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CASES

LVN vs Phil Musicians Guild


Facts:
-

Review on certiorari Certifying the Phil Musicians Guild (FFW) as the sole and exclusive bargaining
agency of all musicians working with said companies. (LVN, Sampaguita Pictures, and Premiere
Productions)
Guild duly registered legitimate labor organization.
LVN and Sampaguita (Company) corporations duly organized under the Phil laws, engage in the making
of motion pictures and in the processing and distribution thereof.
Employs musicians purpose of making music recordings for title music, background music, musical
numbers, finale music and other incidental music.
Prayed be declared as sole and exclusive bargaining agency for all musicians
Company - petition for certification cannot be entertained when the existence of employer-employee
relationship between the parties is contested.
The musical numbers in the filing of the companies are furnished by independent contractors.

Issue
-

WON the musicians are employees of the said companies / WON there is ER-EE Relationship between the
Musicians and the Companies.

Held:
-

Yes. The work of the musical director and musicians is a functional and integral part of the enterprise
performed at the same studio substantially under the direction and control of the company. To determine
whether a person who performs work for another is the latter's employee or an independent contractor, the
National Labor Relations relies on 'the right to control' test. Under this test an employer-employee
relationship exist where the person for whom the services are performed reserves the right to control not
only the end to be achieved, but also the manner and means to be used in reaching the end.
Notwithstanding that the employees are called independent contractors', the Board will hold them to be
employees under the Act where the extent of the employer's control over them indicates that the relationship
is in reality one of employment.
The right of control of the film company over the musicians is shown (1) by calling the musicians through
'call slips' in 'the name of the company; (2) by arranging schedules in its studio for recording sessions; (3) by
furnishing transportation and meals to musicians; and(4) by supervising and directing in detail, through the
motion picture director, the performance of the musicians before the camera, in order to suit the music they
are playing to the picture which is being flashed on the screen.
The musical directors have no such control over the musicians involved in the present case. Said musical
directors control neither the music to be played, nor the musicians playing it. The Premier Production did not
appeal the decision of the Court en banc (thats why its not one of the petitioners in the case) film
companies summon the musicians to work, through the musical directors. The film companies, through the
musical directors, fix the date, the time and the place of work. The film companies, not the musical directors,
provide the transportation to and from the studio. The film companies furnish meal at dinner time. It is well
settled that "an employer-employee relationship exists . . .where the person for whom the services are
performed reserves a right to control not only the end to be achieved but also the means to be used in
reaching such end . . . ."

Legend Hotel vs Hernani S. Realuyo


Facts:
-

A case for illegal dismissal and for other labor standards benefits was filed by Realuyo (AKA Joey R. Roa), a
pianist employed to perform in the restaurant, against Legend.
Realuyo worked as pianist; rate 400-750/night; performs at 7-10pm 6x a week.
Hotel no ER-EE relationship; talent engaged to perform music; 3hrs/day, 2x a week; economic crisis mgt
dispense of his services.
Labor Arbiter and NLRC no ER-EE because Realuyo was receiving Talent Fee as compensation.
CA Realuyo was supervised and controlled by the Hotels mgt, who sometimes requires him to play
tagalog songs and dress according to the motif of the place of performance. His job was in furtherance of
the restaurant business of the hotel.

Issue:
-

WON Realuyo was an employee of the Hotel / WON there is ER-EE relationship

Held:
-

Yes. The hotel wielded the power of selection at the time it entered into the service contract dated Sept. 1,
1992 with Roa. The hotel could not seek refuge behind the service contract entered into with Roa. It is the
law that defines and governs an employment relationship, whose terms are not restricted to those fixed in
the written contract, for other factors, like the nature of the work the employee has been called upon to
perform, are also considered.
The law affords protection to an employee, and does not countenance any attempt to subvert its spirit and
intent. Any stipulation in writing can be ignored when the employer utilizes the stipulation to deprive the
employee of his security of tenure. The inequality that characterizes employer-employee relationship
generally tips the scales in favor of the employer, such that the employee is often scarcely provided real and
better options.
The argument that Roa was receiving talent fee and not salary is baseless. There is no denying that the
remuneration denominated as talent fees was fixed on the basis of his talent, skill, and the quality of music
he played during the hours of his performance. Roas remuneration, albeit denominated as talent fees, was
still considered as included in the term wage in the sense and context of the Labor Code, regardless of how
petitioner chose to designate the remuneration, as per Article 97(f) of the Labor Code.
The power of the employer to control the work of the employee is considered the most significant
determinant of the existence of an employer-employee relationship. This is the so-called control test, and is
premised on whether the person for whom the services are performed reserves the right to control both the
end achieved and the manner and means used to achieve that end.
a. He could not choose the time of his performance, which petitioners had fixed from 7:00 pm to
10:00 pm, three to six times a week;
b. He could not choose the place of his performance;
c. The restaurants manager required him at certain times to perform only Tagalog songs or music,
or to wear barong Tagalog to conform to the Filipiniana motif; and
d. He was subjected to the rules on employees representation check and chits, a privilege granted
to other employees.

Dy Khe Beng vs INTERNATIONAL LABOR and MARINE UNION OF THE PHILIPPINES, ET AL.

Facts:
-

A charge of unfair labor practice was filed against Dy Keh Beng, a proprietor of a basket factory, by
dismissing Solano and Tudla for their union activities. Dy Keh Beng contended that he did not know Tudla
and Solano was not his employee because the latter came to the establishment only when there was work
which he did on pakiaw basis.
Solano was not his employee for the following reasons:
(1) Solano never stayed long enough at Dy's establishment;
(2) Solano had to leave as soon as he was through with the
(3) order given him by Dy;
(4) When there were no orders needing his services there was nothing for him to do;
(5) When orders came to the shop that his regular workers could not fill it was then that Dy went to
his address in Caloocan and fetched him for these orders; and
(6) Solano's work with Dy's establishment was not continuous.

Issue:
-

WON Tudla and Solano are employees of Dy

Held:
-

Yes. Evidence showed that the work of Solano and Tudla was continuous except in the event of illness,
although their services were compensated on piece basis. The control test calls for the existence of the right
to control the manner of doing the work, not the actual exercise of the right considering that Dy Keh Beng is
engaged in the manufacture of baskets known as kaing, those working under Dy would be subject to Dys
specifications such as the size and quality of the kaing. And since the laborers are done at Dys
establishments, it could be inferred that Dy could easily exercise control upon them.
If indeed payment by piece is just a method of compensation and does not define the essence of the
relation. Payment cannot be construed by piece where work is done in such establishment so as to put the
worker completely at liberty to turn him out and take it another at pleasure.
"Sunrise Coconut Products Co. v. Court of Industrial Relations" - judicial notice of the fact that the so-called
"pakyaw" system mentioned in this case as generally practiced in our country, is, in fact, a labor contract
-between employers and employees, between capitalists and laborers.

RJL Martinez Fishing vs NLRC


Facts:
-

Issue:

RJL is principally engaged in the deep-sea fishing business. Since 1978, private respondents were
employed by them as stevedores at Navotas Fish Port for the unloading of tuna fish catch from petitioners'
vessels and then loading them on refrigerated vans for shipment abroad.
On March 27, 1981, private respondents Antonio Boticario, and thirty (30) others, upon the premise that they
are petitioners' regular employees, filed a complaint against petitioners for non-payment of OT pay, premium
pay, legal holiday pay, emergency allowance, SIL and NSD. On April 21, 1981 another complaint against
petitioners for Illegal Dismissal and for Violation of Article 118 of the Labor Code.
RJL - private respondents are contract laborers whose work terminated upon completion of each unloading,
and that in the absence of any boat arrivals, private respondents did not work for petitioners but were free to
work or seek employment with other fishing boat operators.
LA PRs are contractual employees; assuming they are employees, their employment are coterminous with
each unloading and loading job; Pet are not under obligation to hire PRs exclusively; no termination but
merely re-hiring.
NLRC there is ER-EE relationship.

WON there is ER-EE relationship between PRs and RJL.

Held:
-

Yes. The continuity of employment is not the determining factor, but rather whether the work of the laborer is
part of the regular business or occupation of the employee.
Although it may be that private respondents alternated their employment on different vessels when they
were not assigned to petitioners' boats, that did not affect their employee status. The evidence also
establishes that petitioners had a fleet of fishing vessels with about 65 ship captains, and as private
respondents contended, when they finished with one vessel, they were instructed to wait for the next.
Industrial-Commercial-Agricultural Workers Organization vs. CIR - "that during the temporary layoff the
laborers are considered free to seek other employment is natural, since the laborers are not being paid, yet
must find means of support" and such temporary cessation of operations "should not mean starvation for
employees and their families."
Indeed, considering the length of time that private respondents have worked for petitioner since 1978
there is justification to conclude that they were engaged to perform activities usually necessary or desirable
in the usual business or trade of petitioners and are, therefore, regular employees, such that they are
entitled to the benefits awarded.

PHILIPPINE SOCIETY FOR THE PREVENTION OF CRUELTY TO ANIMALS vs COA


Facts:
-

The petitioner was incorporated as a juridical entity over one hundred years ago by virtue of Act No. 1285,
enacted on January 19, 1905, by the Philippine Commission. The petitioner, at the time it was created, was
composed of animal aficionados and animal propagandists. The objects of the petitioner, as stated in
Section 2 of its charter, shall be to enforce laws relating to cruelty inflicted upon animals or the protection of
animals in the Philippine Islands, and generally, to do and perform all things which may tend in any way to
alleviate the suffering of animals and promote their welfare.
At the time of the enactment of Act No. 1285, the original Corporation Law, Act No. 1459, was not yet in
existence.
Sec. 4 power to appoint agents, and make arrest; Sec. 5 One-half of all the fines imposed and collected
through the efforts of said society. (Subsequently recalled by CA 148 in 1936)
Dec 1, 2003, COA audit team went to the office of Pet to conduct an audit survey.
Pet COA has no jurisdiction over them because they are a private entity.
o Jan 1905 had no Corporation Code nor SEC
o EO 63 stripped them of any governmental functions
o Nowhere in their charter is it indicated that they are a public corporation.
o Their EEs are covered with the SSS
o No Govt appointee or rep sits on their board
COA - Pet was a government entity that was subject to the audit jurisdiction of respondent COA.
o Pet is a Body Politic created by virtue of a legislation/special charter
o Pet exercises sovereign powers enforce the laws government instrumentality
o Despite the passage of the Corporation Code, the law creating the petitioner had not been
abolished, nor had it been re-incorporated under any general corporation law.
o RA 8485 designates the petitioner as a member of its Committee on Animal Welfare which is
attached to the Department of Agriculture.

Issue:
Held:

WON Pet is a government instrumentality

No. Since the underpinnings of the charter test had been introduced by the 1935 Constitution and not earlier,
it follows that the test cannot apply to the petitioner, which was incorporated by virtue of Act No. 1285,
enacted on January 19, 1905. Settled is the rule that laws in general have no retroactive effect, unless the
contrary is provided.
All statutes are to be construed as having only a prospective operation, unless the purpose and intention of
the legislature to give them a retrospective effect is expressly declared or is necessarily implied from the
language used. In case of doubt, the doubt must be resolved against the retrospective effect.
There are a few exceptions. Statutes can be given retroactive effect in the following cases: (1) when the law
itself so expressly provides; (2) in case of remedial statutes; (3) in case of curative statutes; (4) in case of
laws interpreting others; and (5) in case of laws creating new rights. None of the exceptions is present in the
instant case.
SEC. 75. Any corporation or sociedad anonima formed, organized, and existing under the laws of the
Philippine Islands and lawfully transacting business in the Philippine Islands on the date of the passage of
this Act, shall be subject to the provisions hereof so far as such provisions may be applicable and shall be
entitled at its optioneither to continue business as such corporation or to reform and organize under and by
virtue of the provisions of this Act, transferring all corporate interests to the new corporation which, if a stock
corporation, is authorized to issue its shares of stock at par to the stockholders or members of the old
corporation according to their interests.
In a legal regime where the charter test doctrine cannot be applied, the mere fact that a corporation has
been created by virtue of a special law does not necessarily qualify it as a public corporation.
The amendments introduced by C.A. No. 148 made it clear that the petitioner was a private corporation and
not an agency of the government. This was evident in Executive Order No. 63, issued by then President of
the Philippines Manuel L. Quezon, declaring that the revocation of the powers of the petitioner to appoint
agents with powers of arrest "corrected a serious defect" in one of the laws existing in the statute books.
a reading of petitioners charter shows that it is not subject to control or supervision by any agency of the
State, unlike government-owned and -controlled corporations. No government representative sits on the
board of trustees of the petitioner. Like all private corporations, the successors of its members are
determined voluntarily and solely by the petitioner in accordance with its by-laws.
The fact that a certain juridical entity is impressed with public interest does not, by that circumstance alone,
make the entity a public corporation, inasmuch as a corporation may be private although its charter contains
provisions of a public character, incorporated solely for the public good. It must be stressed that a quasipublic corporation is a species of private corporations, but the qualifying factor is the type of service the
former renders to the public: if it performs a public service, then it becomes a quasi-public corporation.

Feati University vs Bautista


Facts:
-

January 14, 1963: the President of Feati University Faculty Club (PAFLU) wrote a letter to Mrs. Victoria L.
Araneta, President of Feati University informing her that it registered as a labor union.
January 22, 1963: PAFLU sent a letter with 26 demands in relation to their employment and requesting an
answer within 10 days from receipt thereof.
Araneta answered the letters, requesting that she be given at least 30 days to study thoroughly the different
phases of the demands. Meanwhile counsel for Feati, wrote a letter to the President of PAFLU demanding
proof of its majority status and designation as a bargaining representative
February 1, 1963: the President of PAFLU rejected the extension of time and filed a notice of strike with the
Bureau of Labor due to Featis refusal to bargain collectively.
Conciliation Division of the Bureau of Labor made efforts to conciliate them but failed.
February 18, 1963: PAFLU declared a strike and established picket lines in the premises of Feati resulting in
the disruption of classes in the University.
March 21, 1963: the President of the Philippines certified to the Court of Industrial Relations (CIR) the
dispute between Feati and PAFLU pursuant to the provisions of Section 10 of Republic Act No. 875.
3 cases were filed with the CIR
41-IPA PAFLUs petition to declare in contempt of court since Feati refused to accept them back to work in
violation of the return-to-work order of March 30, 1963 and has employed professors and/or instructors to
take their places

Isuue:
Held:
-

1183-MC PAFLUs petition for certification election praying that it be certified as the sole and exclusive
bargaining representative
Later withdrawn since the Case 41-IPA had already been certified by the President to the CIR and has
absorbed the issues herein
V-30 PAFLUs complaint for indirect contempt of court filed against the administrative officials of the Feati
reiterating Case 41-IPA
May 10, 1963: Feati filed before the SC a petition for certiorari and prohibition with writ of preliminary
injunction which was issued upon the Feati's filing a bond of P50,000 (increased from P1,000), ordering CIR
Judge Jose S. Bautista to desist and refrain from further proceeding
March 23, 1963: On the strength of the presidential certification, Judge Bautista set the case for hearing
Feati, thru counsel filed a motion to dismiss the case upon the ground that the CIR has no jurisdiction over
the case, because:
o The Industrial Peace Act is NOT applicable to the University, it being an educational institution, nor
to the members of the Faculty Club, they being independent contractors
o The presidential certification is violative of Section 10 of the Industrial Peace Act, as the University
is not an industrial establishment and there was no industrial dispute which could be certified to the
CIR
Judge Bautista denied the motion to dismiss and ordered the strikers to return immediately to work and the
University to take them back under the last terms and conditions existing before the dispute arose
Without the motion for reconsideration having been acted upon by the CIR en banc, Judge Bautista set the
case for hearing on the merits for May 8, 1963 but was cancelled upon Featis petition for certiorari alleging
that Judge Jose S. Bautista acted without, or in excess of, jurisdiction, or with grave abuse of discretion, in
taking cognizance of, and in issuing the questioned orders in, CIR Cases Nos. 41-IPA 1183-MC and V-30
Feati claims that it is not an employer within the contemplation of R.A. 875, because it is not an industrial
establishment
Feati also claims that it is only a lessee of the services of its professors and/or instructors pursuant to a
contract of services entered into between them because the University does not exercise control over their
work.
WON Feati can be considered an employer and PAFLU as an employee to be covered by R.A. 875 and
have right to unionize.
YES. petition for certiorari and prohibition with preliminary injunction in Case G.R. No. L-21278 is dismissed.
o Section 2(c) of R.A. 875:

The term employer include any person acting in the interest of an employer, directly or
indirectly, but shall not include any labor organization (otherwise than when acting as an
employer) or any one acting in the capacity or agent of such labor organization.

Congress did not intend to give a complete definition of "employer", but rather
that such definition should be complementary to what is commonly understood
as employer.

Act itself specifically enumerated those who are not included in the term
"employer" and educational institutions are not included; hence, they can be
included in the term "employer". However, those educational institutions that are
not operated for profit are not within the purview of Republic Act No. 875.
o Feati realizes profits and parts of such earning is distributed as
dividends to private stockholders or individuals.

It embraces not only those who are usually and ordinarily considered employees,
but also those who have ceased as employees as a consequence of a labor
dispute.
Employee must be one who is engaged in the service of another; who performs services for another; who
works for salary or wages
"workers" limited to those performing physical labor
o embrace stenographers and bookkeepers
o Teachers are not included
Feati controls the work of the members of its faculty
o prescribes the courses or subjects that professors teach, and when and where to teach

professors' work is characterized by regularity and continuity for a fixed duration


professors are compensated for their services by wages and salaries, rather than by profits
professors and/or instructors cannot substitute others to do their work without the consent of the
university
o professors can be laid off if their work is found not satisfactory
Moreover, even if university professors are considered independent contractors, still they would be covered
by Rep. Act No. 875
professors, instructors or teachers of private educational institutions who teach to earn a living are entitled to
the protection of our labor laws and one such law is Republic Act No. 875.
The term "labor dispute" includes any controversy concerning terms, tenure or conditions of employment, or
concerning the association or representation of persons in negotiating, fixing, maintaining, changing, or
seeking to arrange terms or conditions of employment regardless of whether the disputants stand in
proximate relation of employer and employees.
To certify a labor dispute to the CIR is the prerogative of the President under the law (Because the strike
declared by the members of the minority union threatens a major industry of 18,000 students which affects
the national interest), and this Court will not interfere in, much less curtail, the exercise of that prerogative.
The jurisdiction of the CIR in a certified case is exclusive. The parties involved in the case may appeal to
the Supreme Court from the order or orders thus issued by the CIR.
Section 10 of Republic Act No. 875 empowers the Court of Industrial Relations to issue an order "fixing the
terms of employment." This clause is broad enough to authorize the Court to order the strikers to return to
work and the employer to readmit them
The return-to-work order cannot be considered as an impairment of the contract entered into with the
replacements. Besides, labor contracts must yield to the common good and such contracts are subject to
the special laws on labor unions, collective bargaining, strikes and similar subjects.
o
o
o

ASSOCIATED LABOR UNION vs Judge Borromeo


Facts:
-

ALU is a duly registered labor organization. Among the members thereof are employees of Superior Gas
and Equipment Company of Cebu, Inc (SUGECO)
SUGECO a domestic corporation with offices at Juan Luna Street, Cebu City and a factory plant in
Basak, Mandaue, province of Cebu.
On January 1, 1965 ALU and SUGECO entered into a collective bargaining contract effective up to January
1, 1966. There was an ongoing negotiations for renewal of contract late in February 1966.
12 SUGECO members resigned from ALU. Thereupon negotiations stopped. ALU requested that 12
employees not be allowed to report to work, SUGECO rejected the request due to irreparable injury and that
the contract lapsed. SUGECO stated that the 12 employees should rejoin ALU to resume the negotiations.
ALU wrote to SUGECO of bargaining in bad faith. ALU struck and picketed in the SUGECO plant in
Mandaue.
SUGECO filed a case against ALU with CFI Cebu to restrain the same from picketing in the said plant and
offices elsewhere in the Philippines. CFI Cebu issued a preliminary injunction prayed for by SUGECO.
ALU filed charges of ULP against SUGECO with CIR; filed a motion for reconsideration on the issuance of
the injunction. CFI denied the motion; filed a petition for certiorari and prohibition against Judge Gomez and
Borromeo and SUGECO, prayed that CFI of Cebu has no jurisdiction over the case.
SC annulled the preliminary injunction issued by CFI Cebu and directed to dismiss the case. The writ of
injunction sought by ALU was granted May 16, 1966.
ALU resumed picketing and began to picket at the house of SUGECO's General Manager Mr. & Mrs. Lua
and Cebu Home store.
Mr. Lua filed a complaint with CFI Cebu to restrain ALU from picketing the store and residence and recover
damages.
Judge Borromeo issued an order requiring ALU to show cause order why the writ should not be issued.
ALU filed a motion to dismiss assailed the jurisdiction of CFI Cebu to hear the case on the ground that it has
grown out from a labor dispute.
The judge denied the motion to dismiss and to reconsider his order and dissolve the writ of injunction of
June 30 1966.
ALU commenced the present action for certiorari and prohibition with preliminary injunction to annul the writs
dated June 30 and July 22 1966 and to restrain the lower court from hearing the case.

Issue:
Held:
-

WON the strike conducted at the Cebu home involves a labor dispute.
Yes. Section 5 (a) of Republic Act No. 8758 vests in the Court of Industrial Relations exclusive jurisdiction
over the prevention of any unfair labor practice. Moreover, for an issue "concerning terms, tenure or
conditions of employment, or concerning the association or representation of persons in negotiating, fixing,
maintaining, changing, or seeking to arrange terms or conditions of employment" to partake of the nature of
a "labor dispute", it is not necessary that "the disputants stand in the proximate relation of employer and
employee."
to apply the provisions of Sec. 9 of Republic Act No. 875, governing the conditions under which "any
restraining order" or "temporary or permanent injunction" may issue in any "case involving or growing out of
a labor dispute", it is not indispensable that the persons involved in the case be "employees of the same
employer", although this is the usual case. Sec. 9, likewise, governs cases involving persons:
o 1) "who are engaged in the same industry, trade, craft, or occupation"; or
o 2) "who ... have direct or indirect interests therein", or
o 3) "who are members of the same or an affiliated organization of employers or employees"; or
o
4) "when the case involves any conflicting or competing interests in a "labor dispute" (as
hereinbefore defined) or "persons participating or interested" therein (as hereinafter defined)".
Furthermore, "a person or association shall be held to be a person participating or interested in a labor
dispute if relief is sought against him or it" and "he or it is engaged in the same industry, trade, craft, or
occupation in which such dispute occurs, or has a direct or indirect interest therein, or is a member, officer,
or agent of any association composed in whole or in part of employees or employers engaged in such
industry, trade, craft, or occupation."
Now, then, there is no dispute regarding the existence of a labor dispute between the ALU and SUGECOCebu; that SUGECO's general manager, Mrs. Lua, is the wife of the owner and manager of Cebu Home,
Antonio Lua; and that Cebu Home is engaged in the marketing of SUGECO products. It is, likewise, clear
that as managing member of the conjugal partnership between him and his wife, Mr. Lua has an interest in
the management by Mrs. Lua of the business of SUGECO and in the success or failure of her controversy
with the ALU, considering that the result thereof may affect the condition of said conjugal partnership.
Similarly, as a distributor of SUGECO products, the Cebu Home has, at least, an indirect interest in the labor
dispute between SUGECO and the ALU and in Case No. R-9221. In other words, respondents herein have
an indirect interest in said labor dispute, for which reason, we find that Section 9 of Republic Act No. 875
squarely applies to Case No. R-9414.
Goldfinger v. Feintuch - Within the limits of peaceful picketing, however, picketing may be carried on not only
against the manufacturer but against a non-union product sold by one in unity of interest with the
manufacturer who is in the same business for profit.
American Brake Shoe Co. v. District Lodge 9 of International Association of Machinists - Where corporate
employer had separate plants in Missouri and Pennsylvania, and labor dispute existed atMissouri plant, but
not at the Pennsylvania plant, peaceful picketing at Pennsylvania plant by members of union representing
employees at Missouri plant was not an unfair labor practice as defined by Labor Management Relations
Act....
American Jurisprudence - It seems now generally agreed that a state cannot either by its common law or by
statute prohibit the peaceful picketing of a place of business solely on the ground that the picketing is carried
on by persons not employed therein.

Reynaldo Bautista vs Hon. Amado C. Inciong


Facts:
-

Bautista was employed by ALU as 'Organizer' in 1972 with a starting salary of P250.00 a month. As such he
paid his monthly SSS contributions, with the respondent as his employer. On March 15, 1979, He was left in
the office of ALU while his other co-organizers were in Cainta, Rizal attending a certification election at
Chrysler Philippines, as he was not the organizer assigned in said company. On March 16, 1979, he went on
sick leave for ten (10) days. His SSS sickness benefit application form signed by ALU's physician was given
to ALU for submission to the SSS. On March 16, 1979, complainant reported back for work upon expiration

Issue:
Held:
-

of his leave but was informed by ALU's Area Vice-President for Luzon of his termination effective March 15,
1979. Hence, this complaint filed on March 28, 1979. On April 18, 1979, however, ALU filed a clearance
application to terminate complainant's services effective March 16, 1979 on the ground of abandonment of
work.
Ministry of Labor Bautista was merely accommodated by the respondent union after he was dismissed by
his former employer sometime in 1972 and that his membership coverage with the SSS which shows that
ALU is the one paying the employer's share in the premiums is not conclusive proof that ALU is the Bautista
employer because such payments were performed by the respondent as a favor for all those who were
performing full time union activities with it to entitle them to SSS benefits.
WON Inciong is an employee of ALU
Yes. The mere fact that the respondent is a labor union does not mean that it cannot be considered an
employer of the persons who work for it. Much less should it be exempted from the very labor laws which it
espouses as labor organization.
In determining the existence of an employer-employee relationship, the elements that are generally
considered are the following :
o (a) the selection and engagement of the employee;
o (b) the payment of wages;
o (c) the power of dismissal; and
o (d) the employer's power to control the employee with respect to the means and methods by which
the work is to be accomplished. It is the so-called 'control test' that is the most important element
Petitioner was an employee of the respondent union as reflected in the latter's individual payroll sheets and
shown by the petitioner's membership with the Social Security System (SSS) and the respondent union's
share of remittances in the petitioner's favor. Even more significant, is the respondent union's act of filing a
clearance application with the MOL to terminate the petitioner's services. Bautista was selected and hired by
the Union. He was paid wages by the Union. ALU had the power to dismiss him as indeed it dismissed him.
And definitely, the Union tightly controlled the work of Bautista as one of its organizers.

Corporal, et al. vs NLRC


Facts:
-

Issue:
Held:
-

Five male petitioners, namely, Osias I. Corporal, Sr., Pedro Tolentino, Manuel Caparas, Elpidio Lacap, and
Simplicio Pedelos worked as barbers, while the two female petitioners, Teresita Flores and Patricia Nas
worked as manicurists in New Look Barber Shop located at 651 P. Paterno Street, Quiapo, Manila owned by
private respondent Lao Enteng Co. Inc.. Petitioner Nas alleged that she also worked as watcher and
marketer of private respondent.
Pet New Look Barbershop was originally a single proprietorship, then the children of the owner organized
a corporation w/c was registered with the SEC. They were allowed to work for the company. Then Trinidad
Ong informed them that the building was sold and their services were no longer needed.
PR Pet were joint venturers and were receiving 50% commission of the amount charge from costumers
no ER-EE; serious business loss; had no control over petitioners who were free to come and go as they
wished; all SSS contribution was made by Pet.
LA and NLRC no ER-EE relationship; Common practice in barbershop industry that barbers scissors and
razors and split their earnings; Barbers are characterized as independent contractor.
WON there is ER-EE relationship between Pet and PR
Yes. The Labor Arbiter's findings that the parties were engaged in a joint venture is unsupported by any
documentary evidence. It should be noted that aside from the self-serving affidavit of Trinidad Lao Ong,
there were no other evidentiary documents, nor written partnership agreements presented. We have ruled
that even the sharing of proceeds for every job of petitioners in the barber shop does not mean they were
not employees of the respondent company.

An independent contractor is one who undertakes "job contracting", i.e., a person who (a) carries on an
independent business and undertakes the contract work on his own account under his own responsibility
according to his own manner and method, free from the control and direction of his employer or principal in
all matters connected with the performance of the work except as to the results thereof, and (b) has
substantial capital or investment in the form of tools, equipment, machineries, work premises, and other
materials which are necessary in the conduct of the business.
Petitioners are not "independent contractors". They did not carry on an independent business. Neither did
they undertake cutting hair and manicuring nails, on their own as their responsibility, and in their own
manner and method. The services of the petitioners were engaged by the respondent company to attend to
the needs of its customers in its barber shop. More importantly, the petitioners, individually or collectively, did
not have a substantial capital or investment in the form of tools, equipment, work premises and other
materials which are necessary in the conduct of the business of the respondent company.
ER-EE relationship - Records of the case show that the late Vicente Lao engaged the services of the
petitioners to work as barbers and manicurists in the New Look Barber Shop, then a single proprietorship
owned by him; that in January 1982, his children organized a corporation which they registered with the
Securities and Exchange Commission as Lao Enteng Company, Inc.; that upon its incorporation, it took over
the assets, equipment, and properties of the New Look Barber Shop and continued the business; that the
respondent company retained the services of all the petitioners and continuously paid their wages. Clearly,
all three elements exist in petitioners' and private respondent's working arrangements.
Control - Private respondent claims it had no control over petitioners. The power to control refers to the
existence of the power and not necessarily to the actual exercise thereof, nor is it essential for the employer
to actually supervise the performance of duties of the employee. It is enough that the employer has the right
to wield that power. As to the "control test", the following facts indubitably reveal that respondent company
wielded control over the work performance of petitioners, in that: (1) they worked in the barber shop owned
and operated by the respondents; (2) they were required to report daily and observe definite hours of work;
(3) they were not free to accept other employment elsewhere but devoted their full time working in the New
Look Barber Shop for all the fifteen (15) years they have worked until April 15, 1995; (4) that some have
worked with respondents as early as in the 1960's; (5) that petitioner Patricia Nas was instructed by the
respondents to watch the other six (6) petitioners in their daily task. Certainly, respondent company was
clothed with the power to dismiss any or all of them for just and valid cause. Petitioners were unarguably
performing work necessary and desirable in the business of the respondent company.

10) G.R. No. 192084

September 14, 2011

JOSE
vs.
PHILIPPINE BASKETBALL
MARTINEZ,Respondents.

MEL
ASSOCIATION

BERNARTE, Petitioner,
(PBA),

JOSE

EMMANUEL

M.

EALA,

and

PERRY

Facts:
Complainants (Jose Mel Bernarte and Renato Guevarra) aver that they were invited to join the PBA as referees.
During the leadership of Commissioner Emilio Bernardino, they were made to sign contracts on a year-to-year basis.
During the term of Commissioner Eala, however, changes were made on the terms of their employment. They
received a letter from the Office of the Commissioner advising them that their contract would not be renewed citing
their unsatisfactory performance on and off the court.
Respondents aver, on the other hand, that complainants entered into two contracts of retainer with the PBA in the
year 2003. That complainants were not illegally dismissed because they were not employees of the PBA. Their
respective contracts of retainer were simply not renewed. PBA had the prerogative of whether or not to renew their
contracts, which they knew were fixed.
Issue: Whether petitioner is an employee of respondents.
Held: NO.

To determine the existence of an employer-employee relationship, case law has consistently applied the four-fold
test, to wit: (a) the selection and engagement of the employee; (b) the payment of wages; (c) the power of dismissal;
and (d) the employers power to control the employee on the means and methods by which the work is accomplished.
The so-called "control test" is the most important indicator of the presence or absence of an employer-employee
relationship.
In this case, PBA admits repeatedly engaging petitioners services, as shown in the retainer contracts. PBA pays
petitioner a retainer fee, exclusive of per diem or allowances, as stipulated in the retainer contract. PBA can terminate
the retainer contract for petitioners violation of its terms and conditions.
However, respondents argue that the all-important element of control is lacking in this case, making petitioner an
independent contractor and not an employee of respondents.
Petitioner contends otherwise. Petitioner asserts that he is an employee of respondents since the latter exercise
control over the performance of his work. Petitioner cites the following:
(1) respondents classify or rate a referee;
(2) respondents require referees to attend all basketball games organized or authorized by the PBA, at least one hour
before the start of the first game of each day;
(3) respondents assign petitioner to officiate ballgames, or to act as alternate referee or substitute; (4) referee agrees
to observe and comply with all the requirements of the PBA governing the conduct of the referees whether on or off
the court;
(5) referee agrees (a) to keep himself in good physical, mental, and emotional condition during the life of the contract;
(b) to give always his best effort and service, and loyalty to the PBA, and not to officiate as referee in any basketball
game outside of the PBA, without written prior consent of the Commissioner; (c) always to conduct himself on and off
the court according to the highest standards of honesty or morality; and
(6) imposition of various sanctions for violation of the terms and conditions of the contract.
The SC however held that the foregoing stipulations hardly demonstrate control over the means and methods by
which petitioner performs his work as a referee officiating a PBA basketball game. The contractual stipulations do not
pertain to, much less dictate, how and when petitioner will blow the whistle and make calls. On the contrary, they
merely serve as rules of conduct or guidelines in order to maintain the integrity of the professional basketball league.
We agree with respondents that once in the playing court, the referees exercise their own independent judgment,
based on the rules of the game, as to when and how a call or decision is to be made. The very nature of petitioners
job of officiating a professional basketball game undoubtedly calls for freedom of control by respondents.
Moreover, the following circumstances indicate that petitioner is an independent contractor:
(1) the referees are required to report for work only when PBA games are scheduled, which is three times a week
spread over an average of only 105 playing days a year, and they officiate games at an average of two hours per
game; and
(2) the only deductions from the fees received by the referees are withholding taxes.
In other words, unlike regular employees who ordinarily report for work eight hours per day for five days a week,
petitioner is required to report for work only when PBA games are scheduled or three times a week at two hours per
game.
In addition, there are no deductions for contributions to the Social Security System, Philhealth or Pag-Ibig, which are
the usual deductions from employees salaries. These undisputed circumstances buttress the fact that petitioner is an
independent contractor, and not an employee of respondents.
In addition, the fact that PBA repeatedly hired petitioner does not by itself prove that petitioner is an employee of the
former. For a hired party to be considered an employee, the hiring party must have control over the means and
methods by which the hired party is to perform his work, which is absent in this case. The continuous rehiring by PBA
of petitioner simply signifies the renewal of the contract between PBA and petitioner, and highlights the satisfactory
services rendered by petitioner warranting such contract renewal. Conversely, if PBA decides to discontinue
petitioners services at the end of the term fixed in the contract, whether for unsatisfactory services, or violation of the

terms and conditions of the contract, or for whatever other reason, the same merely results in the non-renewal of the
contract, as in the present case. The non-renewal of the contract between the parties does not constitute illegal
dismissal of petitioner by respondents.

11) G.R. No. 185251

October 2, 2009

RAUL
G.
LOCSIN
and
EDDIE
vs.
PHILIPPINE LONG DISTANCE TELEPHONE COMPANY, Respondent.

B.

TOMAQUIN, Petitioners,

Facts:
Respondent Philippine Long Distance Telephone Company (PLDT) and the Security and Safety Corporation of the
Philippines (SSCP) entered into a Security Services Agreement 3 (Agreement) whereby SSCP would provide armed
security guards to PLDT to be assigned to its various offices.
Pursuant to such agreement, petitioners Raul Locsin and Eddie Tomaquin, among other security guards, were posted
at a PLDT office.
On August 30, 2001, respondent issued a Letter terminating the Agreement effective October 1, 2001.
Despite the termination of the Agreement, however, petitioners continued to secure the premises of their assigned
office. They were allegedly directed to remain at their post by representatives of respondent. In support of their
contention, petitioners provided the copies of petitioner Locsins pay slips for the period of January to September
2002.5
Then, on September 30, 2002, petitioners services were terminated.
Thus, petitioners filed a complaint before the Labor Arbiter for illegal dismissal and recovery of money claims such as
overtime pay, holiday pay, premium pay for holiday and rest day, service incentive leave pay, Emergency Cost of
Living Allowance, and moral and exemplary damages against PLDT.
Issues: Whether or not complainants extended services to the respondent for one (1) year from October 1, 2001 up
to September 30, 2002, without a renewed contract, constitutes an employer-employee relationship between
respondent and the complainants.

Held: YES.
An Employer-Employee Relationship Existed Between the Parties.
It is beyond cavil that there was no employer-employee relationship between the parties from the time of petitioners
first assignment to respondent by SSCP in 1988 until the alleged termination of the Agreement between respondent
and SSCP. It bears pointing out that petitioners were among those declared to be employees of their respective
security agencies and not of PLDT.
The only issue in this case is whether petitioners became employees of respondent after the Agreement between
SSCP and respondent was terminated.
This must be answered in the affirmative.
Notably, respondent does not deny the fact that petitioners remained in the premises of their offices even after the
Agreement was terminated. And it is this fact that must be explained.
The fact remains that petitioners remained at their post after the termination of the Agreement. Notably, in its
Comment dated March 10, 2009,8 respondent never denied that petitioners remained at their post until September
30, 2002. While respondent denies the alleged circumstances stated by petitioners, that they were told to remain at
their post by respondents Security Department and that they were informed by SSCP Operations Officer Eduardo
Juliano that their salaries would be coursed through SSCP as per arrangement with PLDT, it does not state why they
were not made to vacate their posts. Respondent said that it did not know why petitioners remained at their posts.

In the ordinary course of things, responsible business owners or managers would not allow security guards of an
agency with whom the owners or managers have severed ties with to continue to stay within the business premises.
This is because upon the termination of the owners or managers agreement with the security agency, the agencys
undertaking of liability for any damage that the security guard would cause has already been terminated. Thus, in the
event of an accident or otherwise damage caused by such security guards, it would be the business owners and/or
managers who would be liable and not the agency. The business owners or managers would, therefore, be opening
themselves up to liability for acts of security guards over whom the owners or managers allegedly have no control.
It would seem that SSCP was paying petitioners salaries while securing respondents premises despite the
termination of their Agreement. Obviously, it would only be respondent that would benefit from such a situation. And it
is seriously doubtful that a security agency that was established for profit would allow its security guards to secure
respondents premises when the Agreement was already terminated.
Clearly, such a situation makes no sense, and the denials proffered by respondent do not shed any light to the
situation. It is but reasonable to conclude that, with the behest and, presumably, directive of respondent, petitioners
continued with their services. Evidently, such are indicia of control that respondent exercised over petitioners.
Such power of control has been explained as the "right to control not only the end to be achieved but also the means
to be used in reaching such end." With the conclusion that respondent directed petitioners to remain at their posts
and continue with their duties, it is clear that respondent exercised the power of control over them; thus, the existence
of an employer-employee relationship.
In the determination of whether an employer-employee relationship exists between two parties, this Court applies the
four-fold test to determine the existence of the elements of such relationship.
(a) the selection and engagement of the employee;
(b) the payment of wages;
(c) the power of dismissal; and
(d) the employers power to control the employees conduct. It is the so-called "control test" which constitutes the
most important index of the existence of the employer-employee relationship that is, whether the employer controls or
has reserved the right to control the employee not only as to the result of the work to be done but also as to the
means and methods by which the same is to be accomplished.
Evidently, respondent having the power of control over petitioners must be considered as petitioners employerfrom
the termination of the Agreement onwardsas this was the only time that any evidence of control was exhibited by
respondent over petitioners.

12) G.R. No. 169757

November 23, 2011

CESAR C. LIRIO, doing business under the name and style of CELKOR AD SONICMIX, Petitioner,
vs.
WILMER D. GENOVIA, Respondent.
Facts:
On July 9, 2002, respondent Wilmer D. Genovia filed a complaint against petitioner Cesar Lirio and/or Celkor Ad
Sonicmix Recording Studio for illegal dismissal, non-payment of commission and award of moral and exemplary
damages.
Respondent Genovia alleged that on August 15, 2001, he was hired as studio manager by petitioner Lirio, owner of
Celkor Ad Sonicmix Recording Studio (Celkor). He was employed to manage and operate Celkor and to promote and
sell the recording studio's services to music enthusiasts and other prospective clients. He received a monthly salary
of P7,000.00. They also agreed that he was entitled to an additional commission of P100.00 per hour as recording
technician whenever a client uses the studio for recording, editing or any related work. He was made to report for

work from Monday to Friday from 9:00 a.m. to 6 p.m. On Saturdays, he was required to work half-day only, but most
of the time, he still rendered eight hours of work or more. All the employees of petitioner, including respondent,
rendered overtime work almost everyday, but petitioner never kept a daily time record to avoid paying the employees
overtime pay.
Respondent stated that a few days after he started working as a studio manager, petitioner approached him and told
him about his project to produce an album for his daughter, Celine Mei Lirio and promised that he (Lirio) would draft a
contract to assure respondent of his compensation for such services. The job was done then respondent reminded
petitioner about the contract on his compensation but petitioner told respondent that since he was practically a
nobody and had proven nothing yet in the music industry, respondent did not deserve a high compensation and
informed respondent that he was entitled only to 20% of the net profit, and not of the gross sales of the album, and
that the salaries he received and would continue to receive as studio manager of Celkor would be deducted from the
said 20% net profit share. Respondent objected and insisted that he be properly compensated. On March 14, 2002,
petitioner verbally terminated respondents services, and he was instructed not to report for work.
Respondent asserts that he was illegally dismissed as he was terminated without any valid grounds.
In defense, petitioner stated that respondent was not hired as studio manager, composer, technician or as an
employee in any other capacity of Celkor. Respondent could not have been hired as a studio manager, since the
recording studio has no personnel except petitioner.
In the facts about the production of an album, Petitioner asserted that his relationship with respondent is one of an
informal partnership under Article 17675 of the New Civil Code, since they agreed to contribute money, property or
industry to a common fund with the intention of dividing the profits among themselves. Petitioner had no control over
the time and manner by which respondent composed or arranged the songs, except on the result thereof.
Respondent reported to the recording studio between 10:00 a.m. and 12:00 noon. Hence, petitioner contended that
no employer-employee relationship existed between him and the respondent, and there was no illegal dismissal to
speak of.
Issue: Whether there exists an employer-employee relationship between the parties.
Held: YES.
Petitioners argument lacks merit.
In this case, complainant's evidence is substantial enough to prove the employment relationship that on August 14,
2001, he was hired as 'Studio manager' by respondent Lirio to manage and operate the recording studio and to
promote and sell its services to music enthusiasts and clients, proven by his receipt for this purpose from said
respondent a fixed monthly compensation of P7,000.00, with commission of P100.00 per hour when serving as
recording technician, shown by the payroll from July 31, 2001-March 15, 2002. The said evidence points to
complainant's hiring as employee so that the case comes within the purview of our jurisdiction on labor disputes
between an employer and an employee.
Respondent Lirio's so-called existence of a partnership agreement was not substantiated and his assertion
thereto, in the face of complainant's evidence, constitute but a self-serving assertion, without probative
value, a mere invention to justify the illegal dismissal.
Indeed, we find credible that what caused complainant's dismissal on March 14, 2002 was due to his refusal to
respondent's Lirio's insistences on merely giving him 20% based on net profit on sale of the album which he
composed and arranged during his free time and, moreover, that salaries which he received would be deducted
therefrom, which obviously, soured the relations from the point of view of respondent Lirio.

To established that an employer-employee relationship existed between petitioner and respondent, the following
elements must be present:
(a) the selection and engagement of the employee;
(b) the payment of wages;
(c) the power of dismissal; and
(d) the employers power to control the employees conduct. The most important element is the employers control of
the employees conduct, not only as to the result of the work to be done, but also as to the means and methods to
accomplish it.
In this case, the documentary evidence presented by respondent to prove that he was an employee of petitioner are
as follows:
(a) a document denominated as "payroll" (dated July 31, 2001 to March 15, 2002) certified correct by
petitioner, which showed that respondent received a monthly salary of P7,000.00 (P3,500.00 every 15th of
the month and another P3,500.00 every 30th of the month) with the corresponding deductions due to
absences incurred by respondent; and
(b) copies of petty cash vouchers, showing the amounts he received and signed for in the payrolls.
The said documents showed that petitioner hired respondent as an employee and he was paid monthly wages
ofP7,000.00. Petitioner wielded the power to dismiss as respondent stated that he was verbally dismissed by
petitioner, and respondent, thereafter, filed an action for illegal dismissal against petitioner.
The power of control refers merely to the existence of the power. It is not essential for the employer to actually
supervise the performance of duties of the employee, as it is sufficient that the former has a right to wield the power.
Nevertheless, petitioner stated in his Position Paper that it was agreed that he would help and teach respondent how
to use the studio equipment. In such case, petitioner certainly had the power to check on the progress and work of
respondent.
Also, petitioner failed to prove that his relationship with respondent was one of partnership. Such claim was not
supported by any written agreement. The Court notes that in the payroll dated July 31, 2001 to March 15,
2002,35 there were deductions from the wages of respondent for his absence from work, which negates petitioners
claim that the wages paid were advances for respondents work in the partnership.
Remember: If doubt exists between the evidence presented by the employer and the employee, the scales of justice
must be tilted in favor of the latter.

JAVIER VS. FLY ACE CORP. Feb. 15, 2012


FACTS:
On May 23, 2008, Javier filed a complaint before the NLRC for underpayment of salaries and other labor standard benefits. He
alleged that he was an employee of Fly Ace since September 2007, performing various tasks at the respondents warehouse such
as cleaning and arranging the canned items before their delivery to certain locations, except in instances when he would be
ordered to accompany the companys delivery vehicles, as pahinante; that he reported for work from Monday to Saturday from

7:00 oclock in the morning to 5:00 oclock in the afternoon; that during his employment, he was not issued an identification card
and payslips by the company; that on May 6, 2008, he reported for work but he was no longer allowed to enter the company
premises by the security guard upon the instruction of Ruben Ong (Mr. Ong), his superior;5 that after several minutes of begging to
the guard to allow him to enter, he saw Ong whom he approached and asked why he was being barred from entering the premises;
that Ong replied by saying, "Tanungin mo anak mo;" 6 that he then went home and discussed the matter with his family; that he
discovered that Ong had been courting his daughter Annalyn after the two met at a fiesta celebration in Malabon City; that Annalyn
tried to talk to Ong and convince him to spare her father from trouble but he refused to accede; that thereafter, Javier was
terminated from his employment without notice; and that he was neither given the opportunity to refute the cause/s of his dismissal
from work.
To support his allegations, Javier presented an affidavit of one Bengie Valenzuela who alleged that Javier was a stevedore
or pahinante of Fly Ace from September 2007 to January 2008. The said affidavit was subscribed before the Labor Arbiter (LA).7
For its part, Fly Ace averred that it was engaged in the business of importation and sales of groceries. Sometime in December
2007, Javier was contracted by its employee, Mr. Ong, as extra helper on a pakyaw basis at an agreed rate of P 300.00 per trip,
which was later increased to P 325.00 in January 2008. Denying that he was their employee, Fly Ace insisted that there was no
illegal dismissal.8 Fly Ace submitted a copy of its agreement with Milmar Hauling Services and copies of acknowledgment receipts
evidencing payment to Javier for his contracted services bearing the words, "daily manpower (pakyaw/piece rate pay)" and the
latters signatures/initials. The CA likewise added that Javiers failure to present salary vouchers, payslips, or other pieces of
evidence to bolster his contention, pointed to the inescapable conclusion that he was not an employee of Fly Ace. Further, it found
that Javiers work was not necessary and desirable to the business or trade of the company, as it was only when there were
scheduled deliveries, which a regular hauling service could not deliver, that Fly Ace would contract the services of Javier as an
extra helper. the facts alleged by Javier did not pass the "control test." He contracted work outside the company premises; he was
not required to observe definite hours of work; he was not required to report daily; and he was free to accept other work elsewhere
as there was no exclusivity of his contracted service to the company,
ISSUE: Whether or not Javier is an employee of respondent
RULING: No. Javier is not an employee of Fly Ace.
As the records bear out, the LA and the CA found Javiers claim of employment with Fly Ace as wanting and deficient. The Court is
constrained to agree. Although Section 10, Rule VII of the New Rules of Procedure of the NLRC28 allows a relaxation of the rules of
procedure and evidence in labor cases, this rule of liberality does not mean a complete dispensation of proof. Labor officials are
enjoined to use reasonable means to ascertain the facts speedily and objectively with little regard to technicalities or formalities but
nowhere in the rules are they provided a license to completely discount evidence, or the lack of it.
"No particular form of evidence is required to prove the existence of such employer-employee relationship. Any competent and
relevant evidence to prove the relationship may be
admitted.http://www.lawphil.net/judjuris/juri2009/may2009/gr_179652_2009.html - fnt31 Hence, while no particular form of
evidence is required, a finding that such relationship exists must still rest on some substantial evidence. Moreover, the
substantiality of the evidence depends on its quantitative as well as its qualitative aspects."30Although substantial evidence is not a
function of quantity but rather of quality, the x x x circumstances of the instant case demand that something more should have been
proffered. By way of evidence on this point, all that Javier presented were his self-serving statements purportedly showing his
activities as an employee of Fly Ace.
Javier failed to pass the substantiality requirement to support his claim. Hence, the Court sees no reason to depart from the
findings of the CA. While Javier remains firm in his position that as an employed stevedore of Fly Ace, he was made to work in the
company premises during weekdays arranging and cleaning grocery items for delivery to clients, no other proof was submitted to
fortify his claim. The lone affidavit executed by one Bengie Valenzuela was unsuccessful in strengthening Javiers cause. In said
document, all Valenzuela attested to was that he would frequently see Javier at the workplace where the latter was also hired as
stevedore.34 Certainly, in gauging the evidence presented by Javier, the Court cannot ignore the inescapable conclusion that his
mere presence at the workplace falls short in proving employment therein. The supporting affidavit could have, to an extent,
bolstered Javiers claim of being tasked to clean grocery items when there were no scheduled delivery trips, but no information was
offered in this subject simply because the witness had no personal knowledge of Javiers employment status in the company.

The Court is of the considerable view that on Javier lies the burden to pass the well-settled tests to determine the existence of an
employer-employee relationship, viz: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power
of dismissal; and (4) the power to control the employees conduct. Of these elements, the most important criterion is whether the
employer controls or has reserved the right to control the employee not only as to the result of the work but also as to the means
and methods by which the result is to be accomplished.35
Javiers allegations did not establish that his relationship with Fly Ace had the attributes of an employer-employee relationship on
the basis of the above-mentioned four-fold test. Worse, Javier was not able to refute Fly Aces assertion that it had an agreement
with a hauling company to undertake the delivery of its goods. It was also baffling to realize that Javier did not dispute Fly Aces
denial of his services exclusivity to the company. In short, all that Javier laid down were bare allegations without corroborative
proof.
There was no substantial evidence to prove employer-employee relationship. Having a service contract with Milmar Hauling
Services for the purpose of transporting and delivering company products to customers, Fly Ace contracted Javier as an extra
helper or pahinante on a mere "per trip basis." Javier, who was actually a loiterer in the area, only accompanied and assisted the
company driver when Milmar could not deliver or when the exigency of extra deliveries arises for roughly five to six times a month.
Before making a delivery, Fly Ace would turn over to the driver and Javier the delivery vehicle with its loaded company products.
With the vehicle and products in their custody, the driver and Javier "would leave the company premises using their own means,
method, best judgment and discretion on how to deliver, time to deliver, where and [when] to start, and manner of delivering the
products."20

SY VS. CA AND SAHOT FEBRUARY 2003


FACTS:
Sometime in 1958, private respondent Jaime Sahot5 started working as a truck helper for petitioners family-owned trucking
business named Vicente Sy Trucking. In 1965, he became a truck driver of the same family business, renamed T. Paulino Trucking
Service, later 6Bs Trucking Corporation in 1985, and thereafter known as SBT Trucking Corporation since 1994. Throughout all
these changes in names and for 36 years, private respondent continuously served the trucking business of petitioners. In April
1994, Sahot was already 59 years old. He had been incurring absences as he was suffering from various ailments. He inquired
about his medical and retirement benefits with the Social Security System (SSS) on April 25, 1994, but discovered that his premium
payments had not been remitted by his employer. Sahot had filed a week-long leave sometime in May 1994. On May 27th, he was
medically examined and treated for EOR, presleyopia, hypertensive retinopathy G II (Annexes "G-5" and "G-3", pp. 48, 104,
respectively),6 HPM, UTI, Osteoarthritis (Annex "G-4", p. 105),7 and heart enlargement. At the end of his week-long absence, Sahot
applied for extension of his leave for the whole month of June, 1994. Sahot found himself in a dilemma. He was facing dismissal if
he refused to work, But he could not retire on pension because petitioners never paid his correct SSS premiums. The fact
remained he could no longer work as his left thigh hurt abominably. Petitioners ended his dilemma. They carried out their threat
and dismissed him from work, effective June 30, 1994. He ended up sick, jobless and penniless.
On September 13, 1994, Sahot filed with the NLRC NCR Arbitration Branch, a complaint for illegal dismissal, docketed as NLRC
NCR Case No. 00-09-06717-94. He prayed for the recovery of separation pay and attorneys fees against Vicente Sy and Trinidad
Paulino-Sy, Belen Paulino, Vicente Sy Trucking, T. Paulino Trucking Service, 6Bs Trucking and SBT Trucking, herein petitioners.
For their part, petitioners contend that private respondent was not illegally dismissed as a driver because he was in fact petitioners
industrial partner. They add that it was not until the year 1994, when SBT Trucking Corporation was established, and only then did
respondent Sahot become an employee of the company.
ISSUE: WON respondent Jaime Sahot is an employee of petitioner Sy
RULING: Yes. Respondent is an employee of Sy.
there was error committed by the Labor Arbiter when he concluded that complainant was an industrial partner prior to 1994. A
computation of the age of complainant shows that he was only twenty-three (23) years when he started working with respondent as
truck helper.

The elements to determine the existence of an employment relationship are: (a) the selection and engagement of the employee;
(b) the payment of wages; (c) the power of dismissal; and (d) the employers power to control the employees conduct. The most
important element is the employers control of the employees conduct, not only as to the result of the work to be done, but also as
to the means and methods to accomplish it.19
As found by the appellate court, petitioners owned and operated a trucking business since the 1950s and by their own allegations,
they determined private respondents wages and rest day.20 Records of the case show that private respondent actually engaged in
work as an employee. During the entire course of his employment he did not have the freedom to determine where he would go,
what he would do, and how he would do it. He merely followed instructions of petitioners and was content to do so, as long as he
was paid his wages. Indeed, said the CA, private respondent had worked as a truck helper and driver of petitioners not for his own
pleasure but under the latters control.
Private respondent, for his part, denies that he was ever an industrial partner of petitioners. There was no written agreement, no
proof that he received a share in petitioners profits, nor was there anything to show he had any participation with respect to the
running of the business.18 Article 176721 of the Civil Code states that in a contract of partnership two or more persons bind
themselves to contribute money, property or industry to a common fund, with the intention of dividing the profits among
themselves.22 Not one of these circumstances is present in this case. No written agreement exists to prove the partnership
between the parties. Private respondent did not contribute money, property or industry for the purpose of engaging in the supposed
business. There is no proof that he was receiving a share in the profits as a matter of course, during the period when the trucking
business was under operation. Neither is there any proof that he had actively participated in the management, administration and
adoption of policies of the business. Thus, private respondent was not an industrial partner but an employee of petitioner.

ENCYCLOPEDIA vs. NLRC and Limjoco 1996 case

FACTS:
Private respondent Benjamin Limjoco was a Sales Division Manager of petitioner Encyclopaedia Britannica and was in charge of
selling petitioner's products through some sales representatives. As compensation, private respondent received commissions from
the products sold by his agents. He was also allowed to use petitioner's name, goodwill and logo. Petitioner would also be informed
about appointments, promotions, and transfers of employees in private respondent's district. It was, however, agreed upon that
office expenses would be deducted from private respondent's commissions. On June 14, 1974, private respondent Limjoco
resigned from office to pursue his private business. Then on October 30, 1975, he filed a complaint against petitioner
Encyclopaedia Britannica with the Department of Labor and Employment, claiming for non-payment of separation pay and other
benefits, and also illegal deduction from his sales commissions.
Petitioner Encyclopaedia Britannica alleged that complainant Benjamin Limjoco (Limjoco, for brevity) was not its employee but an
independent dealer authorized to promote and sell its products and in return, received commissions therefrom. He also had his
own separate office, financed the business expenses, and maintained his own workforce. The salaries of his secretary, utility man,
and sales representatives were chargeable to his commissions. Thus, petitioner argued that it had no control and supervision over
the complainant as to the manner and means he conducted his business operations. The latter did not even report to the office of
the petitioner and did not observe fixed office hours. Consequently, there was no employer-employee relationship.
Limjoco maintained otherwise. He alleged that he was hired by the petitioner in July 1970, was assigned in the sales department,
and was earning a certain amount as an average monthly salary. was under the supervision of the petitioner's officials who issued
to him and his other personnel, memoranda, guidelines on company policies, instructions and other orders. He was, however,
dismissed by the petitioner when the Laurel-Langley Agreement expired. As a result thereof, Limjoco asserts that in accordance
with the established company practice and the provisions of the collective bargaining agreement, he was entitled to termination
pay, unpaid benefits (Christmas bonus, midyear bonus, clothing allowance, vacation leave, and sick leave), and the amounts
illegally deducted from his commissions which were then used for the payments of office supplies, office space, and overhead
expenses.
ISSUE: WON there is an employer employee relationship between petitioners and respondent LImjoco.

RULING: No. Limjoco is an independent contractor.

In determining the existence of an employer-employee relationship the following elements must be present: 1) selection and
engagement of the employee; 2) payment of wages; 3) power of dismissal; and 4) the power to control the employee's conduct. Of
the above, control of employee's conduct is commonly regarded as the most crucial and determinative indicator of the presence or
absence of an employer-employee relationship. 3 Under the control test, an employer-employee relationship exists where the
person for whom the services are performed reserves the right to control not only the end to be achieved, but also the manner and
means to used in reaching that end. 4
The fact that petitioner issued memoranda to private respondents and to other division sales managers did not prove that petitioner
had actual control over them. The different memoranda were merely guidelines on company policies which the sales managers
follow and impose on their respective agents. It should be noted that in petitioner's business of selling encyclopedias and books,
the marketing of these products was done through dealership agreements. The sales operations were primarily conducted by
independent authorized agents who did not receive regular compensations but only commissions based on the sales of the
products. These independent agents hired their own sales representatives, financed their own office expenses, and maintained
their own staff. Thus, there was a need for the petitioner to issue memoranda to private respondent so that the latter would be
apprised of the company policies and procedures. Nevertheless, private respondent Limjoco and the other agents were free to
conduct and promote their sales operations. The periodic reports to the petitioner by the agents were but necessary to update the
company of the latter's performance and business income. Although the petitioner can fix the prices of the products for reason of
uniformity and private respondent could not alter them, the latter, nevertheless, had free rein in the means and methods for
conducting the marketing operations. He selected his own personnel and only reason why he had to notify the petitioner about
such appointments was for purpose of deducting the employees' salaries from his commissions. (Petitioner in their agreement had
to be informed about the appointments, promotions, and transfers of employees that respondent Limjoco had to take)

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