CASE DIGEST: ALLIED FREE WORKERS’ UNION V C. MARITIMA et al.

ALLIED FREE WORKERS’ UNION

VS

C. MARITIMA et  al.

19 SCRA 258

 [JAN.31, 1967]

NATURE

Petitions for review by certiorari of CIR decision

FACTS

-This is a consolidation of 3 cases involving both parties

-Respondent Compania Maritima (MARITIMA), a local corp. engaged in shipping entered into a contract for lease of services with petitioner Allied Free Workers’ Union (AFWU), a duly registered legitimate labor union. In the contract, it was stipulated that AFWU will do and perform all the work of stevedoring and arrastre services of all vessels or boats of MARITIMA in Iligan City; that the contract is good and valid for 1 month starting Aug.12, 1952, but may be renewed by agreement of the parties with the reservation that MARITIMA has the right to revoke said contract even before the expiration of the term, if and when AFWU fails to render good service.

-Towards the end of 1953, MARITIMA complained to AFWU of unsatisfactory and inefficient service. To remedy the situation, MARITIMA was forced to hire extra laborers from among “stand-by” workers not affiliated to any union.

-On July 1954, AFWU sent a written proposal to MARITIMA for a CBA, but the latter did not reply. Thereafter, AFWU instituted an action in the CIR praying that it be certified as the sole and exclusive bargaining unit composed of all the laborers doing arrastre and stevedoring work for MARITIMA, to which action MARITIMA answered, alleging lack of EREE relationship. On Aug.1954, MARITIMA informed AFWU of the termination of the contract because of the inefficient service rendered by the latter which had adversely affected its business. The termination was to take effect as of Sept.1, 1954. MARITIMA then contracted with the Iligan Stevedoring Union for the arrastre and stevedoring work. The latter agreed to perform the work subject to the same terms and conditions of the contract with AFWU. The new agreement was to be carried out on Sept.1, 1954.

-On Aug.26, 1954, AFWU charged MARITIMA of unfair labor practices (ULPs) before the CIR. MARITIMA answered, again denying the ER-EE relationship between the parties. On Sept.9, 1954, MARITIMA filed an action to rescind the contract, enjoin AFWU members from doing arrastre and stevedoring work in connection with its vessels, and for recovery of damages against AFWU and its officers. The CFI ordered the rescission of the contract and permanently enjoined AFWU members from performing work in connection with MARITIMA’s vessels.

AFWU was later able to secure a writ of preliminary injunction ordering the maintenance of the status quo prior to Jan.6, 1961. Thus, after Jan.18, 1961, AFWU laborers were again back doing the same work as before.

-On Nov.4, 1963, after almost 10 years, the CFI finally rendered its decision: In pursuance of the provisions of Sec.12 of R.A. 875 and the Rules of this court on certification election, the Honorable Secretary of Labor or any of his authorized representative is hereby requested to conduct certification election among all the workers and/or stevedores working in the wharf of Iligan City who are performing stevedoring and arrastre service aboard Compania Maritima vessels docking at Iligan City port in order to determine their representative for collective bargaining with the employer, whether these desire to be represented by the petitioner Allied Free Workers Union or neither; and upon termination of the said election, the result thereof shall forthwith be submitted to this court for further consideration. From this ruling, both parties appealed, AFWU claiming that it should be declared outright as the majority union while MARITIMA contends that said court could not even have correctly ordered a certification election considering that there was an absence of ER-EE relationship between it and said laborers.

ISSUE

WON the order of a certification election by the CIR was proper. (WON there was an ER-EE relationship between AFWU and MARITIMA)

HELD

NO. Before a certification election can be held, there must exist an ER-EE relationship between the ER and the petitioner union. Ratio The duty to bargain collectively exists only between the “employer” and its “employees.” Where there is no duty to bargain collectively, it is not proper to hold certification elections in connection therewith. Reasoning In its findings, the CIR observed that after the rescission, the AFWU laborers continued working in accordance with the “cabo system,” which was the prevailing custom in the place. Under this system, the union was an independent contractor. The CIR also made a finding that prior to the contract between MARITIMA and AFWU, the former had an oral arrastre and stevedoring agreement with another union, the Iligan Laborers Union (ILU), which agreement was also based on the “cabo” system. After unsatisfactory service, MARITIMA cancelled this oral contract and entered into a new contract with AFWU, the terms and conditions of which were similar to the oral contract with ILU. The written contract between AFWU and MARITIMA was signed under the assurance by AFWU that the same arrangement previously had with the former union regarding performance and execution of arrastre and stevedoring contract be followed in accordance with the custom of such kind of work in Iligan. Thus, petitioner union operated as a labor contractor under the so-called “cabo” system.

-From these findings, Insofar as the working agreement was concerned, there was no real difference between the contract and the prior oral agreement. Both were based on the “cabo” system. Hence, since the parties observed the “cabo” system after the rescission of the contract, and since the characteristics of said system show that the contracting union was an independent contractor, it is reasonable to assume that AFWU continued being an independent contractor of MARITIMA. And, being an independent contractor, it could not qualify as an “employee”. With more reason would this be true with respect to the laborers. Moreover, there is no evidence at all regarding the characteristics of the working arrangement between AFWU and MARITIMA after the termination of the CONTRACT. All we have to go on is the court a quo’s finding that the “cabo” system was observed-a system that negatives employment relationship.

-Since the only function of a certification election is to determine, with judicial sanction, which union shall be the official representative or spokesman of the “employees” will be, there being no ER-EE relationship between the parties disputants, it follows that there is neither a duty to bargain collectively. Thus, the order for certification election in question cannot be sustained.

Disposition

Appealed decision of the CIR is AFFIRMED insofar as it dismissed the charge of ULP, but REVERSED and SET ASIDE insofar as it ordered the holding of a certification election. The petition for certification election should be DISMISSED.