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PEOPLE OF THE PHILIPPINES Employment Administration, testified that the records of the POEA do not
498 SCRA 377 (2006), THIRD DIVISION (Carpio Morales, J.) show that Rodolfo is authorized to recruit workers for overseas
employment. A Certification to that effect was in fact issued by
Facts: Petitioner Rosa C. Rodolfo approached private complainants Necitas Hermogenes C. Mateo, Chief of the Licensing Division of POEA.
Ferre and Narciso Corpus individually and invited them to apply for
overseas employment in Dubai. Rodolfo, being their neighbor, Ferre and The second element is doubtless also present. The act of referral, which is
Corpus agreed and went to the formers office. The office bore the business included in recruitment, is the act of passing along or forwarding of an
name Bayside Manpower Export Specialist. In that office, Ferre gave applicant for employment after an initial interview of a selected applicant
P1,000.00 as processing fee and another P4,000.00. Likewise, Corpus gave for employment to a selected employer, placement officer or bureau.
Rodolfo P7,000.00. Rodolfo then told Ferre and Corpus that they were Rodolfos admission that she brought private complainants to the agency
scheduled to leave for Dubai. However, private complainants and all the whose owner she knows and her acceptance of fees including those for
other applicants were not able to depart on the scheduled date as their processing betrays her guilt.
employer allegedly did not arrive. Thus, their departure was rescheduled,
but the result was the same. Suspecting that they were being hoodwinked, Opinion: Rodolfo issued provisional receipts indicating that the amounts
Ferre and Corpus demanded of Rodolfo to return their money. Except for she received from the private complainants were turned over to
the refund of P1,000.00 to Ferre, Rodolfo was not able to return Ferres and Luzviminda Marcos and Florante Hinahon does not free her from liability.
Corpus money. Ferre, Corpus and three others then filed a case for illegal For the act of recruitment may be for profit or not. It is sufficient that
recruitment in large scale with the Regional Trial Court (RTC) against the accused promises or offers for a fee employment to warrant
Rodolfo. conviction for illegal recruitment. Parenthetically, why Rodolfo accepted
the payment of fees from the private complainants when, in light of her
Issue: Is Rodolfo guilty of illegal recruitment in large scale? claim that she merely brought them to the agency, she could have advised
them to directly pay the same to the agency, she proferred no explanation.
Laws Applicable: Promises or offers for a fee employment is sufficient
to warrant conviction for illegal recruitment. SAN MIGUEL CORPORATION v. PROSPERO A. ABALLA et al.
461 SCRA 392 (2005), THIRD DIVISION (Carpio Morales, J.)
Article 13 (b) of the Labor Code defines recruitment and placement as
[a]ny act of canvassing, enlisting, contracting, transporting, utilizing, FACTS: Petitioner San Miguel Corporation (SMC) and Sunflower Multi-
hiring or procuring workers, and includes referrals, contract services, Purpose Cooperative (Sunflower) entered into a one-year Contract of
promising or advertising for employment, locally or abroad, whether for Service and such contract is renewed on a monthly basis until terminated.
profit or not. Pursuant to this, respondent Prospero Aballa et al. rendered services to
Case History: The RTC rendered judgement against Rodolfo but in
imposing the penalty, the RTC took note of the fact that while the After one year of rendering service, Aballa et al., filed a complaint before
information reflected the commission of illegal recruitment in large scale, National Labor Relations Commission (NLRC) praying that they be declared
only the complaint of two (Ferre and Corpus) of the five complainants was as regular employees of SMC. On the other hand, SMC filed before the
proven. Rodolfo appealed to the Court of Appeals (CA). The CA dismissed Department of Labor and Employment (DOLE) a Notice of Closure due to
the petition but modified the penalty imposed by the trial court. The CA serious business losses. Hence, the labor arbiter dismissed the complaint
also dismissed Rodolfos Motion for Reconsideration. and ruled in favor of SMC. Aballa et al. then appealed before the NLRC.

Ruling: The elements of the offense of illegal recruitment, which must ISSUE: Are Aballa et al. employees of SMC?
concur, are: (1) that the offender has no valid license or authority required
by law to lawfully engage in recruitment and placement of workers; and (2) LAWS APPLICABLE: The language of a contract disavowing the existence
that the offender undertakes any activity within the meaning of of an employer-employee relationship is not determinative of the parties
recruitment and placement under Article 13(b), or any prohibited practices relationship. It is the totality of the facts and surrounding circumstances of
enumerated under Article 34 of the Labor Code. If another element is the case.
present that the accused commits the act against three or more persons,
individually or as a group, it becomes an illegal recruitment in a large CASE HISTORY: The NLRC dismissed the appeal finding that
scale. Sunflower is an independent contractor. On appeal, the Court of Appeals
reversed NLRCs decision on the ground that the agreement between SMC
That the first element is present in the case at bar, there is no doubt. Jose and Sunflower showed a clear intent to abstain from establishing an
Valeriano, Senior Overseas Employment Officer of the Philippine Overseas employer-employee relationship.
FACTS: Dr. Dean N. Climaco is a medical doctor who was hired by Coca-
RULING: The test to determine the existence of independent Cola Bottlers Phils., Inc. by virtue of a Retainer Agreement. The Retainer
contractorship is whether one claiming to be an independent contractor Agreement, which began on January 1, 1988, was renewed annually. The
has contracted to do the work according to his own methods and without
last one expired on December 31, 1993. Despite the non-renewal of the
being subject to the control of the employer, except only as to the results
of the work. Retainer Agreement, respondent continued to perform his functions as
company doctor to Coca-Cola until he received a letter dated March 9,
In legitimate labor contracting, the law creates an employer-employee 1995 from the company concluding their retainership agreement effective
relationship for a limited purpose, i.e., to ensure that the employees are 30 days from receipt thereof. Dr. Climaco inquired from the management of
paid their wages. The principal employer becomes jointly and severally the company whether it was agreeable to recognizing him as a regular
liable with the job contractor, only for the payment of the employees employee. The management refused to do so. On February 24, 1994,
wages whenever the contractor fails to pay the same. Other than that, the
respondent filed a Complaint before the NLRC, Bacolod City, seeking
principal employer is not responsible for any claim made by the
employees. recognition as a regular employee of the company and prayed for the
In labor-only contracting, the statute creates an employer-employee payment of all benefits of a regular employee.
relationship for a comprehensive purpose: to prevent a circumvention of ISSUE: Is there an employer-employee relationship?
labor laws. The contractor is considered merely an agent of the principal
employer and the latter is responsible to the employees of the labor-only LAWS APPLICABLE: The Court, in determining the existence of an
contractor as if such employees had been directly employed by the employer-employee relationship, has invariably adhered to the four-fold
principal employer. test: (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
The Contract of Services between SMC and Sunflower shows that the
parties clearly disavowed the existence of an employer-employee employees conduct, or the so-called "control test," considered to be the
relationship between SMC and private respondents. The language of a most important element. No employer-employee relationship exists
contract is not, however, determinative of the parties relationship; rather between the parties. Thecompany lacked the power of control over the
it is the totality of the facts and surrounding circumstances of the case. A performance by respondent of his duties. TheComprehensive Medical
party cannot dictate, by the mere expedient of a unilateral declaration in a Plan, which contains the respondents objectives, duties and obligations,
contract, the character of its business, i.e., whether as labor-only does not tell respondent "how to conduct his physical examination, how to
contractor or job contractor, it being crucial that its character be measured
immunize, or how to diagnose and treat his patients, employees of
in terms of and determined by the criteria set by statute. What appears is
that Sunflower does not have substantial capitalization or investment in [petitioner] company, in each case."
the form of tools, equipment, machineries, work premises and other
materials to qualify it as an independent contractor. On the other hand, it is CASE HISTORY: While the complaint was pending before the Labor
gathered that the lot, building, machineries and all other working tools Arbiter, respondent received a letter dated March 9, 1995 from Petitioner
utilized by Aballa et al. in carrying out their tasks were owned and provided Company concluding their retainership agreement effective thirty (30)
by SMC. days from receipt thereof.

OPINION: All the foregoing considerations affirm by more than substantial RULING:
evidence the existence of an employer-employee relationship between
SMC and Aballa et al. Since Aballa et al. who were engaged in shrimp Through the Comprehensive Medical Plan, provided guidelines merely to
processing performed tasks usually necessary or desirable in the
ensure that the end result was achieved, but did not control the means and
aquaculture business of SMC, they should be deemed regular employees of
the latter and as such are entitled to all the benefits and rights methods by which respondent performed his assigned tasks. Likewise, the
appurtenant to regular employment. They should thus be awarded allegation of complainant that since he is on call at anytime of the day and
differential pay corresponding to the difference between the wages and night makes him a regular employee is off-tangent. Complainant does not
benefits given them and those accorded SMCs other regular employees. dispute the fact that outside of the two (2) hours that he is required to be
at respondent companys premises, he is not at all further required to just
COCA-COLA BOTTLERS PHILS., VS. DR. CLIMACO, sit around in the premises and wait for an emergency to occur so as to
G.R. NO. 146881, FEBRUARY 15, 2007 enable him from using such hours for his own benefit and advantage. In
fact, complainant maintains his own private clinic attending to his private
practice in the city, where he services his patients, bills them accordingly -- employer. Also, if the employee has been performing the job for at least
and if it is an employee of respondent company who is attended to by him one year, even if the performance is not continuous or merely intermittent,
for special treatment that needs hospitalization or operation, this is subject the law deems the repeated and continuing need for its performance as
to a special billing. More often than not, an employee is required to stay in sufficient evidence of the necessity, if not indispensability of that activity
the employers workplace or proximately close thereto that he cannot to the business. Thus, we held that where the employment of project
utilize his time effectively and gainfully for his own purpose. Such is not the employees is extended long after the supposed project has been finished,
prevailing situation here. The Retainership Agreement granted to both the employees are removed from the scope of project employees and are
parties the power to terminate their relationship upon giving a 30-day considered regular employees.
RULING: No. He was considered as a regular employee.
OPINION: Hence, Petitioner Company did not wield the sole power of
dismissal or termination. Considering that there is no employer-employee A review of private respondent's work assignments patently showed he
relationship between the parties, the termination of the Retainership belonged to a work pool tapped from where workers are and assigned
Agreement, which is in accordance with the provisions of the Agreement, whenever their services were needed. In a work pool, the workers do not
does not constitute illegal dismissal of respondent. Consequently, there is receive salaries and are free to seek other employment during temporary
no basis for the moral and exemplary damages granted by the Court of breaks in the business. They are like regular seasonal workers insofar as
Appeals to respondent due to his alleged illegal dismissal. the effect of temporary cessation of work is concerned. This arrangement
is beneficial to both the employer and employee for it prevents the unjust
INTEGRATED CONTRACTOR AND PLUMBING WORKS, INC. VS. situation of "coddling labor at the expense of capital" and at the same time
NATIONAL LABOR RELATIONS COMMISSION AND GLEN SOLON, G.R. enables the workers to attain the status of regular employees. 15
NO. 152427. AUGUST 9, 2005 Nonetheless, the pattern of re-hiring and the recurring need for his services
are sufficient evidence of the necessity and indispensability of such
FACTS: Petitioner is a plumbing contractor. Its business depends on the services to petitioner's business or trade.
number and frequency of the projects it is able to contract with its clients.
On February 23, 1998, while private respondent was about to log out from OPINION: While length of time may not be the controlling test for project
work, he was informed by the warehouseman that the main office had employment, it is vital in determining if the employee was hired for a
instructed them to tell him it was his last day of work as he had been specific undertaking or tasked to perform functions vital, necessary and
terminated. When private respondent went to the petitioner's office on indispensable to the usual business or trade of the employer. Here, private
February 24, 1998 to verify his status, he found out that indeed, he had respondent had been a project employee several times over. His
been terminated. He filed a complaint alleging that he was illegally employment ceased to be coterminous with specific projects when he was
dismissed without just cause and without due process. the Labor Arbiter repeatedly re-hired due to the demands of petitioner's business. 20 Where
ruled that private respondent was a regular employee and could only be from the circumstances it is apparent that periods have been imposed to
removed for cause. Petitioner was ordered to reinstate private respondent preclude the acquisition of tenurial security by the employee, they should
to his former position with full backwages from the time his salary was be struck down as contrary to public policy, morals, good customs or public
withheld until his actual reinstatement, and pay him service incentive order.
leave pay, and 13th month pay for three years. Petitioner further filed a
motion for reconsideration which was denied. It filed an appeal before the POSEIDON FISHING/TERRY DE JESUS V. NLRC,
CA but it was subsequently dismissed for lack of merit. G.R. NO. 168052, FEBRUARY 20. 2006

ISSUE: Is the respondent a project employee of the petitioner or a regular FACTS: Petitioner Poseidon Fishing is a fishing company engaged in the
employee? deep-sea fishing industry with Terry de Jesus as the manager.
Jimmy S. Estoquia was employed as Chief Mate in January 1988 and after
LAWS APPLICABLE: The test to determine whether employment is five years. The contract with Eustoqia per the "Kasunduan", there was a
regular or not is the reasonable connection between the particular activity provision stating that he was being employed only on a por viaje basis
performed by the employee in relation to the usual business or trade of the
and that his employment would be terminated at the end of the trip for 2) those who have rendered at least one year of service whether such
which he was being hired. service is continuous or broken.

He was promoted to Boat Captain but was later demoted to Radio CASE HISTORY: The Labor Arbiter decided in favor of private respondent.
Operator. As a Radio Operator, he monitored the daily activities in their The NLRC affirmed the decision of the Labor Arbiter with the modification.
office and recorded in the duty logbook the names of the callers and time Petitioners filed a Petition for Certiorari with the Court of Appeals, imputing
of their calls. grave abuse of discretion, but the Court of Appeals found none.

On 3 July 2000, Estoquia failed to record a 7:25 a.m. call in one of the RULING: Yes, Eustoquia was a regular employee.
logbooks. When he reviewed the two logbooks, he noticed that he was not
able to record the said call in one of the logbooks so he immediately In a span of 12 years, Eustoquia worked for petitioner first as a Chief Mate,
recorded the 7:25 a.m. call after the 7:30 a.m. entry. then Boat Captain, and later as Radio Operator. His job was directly related
to the deep-sea fishing business of petitioner Poseidon. His work was,
In the morning of 4 July 2000, petitioner detected the error in the entry in therefore, necessary and important to the business of his employer. Such
the logbook. Estoquia was asked to prepare an incident report to explain being the scenario involved, Eustoquia is considered a regular employee.
the reason for the said oversight. On the same day, Poseidons secretary
summoned Estoquia to get his separation pay There is nothing in the contract that says complainant is a casual, seasonal
or a project worker. The date July 1 to 31, 1998 under the heading
Estoquia filed a complaint for illegal dismissal with the Labor Arbiter. "Pagdating" had been placed there merely to indicate the possible date of
arrival of the vessel and is not an indication of the status of employment of
Poseidon and Terry de Jesus asserted that Estoquia was a contractual or a the crew of the vessel.
casual employee employed only on a"por viaje" or per trip basis and that
his employment would be terminated at the end of the trip for which he In the case at bar, the act of hiring and re-hiring in various capacities is a
was being hired. mere gambit employed by petitioner to thwart the tenurial protection of
private respondent. Such pattern of re-hiring and the recurring need for his
ISSUE: Is Eustoqia a regular employee of Poseidon? services are testament to the necessity and indispensability of such
services to petitioners business or trade.
LAWS APPLICABLE: The test to determine whether employment is
regular or not is the reasonable connection between the particular activity OPINION: In this case, Eustoquia was never informed that he will be
performed by the employee in relation to the usual business or trade of the assigned to a "specific project or undertaking at the time of their
employer. And, if the employee has been performing the job for at least engagement.Once a project or work pool employee has been: (1)
one year, even if the performance is not continuous or merely intermittent, continuously, as opposed to intermittently, re-hired by the same employer
the law deems the repeated and continuing need for its performance as for the same tasks or nature of tasks; and (2) these tasks are vital,
sufficient evidence of the necessity, if not indispensability of that activity necessary and indispensable to the usual business or trade of the
to the business. employer, then the employee must be deemed a regular employee.

Article 280 draws a line between regular and casual employment. The Eustoquias functions were usually necessary or desirable in the usual
provision enumerates two (2) kinds of employees, the regular employees business or trade of petitioner fishing company and he was hired
and the casual employees. The regular employees consist of the following: continuously for 12 years for the same nature of tasks. Hence, he was of
regular employee.
1) those engaged to perform activities which are usually necessary or
desirable in the usual business or trade of the employer; and