Government Service Insurance System Family Bank Employees Union v. Villanueva
REITERATIONFacts
1. The Antecedents: GSIS Family Bank, originally organized as Royal Savings Bank in 1969, underwent significant changes in ownership and management. After facing financial difficulties and being placed under receivership by the Central Bank in 1984, it was rehabilitated through a Memorandum of Agreement with Commercial Bank of Manila, a subsidiary of the Government Service Insurance System (GSIS). Subsequently renamed Comsavings Bank and later GSIS Family Bank, the GSIS eventually acquired a majority stake, owning 99.55% of its shares by 1993. In 2004, the Bangko Sentral ng Pilipinas opined that GSIS Family Bank, despite GSIS's majority ownership, was not a government bank as it was organized under the general corporation law for private needs. However, in 2011, Republic Act No. 10149, the GOCC Governance Act, was enacted, creating the Governance Commission for Government-Owned or Controlled Corporations (GOCCs). 2. Procedural History: In 2012, GSIS Family Bank sought clarification from the Bangko Sentral ng Pilipinas and subsequently the Governance Commission regarding its classification under Republic Act No. 10149. The Governance Commission clarified that GSIS Family Bank was considered a government financial institution. This led to a query from GSIS Family Bank's president regarding its authority to negotiate collective bargaining agreements (CBAs) and its employees' right to strike. The Governance Commission, in a letter dated March 8, 2013, advised that as a government financial institution, GSIS Family Bank was unauthorized to enter into a CBA concerning economic terms, citing the Compensation and Position Classification System provided by law. In response, the GSIS Union demanded payment of Christmas bonus as per their existing CBA, accusing the bank of evading contractual obligations. The union asserted that RA 10149 did not apply to GSIS Family Bank, which it maintained was a private bank. Consequently, the GSIS Union filed a complaint before the National Conciliation and Mediation Board and a Notice of Strike, while some employees filed complaints before the National Labor Relations Commission and the Department of Labor and Employment. 3. The Petition: On January 30, 2014, the GSIS Family Bank Employees Union filed a Petition for Certiorari, Prohibition, and Mandamus before the Supreme Court. The Union argued that GSIS Family Bank is a private bank and thus outside the coverage of Republic Act No. 10149, asserting that its creation under the Corporation Code and the subsequent majority share acquisition by GSIS did not automatically convert it into a GOCC. The Union sought to compel GSIS Family Bank management to commence negotiations for a new CBA and to comply with the existing CBA, including the payment of benefits and bonuses. The respondents, in their comments, argued that GSIS Family Bank, as a government-acquired bank and a government financial institution, falls under RA 10149 and is subject to the Governance Commission's directives, which prohibit negotiation of economic terms in CBAs. They also raised procedural issues regarding the improper remedy and the failure to implead indispensable parties. The Supreme Court noted that the closure of GSIS Family Bank rendered the petition moot but proceeded to discuss the substantive issues.
Issue(s)
Whether or not the Petition for Certiorari is the correct remedy. Whether or not the closure of GSIS Family Bank has rendered the Petition moot. Whether or not GSIS Family Bank, a non-chartered government-owned or controlled corporation, can enter into a collective bargaining agreement with its employees.
Ruling
The Petition is DENIED. SO ORDERED.
Ratio Decidendi
On the issue of whether certiorari is the correct remedy: The Court ruled that certiorari under Rule 65 is generally directed against tribunals, boards, or officers exercising judicial or quasi-judicial functions. The Governance Commission (GCG), while having oversight and policy-making functions, does not possess judicial or quasi-judicial authority. Its letters to GSIS Family Bank were advisory opinions, not rulings on justiciable controversies. Furthermore, the petitioner failed to demonstrate the absence of a plain, speedy, and adequate remedy in the ordinary course of law, as advisories from the GCG could have been elevated to the Office of the President. The Court also noted the failure to implead all members of the GCG, a collegial body, as indispensable parties, which is a fatal defect for a certiorari petition. On the issue of whether the closure of GSIS Family Bank has rendered the Petition moot: The Court acknowledged that the closure of GSIS Family Bank by the Bangko Sentral ng Pilipinas Monetary Board on May 13, 2016, effectively rendered the case moot, as the reliefs sought, such as directing negotiations for a new CBA and compliance with the existing one, could no longer be enforced. However, the Court proceeded to resolve the substantive issues to provide guidance to the bench and bar on similar cases. On the issue of whether GSIS Family Bank, a non-chartered government-owned or controlled corporation, can enter into a collective bargaining agreement with its employees: The Court held that GSIS Family Bank, being a government financial institution (GFI) and a government-owned or controlled corporation (GOCC) under R.A. No. 10149, is subject to the Compensation and Position Classification System (CPCS) mandated by the law. While the right to self-organization is guaranteed to government employees, the right to collective bargaining and negotiation is limited to terms and conditions of employment not fixed by law. R.A. No. 10149, as implemented by Executive Order No. 203 (2016), explicitly prohibits GOCCs, whether chartered or non-chartered, from negotiating the economic terms of their CBAs. These matters must conform to the CPCS approved by the President. Therefore, GSIS Family Bank lacked the authority to negotiate economic terms with its employees, and its refusal to enter into a new CBA on these grounds was justified under the prevailing law.
Main Doctrine
Non-chartered government-owned or controlled corporations (GOCCs), including government financial institutions (GFIs), are covered by Republic Act No. 10149 and are subject to the Compensation and Position Classification System developed by the Governance Commission (GCG). Consequently, their management is unauthorized to negotiate economic terms of collective bargaining agreements (CBAs) with their employees, as such matters are subject to presidential approval.