G.R. No. 156292. January 11, 2005.

* credence to the contention of respondents that the real reason behind

ME-SHURN CORPORATION AND SAMMY CHOU, the shutdown of the corporation was the formation of their union.
petitioners, vs. ME-SHURN WORKERS UNION-FSM AND Note that, to constitute an unfair labor practice, the dismissal need not
entirely and exclusively be motivated by the union’s activi-
ROSALINA** CRUZ, respondents. 43

Labor Law; Closure of Establishment; Illegal Dismissal;

Burden of Proof; Basic is the rule in termination cases that the VOL. 448, 43
employer bears the burden of showing that the dismissal was for a JANUARY 11, 2005
just or authorized cause, otherwise the dismissal is deemed
unjustified; Clear and convincing evidence of imminent economic or Me-Shurn Corporation vs. Me-
business reversals should be presented.—The reason invoked by Shurn Workers Union-FSM
petitioners to justify the cessation of corporate operations was alleged ties or affiliations. It is enough that the discrimination was a
business losses. Yet, other than generally referring to the financial contributing factor.  If the basic inspiration for the act of the
crisis in 1998 and to their supposed difficulty in obtaining an export employer is derived from the affiliation or activities of the union, the
quota, interestingly, they never presented any report on the financial former’s assignment of another reason, no matter how seemingly
operations of the corporation during the period before its shutdown. valid, is unavailing.
Neither did they submit any credible evidence to substantiate their Same; Same; Same; While the determination to cease
allegation of business losses. Basic is the rule in termination cases operations is a management prerogative that the State does not
that the employer bears the burden of showing that the dismissal was usually interfere in, where it is manifest that the closure is motivated
for a just or authorized cause. Otherwise, the dismissal is deemed not by a desire to avoid further losses but to discourage the workers
unjustified. Apropos this responsibility, petitioner corporation should from organizing themselves into a union for more effective
have presented clear and convincing evidence of imminent economic negotiations with management, the State is bound to intervene.—The
or business reversals as a form of affirmative defense in the determination to cease operations is a management prerogative that
proceedings before the labor arbiter or, under justifiable the State does not usually interfere in. Indeed, no business can be
circumstances, even on appeal with the NLRC. required to continue operating at a loss, simply to maintain the
Same; Same; Same; Appeals; Elementary is the principle workers in employment. That would be a taking of property without
barring a party from introducing fresh defenses and facts at the due process of law. But where it is manifest that the closure is
appellate stage.—In all the proceedings before the two quasi-judicial motivated not by a desire to avoid further losses, but to discourage
bodies and even before the CA, no evidence was submitted to show the workers from organizing themselves into a union for more
the corporation’s alleged business losses. It is only now that effective negotiations with management, the State is bound to
petitioners have belatedly submitted the corporation’s income tax intervene.
returns from 1996 to 1999 as proof of alleged continued losses during Same; Same; Certification Elections; The DOLE would not
those years. Again, elementary is the principle barring a party from have entertained the Petition for Certification Election if the union
introducing fresh defenses and facts at the appellate stage. This Court were not a legitimate labor organization within the meaning of the
has ruled that matters regarding the financial condition of a company Labor Code; It would be an unwarranted impairment of the right to
—those self-organization through formation of labor associations if
_______________ thereafter such collective entities would be barred from instituting
action in their respective capacity.—Neither are we prepared to
* THIRD DIVISION. believe petitioners’ argument that respondent union was not
** In some pleadings also spelled as “Rosalinda.”
legitimate. It should be pointed out that on June 29, 1998, it filed a
42 Petition for Certification Election. While this Petition was initially
dismissed by the med-arbiter on the basis of a supposed retraction,
42 SUPREME COURT note that the appeal was granted and that Undersecretary Dimapilis-
Baldoz ordered the holding of a certification election. The DOLE
REPORTS ANNOTATED would not have entertained the Petition if the union were not a
Me-Shurn Corporation vs. Me- legitimate labor organization within the meaning of the Labor Code.
Shurn Workers Union-FSM Under this Code, in an unorganized establishment, only a legitimate
union may file a petition for certification election. Hence, while it is
that justify the closing of its business and show the losses in its
not clear from the record whether respondent union is a legitimate
operations—are questions of fact that must be proven below.
organization, we are not readily inclined to believe otherwise,
Petitioners must bear the consequence of their neglect. Indeed, their
especially in the light of the pro-labor policies enshrined in the
unexplained failure to present convincing evidence of losses at the
Constitution and
early stages of the case clearly belies the credibility of their present 44
claim.
Same; Unions; Certification Elections; A company’s
44 SUPREME COURT
preference for a union at the expense of another union could render
said employer guilty of discrimination even if the preferred union is REPORTS ANNOTATED
not company-dominated.—Notwithstanding the Petition for Me-Shurn Corporation vs. Me-
Certification Election filed by respondents and despite knowledge of
the pendency thereof, petitioners recognized a newly formed union Shurn Workers Union-FSM
and hastily signed with it an alleged Collective Bargaining the Labor Code. Verily, the union has the requisite personality
Agreement. Their preference for the new union was at the expense of to sue in its own name in order to challenge the unfair labor practice
respondent union. Moncada Bijon Factory v. CIR held that an committed by petitioners against it and its members. “It would be an
employer could be held guilty of discrimination, even if the preferred unwarranted impairment of the right to self-organization through
union was not company-dominated. formation of labor associations if thereafter such collective entities
Same; Closure of Establishment; Notice to the Department of would be barred from instituting action in their representative
Labor and Employment is mandatory to enable the proper authorities capacity.”
to ascertain whether the closure and/or dismissals are being done in
good faith and not just as a pretext for evading compliance with the PETITION for review on certiorari of a decision of the Court
employer’s just obligations to the affected employees.—Proper of Appeals.
written notices of the closure were not sent to the DOLE and the    The facts are stated in the opinion of the Court.
employees at least one month before the effectivity date of the   Kapunan, Tamano, Villadolid and Associates and Alan
termination, as required under the Labor Code. Notice to the DOLE is A. Leynes for petitioners.
mandatory to enable the proper authorities to ascertain whether the   Benjamin Alar for respondents.
closure and/or dismissals were being done in good faith and not just
as a pretext for evading compliance with the employer’s just PANGANIBAN, J.:
obligations to the affected employees. This requirement is intended to To justify the closure of a business and the termination of
protect the workers’ right to security of tenure. The absence of such the services of the concerned employees, the law requires the
requirement taints the dismissal.
employer to prove that it suffered substantial actual losses.
Same; Same; Unfair Labor Practices; If the basic inspiration
for the act of the employer is derived from the affiliation or activities The cessation of a company’s operations shortly after the
of the union, the former’s assignment of another reason, no matter organization of a labor union, as well as the resumption of
how seemingly valid, is unavailing.—All these factors strongly give business barely a month after, gives credence to the
employees’ claim that the closure was meant to discourage certification election among the rank and file employees of the
union membership and to interfere in union activities. These corporation.11
acts constitute unfair labor practices. Meanwhile, on August 4, 1998, respondent union filed a
The Case Notice of Strike against petitioner corporation on the ground
Before us is a Petition for Review 1 under Rule 45 of the of unfair labor practice (illegal lockout and union busting).
Rules of Court, seeking to annul the November 29, 2002 This matter was docketed as Case No. NCMB-RO3-BEZ-NZ-
Decision2 of the Court of Appeals (CA) in CA-G.R. SP No. 08-42-98.12
69675, the decretal portion of which reads: On August 31, 1998, Chou Fang Kuen (alias Sammy
_______________ Chou, the other petitioner herein) and Raquel Lamayra (the
Filipino administrative manager of the corporation) imposed a
1 Rollo, pp. 3-24. precondition for the resumption of operation and the rehiring
2 Annex “1” of Petition; Id., pp. 26-36. Penned by Justice Renato C.
Dacudao and concurred in by Justices Eugenio S. Labitoria (Division of laid off workers. He allegedly required the remaining union
chairman) and Danilo B. Pine.  officers to sign an Agreement containing a guarantee that upon
their return to work, no union or labor organization would be
45
organized. Instead, the union officers were to serve as
VOL. 448, JANUARY 11, 45 mediators between labor and management.13 After the
2005 _______________

Me-Shurn Corporation vs. Me-Shurn

Workers Union-FSM 9  Rollo, p. 27.
“UPON THE VIEW WE TAKE OF THIS CASE, THUS, the 10 Id., p. 28.
11 Ibid.
judgment must be, as it hereby is, AFFIRMED, and the present 12 Ibid.
petition DISMISSED for lack of merit. Costs shall be taxed against 13 Ibid.
petitioners.”3

47
The affirmed November 29, 2001 Decision4 of the VOL. 448, JANUARY 11, 47
National Labor Relations Commission (NLRC), Third
Division, disposed as follows: 2005
“WHEREFORE, the decision appealed from is hereby SET Me-Shurn Corporation vs. Me-Shurn
ASIDE, and respondent Me-Shurn Corp. is hereby ordered to pay the
Workers Union-FSM
complainants who appeared in the proceedings conducted by the
Labor Arbiter their full backwages from the date their wages were signing of the Agreement, the operations of the corporation
withheld from them to the date of the finality of this decision.” 5 resumed in September 1998.14
On November 5, 1998, the union reorganized and elected a
The Facts new set of officers. Respondent Rosalina Cruz was elected
president.15 Thereafter, it filed two Complaints docketed as
On June 7, 1998, the regular rank and file employees of NLRC Case Nos. RAB-III-11-9586-98 and RAB-III-09-0322-
Me-Shurn Corporation organized Me-Shurn Workers Union- 99. These cases were consolidated and assigned to Labor
FSM, an affiliate of the February Six Movement Arbiter Henry Isorena for compulsory arbitration.
(FSM).6 Respondent union had a pending application for Respondents charged petitioner corporation with unfair labor
registration with the Bureau of Labor Relations (BLR) through practice, illegal dismissal, underpayment of wages and
a letter dated June 11, 1998.7 deficiency in separation pay, for which they prayed for
Ten days later, or on June 17, 1998, petitioner corporation damages and attorney’s fees.
started placing on forced leave all the rank and file employees The corporation countered that because of economic
who were members of the union’s bargaining unit.8 reversals, it was compelled to close and cease its operations to
On June 23, 1998, respondent union filed a Petition for prevent serious business losses; that under Article 283 of the
Certification Election with the Med-Arbitration Unit of the Labor Code, it had the right to do so; that in August 1998, it
_______________ had paid its 342 laid off employees separation pay and benefits
in the total amount of P1,682,863.88; and that by virtue of
these payments, the cases had already become moot and
3 CA Decision, p. 11; Id., p. 36. academic. It also averred that its resumption of operations in
4 Annex “5” of Petition; Id., pp. 65-70. Penned by Commissioner Ireneo
B. Bernardo and concurred in by Presiding Commissioner Lourdes C. Javier September 1998 had been announced and posted at the Bataan
and Commissioner Tito F. Genilo. Export Processing Zone, and that some of the former
5 NLRC Decision, p. 5; Id., p. 69. employees had reapplied.
6 Rollo, p. 27. Petitioner corporation questioned the legality of the
7 Ibid.
8 Respondents’ Memorandum, p. 2; Id., p. 152. representation of respondent union. Allegedly, it was not the
latter, but the Me-Shurn Independent Employees’ Union—
46 with Christopher Malit as president—that was recognized as
46 SUPREME COURT REPORTS the existing exclusive bargaining agent of the rank and file
ANNOTATED employees and as the one that had concluded a Collective
Bargaining Agreement (CBA) with the corporation on May
Me-Shurn Corporation vs. Me-Shurn 19, 1999.16 Hence, the corporation asserted that Undersecretary
Workers Union-FSM _______________
Department of Labor and Employment (DOLE), Regional
Office No. 3.9
14 Rollo, p. 30.
Instead of filing an answer to the Petition, the corporation 15 Id., p. 28.
filed on July 27, 1998, a comment stating that it would 16 Id., p. 53.
temporarily lay off employees and cease operations, on
account of its alleged inability to meet the export quota 48
required by the Board of Investment.10 48 SUPREME COURT REPORTS
While the Petition was pending, 184 union members ANNOTATED
allegedly submitted a retraction/withdrawal thereof on July 14,
Me-Shurn Corporation vs. Me-Shurn
1998. As a consequence, the med-arbiter dismissed the
Petition. On May 7, 1999, Department of Labor and Workers Union-FSM
Employment (DOLE) Undersecretary Rosalinda Dimapilis- Dimapilis-Baldoz’s Decision ordering the holding of a
Baldoz granted the union’s appeal and ordered the holding of a certification election had become moot and academic.
 On the other hand, respondents contested the legality of
21 See  Certification from DOLE Regional Office No. III signed by
the formation of the Me-Shurn Independent Employees’ Geraldine M. Panlilio; Id., p. 103.
Union and petitioners’ recognition of it as the exclusive 22 This case was deemed submitted for decision on August 20, 2004,
bargaining agent of the employees. Respondents argued that upon this Court’s receipt of petitioners’ Supplemental Memorandum signed
the pendency of the representation issue before the DOLE had by Attys. Ma. Victoria A. Soriano-Villadolid, Michelle L. Yulo and Jean-Paul
A. Acut. Earlier, on April 5, 2004, petitioners
barred the alleged recognition of the aforementioned union.
Labor Arbiter Isorena dismissed the Complaints for lack of 50
merit. He ruled that (1) actual and expected losses justified the 50 SUPREME COURT REPORTS
closure of petitioner corporation and its dismissal of its
employees; (2) the voluntary acceptance of separation pay by ANNOTATED
the workers precluded them from questioning the validity of Me-Shurn Corporation vs. Me-Shurn
their dismissal; and (3) the claim for separation pay lacked Workers Union-FSM
factual basis.17 Issues
On appeal, the NLRC reversed the Decision of Labor In their Supplemental Memorandum, petitioners submit
Arbiter Isorena. Finding petitioners guilty of unfair labor the following issues for our consideration:
practice, the Commission ruled that the closure of the “(1) Whether the dismissal of the employees of petitioner
corporation shortly after respondent union had been organized, Meshurn Corporation is for an authorized cause, and
as well as the dismissal of the employees, had been effected (2) Whether respondents can maintain a suit against
under false pretenses. The true reason therefor was allegedly petitioners.”23

to bar the formation of the union. Accordingly, the NLRC held

that the illegally dismissed employees were entitled to back The Court’s Ruling
wages.18
After the denial of their Motion for The Petition lacks merit.
Reconsideration,19 petitioners elevated the cases to the
CA via a Petition for Certiorari under Rule 65. 20 They First Issue:
maintained that the NLRC had committed grave abuse of Validity of the Dismissal
discretion and serious errors of fact and law in reversing the
Decision of the labor arbiter and in finding that the The reason invoked by petitioners to justify the cessation
corporation’s cessation of operations in August 1998 had been of corporate operations was alleged business losses. Yet, other
tainted with unfair labor practice. than generally referring to the financial crisis in 1998 and to
_______________ their supposed difficulty in obtaining an export quota,
interestingly, they never presented any report on the financial
operations of the corporation during the period before its
17 Annex “3”; Id., pp. 46-58.
18 Annex “5”; Id., pp. 65-70. shutdown. Neither did they submit any credible evidence to
19 See NLRC Resolution dated January 24, 2002; CA Rollo, p. 46. substantiate their allegation of business losses.
20 CA Rollo, pp. 2-17. Basic is the rule in termination cases that the employer
bears the burden of showing that the dismissal was for a just or
49
authorized cause. Otherwise, the dismissal is deemed
VOL. 448, JANUARY 11, 49 unjustified. Apropos this responsibility, petitioner corporation
2005 _______________
Me-Shurn Corporation vs. Me-Shurn
submitted their regular Memorandum signed by Atty. Alan A. Leynes.
Workers Union-FSM Respondents’ Memorandum, signed by Atty. Benjamin C. Alar, was received
Petitioners added that respondent union’s personality to by this Court on April 1, 2004.
represent the affected employees had already been repudiated
23 Petitioners’ Supplemental Memorandum, pp. 5-6; Rollo, pp. 191-
by the workers themselves in the certification election 192. See also the statement of issues in petitioners’ regular Memorandum;
conducted by the DOLE. Pursuant to the Decision of Rollo, p. 163.
Undersecretary Dimapilis-Baldoz in Case No. RO3 00 9806
RU 001, a certification election was held on September 7, 51
2000, at the premises of petitioner corporation under the VOL. 448, JANUARY 11, 51
supervision of the DOLE. The election had the following 2005
results:
“Me Shurn Workers Union-FSM—1
Me-Shurn Corporation vs. Me-Shurn
No Union—135 Workers Union-FSM
Spoiled—2 should have presented clear and convincing evidence 24 of
Challenged—52 imminent economic or business reversals as a form of
Total Votes Cast—190” 21
affirmative defense in the proceedings before the labor arbiter
or, under justifiable circumstances, even on appeal with the
Ruling of the Court of Appeals NLRC.
However, as previously stated, in all the proceedings
The CA dismissed the Petition because of the failure of before the two quasi-judicial bodies and even before the CA,
petitioners to submit sufficient proof of business losses. It no evidence was submitted to show the corporation’s alleged
found that they had wanted merely to abort or frustrate the business losses. It is only now that petitioners have belatedly
formation of respondent union. The burden of proving that the submitted the corporation’s income tax returns from 1996 to
dismissal of the employees was for a valid or authorized cause 1999 as proof of alleged continued losses during those years.
rested on the employer. Again, elementary is the principle barring a party from
The appellate court further affirmed the union’s legal introducing fresh defenses and facts at the appellate
personality to represent the employees. It held that (1) stage.25 This Court has ruled that matters regarding the
registration was not a prerequisite to the right of a labor financial condition of a company—those that justify the
organization to litigate; and (2) the cases may be treated as closing of its business and show the losses in its operations—
representative suits, with respondent union acting for the are questions of fact that must be proven below. 26 Petitioners
benefit of all its members. must bear the consequence of their neglect. Indeed, their
Hence, this Petition.22 unexplained failure to present convincing evidence of losses at
  the early stages of the case clearly belies the credibility of
_______________
their present claim.27
 Obviously, on the basis of the evidence—or the lack succeeded on June 7, 1998. Ten days later, without any valid
thereof—the appellate court cannot be faulted for ruling that notice, all of them were placed on forced leave, allegedly
the NLRC did not gravely abuse its discretion in finding that because of lack of quota.
_______________ All these considerations give credence to their claim that
the closure of the corporation was a mere subterfuge, “a
systematic approach intended to dampen the enthusiasm of the
24 Camara Shoes v. Kapisanan ng mga Manggagawa sa Camara Shoes,
173 SCRA 127, May 5, 1989; Garcia v. National Labor Relations union members.”28
Commission, 153 SCRA 639, September 4, 1987; National Federation of Third, as a condition for the rehiring of the employees, the
Labor Unions v. Ople, 143 SCRA 124, July 22, 1986; Manila Hotel union officers were made to sign an agreement that they would
Corporation v. National Labor Relations Commission, 141 SCRA 169, not form any union upon their return to work. This move was
January 22, 1986.
25 CLLC E.G. Gochangco Workers Union v. National Labor Relations contrary to law.
Commission, 161 SCRA 655, May 30, 1988. Fourth, notwithstanding the Petition for Certification
26 Philippine Engineering Corporation v. Court of Industrial Relations, Election filed by respondents and despite knowledge of the
41 SCRA 89, September 30, 1971.
pendency thereof, petitioners recognized a newly formed
27 Camara Shoes v. Kapisanan ng mga Manggagawa sa Camara Shoes,
supra. union and hastily signed with it an alleged Collective
Bargaining Agreement. Their preference for the new union
52 was at the expense of respondent union. Moncada Bijon
52 SUPREME COURT REPORTS Factory v. CIR29
ANNOTATED  
_______________
Me-Shurn Corporation vs. Me-Shurn
Workers Union-FSM 28 Philippine Engineering Corporation v. Court of Industrial Relations;
supra, p. 99; per Zaldivar, J.
the closure of petitioner corporation was not due to alleged 29 4 SCRA 756, March 30, 1962 (also cited in Philippine Charity
financial losses. Sweepstakes Office v. The Association of Sweepstakes Staff Personnel, 115
At any rate, even if we admit these additional pieces of SCRA 34, July 16, 1982).
evidence, the circumstances surrounding the cessation of
54
operations of the corporation reveal the doubtful character of
its supposed financial reason. 54 SUPREME COURT REPORTS
First, the claim of petitioners that they were compelled to ANNOTATED
close down the company to prevent further losses is belied by Me-Shurn Corporation vs. Me-Shurn
their resumption of operations barely a month after the
corporation supposedly folded up.
Workers Union-FSM
Moreover, petitioners attribute their loss mainly to their held that an employer could be held guilty of discrimination,
failure to obtain an export quota from the Garments and even if the preferred union was not company-dominated.
Textile Export Board (GTEB). Yet, as pointed out by Fifth, petitioners were not able to prove their allegation
respondents, the corporation resumed its business without first that some of the employees’ contracts had expired even before
obtaining an export quota from the GTEB. Besides, these the cessation of operations. We find this claim inconsistent
export quotas pertain only to business with companies in the with their position that all 342 employees of the corporation
United States and do not preclude the corporation from were paid their separation pay plus accrued benefits in August
exporting its products to other countries. In other words, the 1998.
business that petitioner corporation engaged in did not depend Sixth, proper written notices of the closure were not sent
entirely on exports to the United States. to the DOLE and the employees at least one month before the
If it were true that these export quotas constituted the effectivity date of the termination, as required under the Labor
determining and immediate cause of the closure of the Code. Notice to the DOLE is mandatory to enable the proper
corporation, then why did it reopen for business barely a authorities to ascertain whether the closure and/or dismissals
month after the alleged cessation of its operations? were being done in good faith and not just as a pretext for
Second, the Statements of Income and Deficit for the years evading compliance with the employer’s just obligations to the
1996 and 1997 show that at the beginning of 1996, the affected employees.30 This requirement is intended to protect
corporation had a deficit of P2,474,505. Yet, the closure was the workers’ right to security of tenure. The absence of such
effected only after more than a year from such year-end requirement taints the dismissal.
deficit; that is, in the middle of 1998, shortly after the All these factors strongly give credence to the contention
formation of the union. of respondents that the real reason behind the shutdown of the
On the other hand, the Statement of Income and Deficit for corporation was the formation of their union. Note that, to
the year 1998 does not reflect the extent of the losses that constitute an unfair labor practice, the dismissal need not
petitioner corporation allegedly suffered in the months prior to entirely and exclusively be motivated by the union’s activities
its closure in July/August 1998. This document is not an or affiliations. It is enough that the discrimination was a
adequate and competent proof of the alleged losses, consider- contributing factor.31 If the basic inspiration for the act of the
53 employer is derived from the affiliation or activities of the
union, the former’s assignment of another reason, no matter
VOL. 448, JANUARY 11, 53
how seemingly valid, is unavailing.32
2005  
Me-Shurn Corporation vs. Me-Shurn _______________

Workers Union-FSM 30 Guerrero v. National Labor Relations Commission, 261 SCRA 301,
ing that it resumed operations in the succeeding month of August 30, 1996. See also Wiltshire File Co., Inc. v. National Labor Relations
September. Commission, 193 SCRA 665, February 7, 1991.
Upon careful study of the evidence, it is clear that the 31 Philippine Engineering Corporation v. Court of Industrial Relations,
supra.
corporation was more profitable in 1997 than in 1996. By the 32 Ibid.
end of 1997, it had a net income of P1,816,397.
If petitioners were seriously desirous of averting losses, 55
why did the corporation not close in 1996 or earlier, when it VOL. 448, JANUARY 11, 55
began incurring deficits? They have not satisfactorily 2005
explained why the workers’ dismissal was effected only after
the formation of respondent union in September 1998. Me-Shurn Corporation vs. Me-Shurn
We also take note of the allegation that after several years Workers Union-FSM
of attempting to organize a union, the employees finally
 Concededly, the determination to cease operations is a certification election raising a legitimate representation issue.
management prerogative that the State does not usually (Colegio de
interfere in. Indeed, no business can be required to continue
_______________
operating at a loss, simply to maintain the workers in
employment. That would be a taking of property without due
process of law. But where it is manifest that the closure is
motivated not by a desire to avoid further losses, but to
discourage the workers from organizing themselves into a
union for more effective negotiations with management, the
State is bound to intervene.33

Second Issue:
Legal Personality of Respondent Union

Neither are we prepared to believe petitioners’ argument

that respondent union was not legitimate. It should be pointed
out that on June 29, 1998, it filed a Petition for Certification
Election. While this Petition was initially dismissed by the
med-arbiter on the basis of a supposed retraction, note that the
appeal was granted and that Undersecretary Dimapilis-Baldoz
ordered the holding of a certification election.
The DOLE would not have entertained the Petition if the
union were not a legitimate labor organization within the
meaning of the Labor Code. Under this Code, in an
unorganized establishment, only a legitimate union may file a
petition for certification election.34 Hence, while it is not clear
from the record whether respondent union is a legitimate
organization, we are not readily inclined to believe otherwise,
especially in the light of the pro-labor policies enshrined in the
Constitution and the Labor Code.35
Verily, the union has the requisite personality to sue in its
own name in order to challenge the unfair labor practice
_______________

33 Carmelcraft Corporation v. National Labor Relations Commission,

186 SCRA 393, June 6, 1990.
34 Article 257, Labor Code.
35 Article 246, Ibid.

56
56 SUPREME COURT REPORTS
ANNOTATED
Me-Shurn Corporation vs. Me-Shurn
Workers Union-FSM
committed by petitioners against it and its members. 36 “It
would be an unwarranted impairment of the right to self-
organization through formation of labor associations if
thereafter such collective entities would be barred from
instituting action in their representative capacity.” 37
Finally, in view of the discriminatory acts committed by
petitioners against respondent union prior to the holding of the
certification election on September 27, 2000—acts that
included their immediate grant of exclusive recognition to
another union as a bargaining agent despite the pending
Petition for certification election—the results of that election
cannot be said to constitute a repudiation by the affected
employees of the union’s right to represent them in the present
case.
WHEREFORE, the Petition is DENIED, and the assailed
Decision AFFIRMED. Costs against the petitioners.
SO ORDERED.
Sandoval-Gutierrez, Corona, Carpio-
Morales and Garcia, JJ., concur.
Petition denied, assailed decision affirmed.
 
Notes.—A decision in a certification case does not
foreclose all further dispute between the parties as to the
existence, or non-existence, of employer-employee
relationship between them. (Manila Golf & Country Club, Inc.
vs. Intermediate Appellate Court, 237 SCRA 207 [1994])
In order to allow the employer to validly suspend the
bargaining process there must be a valid petition for