LVN PICTURES, INC. vs.

PHILIPPINE MUSICIANS Guild (FFW) & COURT

OFINDUSTRIALRELATIONSSAMPAGUITA PICTURES, INC. vs. PHILIPPINE MUSICIANS Guild (FFW) &
COURT OFINDUSTRIALRELATIONS

FACTS:

Respondent Philippine Musicians Guild (FFW) is a duly registered legitimate labor organization.
LVN Pictures, Inc., Sampaguita Pictures, Inc., and Premiere Productions, Inc. are corporations, duly organized
under the Philippine laws, engaged in the making of motion pictures and in the processing and distribution
thereof. Petitioner companies employ musicians for the purpose of making music recordings for title
music, background music, musical numbers, finale music and other incidental music, without which a
motion picture is incomplete. Ninety-five(95%) percent of all the musicians playing for the musical
recordings of said companies are members of the Guild. The Guild has no knowledge of the
existence of any other legitimate labor organization representing musicians in said companies.
Premised upon these allegations, the Guild prayed that it be certified as the sole and exclusive
bargaining agency for all musicians working in the aforementioned companies. In their respective
answers, the latter denied that they have any musicians as employees, and alleged that the musical
numbers in the filing of the companies are furnished by independent contractors. The lower court sustained the Guild’s
theory. Are consideration of the order complained of having been denied by the Court en banc, LVN
Pictures, inc., and Sampaguita Pictures, Inc., filed these petitions for review for certiorari.

ISSUE:

Whether the musicians in question (Guild members) are “employees “of the petitioner film
companies.

RULING:

YES The Court agreed with the lower court’s decision, to wit: Lower court resorted to apply R.A. 875 and US
Laws and jurisprudence from which said Act was patterned after. (Since statutes are to be construed in
the light of purposes achieved and the evils sought to be remedied). It ruled that 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. In other words, 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. (United InsuranceCompany, 108, NLRB No. 115.).Notwithstanding that the employees are
called independent contractors', the Boardwill hold them to be employees under the Act where the
extent of the employer'scontrol over them indicates that the relationship is in reality one of
employment.(John Hancock Insurance Co., 2375-D, 1940, Teller, Labor Dispute Collective Bargaining,
Vol.). 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 (that’s why it’s 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 .
. . ." The decisive nature of said control over the "means to be used", is illustrated in the case of
Gilchrist Timber Co., et al., in which, by reason of said control, the employer-employee relationship
was held to exist between the management and the workers, notwithstanding the intervention of an
alleged independent contractor, who had, and exercise, the power to hire and fire said workers. The
aforementioned control over the means to be used" in reading the desired end is possessed and
exercised by the film companies over the musicians in the cases before us. WHEREFORE, the order
appealed from is hereby affirmed, with costs against petitioners herein. It is so ordered

Dy Keh Beng vs. Int’l Labor and Maritime Union

FACTS:
A charge of unfair labor practice was filed against Dy Keh Beng, a proprietor of a
basket factory, bydismissing 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. Dy Keh Beng countered with a special
defense of simple extortion committed by the head of the labor union.

ISSUE:
W/N there existed an employee-employer relation between petitioner and respondents

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 Dy’s specifications such as the size and quality of
the “kaing”. And since the laborers are done at Dy’s establishments, it could beinferred
that Dy could easily exercise control upon them. As to the contention that Solano was not an employee
because he worked on piece basis, the court ruled that it should be determined that 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 Justice
Perfecto also contended that pakyaw system is a labor contract between employers and employees
between capitalists and laborers. Wherefore, the award of backwages is modified to an award
of backwages for 3 years at the rated of compensation the employees were receiving at the
time of dismissal.
ABS-CBN BROADCASTING CORPORATION vs. MARLYN NAZARENO, MERLOU GERZON, JENNIFER
DEIPARINE, and JOSEPHINE LERASAN (G.R. No. 164156, September 26, 2006)

Facts:

Petitioner ABS-CBN Broadcasting Corporation (ABS-CBN) is engaged in the broadcasting business and
owns a network of television and radio stations, whose operations revolve around the broadcast,
transmission, and relay of telecommunication signals. The respondents Nazareno, Gerzon,
Deiparine, and Lerasan as production assistants (PAs) on different dates were employed by the
Petitioner, assigned at the news and public affairs, for various radio programs in the Cebu
Broadcasting Station, with a monthly compensation of P4,000. They were issued ABS-CBN
employees’ identification cards and were required to work for a minimum of eight hours a day,
including Sundays and holidays. They were under the control and supervision of Assistant Station
Manager Dante J. Luzon, and News Manager Leo Lastimosa.

On December 19, 1996, petitioner and the ABS-CBN Rank-and-File Employees executed a Collective
Bargaining Agreement (CBA) to be effective during the period from December 11, 1996 to December
11, 1999. However, since petitioner refused to recognize PAs as part of the bargaining unit,
respondents were not included to the CBA.

On October 12, 2000, respondents filed a Complaint for Recognition of Regular Employment Status,
Underpayment of Overtime Pay, Holiday Pay, Premium Pay, Service Incentive Pay, Sick Leave Pay,
and 13th Month Pay with Damages against the petitioner before the NLRC. The Labor Arbiter
directed the parties to submit their respective position paper however they failed to file their
position papers within the reglementary period, Labor Arbiter Jose G. Gutierrez dismissed the
complaint without prejudice for lack of interest to pursue the case. Respondents received a copy of
the Order on May 16, 2001. Instead of re-filing their complaint with the NLRC within 10 days from
May 16, 2001, they filed, on June 11, 2001, an Earnest Motion to Refile Complaint with Motion to
Admit Position Paper and Motion to Submit Case for Resolution. The Labor Arbiter granted this
motion in an Order dated June 18, 2001, and forthwith admitted the position paper of the
complainants.

On July 30, 2001, the Labor Arbiter rendered judgment in favor of the respondents, and declared
that they were regular employees of petitioner; as such, they were awarded monetary benefits. On
appeal to the NLRC, it ruled that respondents were entitled to the benefits under the CBA because
they were regular employees who contributed to the profits of petitioner through their
labor. Petitioner thus filed a petition for certiorari under Rule 65 of the Rules of Court before the CA,
raising both procedural and substantive issues. CA Affirmed the ruling of the NLRC.
ISSUE

Whether the appellate court committed palpable and serious error of law when it affirmed the
rulings of the NLRC, and entertained respondents’ appeal from the decision of the Labor Arbiter
despite the admitted lapse of the reglementary period within which to perfect the appeal.

HELD

We agree with petitioner’s contention that the perfection of an appeal within the statutory or
reglementary period is not only mandatory, but also jurisdictional; failure to do so renders the
assailed decision final and executory and deprives the appellate court or body of the legal authority
to alter the final judgment, much less entertain the appeal. However, this Court has time and again
ruled that in exceptional cases, a belated appeal may be given due course if greater injustice may
occur if an appeal is not given due course than if the reglementary period to appeal were strictly
followed. The Court resorted to this extraordinary measure even at the expense of sacrificing order
and efficiency if only to serve the greater principles of substantial justice and equity.

In the case at bar, the NLRC did not commit a grave abuse of its discretion in giving Article 223 of the
Labor Code a liberal application to prevent the miscarriage of justice. Technicality should not be
allowed to stand in the way of equitably and completely resolving the rights and obligations of the
parties. We have held in a catena of cases that technical rules are not binding in labor cases and are
not to be applied strictly if the result would be detrimental to the workingman.

WPP Marketing Communications, Inc., et al. vs. Jocelyn M. Galera

GR No. 169207; March 25, 2010

Facts:

Petitioner Jocelyn M. Galera is an American citizen, who was hired by respondent John Steedman,
Chairman of WPP Worldwide and Chief Executive Officer of Mindshare, Co., a corporation based in
Hong Kong, China, to work in the Philippines for private respondent WPP Marketing
Communications, Inc. (WPP), a corporation registered and operating under the laws of Philippines.
Under the employment contract, Galera would commence employment on September 1, 1999, with
the position of Managing Director of Mindshare Philippines. Thus, without obtaining an alien
employment permit, Galera commenced her employment with WPP Philippines on the said date. It
was only after four months from the time she commenced employment that private respondent
WPP filed before the Bureau of Immigration an application for petitioner Galera to receive a working
visa. In the application, she was designated as Vice-President of WPP. Petitioner alleged that she was
constrained to sign the application in order that she could remain in the Philippines and retain her
employment.

On December 14, 2000, private respondent Galera was verbally informed by Steedman that her
employment had been terminated. She received her termination letter the following day. Her
termination prompted Galera to commence a complaint for illegal dismissal before the labor arbiter.
The labor arbiter found WPP, Steedman, Webster, and Lansang liable for illegal dismissal and
damages. Furthermore the labor arbiter stated that Galera was not only illegally dismissed but was
also not accorded due process, saying that Galera was not given an opportunity by WPP to defend
herself and explain her side. Thus, WPP did not observe both substantive and procedural due
process in terminating Galera’s employment. The labor arbiter ordered WPP to reinstate Galera and
to pay her backwages, transportation and housing benefits, and moral and exemplary damages,
among others.

On appeal, the NLRC reversed the labor arbiter’s ruling. The NLRC ruled that Galera was WPP’s Vice-
President, and therefore, a corporate officer at the time she was removed by the Board of Directors
on 14 December 2000. The NLRC ruled that the labor arbiter had no jurisdiction over the case
because being a corporate officer, a case arising from her termination is considered as an intra-
corporate dispute, which was cognizable by the Securities and Exchange Commission under P.D. 902-
A (but now by the Regional Trial Courts designated as Commercial Courts by the Supreme Court
pursuant to Section 5.2 of RA No.8799).

The Court of Appeals reversed the NLRC. It ruled that Galera’s appointment by the Board of
Directors of the WPP as Vice President for Media had no legal effect as WPP’s by-laws provided for
only one Vice-President, which at that time was occupied. Furthermore, WPP’s by-laws did not
include a managing director as among its corporate officers. The Court of Appeals ordered WPP to
pay Galera backwages and separation pay, as well as housing benefits, moral and exemplary
damages, and attorney’s fees, among others.

The case was subsequently elevated to the Supreme Court.

Issues:

1. Is Galera an employee or a corporate officer of WPP?

2. Did the labor arbiter have jurisdiction over the case?

3. Was Galera illegally dismissed?

4. Is Galera entitled to collect the award of backwages and damages even if she did not have an
alien employment permit when she commenced her employment in the Philippines?

Ruling (First Issue):

Galera is an employee of WPP. She is not a corporate officer of WPP. An examination of WPP’s by-
laws resulted in a finding that Galera’s appointment as a corporate officer (Vice-President with the
operational title of Managing Director of Mindshare) during a special meeting of WPP’s Board of
Directors is an appointment to a non-existent corporate office. WPP’s by-laws provided for only one
Vice-President. At the time of Galera’s appointment on December 31, 1999, WPP already had one
Vice-President in the person of Webster. Galera cannot be said to be a director of WPP also because
all five directorship positions provided in the by-laws are already occupied.

The appellate court further justified that Galera was an employee and not a corporate officer by
subjecting WPP and Galera’s relationship to the four-fold test: (a) the selection and engagement of
the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employer’s power
to control the employee with respect to the means and methods by which the work is to be
accomplished. The appellate court found that Sections 1 and 4 of the employment contract mandate
where and how often she is to perform her work; Sections 3, 5, 6 and 7 show that wages she
receives are completely controlled by WPP; and Sections 10 and 11 clearly state that she is subject
to the regular disciplinary procedures of WPP.

(Second Issue):

The Labor Arbiter had jurisdiction over the illegal dismissal complaint filed by Galera. Galera being an
employee, the Labor Arbiter and the NLRC had jurisdiction over her illegal dismissal complaint.
Article 217 of the Labor Code vests the Labor Arbiter with the jurisdiction to hear and decide, among
others termination disputes, involving workers, whether agricultural or non-agricultural.

(Third Issue):

Yes, WPP’s dismissal of Galera lacked both substantive and procedural due process.

WPP failed to prove any just or authorized cause for Galera’s dismissal. WPP was unable to
substantiate the allegations of Steedman’s December 15, 2000 letter to Galera, (questioning her
leadership and competence). Galera, on the other hand, presented documentary evidence in the
form of congratulatory letters, including one from Steedman, which contents are diametrically
opposed to the December 15, 2000 letter. Also, the law requires that the employer must furnish the
worker sought to be dismissed with two written notices before termination of employment can be
legally effected: (1) notice which apprises the employee of the particular acts or omissions for which
his dismissal is sought; and (2) the subsequent notice which informs the employee of the employer’s
decision to dismiss him. Failure to comply with the requirements taints the dismissal with illegality.
WPP’s acts clearly show that Galera’s dismissal did not comply with the two-notice rule.

(Fourth Issue):

No, Galera could not claim the employees benefits she is entitled under Philippine Labor Laws. The
law and the rules are consistent in stating that the employment permit must be acquired prior to
employment. Article 40 of the Labor Code states: "Any alien seeking admission to the Philippines for
employment purposes and any domestic or foreign employer who desires to engage an alien for
employment in the Philippines shall obtain an employment permit from the Department of Labor.
Section 4, Rule XIV, Book 1 of the Implementing Rules and Regulations provides, among others, that
if an alien enters the country under a non-working visa and wishes to be employed thereafter, he
may only be allowed to be employed upon presentation of a duly approved employment permit.

Galera cannot come to this Court with unclean hands. To grant Galera’s prayer is to sanction the
violation of the Philippine labor laws requiring aliens to secure work permits before their
employment. We hold that the status quo must prevail in the present case and we leave the parties
where they are. This ruling, however, does not bar Galera from seeking relief from other
jurisdictions.

G.R. No. 169207/G.R. No. 169239, March 25, 2010.

WPP Marketing Communications, Inc. et al. vs. Jocelyn M. Galera/Jocelyn M. Galera vs. WPP
Marketing Communications, Inc. et al.,

Employee vs. corporate officer. Corporate officers are given such character either by the
Corporation Code or by the corporation’s by-laws. Under Section 25 of the Corporation Code, the
corporate officers are the president, secretary, treasurer and such other officers as may be provided
in the by-laws. Other officers are sometimes created by the charter or by-laws of a corporation, or
the board of directors may be empowered under the by-laws of a corporation to create additional
offices as may be necessary.
An examination of WPP’s by-laws resulted in a finding that Galera’s appointment as a corporate
officer (Vice-President with the operational title of Managing Director of Mindshare) during a special
meeting of WPP’s Board of Directors is an appointment to a non-existent corporate office. WPP’s
by-laws provided for only one Vice-President. At the time of Galera’s appointment on 31 December
1999, WPP already had one Vice-President in the person of Webster. Galera cannot be said to be a
director of WPP also because all five directorship positions provided in the by-laws are already
occupied. Finally, WPP cannot rely on its Amended By-Laws to support its argument that Galera is a
corporate officer. The Amended By-Laws provided for more than one Vice-President and for two
additional directors. Even though WPP’s stockholders voted for the amendment on 31 May 2000,
the SEC approved the amendments only on 16 February 2001. Galera was dismissed on 14
December 2000. WPP, Steedman, Webster, and Lansang did not present any evidence that Galera’s
dismissal took effect with the action of WPP’s Board of Directors.

Additionally, the following provisions in her employment contract are convincing indicators that
Galera was an employee and not a corporate officer: (1) it mandates where and how often she is to
perform her work; (2) the wages she receives are completely controlled by WPP; (3) she is subject to
the regular disciplinary procedures of WPP; (4) section 14 thereof clearly states that she is a
permanent employee — not a Vice-President or a member of the Board of Directors; (5) the
intellectual property rights created or discovered by petitioner during her employment shall
automatically belong to private respondent WPP [Under the Intellectual Property Code, this
condition prevails if the creator of the work subject to the laws of patent or copyright is an employee
of the one entitled to the patent or copyright]; and (6) the disciplinary procedure states that her
right of redress is through Mindshare’s Chief Executive Officer for the Asia-Pacific. This last
circumstance implies that she was not even under the disciplinary control of WPP’s Board of
Directors, and therefore, she could not have been a WPP corporate officer as only the WPP Board of
Directors could appoint and terminate its own corporate officer.

Maraguinot v. NLRC

FACTS:

Petitioner maintains that he was employed by respondents as part of the filming crew. He was
laterpromoted as an electrician. Petitioners’ tasks contained of loading movie equipment in the
shoothing area.Petitioners sought the assistance of their supervisor, Cesario, to facilitate their
request that respondents adjusttheir salary in accordance with the minimum wage law. Mrs. Cesario
informed petitioners that del Rosario wouldagree to increase their salary only if they signed a blank
employment contract. As petitioner refused to sign,respondents forced Enero (the other petitioner
who worked as a crew member) to go on leave. However, when hereported to work, respondent
refused to take him back. Maraguinot was dropped from the company payroll butwhen he returned,
he was again asked to sign a blank employment contract, and when he still refused,respondent’s
terminated his services. Petitioners thus sued for illegal dismissal.Private respondents assert that
they contract persons called producers to produce or make movies forprivate respondents and
contend that petitioners are project employees of the associate producers, who act asindependent
contractors. Thus, there is no ER-EE relationship.However, petitioners cited that their performance
of activities is necessary in the usual trade or business of respondents and their work in continuous.

ISSUE:

W/N ER-EE relationship exists

HELD:

Yes.With regards to VIVA’s contention that it does not make movies but merely distributes motion
pictures,there is no sufficient proof to prove this contention.In respect to respondents’ allegation
that petitioners are project employees, it is a settled rule that thecontracting out of labor is allowed
only in case of job contracting. However, assuming that the associate producersare job contactors,
they must then be engaged in the business of making motion pictures. Associate producersmust
have tools necessary to make motion pictures. However, the associate producers in this case have
none of these. The movie-making equipment are supplied to the producers and owned by VIVA.
Thus, it is clear that theassociate producer merely leases the equipment from VIVA.In addition, the
associate producers of VIVA cannot be considered labor-only contractors as they did notsupply,
recruit nor hire the workers. It was Cesario, the Shooting Supervisor of VIVA, who recruited crew
members. Thus, the relationship between VIVA and its producers or associate producers seems to be
that of agency.With regards to the issue of illegal dismissal, petitioners assert that they were regular
employees who wereillegally dismissed. Petitioners in this case had already attained the status of
regular employees in view of VIVA’sconduct. Thus, petitioners are entitled to back wages.A project
employee or a member of a work pool may acquire the status of a regular employee when:a.there is
a continuous rehiring of project employees even after a cessation of projectb.the tasks performed by
the alleged project employee are vital and necessary to the business of employer The tasks of
petitioners in loading movie equipment and returning it to VIVA’s warehouse and fixing thelighting
system were vital, necessary and indispensable to the usual business or trade of the
employer.Wherefore, petition is granted.

JOSE SONZA vs. ABS-CBN BROADCASTING CORPORATIONG.R. No. 138051 June 10, 2004

FACTS:

In May 1994, ABS-CBN signed an agreement with the Mel and Jay Management and Development
Corporation (MJMDC). ABS-CBN was represented by its corporate officers while MJMDC was
represented by Sonza, as President and general manager, and Tiangco as its EVP and treasurer.
Referred to in the agreement as agent, MJMDC agreed to provide Sonza’s services exclusively to
ABS-CBN as talent for radio and television. ABS-CBN agreed to pay Sonza a monthly talent fee of
P310, 000 for the first year andP317, 000 for the second and third year. On April 1996, Sonza wrote a
letter to ABS-CBN's President, Eugenio Lopez III, where he irrevocably resigned in view of the recent
events concerning his program and career. The acts of the station are violative of the Agreement and
said letter will serve as notice of rescission of said contract. The letter also contained the waiver and
renunciation for recovery of the remaining amount stipulated but reserves the right to seek recovery
of the other benefits under said Agreement. After the said letter, Sonza filed with the Department of
Labor and Employment a complaint alleging that ABS-CBN did not pay his salaries, separation pay,
service incentive pay, 13th month pay, signing bonus, travel allowance and amounts under the
Employees Stock Option Plan (ESOP). ABS-CBN contended that no employee-employer relationship
existed between the parties. However, ABS-CBN continued to remit Sonza’s monthly talent feesbut
opened another account for the same purpose. The Labor Arbiter dismissed the complaint and
found that there is no employee-employer relationship. The LA ruled that he is not an employee by
reason of his peculiar skill and talent as a TV host and a radio broadcaster. Unlike an ordinary
employee, he was free to perform his services in accordance with his own style. NLRC and CA
affirmed the LA. Should there be any complaint, it does not arise from an employer-employee
relationship but from a breach of contract.

ISSUE: Whether or not there was employer-employee relationship between the parties.

HELD: There is no employer-employee relationship between Sonza and ABS-CBN. Petition denied.
Judgment decision affirmed. Case law has consistently held that the elements of an employee-
employerrelationship are selection and engagement of the employee, the payment of wages, the
power of dismissal and the employer’s power to control the employee on the means and methods
by which the work is accomplished. The last element, the so-called "control test", is the most
important element.
 Television and Production Exponents, Inc. vs Roberto Servaña

542 SCRA 578 – Labor Law – Labor Standards – Regular Employee – Employer-employee
relationship – Four Fold Test

FACTS:

Servaña started out as a security for the Agro-Commercial Security Agency (ACSA) since 1987. The
agency had a contract with TV network RPN 9.

On the other hand, Television and Production Exponents, Inc (TAPE). is a company in charge of TV
programming and was handling shows like Eat Bulaga! Eat Bulaga! was then with RPN 9.

In 1995, RPN 9 severed its relations with ACSA. TAPE retained the services of Servaña as a security
guard and absorbed him.

In 2000, TAPE contracted the services of Sun Shield Security Agency. It then notified Servaña that he
is being terminated because he is now a redundant employee.

Servaña then filed a case for illegal Dismissal. The Labor Arbiter ruled that Servaña’s dismissal is valid
on the ground of redundancy but though he was not illegally dismissed he is still entitled to be paid a
separation pay which is amounting to one month pay for every year of service which totals to
P78,000.00.

TAPE appealed and argued that Servaña is not entitled to receive separation pay for he is considered
as a talent and not as a regular employee; that as such, there is no employee-employer relationship
between TAPE and Servaña. The National Labor Relations Commission ruled in favor of TAPE. It ruled
that Servaña is a program employee. Servaña appealed before the Court of Appeals.

The Court of Appeals reversed the NLRC and affirmed the LA. The CA further ruled that TAPE and its
president Tuviera should pay for nominal damages amounting to P10,000.00.

ISSUE:

Whether or not there is an employee-employer relationship existing between TAPE and Servaña.

HELD:

Yes. Servaña is a regular employee.

In determining Servaña’s nature of employment, the Supreme Court employed the Four Fold Test:

1. Whether or not employer conducted the selection and engagement of the employee.

Servaña was selected and engaged by TAPE when he was absorbed as a “talent” in 1995. He is not
really a talent, as termed by TAPE, because he performs an activity which is necessary and desirable
to TAPE’s business and that is being a security guard. Further, the primary evidence of him being
engaged as an employee is his employee identification card. An identification card is usually
provided not just as a security measure but to mainly identify the holder thereof as a bona fide
employee of the firm who issues it.
2. Whether or not there is payment of wages to the employee by the employer.

Servaña is definitely receiving a fixed amount as monthly compensation. He’s receiving P6,000.00 a
month.

3. Whether or not employer has the power to dismiss employee.

The Memorandum of Discontinuance issued to Servaña to notify him that he is a redundant

employee evidenced TAPE’s power to dismiss Servaña.

4. Whether or not the employer has the power of control over the employee.

The bundy cards which showed that Servaña was required to report to work at fixed hours of the day
manifested the fact that TAPE does have control over him. Otherwise, Servaña could have reported
at any time during the day as he may wish.

Therefore, Servaña is entitled to receive a separation pay.

On the other hand, the Supreme Court ruled that Tuviera, as president of TAPE, should not be held
liable for nominal damages as there was no showing he acted in bad faith in terminating Servaña.

Regular Employee Defined:

One having been engaged to perform an activity that is necessary and desirable to a company’s
business