Issuances of the Department of Labor and Employment and its Attached Agencies

Section 1

The incumbent bargaining agent shall continue to be entitled to check-off and collect dues and agency fees despite the pendency of a representation case, other inter/intra-union disputes or related labor relations disputes.

Section 2

The Regional or Bureau Director may inquire into the financial activities of any legitimate labor organization and examine their books of accounts and other records to determine compliance with the law and the organization's constitution and by-laws. Such examination shall be made upon the filing of a request or complaint for the conduct of an accounts examination by any member of the labor organization, supported by the written consent of at least twenty (20%) percent of its total membership.

Section 3

A request for examination of books of accounts of independent labor unions, chartered locals and workers associations pursuant to Article 274 shall be filed with the Regional Office that issued its certificate of registration or certificate of creation of chartered local. A request for examination of books of accounts of federations or national unions and trade union centers pursuant to Article 274 shall be filed with the Bureau. Such request or complaint, in the absence of allegations pertaining to a violation of Article 241, shall not be treated as an intra-union dispute and the appointment of an Audit Examiner by the Regional or Bureau Director shall not be appealable.

Section 4

Any complaint or petition with allegations of mishandling, misappropriation or non-accounting of funds in violation of Article 241 shall be treated as an intra-union dispute. It shall be heard and resolved by the Med-Arbiter pursuant to the provisions of Rule XI.

Section 5

The complaint or petition for audit or examination of funds and book of accounts shall prescribe within three (3) years from the date of submission of the annual financial report to the Department or from the date the same should have been submitted as required by law, whichever comes earlier.

Section 6

A decision granting the conduct of audit shall include the appointment of the Audit Examiner and a directive upon him/her to submit his/her report and recommendations within ten (10) days from termination of audit. The decision granting the conduct of audit is interlocutory and shall not be appealable. The decision denying or dismissing the complaint or petition for audit may be appealed within ten (10) days from receipt thereof pursuant to the provisions prescribed in Rule XI.

Section 7

Within twenty-four (24) hours from receipt of the decision granting the conduct of audit, the Regional Director shall summon the parties to a pre-audit conference conducted by the Audit Examiner to determine and obtain the following: (a) sources of funds covered by the audit; (b) the banks and financial institutions where the labor organization maintains its account; (c) union books of accounts and financial statements; (d) disbursement vouchers with supporting receipts, invoices and other documents; (e) income and revenue receipts; SEIDAC (f) cash books; (g) minutes of general membership meeting and board meetings; (h) other relevant matters and documents. The first pre-audit conference shall be scheduled within ten (10) days from receipt by the Audit Examiner of the decision granting the conduct of an audit.

Section 8

The Regional Director may compel any party to appear or bring the required financial documents in a conference or hearing through the issuance of a subpoena ad testificandum or subpoena duces tecum. He/She may also require the employer concerned to issue certifications of union dues and other assessments remitted to the union during the period of audit.

Section 9

Where book of accounts are submitted by the parties, the Audit Examiner shall: (a) examine the transactions reflected in the disbursement vouchers; (b) determine the validity of the supporting documents attached to the vouchers consistent with the union's constitution and by-laws, relevant resolutions of the union and the Labor Code; TEHDIA (c) trace recording and posting in the disbursement book; (d) record observations or findings of all financial transactions. Where no book of accounts are maintained by the officers of the labor organization, the Audit Examiner shall: (a) examine the transactions reflected in the disbursement vouchers; (b) determine the validity of the supporting documents attached to the vouchers consistent with the labor organization's constitution and by-laws, relevant board resolutions, and the Labor Code; (c) prepare working papers or worksheet/s; (d) record and post all financial transactions reflected in the cash vouchers in the working papers or worksheet/s; and (e) record observations or findings of all financial transactions. The Audit Examiner shall conduct an inventory of all physical assets acquired by the labor organization, if any, and on the basis of his/her findings prepare his/her audited financial report or statement reflecting the true and correct financial accounts and balances of the labor organization with relevant annexes attached. SEIDAC

Section 10

The Audit Examiner shall have sixty (60) days from the date of first pre-audit conference within which to complete the conduct of audit, unless the volume of financial records, the period covered by the audit and other circumstances warrant the extension thereof. In such a case, the Audit Examiner shall notify the Med-Arbiter or the Bureau Director, as the case may be, of such fact at least ten (10) days before the expiration of the sixty (60) day period.

Section 11

The Audit Examiner shall make a report of his/her findings to the parties involved and the same shall include the following: (a) name of the labor organization; (b) name of complainant(s) or petitioner(s) and respondent(s); (c) name of officers of the labor organization during the period covered by the audit report; (d) scope of the audit; (e) list of documents examined; (f) audit methods and procedures adopted; and (g) findings and recommendations.

Section 12

A copy of the audit report shall be forwarded by the Audit Examiner to the Med-Arbiter or the Bureau Director, as the case may be, within ten (10) days from termination of the audit, together with the entire records of the case and all documents relative to the conduct of the audit.

Section 13

The Med-Arbiter or the Bureau Director shall render a decision within twenty (20) days from receipt of the audit report. All issues raised by the parties during the conduct of the audit shall be resolved by the Med-Arbiter. The decision shall be released in the same manner prescribed in Section 15, Rule XI. When warranted, the Med-Arbiter or Bureau Director shall order the restitution of union funds by the responsible officer(s) in the same decision.

Section 14

Appeal from the decision of the Med-Arbiter denying the conduct of audit and from the results of the audit may be filed by any of the parties with the Bureau. Decisions rendered by the Bureau after the conduct of audit in the exercise of its original jurisdiction may be appealed to the Office of the Secretary. Both shall be resolved in accordance with the provisions of Section 16, Rule XI.

Section 15

No complaint for inquiry or examination of the financial and book of accounts as well as other records of any legitimate labor organization shall be entertained during the sixty (60) day freedom period or within thirty (30) days immediately preceding the date of election of union officers. Any complaint or petition so filed shall be dismissed.