G.R. No.

110854 February 13, 1995 its offices and said positions are [sic] listed in ANNEX
"A" hereof.
PIER 8 ARRASTRE & STEVEDORING SERVICES, INC., petitioner,
vs. As such representative the UNION is designated as the
HON. MA. NIEVES ROLDAN-CONFESOR, in her capacity as Secretary of Labor collective bargaining agent with respect to and
and Employment, and GENERAL MARITIME & STEVEDORES UNION concerning the terms and conditions of employment
(GMSU), respondents. and the interpretations and implementation of the
provisions and conditions of this Agreement.

Annex "A" of the CBA is the listing of positions covered thereby.

PUNO, J.: These are:

Petitioner corporation and private respondent labor union entered into a three-year 1. Foremen;
Collective Bargaining Agreement (CBA) with expiry date on November 27, 1991. 2. Gang bosses;
During the freedom period the National Federation of Labor Unions (NAFLU) 3. Winchmen;
questioned the majority status of Private respondent through a petition for 4. Signalmen;
certification election. The election conducted on February 27, 1992 was won by 5. Stevedores;
private respondent. On March 19, 1992, private respondent was certified as the sole 6. Dockworkers;
and exclusive bargaining agent of petitioner's rank-and-file employees. 7. Tallymen;
8. Checkers;
On June 22, 1992, private respondent's CBA proposals were received by petitioner. 9. Forklift and crane operators;
Counter-proposals were made by petitioner. Negotiations collapsed, and on August 10. Sweepers;
24, 1992, private-respondent filed a Notice of Strike with the National Conciliation 11. Mechanics;
and Mediation Board (NCMB). The NCMB tried but failed to settle the parties' 12. Utilitymen;
controversy. 13. Carpenters; and
14. Other rank and file employees;
On September 30, 1992, public respondent Secretary of Labor assumed jurisdiction
over the dispute. She resolved the bargaining deadlock between the parties through The company argues in the first instance that under Article 212(m) in
an Order, dated March 4, 1993, which reads, in part: relation to Article 245 of the Labor Code, supervisors are ineligible for.
membership in a labor organization of rank and file. Being
xxx xxx xxx supervisors, foremen should be excluded from the bargaining unit.

A. The non-economic issues The Company likewise seeks the exclusion on the ground of lack of
community of interest and divergence in functions, mode of
1. Scope/coverage of the CBA. Article I of the 1988 CBA provides: compensation and working conditions of the following:

The Company recognizes the Union as the sole and 1. Accounting clerk;
exclusive collective bargaining representative of all the 2. Audit clerk;
stevedores, dockworkers, gang bosses, foremen, rank 3. Collector;
and file employees working at Pier 8, North Harbor and 4. Payroll clerk;
5. Nurse;
6. Chief biller;
 7. Biller; 7. Effectivity of the CBA. The Union demands that the CBA should be
8. Teller/biller; fully retroactive to 28 November 1991. The Company is opposed on
9. Personnel clerk; the ground that under Article 253-A of the labor code, the six-month
10. Timekeeper; period within which the parties must come to an agreement so that the
11. Asst. timekeeper; same will be automatically retroactive is long past.
12. Legal secretary;
13. Telephone operator; The Union's demand for full retroactivity, we note, will result in undue
14. Janitor/Utility; and financial burden to the Company. On the other hand, the Company's
15. Clerk reliance on Article 253-A is misplaced as this applies only to the
renegotiated terms of an existing CBA. Here, the deadlock arose from
These positions, the Company argues, cannot be lumped together negotiations for a new CBA.
with the stevedores or dockworkers who mostly comprise the
bargaining unit. Further, notwithstanding the check-off provisions of These considered, the CBA shall be effective from the time we
the CBA, the incumbents in these positions have never paid union assumed jurisdiction over the dispute, that is, on 22 September 1992,
dues. Finally, some of them occupy confidential positions and and shall remain e effective for five (5) years thereafter. It shall be
therefore ought to be excluded from the bargaining unit. understood that except for the representation aspect all other
provisions thereof shall be renegotiated not later than three (3) years
The Union generally argues that the Company's proposed exclusions after its effectivity, consistently with Article 253-A of the Labor Code.
retrogressive. . . .
B. The economic issues
We see no compelling justification to order the modification of Article I
of the 1988 CBA as worded. For by lumping together stevedores and The comparative positions of the parties are:
other rank and file employees, the obvious intent of the parties was to
treat all employees not disqualified from union membership as COMPANY UNION
members of one bargaining unit. This is regardless of working
conditions, mode of compensation, place of work, or other
xxx xxx xxx
considerations. In the absence of mutual agreement of the parties or
evidence that the present compositions of the bargaining unit is
detrimental to the individual and organizational rights .either
Vacation and sick leave 17 days vacation and sick leave i) For all covered employees
5
of the
employees or of the Company, this expressed intent cannot be set 17 days sick leave per year and 17 days sick than gang
aside. for employment with at least gang bosses:
five years of service.
It may well be that as a consequence of Republic Act No. 6715,
foremen are ineligible to join the union of the rank and file. But this 15 working days vacation and
provision can be invoked only upon proof that the foremen sought to 15 working days sick leave
be excluded from the bargaining unit are cloaked with effective for those with at least 1 year
recommendatory powers such as to qualify them under the legal of service
definitions of supervisors.

xxx xxx xxx 20 working days vacation and

20 working days sick leave
 for those with more than one 1) the condition that a gang
year of service up to 5 years bosses must have worked for at
of service least 120 days in a calendar
year shall be reduced to 110
25 working days vacation and days; and
25 working days sick leave
for those with more than 5 2) where the above number of
years of service up to 10 days worked is not met, the
years of service gang boss shall still be entitled
to vacation and sick leave with
30 working days vacation and pay, as follows:
30 working days sick leave 109 - 90 days worked: 90%
for those with more than 10 89 - 75 days worked: 50%
years of service
xxx xxx xxx
Provided that in the case Provided that in the case of a
rotation worker, he must. Death
have aid P1,500.00 to heirs P10,000.00 to heirs of covered
7
of a rotation worker, he
must have work for at worked for 140 days in a of covered employees employees
least 160 days in a year calendar year as a condition
P5,000.00 assistance for death
for availment for availment.
of immediate member of
Provided, further that in the covered employee's family
event a rotation worker fails
xxx xxx xxx
to complete 140 days work in
a calendar year, he shall still 12
. Emergency
be entitled to vacation and loan
sick leave with pay, as follows: a) amount of P700.00 but 30 days salary payable
139 - 120 days worked: 90% damage through
119 - 110 days worked: 50% entitlement to dwelling by fire payroll deduction in twelve
shall
ii) For Gang bosses: be included monthly installments
Same as the above schedule
except that: b) cash bond None The company shall put up
a cash
for loss, damage bond of not less than
 P40,000.00 xxx xxx xxx
or accident for winchmen, crane and
forklift 8. Death aid P3,000.00 to the heirs of each covered employee
operators.
xxx xxx xxx

12. Emergency loan 30 days pay, payable through payroll deductions

xxx xxx xxx
of 1/12 of monthly salary
Balancing the right of the Company to remain viable and to just
WHEREFORE, the Pier 8 Arrastre and Stevedoring Services and the
returns to its investments with right of the Union members to just
General Maritime Services Union are hereby ordered to execute new
rewards for their labors, we find the following award to be fair and
collective bargaining agreement the incorporating the dispositions
reasonable:
herein contained. These shall be in addition to all other existing terms,
conditions and benefits of employment, except those specifically
xxx xxx xxx deleted herein, which have previously governed the relations of the
parties. All other disputed items not specifically touched upon herein
. Vacation and Sick
6
are deemed denied, without prejudice to such other agreements as
Leave the parties may have reached in the meantime. The collective
a) Non-rotation workers 17 days vacation/17 days bargaining agreement so executed shall be effective from 22
sick leave September 1992 and up to five years thereafter, subject to
for those with at least 1 renegotiation on the third year of its effectivity pursuant to Article 253-
year of service A of the Labor Code.1

Petitioner sought partial reconsideration of the Order. On June 8, 1993, public

b) Rotation workers other 17 days vacation/17 days respondent affirmed her findings, except for the date of effectivity of the Collective
sick leave, Bargaining Agreement which was changed to September 30, 1992. This is the date
than gang boss provided that the covered when she assumed jurisdiction over the deadlock.
worker
must have worked for at Petitioner now assails the Order as follows:
least 155 days
in a calendar year I

c) Gang bosses 17 days vacation/17 days THE HONORABLE SECRETARY OF LABOR COMMITTED GRAVE
sick leave, ABUSE OF DISCRETION IN NOT EXCLUDING CERTAIN
POSITIONS FROM THE BARGAINING AGREEMENT UNIT
provided that the gang
boss must have II
worked for at least 115
days in a THE HONORABLE SECRETARY OF LABOR COMMITTED GRAVE
calendar year ABUSE OF DISCRETION IN MAKING THE CBA EFFECTIVE ON
SEPTEMBER 30, 1992 WHEN SHE ASSUMED JURISDICTION
 OVER THE LABOR DISPUTE AND NOT MARCH 4, 1993 WHEN Regulations Implementing R.A.. 6715, differentiate managerial, supervisory, and
SHE RENDERED JUDGMENT OVER THE DISPUTE rank-and-file employees, thus:

III "Managerial Employee" is one who is vested with powers or

prerogatives to lay down and execute management policies and/or to
THE HONORABLE SECRETARY OF LABOR COMMITTED GRAVE hire, transfer, suspend, layoff recall, discharge, assign or discipline
ABUSE OF DISCRETION IN REDUCING THE NUMBER OF DAYS employees. Supervisory employees are those who, in the interest of
AN EMPLOYEE SHOULD ACTUALLY WORK TO BE ENTITLED TO the employer, effectively recommend such managerial actions if the
VACATION AND SICK LEAVE BENEFITS exercise of such authority is not merely routinary or clerical in nature
but requires the use of independent judgment. All employees not
IV falling within any of the above definitions are considered rank-and-file
employees for purposes of the Book.
THE HONORABLE SECRETARY OF LABOR COMMITTED GRAVE
ABUSE OF DISCRETION IN INCREASING WITHOUT FACTUAL This Court has ruled on numerous occasions that the test of supervisory or
BASIS THE DEATH AID AND EMERGENCY LOAN 2 managerial status is whether an employee possesses authority to act in the interest
of his employer which authority is not merely routinary or clerical in nature but
The petition is partially meritorious. requires use of independent judgment. 3 What governs the determination of the
nature of employment is not the employee's title, but his job description. If the nature
Firstly, petitioner questions public respondent for not excluding four (4) foremen, a of the employee's job does not fall under the definition of "managerial" or
legal secretary, a timekeeper and an assistant timekeeper from the bargaining unit "supervisory" in the Labor Code, he is eligible to be a member of the rank-and-file
composed of rank-and-file employees represented by private respondent. Petitioner bargaining unit. 4
argues that: (1) the failure of private respondent to object when the foremen and
legal secretary were prohibited from voting in the certification election constitutes an Foremen are chief and often especially-trained workmen who work with and
admission that such employees hold supervisory/confidential positions; and (2) the primary duty and commonly are in charge of a group of employees in an industrial plant or in
responsibility of the timekeeper and assistant timekeeper is "to enforce company rules and regulations by reporting construction work. 5 They are the persons designated by the employer-management
to petitioner . . . those workers who committed infractions, such as those caught abandoning their posts." and hence, to direct the work of employees and to superintend and oversee them. 6 They
they should not be considered as rank-and-file employees.
are representatives of the employer-management with authority over particular
groups of workers, processes, operations, or sections of a plant or an entire
The applicable law governing the proper composition of bargaining unit is Article 245 organization. In the modern industrial plant, they are at once a link in the chain of
of the labor Code, as amended, which provides as follows: command and the bridge between the management and labor. 7 In the performance
their work, foremen definitely use their independent judgment and are empowered to
Art. 245. Ineligibility of managerial employees to join any labor make recommendations for managerial action with respect to those employees
organization; employees to join any labor organization; right of under their control. Foremen fall squarely under the category of supervisory
supervisory employees. — Managerial employees are not eligible to employees, and cannot be part of rank-and-file unions.
join, assist or form any labor organization. Supervisory employees
shall not be eligible for membership in a labor organization of the Upon the other hand, legal secretaries are neither managers nor supervisors. Their
rank-and-file employees but may join, assist or form separate labor work is basically routinary and clerical. However, they should be differentiated from
organizations of their own. rank-and-file employees because they, are tasked with, among others, the typing of
legal documents, memoranda and correspondence, the keeping of records and files,
Article 212(m) of the same Code, as well as Book V, Rule 1, Section 1(o) of the the giving of and receiving notices and such other duties as required by the legal
Omnibus Rules Implementing the Labor Code, as amended by the Rules and personnel of the corporation. 8 Legal secretaries therefore fall under the category
of confidential employees. Thus, to them applies our holding in the case of Philips The next issue is the date when the new CBA of the parties should be given effect.
Industrial Development, Inv., v. NLRC, 210 SCRA 339 (1992), that: Public respondent fixed the effectivity date on September 30, 1992. when she
assumed jurisdiction over the dispute. Petitioner maintains it should be March 4.
. . . By the very functions, they assist confidential capacity to, or have 1993, when public respondent rendered judgment over the dispute.
access to confidential. matters of, persons to, exercise managerial
functions in the field of labor relations. As such, the rationale behind The applicable laws are Articles 253 and 253- A of the Labor Code, thus:
the ineligibility of managerial employees to form, assist or join a labor
union equally applies to them. Art. 253. Duty to bargain collectively when there exists a collective
bargaining agreement. — When there is a collective bargaining
In Bulletin Publishing Co., Inc., vs. Hon. Augusto Sanchez, this Court agreement, the duty to bargain collectively shall also mean that
elaborated on this rationale, thus: neither party shall terminate nor modify such agreement during its
lifetime. However, either party can serve a written notice to terminate
. . . The rationale, for this inhibition has been stated to or modify the agreement at least sixty (60) days prior to its expiration
be, because if these managerial employees would date. It shall be the duty of both parties to keep the status quo and to
belong to or be affiliated with Union the latter might not, continue in full force and effect the terms and conditions of the
be assured of their loyalty to the Union in view of existing agreement during the 60-day period and/or until a new
evident conflict of interests. The Union can also agreement is reached by the parties.
become company-dominated with the presence of
managerial employees in Union membership. and;

In Golden Farms, Inc., vs. Ferrer-Calleja, 9 this court explicitly made Art. 253-A. Terms of a collective bargaining agreement. — Any
this rationale applicable to confidential employees: Collective Bargaining Agreement that the parties may enter into shall,
insofar as the representation aspect is concerned, be for a term of five
This rationale holds true also for confidential (5) years. No petition questioning the majority status of the incumbent
employees . . ., who having access to confidential bargaining agent shall be entertained and no certification election
information, may become the source of undue shall be conducted by the Department of Labor and Employment
advantage. Said employee(s) may act as a spy or outside the sixty-day period immediately before the date of expiry of
spies of either party to a collective bargaining such five year term of the Collective Bargaining Agreement. All other
agreement. . . . provisions of the Collective Bargaining Agreement shall be
renegotiated not later than three (3) years after its execution. Any
We thus hold that public respondent acted with grave abuse of discretion in not agreement on such other provisions of the Collective Bargaining
excluding the four foremen and legal secretary from the bargaining unit composed of Agreement entered into within six (6) months from the date of expiry
rank-and-file employees. of the term of such other provisions as fixed in such Collective
Bargaining Agreement, shall retroact to the day immediately following
As for the timekeeper and assistant timekeeper it is clear from petitioner's own such date. If any such agreement is entered into beyond six months,
pleadings that they are, neither managerial nor supervisory employees. They are the parties shall agree on the duration of collective bargaining
merely tasked to report those who commit infractions against company rules and agreement, the parties may exercise their rights under this Code.
regulations. This reportorial function is routinary and clerical. They do not determine
the fate of those who violate company policy rules and regulations function. It follows In Union of Filipino Employees v. NLRC, 192 SCRA 414 (1990), this court interpreted
that they cannot be excluded from the subject bargaining unit. the above law as follows:
 In light of the foregoing, this Court upholds the pronouncement of the P520,723,44, or 35.19% of its net income for 1991. The Company
NLRC holding the CBA to be signed by the parties effective upon the likewise urges us to consider the multiplier effect of its proposals on
promulgation of the assailed resolution. It is clear and explicit from the second and third years of the CBA. As additional argument, the
Article 253-A that any agreement on such other provisions of the CBA Company manifests that a portion of its pier will undergo a six-month
shall be given retroactive effect only when it is entered into within six to one-year renovation starting January 1993.
(6) months from its expiry date. If the agreement was entered into
outside the six (6) month period, then the parties shall agree on the On the other hand, the Union's main line of argument — that is, aside
duration of the retroactivity thereof. from being within the financial capacity of the Company to grant, its
demands are fair and reasonable — is not supported by evidence
The assailed resolution which incorporated the CBA to be signed by controverting the Company's own presentation of its financial
the parties was promulgated June 5, 1989, the expiry date of the past capacity. The Union in fact uses statements of the Company for 1989-
CBA. Based on the provision of Section 253-A, its retroactivity should 1991, although it interprets these data as sufficient justification for its
be agreed upon. by the parties. But since no agreement to that effect own proposals. It also draws our attention to the bargaining history of
was made, public respondent did not abuse its discretion in giving the the parties, particularly the 1988 negotiations during which the
said CBA a prospective effect. The action of the public respondent is company was able to grant wage increases despite operational
within the ambit of its authority vested by existing law. losses.

In the case of Lopez Sugar Corporation v. Federation of Free Workers, 189 SCRA Balancing the right of the Company to remain viable and to just
179 (1991), this Court reiterated the rule that although a CBA has expired, it returns to its investments with right of the Union members to just
continues to have legal effects as between the parties until a new CBA has been rewards for their labors, we find the following award to be fair and
entered into. It is the duty of both parties to the to keep the status quo, and to reasonable . . . . 11
continue in full force and effect the terms and conditions of the existing agreement
during the 60-day freedom period and/or until a new agreement is reached by the It is evident that the above portion of the impugned Order is based on well-studied
parties. 10 Applied to the case at bench, the legal effects of the immediate past CBA evidence. The conclusions reached by public respondent in the discharge of her
between petitioner and private respondent terminated, and the effectivity of the new statutory duty as compulsory arbitrator, demand the high respect of this Court. The
CBA began, only on March 4, 1993 when public respondent resolved their dispute. study and settlement of these disputes fall within public respondent's distinct
administrative expertise. She is especially trained for this delicate task, and she has
Finally, we find no need to discuss at length the merits of the third and fourth within her cognizance such data and information as will assist her in striking the
assignments of error. The questioned Order relevantly states: equitable balance between the needs of management, labor and the public. Unless
there is clear showing of grave abuse of discretion, this Court cannot and will not
In the resolution of the economic issues, the Company urges us to interfere with the labor expertise of public respondent Secretary of Labor.
consider among others, present costs of living, its financial capacity,
the present wages being paid by the other cargo handlers at the North IN VIEW WHEREOF, public respondents Order, dated March 4, 1993, and
Harbor, and the fact that the present average wage of its workers is Resolution, dated June 8, 1993, are hereby MODIFIED to exclude foremen and legal
P127.75 a day, which is higher than the statutory minimum wage of secretaries from the rank-and-file bargaining unit represented by private respondent
P118.00 a day. The Company's evidence, consisting of its financial union, and to fix the date of effectivity of the five-year collective bargaining
statements for the past three years, shows that its net income was agreement between petitioner corporation and private respondent union on March 4,
P743,423.45 for 1989, P2,108,569.03 for 1990, and P1,479,671.84 for 1993. No costs.
1991, or an average of P1,443,885.10 over the three-year period. It
argues that for just the first year of effectivity of the CBA, the SO ORDERED.
Company's proposals on wages, effect thereof on overtime, 13th
month pay, and vacation and sick leave commutation, will cost about Narvasa, C.J., Bidin, Regalado and Mendoza, JJ., concur.