Definitive Report - Report No 241, November 1985

Case No 1323 (Philippines) - Complaint date: 07-MAR-85 - Closed

1. 341. The International Confederation of Free Trade Unions (ICFTU) presented a complaint of violations of trade union rights against the Government of the Philippines on 7 March 1985. The Trade Unions of the Philippines and Allied Services (TUPAS) also addressed a complaint against the Government in communications dated 13 and 29 May 1985, as did the Kilusang Mayo Uno (KMU) in a communication dated 8 June 1985. The Government sent its observations in communications dated 30 May, 14 June and 26 August 1985.
2. 342. The Philippines have ratified the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No.087)and the Right to Organise and Collective Bargaining Convention, 1949 (No.098); they have not ratified the Labour Relations (Public Service) Convention, 1978 (No. 151).

A. The complainants' allegations

1. 343. In its communication of 7 March 1985, the ICFTU states that it is greatly concerned about restrictions relating to the right to strike, the requirements for the registration of trade unions, the powers of inquiry conferred on the Department of Labour in respect of the financial management of unions and the harassment, arrest and detention of trade unionists in the Philippines. This has been reflected in the observations of the ILO Committee of Experts on the Application of Conventions and Recommendations and by the Committee on Freedom of Association in its conclusions concerning Cases Nos. 1157 and 1192. In particular, the ICFTU alleges an additional infringement of trade union rights by the Government, namely the denial of the right to organise in the public sector. According to the ICFTU, while section 244 of the Labour Code guarantees the right to "self-organisation" to workers in commercial, industrial and agricultural enterprises, the workers in government and local government services, as well as workers in government-owned or controlled corporations - covered by the Civil Service Law and Rules - are excluded from the right to organise in trade unions. This, states the ICFTU, results in a situation where a substantial proportion of Filipino workers are without the protection and means for the furtherance of their interests by trade union organisations.
2. 344. In its communication of 13 May 1985, the TUPAS alleges that recent legislation on strikes and lock-outs - Letter of Instruction No. 1458 promulgated on 1 May 1985, a copy of which is supplied - weakens concerted actions, strikes and picketing by workers, and is in violation of ILO Conventions.
3. 345. In its communication of 29 May 1985, the TUPAS states that, although Letter of Instruction No. 1458 has not at present been implemented, it is contrary to the ILO Conventions on freedom of association for the following reasons: (1) it states that any assumption of jurisdiction by the President or Minister of Labour shall be immediately executory even if such action is under appeal to the Supreme Court; (2) it empowers the Minister of Labour to authorise the employer to hire replacement labour; (3) the police and military may be used for the immediate execution of orders even if the Supreme Court should subsequently declare the action of the Minister void.
4. 346. In its communication of 8 June 1985, the KMU first alleges that the following labour leaders were arrested on 13 August 1982 and remain detained by the military authorities: Romeo Castillo, Cesar Bristol, Danilo Garcia, Herminia Ibarra (all detained at Military Camp Bagong Diwa), Millet Soriano, José Britanico, Simplicio Anino, Lauro Pabit (all detained at Military Camp Crame), Ceferino Pineda, Antonio Cabrera, Renato Yineda, Roberto Ramos and Noel Maglalang (all detained at Military Camp Olivas). According to the KMU, they were charged with offences which they have not committed.
5. 347. Secondly, the KMU alleges that the major labour laws are repressive and violate the ILO Constitution and freedom of association Conventions. For example, freedom of association and the right to collective bargaining are restricted in the following circumstances:
   • a) government employees, including employees working in quasi-public corporations, are not allowed to organise as labour organisations and are prohibited from declaring a strike or engaging in other concerted activities. Their security of tenure and other terms and conditions of employment are governed by the Philippine Civil Service Laws which are unilaterally imposed by the Government. Prior to martial law in the Philippines, the rights of public employees to organise in quasi-public corporations had been recognised;
   • b) workers in the following industries are allowed to organise labour unions but are prohibited from declaring a strike or engaging in concerted activities pursuant to section 264 g) of the Labor Code, Legislative Resolution No. 473 and Executive Order No. 815: export-oriented industries, semi-conductor business, public utilities, companies engaged in the generation or distribution of energy, banks and hopsitals;
   • c) the following are not allowed to unionise: private security guards, personnel employed by the employers for the protection and security of their person, properties and the factory, managerial employees, casual, probationary and temporary employees, apprentices, learners and contractual workers.
6. 348. The KMU alleges in this connection that freedom of association is curtailed by the Government by not according to a labour organisation the status of a legitimate labour organisation unless it registers with the Ministry of Labour and Employment. For example, KMU is refused recognition by the Government because it is not a registered labour centre despite clear and unequivocal acceptance by the Filipino workers of its legitimacy. Moreover, undue delays in the handling of union representation cases affects the rights of the workers to form an association. For example, a simple election case can last for more than one year thereby frustrating the free choice of bargaining agents. Related to this are the stringent requirements imposed by the Government for the registration of labour unions (section 234 of the Labour Code) and labour federations and national unions (section 237 of the Labour Code: a labour federation or national union cannot be registered unless the applicant presents proof that ten local unions with collective bargaining agreements are affiliated to the federation).
7. 349. The KMU also refers to section 6 of Presidential Decree No. 1391 by which workers are prohibited from changing their bargaining agent during the life of a collective bargaining contract which is fixed at three years. Consequently, even if the bargaining agent selected no longer enjoys the trust and confidence of the workers, the latter have to wait for three years before the bargaining representative could be changed.
8. 350. The KMU next refers to section 4 f) of Rule III of the Rules Implementing Presidential Decree No. 1391 which reads: "... No person who is not an employee or worker of the company or establishment where an independently registered union, affiliate, local or chapter of a labour federation or national union operates shall henceforth be elected or appointed as an officer of such union, affiliate, local or chapter. " This rule, according to the KMU, prohibits a person not employed by the company from becoming a union officer.
9. 351. According to the KMU, freedom of association is also violated by the Government because it is empowered by law (sections 238, 239 and 240 of the Labour Code) to cancel the registration certificates of labour unions for the following reasons: fraud in connection with the ratification of the union's constitution; failure to submit the founding documents within 30 days from their adoption; fraud during elections or failure to submit election information within 30 days of the election; failure to submit annual returns within 30 days of the close of the financial year; engaging in any activity prohibited by law; entering into collective agreements setting conditions of employment below the minimum legal standards; asking for or accepting special fees from employers or union members; failure to submit membership lists at least once a year.
10. 352. Lastly, the KMU alleges that from January to May 1985 there has been an upsurge in trade union repression, involving the death of at least nine workers while actively representing their unions. This complainant states that on 1 May 1985 the President issued Letter of Instruction No. 1458 which provides for the immediate involvement of the military in picket lines. It claims that the use of fanatic groups, para-military and direct military intervention in strike situations is obvious.
11. 353. The KMU attaches to its communication a voluminous petition containing further details regarding alleged violations of Conventions Nos. 87 and 98 and requesting the ILO to instruct the Government to stay the implementation of Labour Laws Nos. 130 and 227, Executive Order No. 815, Resolution No. 473 and Letter of Instruction No. 1458. In addition to repeating the detailed allegations listed above, the petition refers specifically to undue employer and government interference in the internal activities of unions by requiring a majority of two-thirds votes before concerted action can be authorised and by permitting their representatives to attend and/or supervise union meetings.
12. 354. According to the KMU petition, rather than heed the criticisms of several international bodies, the Government issued Letter of Instruction No. 1458. This legislation was used to put down a strike by 800 employees of the Filipinas Synthetic Fiber Corporation at Santa Rosa, Laguna, with resulting injuries to 70 strikers. While this legislation requires the employer to comply with a return-to-work order, the KMU alleges that some do not immediately reinstate striking employees, e.g. Baxter Travenol, Allied Banking Corporation, Blue Bar Coconut and the Producers Bank. In addition, while the Letter of Instruction requires the payment of back wages to striking employees, the Minister of Labour does not order such repayment.
13. 355. The KMU also attaches to its complaint a copy of a petition it presented on 10 June 1985 to the Supreme Court of the Philippines requesting the issuance of a temporary restraining order against implementation of Letter of Instruction No. 1458 until the Court can decide that it is invalid and unconstitutional.

B. The Government's reply

1. 356. In its communication of 30 May 1985, the Government explains that although both private sector and government employees are guaranteed the right to association, government employees performing governmental functions were in the past the only group not allowed to engage in concerted activities. When the situation emerged where employees of government-owned or controlled corporations engaged in proprietary functions received wages and benefits far higher than their counterparts in the various branches of Government, it was decided to include such employees within the ambit of the Civil Service Act of 1959. As a result of debates on this point during the adoption of the 1973 Constitution, section 1, Article XII-B, was passed, placing these employees under the Civil Service Act and providing that compensation of all government employees shall be standardised by the National Assembly. The Government points out that section 277 of the Labour Code incorporated the constitutional provision in the following terms: The terms and conditions of employment of all government employees, including employees of all government-owned or controlled corporations shall be governed by the Civil Service Law, rules and regulations. Their salaries shall be standardised by the National Assembly as provided for in the new Constitution. However, there shall be no reduction of existing wages, benefits, and other terms and conditions of employment being enjoyed by them at the time of the adoption of the Code.
2. 357. According to the Government, the phrase "government-owned or controlled corporations" has been interpreted by the Secretary (now Minister) of Justice and the National Labour Relations Commission (NLRC) of the Ministry of Labour and Employment as contemplating only those created by charter or by special laws or decrees. It does not include corporations incorporated or organised under the Corporation Code of the Philippines and motivated wholly for profit and the promotion of private interests. Hence, eventual government takeover through the acquisition of a controlling bloc of shares does not affect existing unions and collective bargaining agreements within the undertaking.
3. 358. The Government stresses that there is no law in the country that restricts the right to organise of government employees. On the contrary, the right to organise is guaranteed by the Constitution. Thus, in a case filed by the Alliance of Government Workers in 1983, the Supreme Court ruled: ... Our dismissal of this petition should not, by any means, be interpreted to imply that workers in government-owned and controlled corporations, or in state colleges and universities, may not enjoy freedom of association. The workers whom the petitioner purports to represent have the right, which may not be abridged, to form associations or societies for purposes not contrary to law. This is a right they share with all public officers and employees and, in fact, by everybody living in this country. But they may not join associations which impose the obligation to engage in concerted activities in order to get salaries, fringe benefits, and other emoluments higher than or different from that provided by law and regulations.
   • That government employees can and do form associations of their own choosing to promote and protect their collective interests is evidenced by such organisations as the Philippine Government Employees' Association (PGEA), the Alliance of Government Workers (AGW), the Philippine Public School Teachers' Association (PPSTA), the Labor Arbiters' Association of the Philippines, Inc. (LAAPI), the Philippine Veterans Bank Employees' Union (PVBEU) and various co-operatives and trade organisations in the public sector.
4. 359. Referring to the alleged limitation on the exercise of the right to strike in government-owned and controlled corporations, the Government explains that prior to the promulgation of the 1973 Constitution, employees of such corporations performing proprietary functions could join a union that imposed the duty to strike and other similar concerted actions. In practice, however, labour disputes involving government-owned or controlled corporations were considered imbued with national interest and were often recommended by the then Secretary of Labour to be certified by the President to the Court of Industrial Relations for compulsory arbitration under the legislation then in force. The Government states that the constitutional provision is not absolute in that it refers only to those corporations with special charters. Thus, corporations organised by the Government or those incorporated under the Corporation Act continue to enjoy the right to collective bargaining and concerted activities. Among these corporations are the Philippine Airlines, Petrophil and Hyatt Regency Hotel, in which their employees are not only unionised, but also have existing collective agreements with them.
5. 360. According to the Government, the rights and interests of government workers are protected by Executive Order No. 895 of 1 May 1983. This directive provides for the creation of an Employee-Management Committee in every government-owned or controlled corporation and an Employee-Management Consultative Council in the Civil Service Commission. The Government recognises that the formation of these bodies is crucial in view of the limitations on the right to bargain collectively regarding wages and strike actions. Executive Order No. 895 aims at fostering closer and more harmonious employer-employee relations in government-owned or controlled corporations. The Committee and the Council are intended to improve the existing framework for the expeditious settlement of grievances and in providing a forum for regular and meaningful dialogue between the parties. "Grievances" as used in Executive Order No. 895, are defined as problems arising from physical working conditions, placement of employees, work distribution, performance appraisal, arbitrary actions, lay-offs and transfers, selection and promotion and other matters that may give rise to employee dissatisfaction. The rules governing operation of the employee-management committees provide that these shall be composed of equal representation of managment and workers. The Council, on the other hand, shall be composed of permanent representatives from the Employee-Management Committee which has referred a grievance to the Council and a representative from the ministry and agency to which the corporation involved is attached.
6. 361. The Government admits, however, that despite the administrative and judicial pronouncements regarding the right to self-organisation, some sectors continue to call for clarificatory legislation. In view of this, Parliamentary Bill No. 4962 was filed on 25 February 1985 proposing several amendments to the Labour Code. Among the proposed amendments is a provision which, while still prohibiting strikes in the public sector, recognises the right of this class of employees to bargain collectively with their employers and seeks to extend to them the same rights and privileges enjoyed by private sector employees. A current review is also being undertaken by the Cabinet in line with the Supreme Court decision on the matter.
7. 362. To its communication dated 14 June 1985, the Government attaches a copy of the "Guide-lines to implement Letter of Instruction No. 1458" dated 31 May 1985. The "Guide-lines" include safeguards such as exhaustion of conciliation or mediation before certifying the dispute to the National Labour Relations Commission for compulsory arbitration, the right to peaceful picketting and a restriction on the role of law enforcement authorities in labour disputes.
8. 363. In its letter of 26 August 1985, the Government first observes that many of the issues raised in the present complaint have already been examined by both the Committee on Freedom of Association and the Committee of Experts; it accordingly refers to its past replies on these issues.
9. 364. The Government states that, on 20 August 1985, Millet Soriano, Simplicio Anino, Lauro Pabit and José Britanico were released from detention on bail. They are being tried for conspiracy to commit rebellion or insurrection, illegal possession of explosives and violation of Presidential Decree No. 33. The Government also states that, according to documentation at the Ministry of National Defence, the other militant labour leaders were arrested not for legitimate trade union activity but for subversive and illegal acts; they are charged with illegal possession of firearms and ammunition and incitement to sedition, rebellion or insurrection.
10. 365. As regards the allegations concerning the labour legislation, the Government points to the following recent developments:
    • - the first meeting, on 20 February 1985, of the Tripartite Discussion Series on Labour and Employment Issues, during which the KMU, TUPAS and other workers' organisations were able to present their recommendations on the subject of arbitration to be included in the Ministry's Study Team review of labour laws, which is expected to hand down its final recommendations very soon;
    • - a public hearing, on 8 August 1985, on a draft bill (No. 4962) to amend the Labour Code incorporating some of the provisions referred to by the Committee of Experts; - a National Tripartite Conference, to be held in September 1985, to discuss all possible amendments to labour legislation.
11. 366. More particularly, the Government explains that Letter of Instruction No. 1458 was prompted by the open defiance of both labour and management sectors of lawful orders issued by the Ministry of Labour. Although issued in good faith by the Government, it is being included in the on-going review of labour relations laws in view of the varied reactions from both labour and management.

C. The Committee's conclusions

1. 367. The Committee notes that four of the labour leaders listed by the KMU have been released from detention on bail pending trial on charges unrelated to their trade union functions or activities. Given that the complainant did not attempt to link these arrests to the trade union activities of those concerned and merely referred to "an upsurge of trade union repression involving the death of at least nine workers" without supplying further details, the Committee considers that this aspect of the case does not call for further examination.
2. 368. Voluminous detail was provided by both sides on the alleged legislative violations of Conventions Nos. 87 and 98. The ICFTU and KMU allege that public employees covered by the Civil Service Law and Rules are excluded from the right to organise in trade unions, cannot bargain collectively or strike. The Government explains why civil servants and employees of government-owned or controlled corporations are subject to the same restrictions and points out that the latter (as well as teachers), by virtue of a Supreme Court ruling, may join associations which do not impose the obligation to strike. They can also discuss working conditions and grievances through the Employee/Management Consultative Council. The Government also points out that a distinction has been made whereby employees of those para-public corporations not set up by special charter continue to enjoy the right to bargain collectively and strike in the same manner as private sector workers.
3. 369. The Committee notes that the Committee of Experts commenting on the question of the right to organise of public employees, has stated that, since they do have the right to form associations under the Civil Service Law, they are therefore not denied the rights guaranteed by Article 2 of Convention No. 87. Problems, however, arise under Convention No. 98 in that freedom to bargain collectively is restricted for a very broadly defined group of public servants. As has been pointed out to the Government in comments by the Committee of Experts under Convention No. 89 since 1981, Article 4 thereof concerning the encouragement and promotion of collective bargaining applies both to the private sector and to public undertakings and bodies, it being possible under Article 6 to exclude from such application only public servants engaged in the administration of the State, i.e. civil servants employed in various capacities in government ministries and other comparable bodies. The Committee accordingly trusts that the current high-level revision of the labour laws will take this principle into account and requests the Government to keep the Committee of Experts on the Application of Conventions and Recommendations informed of developments as regards permitting public employees in both para-public corporations set up by charter and non-civil-service posts to negotiate their terms and conditions of employment.
4. 370. A related issue is raised by the KMU which refers to various Labour Code restrictions on private-sector unionisation (e.g., it is not available for private security guards, managerial employees, casual, probationary, temporary and contractual workers) and on the right to strike in the private sector (prohibited in export-oriented industries, semi-conductor business, public utilities, banks, hospitals). The Committee recalls that the Committee of Experts, in its 1981 observation concerning the Philippines' application of Convention No. 87, noted the Government's explanation that security staff have para-military status and are required to undergo pre-employment training under the direct supervision of the Philippine Constabulary. At the same time the Committee of Experts noted the restrictive definition of "managerial employee" and did not pursue the matter since such employees were free to form their own organisations for purposes other than for collective bargaining. The Committee observes, as regards casual or probationary workers, that there is no specific provision in the Labour Code (1985 Consolidation) denying apprentices or learners the right to join a union. Moreover, section 244 of the Code specifically recognises the right of "ambulant, intermittent and itinerant workers, self-employed people, rural workers and those without any definite employers" to form labour organisations. The Committee accordingly considers that this aspect of the case does not call for further examination.
5. 371. The ban on the right to strike in some private sector activities has, however, been criticised by this Committee and the Committee of Experts in the past. Although the 1985 observation by the Committee of Experts under Convention No. 87 noted that legal strikes had in practice taken place in banks, electric industries and export-processing zones, the Government's attention was again drawn to the principle that strikes can only be restricted or prohibited in respect of the civil service or essential services in the strict sense of the term, i.e. where the interruption of such activities would endanger the life, personal safety or health of the whole or part of the population. The Committee again trusts that the current review of labour legislation will result in amendments being adopted in the light of the foregoing principle to limit the excessive restrictions on the right to strike.
6. 372. As regards the KMU's further criticisms of labour legislation (too detailed regulation of registration of labour unions and federations; three-year limit for changing a bargaining agent; ban on holding union office on a person not belonging to the company involved; wide range of reasons for the cancellation of registration certificates; the two-third vote requirement for strike action), the Committee recalls once again that the ILO supervisory bodies have previously criticised these restrictions and has called for their amendment. The Committee can only reiterate this request, and hopes that these points will be considered during the current review referred to above.
7. 373. Lastly, as regards Letter of Instruction No. 1458 of 1 May 1985, the Committee notes that, according to one complainant, it has not as yet been used and that the Ministry of Labour has issued "Guide-lines" emphasising voluntary settlement of labour disputes before referral to compulsory arbitration and restricting the role of law enforcement authorities. Moreover, the "Guide-lines" provide for the specification of legal sanctions in the event of failure to comply with an arbitration order, such as non-payment of back wages. The Committee attaches great importance to the "Guide-lines" of the Ministry of Labour and emphasises that any hasty decision to refer disputes to compulsory arbitration is not in conformity with these "Guide-lines". It observes that the Government has responded to the varied reactions from labour and management to this Letter of Instruction by including it in the current review of labour relations laws. The Committee requests the Government to keep the Committee of Experts informed of any developments concerning this legislation.

The Committee's recommendations

1. 374. In these circumstances, the Committee recommends the Governing Body to approve this report and, in particular, the following conclusions:
   • a) Given the lack of detail on and substantiation of the alleged arrest of several labour leaders for trade union activities, the Committee considers that this aspect of the case does not call for further examination.
   • b) As regards the legislative aspects of this case, the Committee recalls the conclusions of the Committee of Experts on the Application of Conventions and Recommendations to the effect that public servants do have the right to form associations under the Civil Service Law, but that the restriction on the right to bargain collectively placed on such public employees goes beyond the exclusion permitted by Article 6 of Convention No. 98.
   • c) In view of the conclusions reached by the Committee of Experts on the alleged restriction of freedom of association for private security guards, managerial employees and casual and probationary employees, the Committee is of the opinion that this aspect of the case does not call for further examination.
   • d) As regards the ban on the right to strike in certain private sector activities, the Committee once again draws the Government's attention to the principle that strikes can only be restricted or prohibited in respect of the civil service or essential services in the strict sense of the term.
   • e) As regards the remaining criticisms in the current labour legislation as well as Letter of Instruction No. 1458, the Committee notes that a high-level review of labour relations legislation is presently under way and that a draft bill is before Parliament incorporating some of the provis ions referred to by ILO supervisory bodies. The Committee trusts that this review will take into account all the comments of the supervisory bodies.
   • f) The Committee draws the legislative matters raised in subparagraphs (b), d) and e) of this case to the attention of the Committee of Experts on the Application of Conventions and Recommendations and hopes that the Government will keep that Committee informed of developments concerning the labour laws as a whole.