PMPD's officers and members during the May 1, 2012 Demonstration in Rosario, Cavite

Rosario, Cavite – The Pagkakaisa ng Manggagawa sa Philippine Denrai (PMPD) – Independent represented by its 16 union officials and members won the consolidated complaint for unfair labor practice, illegal closure and illegal dismissal against the Philippine Denrai, Inc. (PDI) now known as Kyoto Global Exterior Inc. (KGEI) that it filed before the National Labor Relations Commission Regional Arbitration Branch IVA (NLRC RAB-IVA) in Calamba City, Laguna on 2012.

In the decision of Labor Arbiter Edgar Bisana, he ordered respondent company PDI/KGEI to jointly pay the complainants their full backwages, separation pay of one month per year of service less the amount if they received any, moral damages and exemplary damages for being dismissed with malice and fraud and attorney’s fees for a total of more than P5.6M due to unfair labor practice (ULP).

Company Sale, Fraudulent

Arbiter Bisana in the discussion of his decision noted that PDI and KGEI through its counsel was very cautious and conscious in not revealing the real and exact cause of their business closure except that there was a PDI board resolution approving the sale of the company to KGEI.

But the said board resolution also did not mention the real reason behind the abrupt sale aside from being the prerogative of the company owner.

The arbiter also pointed out KGEI’s non interest in the complaint filed against it being the third party in the case by letting PDI’s counsel and officer to represent it in the case.

The arbiter also said that a co-mingling of interest between PDI and KGEI existed. He later added that there was no bona fide sale and the sale was simulated. Thus, Arbiter Bisana resolved that PDI and KGEI as one and the same company.

Union Busting

PDI workers established their union PMPD with legal support from the Workers Assistance Center (WAC) on January 2012 and gained independent registration on February 15, 2012. The union has 59 members out of the 80 regular rank-and-file employees.

The workers who initiated the union formation were known leaders of the Labor-Management Council (LMC). Their decision to form their union came from the fact that the LMC’s existence was worthless to make their working condition better. According to the workers, they were tired of repeatedly listening to unfulfilled promises of the management during LMC meetings. Proof was that senior employees who were already 7-13 years in the company but still receive minimum wage just like a newly-hired employee.

PDI/KGEI also did not pay its employees of the 30 minutes before the scheduled time-in that it required the employees to come; otherwise employees will be dealt with disciplinary action.

After the management learned that a union was established in the company, it started its actions to discredit the union and discourage the workers from supporting the union.

The then-PDI management organized various meetings and general assembly, with the presence of different government officials to ultimately intimidate workers from their union activities.

Respondent company also organized a seminar on how to have a positive work attitude in order to work ‘harmoniously’ with the management sometime in April 2012 when PMPD filed for its Petition for Certification Election (PCE).

When all efforts to intimidate the unionists and the possible scenario of losing in the upcoming certification election, the management announced a Voluntary Separation Program (VSP) in a general assembly and offered a 100% separation pay which mainly targeted the union officers in early June 2012. The management added at that time that employees should avail of the said offer while the management can still provide since the management already had incurred huge losses and might cease operation soon.

Later on the same month, the management met all department leaders through Willie Tolentino and another manager Ricky Manansala and showed an unaudited financial report that revealed PDI’s losses and diminishing purchase orders from May to June. The managers said that the company was in a very fragile financial position that it may soon cease operations. Tolentino, before the meeting ended, asked the union officers if they would still push with the election and later collective bargaining given the ‘dire situation’ of the company which the union officers later affirmed.

On July 16, 2012, the management called for another general assembly and announced that the company is closing down due to severe and urgent business exigencies. With the presence of representatives from the Department of Labor and Employment - Cavite (DOLE-Cavite), Philippine Economic Zone Authority (PEZA), and Office of the Provincial Governor (OPG), the management forced the employees to get their respective checks as payment for their separation pay computed as one (1) month per year of service because the company will cease to operate on that day and they might not get their paychecks at all.

The events that transpired according to Arbiter Bisana, “… there was an orchestrated effort on the part of the respondents to condition the mind of the complainants that the company is losing…” He also stated that PDI/KGEI financial statement was merely a scrap of paper because it was not signed by an official representative of the company nor an independent accountant.

The arbiter later added that the PDI lied to the employees that the business closure was due to financial losses while in fact a ‘sale’ to KGEI. “If indeed, there were business reverses, how come all the complainants were paid their separation pay in one day on July 16, 2012, when it also announced its closure giving complainants no alternative to receive their separation pay with regret,” the arbiter added.

Thus, Arbiter Bisana also made it clear in his decision that the PDI/KGEI bogus sale was for the sole reason to thwart the workers right to freedom of association and collective bargaining since the National Conciliation and Mediation Board (NCMB) in Imus City had already ordered a certification election, “… the law is very explicit that the sale must be bona fide and not one that will interfere in the right of the complainants to self-organization to demand better terms and conditions of employment.”

Authorities in Cahoots with Management

Arbiter Bisana also stated another reason that PDI/KGEI is liable for unfair labor practice. It was the fact that the respondent companies did not refute the unionists’ statements about the OPG’s men lecture regarding the negative effects of union formation.

In Arbiter Bisana’s words, “plainly, the governor’s men were in cahoots with respondent PDI when the latter invited them to dissuade complainants from forming a union.”

Detailing PDI’s anti-union moves after it learned of the employees’ unionization, it was on March 2012 that the PDI management called for a meeting. It was attended by two (2) representatives from the OPG who told the workers that the union formation will do more harm than good and may result in the company closing down.

Also present in the said meeting along with the OPG’s men was Mr. Allan Datahan, the Industrial Relations Division (IRD) Officer of PEZA in the Cavite Economic Zone (CEZ). They were introduced by the management as special guests

On the other hand, on April 2012, no less than the Cavite Governor Jonvic Remulla visited PDI for the first time. The governor told the employees that labor-management problems can be best solved if parties sincerely talk to each other, without mentioning the right of the workers to freedom of association. The visit was construed by the unionized workers as a clear support of the governor to the management’s effort to weed out the union, which eventually intimidated them.

Also puzzling for Arbiter Bisana was the dismissal of the PCE of PMPD in the DOLE Regional IVA Office in Calamba, Laguna on the day when PDI announced the ‘shutdown’ and paid the workers of their respective separation pay.

According to WAC, the victory of ULP case against the PDI/KGEI is a very welcome decision in the light of succeeding cases of union busting involving companies inside the economic zones of Cavite, the recent ones being the ITO Parts Philippines Mfg. Corp. and C & F Mfg. Phils. Corp. All of these firms have the same pattern of union busting and involvement of DOLE and PEZA officials.

PDI now known as KGEI is a 99.98% Japanese-owned company operating in CEZ since March 1999. It manufactures gates, garden sets, fountains; decorative rocks and similar or related products made of fiberglass reinforced plastics and / or aluminum casting exported to Japan.

The head office of PDI’s mother company Denrai Kohbo Co., Ltd., can be found in Kyoto, Japan. Denrai Kohbo in its website ( lists KGEI as its only subsidiary in the Philippines and declared sales of ¥1.2B in November 2006-October 2007.

PDI/KGEI can still appeal the decision of NLRC RAB-IVA before the national office of NLRC in Quezon City.