21. Sonza vs ABS CBN (131 SCRA 583) (GR NO.
138051) was made subject to respondent’s Rules and Regulations,
FACTS:
1. May 1994, Respondent ABS-CBN signed an agreement with Mel
and Jay Management and Development Corporation ("MJMDC")
represented by Carmela Tiangco and herein petitioner Jose Sonza.
They agreed that Sonza will provide services exclusively to ABS
CBN as talent for radio and television.
2. April 1, 1996, Sonza wrote a letter to the respondent saying that
his resignation to the company, in view of the recent events
concerning his programs and career is irrevocable. He also stated
in his letter a notice of rescission of their Agreement and a waiver
of the recovery of the remaining amount stipulated in the
Agreement but he reserves the right to seek recovery of other
benefits under said Agreement.
3. April 30, 1996, Sonza filed a complaint against ABS-CBN before
the DOLE - NCR complained that ABS-CBN did not pay his
salaries, separation pay, service incentive leave pay, 13th month
pay, signing bonus, travel allowance and amounts due under the
Employees Stock Option Plan (ESOP). ABS denied that there was
an ER-EE relationship that existed between the petitioner saying
that as a practice in the broadcast industry they treat talents like
SONZA as independent contractors.
4. Labor arbiter rendered its Decision, dismissing the complaint. LA
said that the complainant was engaged by respondent by reason
of his peculiar skills and talent as a TV host and a radio
broadcaster. Unlike an ordinary employee, he was free to
perform the services he undertook to render in accordance
with his own style.Whatever benefits complainant enjoyed
arose from specific agreement by the parties and not by reason
of employer-employee relationship. The fact that complainant
likewise, does not detract from the absence of employer-
employee relationship.
ISSUE: WON AN EMPLOYER-EMPLOYEE RELATIONSHIP
EXISTED BETWEEN SONZA AND ABS-CBN.
HELD: No, Sonza is not an employee of ABS-CBN. Thus there is no ER-
EE relationship.
The Supreme Court applying the 4-fold test decided on the case.
1. That the specific selection and hiring Sonza, because of his unique
skills, talent and celebrity status not possessed by ordinary
employees is a circumstance indicative but not conclusive of
independent contractual relationship.
2. With regard to the payment of wages, whatever benefits Sonza
enjoyed arose from contract and not because of an ER-EE
relationship. The payment of talent fees directly to Sonza and not
to MJMDC does not negate the status of Sonza as an independent
contractor.
3. The manner by which Sonza terminated his relationship with
ABS-CBN is immaterial. Whether he rescinded the Agreement or
resigned from work does not determine his status as an employee
or independent contractor.
4. ABS-CBN did not exercise control over the means and methods of
performance of Sonza’s work even if they were dissatisfied. All
they have is the right not to broadcast Sonza’s shows but still
continue to pay in full Sonza’s talent fees as per the Agreement.
This proves that ABS-CBN’s control was limited only to the result
of Sonza’s work.
 5. ABS-CBN does not require Sonza to comply with its rules and
standards of performance prescribed for its employees but as to
their Agreement, Sonza has to abide to the Code of Ethics of the
KBP.
6. Lastly, Exclusivity clause in the Agreement does not in itself mean
that Sonza is an employee of ABS-CBN. In the broadcast industry,
exclusivity is not necessarily the same as control. Hiring of
exclusive talents is not designed to control the means and methods
of work of the talent, but simply to protect the investment of the
broadcast station. The huge talent fees partially compensates for
exclusivity, as in the present case.
JURISDICTION
22. SMC vs NLRC (61 SCRA 719) ( GR NO. 80774)
FACTS:
1. In line with the innovation program sponsored by the Petitioner
(Corporation) and under which the management grants cash
awards to employees who submit to the corporation ideas and
suggestions found to be beneficial to the corporation, private
respondent Rustico Vega submitted an innovation proposal to
eliminate the alleged defects in the quality and taste of the product
“San Miguel Beer Grande.”
2. Petitioner Corporation, however, did not find the proposal
acceptable and consequently refused Mr. Vega's subsequent
demands for a cash award under the Innovation Program.
3. A complaint was filed by Vega against petitioner alleging that his
proposal "[had] been accepted by the methods analyst and
implemented by the Corporation [in] October 1980," and that the
same "ultimately and finally solved the problem of the
Corporation in the production of Beer Grande." he claims
entitlement to a cash prize of P60,000.00 (the maximum award per
proposal offered under the Innovation Program) and attorney's
fees.
4. Petitioner answered and alleged that private respondent had no
cause of action. It denied ever having approved or adopted Mr.
Vega's proposal as part of the Corporation's brewing procedure in
the production of San Miguel Beer Grande because the proposal
was turned down "for lack of originality" and that the same, "even
if implemented [could not] achieve the desired result." Also,
Petitioner further alleged that the Labor Arbiter had no
jurisdiction, Mr. Vega having improperly bypassed the
grievance machinery procedure prescribed under a then
existing collective bargaining agreement between management
and employees, and available administrative remedies
provided under the rules of the Innovation Program.
5. The Labor Arbiter, noting that the money claim of complainant
Vega in this case is "not a necessary incident of his employment"
and that said claim is not among those mentioned in Article 217 of
the Labor Code, dismissed the complaint for lack of jurisdiction.
However, in a gesture of "compassion and to show the
government's concern for the workingman," the Labor Arbiter also
directed petitioner to pay Mr. Vega the sum of P2,000.00 as
"financial assistance." This order was subsequently appealed by
both parties. Acting on the appeal, the respondent NLRC rendered
a decision in favor of the private respondent, ordering the
 petitioner to pay the innovation program grant of P 60,000, hence
this appeal.
ISSUE: WON the Labor Arbiter and the Commission have jurisdiction
over the subject matter of the case.
HELD: No, While paragraph 3 of Art 217 of the Labor Code refers to "all
money claims of workers," it is not necessary to suppose that the entire
universe of money claims that might be asserted by workers against their
employers has been absorbed into the original and exclusive jurisdiction of
Labor Arbiters. Put a little differently, money claims of workers which
now fall within the original and exclusive jurisdiction of Labor Arbiters
are those money claims which have some reasonable causal connection
with the employer-employee relationship.
In the case at bar, just because the claim arises from employer-employee
relationship, it does not follow that it is automatically within the
jurisdiction of the Labor Arbiter. SMC’s Innovation Program was
essentially an invitation from petitioner Corporation to its employees to
submit innovation proposals, and that petitioner Corporation undertook to
grant cash awards to employees who accept such invitation and whose
innovation suggestions, in the judgment of the Corporation's officials,
satisfied the standards and requirements of the Innovation Program and
which, therefore, could be translated into some substantial benefit to the
Corporation. Such undertaking, though unilateral in origin, could
nonetheless ripen into an enforceable contractual (facio ut des) obligation
on the part of petitioner Corporation under certain circumstances. Thus,
whether or not an enforceable contract, albeit implied arid innominate, had
arisen between petitioner Corporation and private respondent Vega in the
circumstances of this case, and if so, whether or not it had been breached,
are preeminently legal questions, questions not to be resolved by referring
to labor legislation and having nothing to do with wages or other terms
and conditions of employment, but rather having recourse to our law on
contracts.
Where the claim to the principal relief sought is to be resolved not by
reference to the Labor Code or other labor relations statute or a collective
bargaining agreement but by the general civil law, the jurisdiction over the
dispute belongs to the regular courts of justice and not to the Labor Arbiter
and the NLRC. In such situations, resolution of the dispute requires
expertise, not in labor management relations nor in wage structures and
other terms and conditions of employment, but rather in the application of
the general civil law. Clearly, such claims fall outside the area of
competence or expertise ordinarily ascribed to Labor Arbiters and the
NLRC and the rationale for granting jurisdiction over such claims to these
agencies disappears.
23. PEPSI vs GALANG (GR No. 89621)
FACTS:
1. The private respondents were employees of the petitioner who
were suspected of complicity in the irregular disposition of empty
Pepsi Cola bottles. The petitioners filed a criminal complaint for
theft against them but this was later withdrawn and substituted
with a criminal complaint for falsification of private documents.
The complaint was dismissed by MTC of Leyte and the dismissal
was affirmed by the Office of the Provincial Prosecutor.
2. Allegedly After an administrative investigation, the private
respondents were dismissed by the petitoner company, as a result
the filed a complaint in the Regional Branch of the NLRC in
 Tacloban against the company for illegal dismissal and demanded
reinstatement with damages. In a separate civil complaint, they
filed in the RTC of Leyte, a claim for damages arising from what
they claimed to be their malicious prosecution.
3. Petitioners moved to dismiss the civil complaint on the ground
that the trial court has no jurisdiction over the case since it
involves ER-EE relations that were exclusively cognizable by the
labor arbiter. Petitioners invoke Art 217 of the Labor Code to
support their position.
ISSUE: WON the Labor Arbiter and the Commission have jurisdiction
over the subject matter of the case.
HELD: The Supreme Court reiterated in its decision that not every
controversy involving workers and their employers can be resolved only
by the labor arbiters. This will be so only if there is a "reasonable causal
connection" between the claim asserted and employee-employer relations
to put the case under the provisions of Article 217. Absent such a link,
the complaint will be cognizable by the regular courts of justice in the
exercise of their civil and criminal jurisdiction.
The case involves a complaint for damages for malicious prosecution
which was filed with the Regional Trial Court of Leyte by the employees
of the defendant company. It does not appear that there is a "reasonable
causal connection" between the complaint and the relations of the parties
as employer and employees. The complaint did not arise from such
relations and in fact could have arisen independently of an employment
relationship between the parties. No such relationship or any unfair labor
practice is asserted. What the employees are alleging is that the petitioners
acted with bad faith when they filed the criminal complaint which the
Municipal Trial Court said was intended "to harass the poor employees"
and the dismissal of which was affirmed by the Provincial Prosecutor "for
lack of evidence to establish even a slightest probability that all the
respondents herein have committed the crime imputed against them." This
is a matter which the labor arbiter has no competence to resolve as the
applicable law is not the Labor Code but the Revised Penal Code.
24. MEDINA VS CARLOS-BARTOLOME
FACTS:
1. May 1, 1978, PD 1376 an amendatory decree took effect which
provides that Regional Directors shall not indorse and Labor Arbiters
shall not entertain claims for moral or other forms of damages, and now
expressly confers jurisdiction on the courts in these cases.
2. One afternoon in December 1977, without any provocation, Cosme
Aboitiz, President and CEO of Pepsi-Cola Bottling Company, shouted
and maliciously humiliated and dismissed herein petitioners with the
use of slanderous language and other words of similar import uttered in
the presence of the petitioner’s subordinate employees.
3. May 10, 1979, the petitioners filed a joint criminal complaint against
Aboitiz for oral defamation. The Petition was sustained and the
minister of Justice directed them to file an information for Grave
Slander.
4. A motion to dismiss the complaint for lack of jurisdiction was filed by
COSME DE ABOITIZ and PEPSI-COLA BOTTLING COMPANY
OF THE PHILIPPINES, INC. The trial court denied the motion saying
that the complaint for civil damages is clearly not based on an ER-EE
relationship but on the manner of the dismissal made and the effects
following therefrom.
5. May 1, 1980, PD 169, an amendment to Article 217 and Art 248 took
effect and has vested exclusive and original jurisdiction to labor
arbiters, cases which may include claims for damages and other
affirmative reliefs.
6. While the case was on trial, another motion to dismiss the complaint
was filed by COSME DE ABOITIZ and PEPSI-COLA BOTTLING
COMPANY OF THE PHILIPPINES, INC immediately after the
amendment took effect. It was subsequently granted by the trial court
saying that this case would not have arisen if the petitioners had not
been employees of the respondent company. Hence, this petition.

ISSUE: WON the Labor Code has any relevance to the reliefs sought by
the petitioners. For if the Labor Code has no relevance, any discussion
concerning the statutes amending it whether or not they have retroactive
effect is unnecessary.

HELD: The Supreme Court held that it is obvious from the complaint that
the plaintiffs have not alleged any unfair labor practice. Theirs is a simple
action for damages for tortious acts allegedly committed by the
defendants. Such being the case, the governing statute is the Civil Code
and not the Labor Code. It results that the orders under review are based
on a wrong premise. The SC granted the petition and ordered the
respondent Judge to reinstate the case and render decision on the merits.