
How the Court reasoned
- A union that is registered has legal personality, and under the implementing rules that status cannot be attacked collaterally. It may be questioned only in a direct, independent petition for cancellation of registration.
- In certification election proceedings the employer is a mere bystander. The choice of bargaining agent belongs to the employees, so the employer has no legal personality to oppose the petition.
- AIM's establishment is unorganized, so a certification election is automatic once a legitimate labor organization files a petition.
- A petition for cancellation of registration pending elsewhere does not bar a certification election. AIM's cancellation petition is therefore no basis to deny AFA's petition.
- In this case, AIM had no right to oppose AFA's Petition for Certification Election, and the Court of Appeals erred in denying the petition.
“This Court further holds that the legitimacy of a labor organization may not be attacked in a petition for certification election.”
Rule applied
Bystander rule; Omnibus Rules Implementing the Labor Code, Book V, Rule VIII and Rule XIV, Sec. 8; Labor Code, Art. 245 (238) and Art. 247 (239)
Whether or not the registration of the Asian Institute of Management Faculty Association as a legitimate labor organization should be cancelled.
AFA's registration should not be cancelled. AIM proved none of the exclusive grounds for cancellation, including fraud or misrepresentation.
How the Court reasoned
- Article 247 (239) lists the grounds for cancelling a union's registration, such as misrepresentation, false statement or fraud in adopting its constitution and by-laws, or in its registration documents. These grounds are exclusive.
- The State policy favors the right to self-organization, so the grounds for cancellation are strictly construed. Misrepresentation or fraud must be proven by evidence.
- AIM claimed AFA misrepresented that its members were rank-and-file employees. Since the faculty are not managerial employees, there was no misrepresentation.
- AIM showed no other ground under Article 247. The Court of Appeals and the Bureau of Labor Relations rightly sustained AFA's registration, so AIM's petition (G.R. No. 207971) fails.
“The grounds for the cancellation of a legitimate labor organization's certificate of registration are exclusive.”
Rule applied
Article 247 (239) of the Labor Code, as amended; Art. 3 of the Labor Code and Art. XIII, Sec. 3 of the Constitution (right to self-organization)
Doctrines
Faculty members whose policymaking powers are merely recommendatory, subject to review by a higher board, and concern academic rather than proprietary matters are not managerial employees and may form or join a labor organization.
The legitimacy of a labor organization cannot be collaterally attacked in a petition for certification election. It may be challenged only in an independent petition for cancellation of registration.
The employer is a mere bystander in certification election proceedings and has no legal personality to oppose the petition. In an unorganized establishment, certification election is automatic.
The grounds for cancelling the registration of a legitimate labor organization are exclusive, and fraud or misrepresentation must be proven. If none is shown, registration is sustained in line with the State policy favoring self-organization.
The pendency of a petition for cancellation of union registration does not bar the conduct of a certification election. The inclusion of some managerial employees in the union is resolved through inclusion-exclusion proceedings.
Final Disposition
WHEREFORE, the Court grants AFA's Petition in G.R. No. 197089 (regarding the Petition for Certification Election) and denies AIM's Petition in G.R. No. 207971 (regarding the Petition for Cancellation of AFA's registration as a labor organization). AIM's faculty members are not managerial employees, and AFA's registration as a legitimate labor organization is sustained.
Notes
Penned by Senior Associate Justice Leonen, Second Division. The text preview was truncated, so the details come from the chunk extractions. Engineering Equipment remains applicable despite Republic Act No. 6715.