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Pepsi Cola Products Philippines, Inc. (petitioner) v. Honorable Secretary of Labor (respondents) 1. Facts:

a. June 1990: The Pepsi-Cola Employees Organization-UOEF (Union) filed a petition for certification election with the Med-Arbiter seeking to be the exclusive bargaining agent of supervisors of Pepsi-Cola Philippines, Inc. (PEPSI). i. Med-Arbiter granted this stating that PCEU-UOEF was an affiliate of Union de Obreros Estivadores de Filipinas (or the Federation) with two (2) rank and file unions, Pepsi-Cola Labor Unity (PCLU) and Pepsi-Cola Employees Union of the Philippines (PEUP). ii. July 1990: PEPSI filed a petition to Set Aside, Cancel and/or Revoke Charter of PCEU-UOEF on the grounds that (a) members of the Union were managers, and (b) a supervisors’ union cannot affiliate with a federation whose members include the rank and file union of the same company. a. February 1991: Court grants temporary restraining order and/or preliminary injunction. Issue is whether or not a supervisors’ union can affiliate with the same Federation of which two (2) rank and file unions are likewise members, without violating Article 245 of the Labor Code (PD 442), as amended, by Republic Act 6715, which provides: iii. Managerial employees are not eligible to join, assist or form any labor organization. Supervisory employees shall not be eligible for membership in a labor organization of the rank-and-file employees but may join, assist or form separate labor organizations of their own.” b. On April 8, 1991, the Secretary of Labor and Employment sent in a Comment, alleging that: 1) until and unless there is a final order cancelling its certificate of registration or charter certificate, a labor organization remains to be a legitimate labor organization entitled to exercised all the rights and duties accorded to it by the Labor Code including the right to be certified as a bargaining representative; 2) Public respondent cannot be deemed to have committed grave abuse of discretion with respect to an issue that was never presented before it for resolution i. Art. 245 of the New Labor Code does not preclude the supervisor's union and the rank-and-file union from being affiliated with the same federation. ii. A federation of local union is not the labor organization referred to in Article 245 but only becomes entitled to all the rights enjoyed by the labor organization (at the company level). In other words, the affiliation of the supervisory employee's union with the same federation with which the rank and file employees union is affiliated did not make the supervisory employees members of the rank and file employee's union and vice versa. c. PEPSI replies that Petition to Set-Aside, Cancel, Revoke Charter Union Affiliation should first be disposed of before granting the Petition for the Conduct of Certification Election. To allow the conduct of the certification election to proceed would make any decision arrived at by the Bureau of Labor Relations useless inasmuch as the same would necessarily be rendered moot and academic. i. PEPSI also stressed that officials of both PCLU and PEUP are top ranking officials of UOEF. ii. The respondent supervisory union could do indirectly what it could not do directly as the simple expedient of affiliating with UOEF would negate the manifest intent and letter of the law that supervisory employees can only "join, assist or form separate labor organizations of their own" and cannot "be eligible for membership in a labor organization of the rank and file employees." iii. However, there is absolutely nothing in the Labor Code that prohibits a federation from representing or exercising influence over its affiliates. On the contrary, this is precisely the reason why federations are formed and are allowed by law to exist. On December 9, 1991, the Court resolved to DISMISS the case for "failure to sufficiently show that the questioned judgment is tainted with grave abuse of discretion." In a Resolution dated...
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