Ratified treaty;¹ Work of international supervisory bodies²

Deregistration of a Union for failure to comply with legislated requirements/ Exercise of administrative discretion/ Reference to international law to strengthen decision based on domestic law

Grand Plaza Hotel Corporation lodged an appeal before the Supreme Court against a decision of the Court of Appeals rejecting the Corporation’s request for it to cancel the registration of the National Union of Workers in the Hotel, Restaurant and Allied Industries-Heritage Hotel Manila Supervisors Chapter.³

The Corporation’s request for the Court to deregister the Union was based on the fact that the Union had failed to comply with mandated reporting requirements prescribed by the Labor Code, in that it had not submitted to the Bureau of Labor Relations its annual financial report for several years or the list of its members since it filed its registration papers in 1995. Under the Labor Code, the Court had discretion to cancel the Union’s registration in these circumstances.

Before it was submitted to the Court of Appeals, the Corporation initially submitted the request for deregistration of the Union to the Department of Labor and Employment-National Capital Region (DOLE), and then the Bureau of Labor Relations (BLR),  both administrative authorities, as required by the Labor Code. Both the DOLE Secretary and the Director of the BLR rejected the request.

In considering the request, the Supreme Court observed that the relevant provisions of the Labor Code had since been amended (after the instigation of these proceedings) to further limit the circumstances in which a trade union could be deregistered. It observed the intention of these amendments was to protect the workers’ right to self-organization and enhanced the Philippines’ compliance with its international obligations as embodied in ILO Convention No. 87, pertaining to the non-dissolution of workers’ organizations by administrative authority.

In this context, the Supreme Court stated:

“ILO Convention No. 87, which we have ratified in 1953, provides that "workers’ and employers’ organizations shall not be liable to be dissolved or suspended by administrative authority." The ILO has expressed the opinion that the cancellation of union registration by the registrar of labor unions, which in our case is the BLR, is tantamount to dissolution of the organization by administrative authority when such measure would give rise to the loss of legal personality of the union or loss of advantages necessary for it to carry out its activities, which is true in our jurisdiction. Although the ILO has allowed such measure to be taken, provided that judicial safeguards are in place, i.e., the right to appeal to a judicial body, it has nonetheless reminded its members that dissolution of a union, and cancellation of registration for that matter, involve serious consequences for occupational representation. It has, therefore, deemed it preferable if such actions were to be taken only as a last resort and after exhausting other possibilities with less serious effects on the organization.

The aforesaid amendments and the ILO’s opinion on this matter serve to fortify our ruling in this case (…)”⁴.

The Supreme Court then quoted with approval the grounds for the decision of the DOLE Secretary, finding that the Union’s failure to comply with statutory obligations (which it had subsequently rectified) did not outweigh the importance of the rights of workers to self-organization. The Court stated an overly stringent interpretation of the statute governing cancellation of union registration without regard to surrounding circumstances could not be allowed as it would lead to an unconstitutional application of the statute and emasculation of public policy objectives.

Having referred to ILO Convention No. 87 and the work of the ILO Committee of Experts on the Application of Conventions and Recommendations to strengthen its decision based on domestic law, the Supreme Court upheld the ruling of the Court of Appeals, determining that the Corporation’s petition to deregister the Union be rejected.

¹ ILO Freedom of Association and Protection of the Right to Organize Convention, 1948 (No. 87).

² ILO Committee of Experts on the Application of Conventions and Recommendations.

³ Presidential Decree No. 442.

⁴ Here the decision refers to ILO: Freedom of association and collective bargaining, General Survey of the Committee of Experts on the Application of Conventions and Recommendations, International Labour Conference, 81^st Session, Geneva, 1994,  Report III(4B).