Caurdanetaan Piece Workers Union vs. Laguesma & Corfarm Grains G.R No.

113542, February 24, 1998 Facts: Caurdanetaan Piece Workers Union members (petitioners) worked as cargadores for Corfarms Grains,Inc. (private respondent). They loaded, unloaded and piled sacks of palay from the warehouses to the cargo trucks and from the cargo trucks to the buyers. They were paid by private respondent on a piece rate basis. When Corfarm denied some benefits to these cargadores, they organized a union. Upon learning of its formation, Corfarm barred its members from working with them and replaced them with non-members of the union. Petitioner filed [a petition] for certification election before the Department of Labor and Employment and also filed a complaint for illegal dismissal. Corfarm denies that it had the power of control, rationalizing that petitioner's members "were 'street-hired' workers engaged from time to time to do loading and unloading work .There was no superintendent-in-charge to give orders and there were no gate passes issued, nor tools, equipment and paraphernalia issued by Corfarm for loading/unloading. Furthermore they contended that employer-employee relationship is negated by the fact that they offer and actually perform loading and unloading work for various rice mills in Pangasinan . Labor Arbiter Rolando D. Gambito issued his decision finding the dismissal of petitioner's members illegal. Public Respondent Laguesma premised the dismissal of the petition for certification election on the absence of an employer-employee relationship between petitioner's members and private respondent ISSUE: The present controversy hinges on whether or not an employer-employee relationship between the CPWU members and Respondent Corfarm exist. HELD. Yes there is employer-emploee relationship. To determine the existence of an employeremployee relation, this Court has consistently applied the "four-fold" test which has the following elements: (1) the power to hire, (2) the payment of wages, (3) the power to dismiss, and (4) the power to control - the last being the most important element. Caurdanetaan Piece Workers Union members (petitioners) performed work which is directly related, necessary and vital to the operations of Corfarm. Moreover, Corfarm did not even allege, much less prove, that petitioner's members have "substantial capital or investment in the form of tools, equipment, machineries, [and] work premises, among others. To be considered as independent contractors. Furthermore, said respondent did not contradict petitioner's allegation that it paid wages directly to these workers without the intervention of any third-party independent contractor. It also wielded the power of dismissal over petitioners; in fact, its exercise of this power was the progenitor of the illegal dismissal case. Clearly, the workers are not independent contractors. Assuming arguendo that they did work with other rice mills, this was required by the imperative of meeting their basic needs.

ALEJANDRO MARAGUINOT, JR. and PAULINO ENERO vs NLRC GRN 120969 January 22, 1998 Facts: Petitioner Alejandro Maraguinot, Jr. maintains that he was employed by private respondents filming crew and was was promoted to the rank of Electrician. Petitioner Paulino Enero, on his part, claims that private respondents employed him as a member of the shooting crew . Petitioners' tasks consisted of loading, unloading and arranging movie equipment in the shooting area as instructed by the cameraman, returning the equipment to Viva Films' warehouse, assisting in the "fixing" of the lighting system, and performing other tasks that the cameraman and/or director may assign. Petitioners sought the assistance of their supervisor, Mrs. Alejandria Cesario, to facilitate their request that private respondents adjust their salary in accordance with the minimum wage law. Mrs. Cesario informed petitioners that Mr. Vic del Rosario would agree to increase their salary only if they signed a blank employment contract. As petitioners refused to sign, private respondents forced Enero to go on leave, then refused to take him back when he reported for work. Meanwhile, Maraguinot was again asked to sign a blank employment contract, and when he still refused, private respondents terminated his services. Petitioners thus sued for illegal dismissal before the Labor Arbiter. On the other hand, private respondents claim that Viva Films (hereafter VIVA) that it is primarily engaged in the distribution and exhibition of movies - but not in the business of making movies; in the same vein, private respondent Vic del Rosario is merely an executive producer, i.e., the financier who invests a certain sum of money for the production of movies distributed and exhibited by VIVA. Private respondents assert that they contract persons called "producers" - also referred to as "associate producers" to "produce" or make movies for private respondents; and contend that petitioners are project employees of the associate producers who, in turn, act as independent contractors. As such, there is no employer-employee relationship between petitioners and private respondents. After considering both versions of the facts, the Labor Arbiter ruled in favor of the complainants. Respondents were ordered to reinstate complainants to their former positions.Private respondents appealed to the NLRC . The NLRC, in reversing the Labor Arbiter, then concluded that these circumstances, taken together, indicated that complainants (herein petitioners) were "project employees." Issue: The determination of whether an employer-employee relationship existed between petitioners and private respondents or any one of private respondents. Held: All the circumstances indicate an employment relationship between petitioners and VIVA alone, thus the inevitable conclusion is that petitioners are employees only of VIVA. In respect to the respondent’s allegation that the petitioners are project employees, it is a settled rule that contracting out of labor is allowed only in case of job contracting. In the case at bar, the associate

producers cannot be considered as job contractors but only agents because they are not engaged in the business of making motion pictures. The movie making equipment are supplied to the producers and owned by VIVA. In addition, the associate producers cannot be considered as labor only contractors as they did not supply, recruit nor hire workers. It may not be ignored, however, that private respondents expressly admitted that petitioners were part of a work pool; 31 and, while petitioners were initially hired possibly as project employees, they had attained the status of regular employees in view of VIVA's conduct. A project employee or a member of a work pool may acquire the status of a regular employee when the following concur: 1) There is a continuous rehiring of project employees even after cessation of a project; 32 and 2) The tasks performed by the alleged "project employee" are vital, necessary and indispensable to the usual business or trade of the employer. 33

Makati Haberdashery, Inc. vs. NLRC G.R. Nos. 83380-81, November 15, 1989 Facts: Private respondents, have been working for Makati Haberdashery, Inc. as tailors, seamstress, sewers, basters (manlililip) and "plantsadoras". They are paid on a piece-rate basis except two workers who are paid on a monthly basis. In addition to their piece-rate, they are given a daily allowance of three (P 3.00) pesos provided they report for work before 9:30 a.m. everyday. Private respondents are required to work from or before 9:30 a.m. up to 6:00 or 7:00 p.m. from Monday to Saturday and during peak periods even on Sundays and holidays. The Sandigan ng Manggagawang Pilipino, a labor organization of the respondent workers, filed a complaint(a) underpayment of the basic wage; (b) underpayment of living allowance; (c) non-payment of overtime work and other money claims. The Labor Arbiter decided in favor of the complainants which was further affirmed by the NLRC. Petitioners filed the petition contending that public respondents were erroneous in concluding that an employer-employee relationship exist between Haberdashery and the private respondents. Issue: WHETHER OR NOT AN EMPLOYER-EMPLOYEE RELATIONSHIP EXISTS BETWEEN PETITIONER HABERDASHERY AND RESPONDENTS WORKERS. Held: The facts indubitably reveal that the most important requisite of control is present. As gleaned from the operations of petitioner, when a customer enters into a contract with the haberdashery or its proprietor, the latter directs an employee who may be a tailor, pattern maker, sewer or "plantsadora" to take the customer's measurements, and to sew the pants, coat or shirt as specified by the customer. Supervision is actively manifested in all these aspects — the manner and quality of cutting, sewing and ironing. Furthermore, the presence of control is immediately evident in a memorandum issued by Assistant Manager which requires workers comply with the following directives: 1. To follow instructions only from specific persons; 2. Before accepting the job orders tailors must check the materials, job orders, due dates and other things to maximize the efficiency of production; 3. All job orders must be finished one day before the due date. 4. Alteration-Before accepting alteration person attending on customers must ask first or must advise the tailors regarding the due dates. 5. Any tailor violating the memorandum will be subject to disciplinary action. It is evident that petitioner has reserved the right to control its employees not only as to the result but also the means and methods by which the same are to be accomplished. That private

respondents are regular employees is further proven by the fact that they have to report for work regularly from 9:30 a.m. to 6:00 or 7:00 p.m. and are paid an additional allowance of P 3.00 daily if they report for work before 9:30 a.m. and which is forfeited when they arrive at or after 9:30 a.m. 11 Since private respondents are regular employees, necessarily the argument that they are independent contractors must fail. As established, private respondents did not exercise independence in their own methods, but on the contrary were subject to the control of petitioners from the beginning of their tasks to their completion. Unlike independent contractors who generally rely on their own resources, the equipment, tools, accessories, and paraphernalia used by private respondents are supplied and owned by petitioners. Private respondents are totally dependent on petitioners in all these aspects. Villamaria vs. CA G.R. No. 165881,2006
Facts: Petitioner Oscar Villamaria, Jr. was the owner of Villamaria Motors, a sole proprietorship engaged in assembling passenger jeepneys with a public utility franchise. By 1995, Villamaria stopped assembling jeepneys and retained only nine, four of which he operated by employing drivers on a "boundary basis." One of those drivers was respondent Bustamante who drove the jeepney with Plate No. PVU-660. Bustamante remitted P450.00 a day to Villamaria as boundary and kept the residue of his daily earnings as compensation for driving the vehicle. In August 1997, Villamaria verbally agreed to sell the jeepney to Bustamante under the "boundary-hulog scheme," where Bustamante would remit to Villarama P550.00 a day for a period of four years; Bustamante would then become the owner of the vehicle and continue to drive the same under Villamaria’s franchise. It was also agreed that Bustamante would make a downpayment of P10,000.00.

Villamaria executed a contract entitled "Kasunduan ng Bilihan ng Sasakyan sa Pamamagitan ng Boundary-Hulog"5The parties agreed that if Bustamante failed to pay the boundary-hulog for three days, Villamaria Motors would hold on to the vehicle until Bustamante paid his arrears, including a penalty of P50.00 a day; in case Bustamante failed to remit the daily boundary-hulog for a period of one week, the Kasunduan would cease to have legal effect and Bustamante would have to return the vehicle to Villamaria Motors. Under the Kasunduan, Bustamante was prohibited from driving the vehicle without prior authority from Villamaria Motors Bustamante and other drivers who also had the same arrangement with Villamaria Motors failed to pay their respective boundary-hulog. This prompted Villamaria to serve a "Paalala,"6 reminding them that under the Kasunduan, failure to pay the daily boundary-hulog for one week, would mean their respective jeepneys would be returned to him without any complaints. Villamaria took back the jeepney driven by Bustamante and barred the latter from driving the vehicle. Bustamante filed a Complaint7 for Illegal Dismissal against Villamaria and his wife Teresita. spouses Villamaria argued that Bustamante was not illegally dismissed since the Kasunduan executed on August 7, 1997 transformed the employer-employee relationship into that of vendorvendee. the Labor Arbiter rendered judgment17 in favor of the spouses Villamaria. Bustamante appealed the decision to the NLRC. The NLRC rendered judgment20 dismissing the appeal for lack of merit. Bustamante elevated the matter to the CA via Petition for Certiorari. the CA reversed and set aside the NLRC decision.

ISSUE: Whether or not the boundary-hulog scheme negated the presence of employeremployee relationship.

Held: No. The Court agreed with the ruling of the CA that, under the boundary-hulog scheme incorporated in the Kasunduan, a dual juridical relationship was created between petitioner and respondent: that of employer-employee and vendor-vendee. The Kasunduan did not extinguish the employer-employee relationship of the parties extant before the execution of said deed. The boundary system is a scheme by an owner/operator engaged in transporting passengers as a common carrier to primarily govern the compensation of the driver, that is, the latter’s daily earnings are remitted to the owner/operator less the excess of the boundary which represents the driver’s compensation. Under this system, the owner/operator exercises control and supervision over the driver. It is unlike in lease of chattels where the lessor loses complete control over the chattel leased but the lessee is still ultimately responsible for the consequences of its use. The management of the business is still in the hands of the owner/operator, who, being the holder of the certificate of public convenience, must see to it that the driver follows the route prescribed by the franchising and regulatory authority, and the rules promulgated with regard to the business operations. The fact that the driver does not receive fixed wages but only the excess of the "boundary" given to the owner/operator is not sufficient to change the relationship between them. Indubitably, the driver performs activities which are usually necessary or desirable in the usual business or trade of the owner/operator.46The juridical relationship of employer-employee between petitioner and respondent was not negated by the foregoing stipulation in the Kasunduan, considering that petitioner retained control of respondent’s conduct as driver of the vehicle.

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