INSULAR LIFE ASSURANCE vs NLRC Case Digest [G.R. No. 84484 November 15, 1989] INSULAR LIFE ASSURANCE CO., LTD., petitioner, vs.

NATIONAL LABOR RELATIONS COMMISSION and MELECIO BASIAO, respondents. FACTS: Since 1968, respondent Basiao has been an agent for petitioner company, and is authorized to solicit within the Philippines applications for insurance policies and annuities in accordance with the existing rules and regulations of the company. In return, he would receive compensation, in the form of commissions. Some four years later, in April 1972, the parties entered into another contract — an Agency Manager's Contract — and to implement his end of it Basiao organized an agency or office to which he gave the name M. Basiao and Associates, while concurrently fulfilling his commitments under the first contract with the Company. In May, 1979, the Company terminated the Agency Manager's Contract. After vainly seeking a reconsideration, Basiao sued the Company in a civil action and this, he was later to claim, prompted the latter to terminate also his engagement under the first contract and to stop payment of his commissions starting April 1, 1980. Basiao thereafter filed with the then Ministry of Labor a complaint against the Company and its president. The complaint sought to recover commissions allegedly unpaid thereunder, plus attorney's fees. The respondents disputed the Ministry's jurisdiction over Basiao's claim, asserting that he was not the Company's employee, but an independent contractor. ISSUE: Whether or not there exist an employer-employee relationship between Basiao and Insular Life. HELD: The SC ruled in favor of Insular Life. Not every form of control that the hiring party reserves to himself over the conduct of the party hired in relation to the services rendered may be accorded the effect of establishing an employer-employee relationship between them in the legal or technical sense of the term. A line must be drawn somewhere, if the recognized distinction between an employee and an individual contractor is not to vanish altogether. Logically, the line should be drawn between rules that merely serve as guidelines towards the achievement of the mutually desired result without dictating the means or methods to be employed in attaining it, and those that control or fix the methodology and bind or restrict the party hired to the use of such means. The first, which aim only to promote the result, create no employer-employee relationship unlike the second, which address both the result and the means used to achieve it. The distinction acquires particular relevance in the case of an enterprise affected with public interest, as is the business of insurance, and is on that account subject to regulation by the State with respect, not only to the relations between insurer and insured but also to the internal affairs of the insurance company. Rules and regulations governing the conduct of the business are provided for in the Insurance Code and enforced by the Insurance Commissioner. It is, therefore, usual and expected for an insurance company to promulgate a set of rules to guide its commission agents in selling its

policies that they may not run afoul of the law and what it requires or prohibits. Of such a character are the rules which prescribe the qualifications of persons who may be insured, subject insurance applications to processing and approval by the Company, and also reserve to the Company the determination of the premiums to be paid and the schedules of payment. None of these really invades the agent's contractual prerogative to adopt his own selling methods or to sell insurance at his own time and convenience, hence cannot justifiably be said to establish an employeremployee relationship between him and the company. The respondents limit themselves to pointing out that Basiao's contract with the Company bound him to observe and conform to such rules and regulations as the latter might from time to time prescribe. No showing has been made that any such rules or regulations were in fact promulgated, much less that any rules existed or were issued which effectively controlled or restricted his choice of methods — or the methods themselves — of selling insurance. Absent such showing, the Court will not speculate that any exceptions or qualifications were imposed on the express provision of the contract leaving Basiao "... free to exercise his own judgment as to the time, place and means of soliciting insurance." The Court, therefore, rules that under the contract invoked by him, Basiao was not an employee of the petitioner, but a commission agent, an independent contractor whose claim for unpaid commissions should have been litigated in an ordinary civil action. NLRC Decision set aside.

Singer Sewing Machine vs NLRC (91307) 193 SCRA 271 Facts: Singer Machine Collectors Union-Baguio filed a petition for direct certification as the sole and exclusive bargaining agent of all collectors of Singer Sewing Machine. The company opposed the petition mainly because the union members are not employees but independent contractors as evidenced by the collection agency agreement which they signed. Med-Arbiter ruled that there exists an employee-employer relationship and granted the certification election which was affirmed by Sec. Drilon. The company files the present petition on the determination of the relationship. The union insist that the provisions of the Collection Agreement belie the company’s position that the union members are independent contractors. Issue: WON there exists an employer-employee relationship between the parties. Held: Respondents are not employees of the company. The present case calls for the application of the control test, which if not satisfied, would lead to the conclusion that no employee-employer relationship exists. If the union members are not employees, no right to organize for the purpose of bargaining or as a bargaining agent cannot be recognized.

promotions. They alleged that although the petitioners were employees of the Manila Golf and Country Club. All these considerations clash frontally with the concept of employment. however. vs IAC and Fermin Llamar (1994) G. private respondent received commissions from the products sold by his agents. moreover. Inc. received commissions there from. payment of wages. As compensation. any discipline may be meted them beyond barring them from the premises which. and without violating any right to work on their part. and also illegal deduction from his sales commissions. is less a measure of employer control than an assurance that the work is fairly distributed. however. work for the club to which they attach themselves on sufferance but. 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 . claiming for non-payment of separation pay and other benefits. In the case before the SSC. agreed upon that office expenses would be deducted from private respondent’s commissions.R.R. 64948 Facts: Respondents were caddies and employees of Manila Golf & Country Club who originally filed a petition with the Social Security Commission (SSC) for coverage and availment of benefits under the Social Security Act.. The agreement confirms the status of the collecting agents as independent contractor. vs NLRC (1996) G. as pointed out by petitioner which was never refuted that: has no means of compelling the presence of a caddy. also without having to observe any working hours.The following elements are generally considered in the determination of the relationship: the selection and engagement of the employee. Petitioner would also be informed about appointments. caddies by occupation. It was. and hence. Moreover. Encyclopaedia Britannica (Phil) Inc. The court finds that since private respondents are not employees of the company. The salaries of his secretary. Limjoco resigned from office to pursue his private business. It seems to the Court. goodwill and logo. a domestic corporation. free to leave anytime they please. it may be supposed. a caddy who is absent when his turn number is called simply losing his turn to serve and being assigned instead the last number for the day. 87098 Facts: Manila Golf & Country Club. the Club may do in any case even absent any breach of the rules. Limjoco did not have any salary and his income from the company was dependent on the volume of sales accomplished. to stay away for as long they like. caddies must submit to some supervision of their conduct while enjoying the privilege of pursuing their occupation within the premises and grounds of whatever club they do their work in. Thus. that as such caddies. He also had his own separate office. It is not pretended that if found remiss in the observance of said rules.. For all that is made to appear. and maintained his own workforce. showing that the Club has not the measure of control over the incidents of the caddies' work and compensation that an employer would possess. were allowed into the Club premises to render services as such to the individual members and guests playing the Club's golf course and who themselves paid for such services. A caddy is not required to exercise his occupation in the premises of petitioner. He then filed a complaint against petitioner Encyclopaedia Britannica with DOLE. and sales representatives were chargeable to his commissions. and transfers of employees in private respondent’s district. In the very nature of things. The IAC would point to the fact that the Club suggests the rate of fees payable by the players to the caddies as still another indication of the latter's status as employees. utility man. Not all collecting agents are employees and neither are all collecting agents independent contractors. The requirement that collection agents utilize only receipt forms and report forms issued by the company and that reports shall be submitted at least once a week is not necessarily an indication of control over the means by which the job collection is to be performed. power of dismissal and the power to control the employee’s conduct which is the most important element. the latter had not registered them as such with the SSS. Court agree that the group rotation system so-called. the respondent Club alleged that the petitioners. the petitioners were not subject to the direction and control of the Club as regards the manner in which they performed their work. On June 1974. Even if report requirements are to be called control measures. Issue: WON there exist an employer-employee relationship between the cadies and the Golf Club? Held: No existence of employer-employee relationship. He may work with any other golf club or he may seek employment a caddy or otherwise with any entity or individual without restriction by petitioner. they were not the Club's employees. There is no constitutional and legal basis for their union to be granted their petition for direct certification. financed the business expenses. The nature of the relationship between a company and its collecting agents depends on the circumstances of each particular relationship. He was also allowed to use petitioner’s name. they 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. Petitioner alleged that Limjoco was not its employee but an independent dealer authorized to promote and sell its products and in return. on the other hand. they are not entitled to the constitutional right to form or join a labor organization for the purposes of collective bargaining. that the intendment of such fact is to the contrary. The plain language of the agreement reveals that the designation as collection agent does not create an employment relationship and that the applicant is to be considered at all times as an independent contractor. any control is only with respect to the end result of the collection since the requirements regulate the things to be done after the performance of the collection job or the rendition of service.

he could not be employed elsewhere and he would be required to devote full time for petitioner." This latest Agreement stressed that the "New Business Manager in performance of his duties defined herein." and that "(u)nder no circumstance shall the New Business Manager and/or his employees be considered employees of Sun Life. and termination of the agreement inter alia by written notice "without cause. The contracts she had willingly and knowingly signed with Sun Life repeatedly and clearly provided that said agreements were terminable by either party by written notice with or without cause. private respondent was also a director and later the president of the Farmers’ Rural Bank. his obligations. "MANAGER'S Supplementary Agreement. Rogelio wanted to pull out his wife from the operating room. Hosaka has not yet arrived. Noteworthy is that this last agreement. Carungcong would be considered an independent contractor and not . of Canada (1997) G. Erlinda was admitted to the medical center the day before the operation. Dr. As he pointed out in his resignation letter. an employee of Sun Life. like the "Career Agent's (or Unit Manager's) Agreement" first signed by her. The family of Ramos sued them for damages. commenced an inquiry into the special fund availments of Carungcong and other New Business Managers which later prompted the petitioner’s termination. The nail beds of Erlinda were bluish discoloration in her left hand. At the time he was connected with the petitioner company." After receiving reports of anomalies in relation thereto from unit managers and agents by the company’s VP. 118086 Facts: Susan Carungcong began as an agent of Sun Life in 1974. an employee of Sun Life. Carungcong and Sun Life executed another Agreement . . that in the performance of her duties defined herein. Issue: WON there existed an employer-employee relationship between Caruncong and Sunlife? Held: Carungcong was an independent contractor and not an employee of Sun Life. who as admitted by the latter had other ―conflict of interest‖ requiring his personal attention. . 1979" said second contract — explicitly described as a "further agreement" — contained provisions regarding remuneration (overriding commissions in accordance with a fixed schedule)." and that "under no circumstance shall the New Business Manager and/or his employees be considered employees of Sun Life. it was rather unusual for him to wait for more than a year from his separation from work before he decided to file his claims. If private respondent was indeed an employee. Dr. Around 9:30. said contract was superseded by 2 new agreements: first. Dr. Guiterres tried to intubate Erlinda. she was ready for operation as early as 7:30 am." Making explicit reference to the first agreement "which became effective on the 1st day of July." It declared that the "Agent shall be an independent contractor and none of the terms of agreement shall be construed as creating an employer-employee relationship. Erlinda remained in comatose condition until she died. thus entitled to reinstatement without loss of seniority rights and other benefits. She then instituted proceedings for vindication in the Arbitration Branch of the National Labor Relations Commission where she succeeded in obtaining a favorable judgment finding that there existed an employer-employee relationship between her and Sun Life." Subsequently. or by written notice "with or without cause. ruled that she had been illegally dismissed. Had he been an employee of the company. She was referred to Dr. Five years later. shall be considered an independent contractor and not .Issue: WON there exist an employer-employee relationship and necessarily entitles Limjoco of his claims? Held: Private respondent was merely an agent or an independent dealer of the petitioner." dealt with such matters as the agent's commissions. limitation of authority. she signed an ―Agent’s Agreement‖ and was designated to solicit applications for insurance and annuity services. Respondent was free to conduct his work and he was free to engage in other means of livelihood. a surgeon. At 3 pm. In ascertaining whether the relationship is that of employer-employee or one of independent contractor. By 10 am. Hosaka. limitations on his authority. it would indicate that petitioner has no effective control over the personal activities of Limjoco. Limjoco was aware of ―conflict with other interests which xxx have increasingly required my personal attention‖. Hosaka finally arrived at 12:10 pm more than 3 hours of the scheduled operation. second. Erlinda was being wheeled to the Intensive care Unit and stayed there for a month. and termination of the agreement by death. .by which the former was named New Business Manager with the function generally "to manage a New Business Office established by her and to obtain applications for life insurance Ramos vs Court of Appeals (124354) 380 SCRA 467 Facts: Petitioner Erlinda Ramos was advised to undergo an operation for the removal of her stone in the gall bladder. was titled. As pointed out ―the element of control is absent. is the "Career Agent's (or Unit Manager's) Agreement. 1985 in the De los Santos Medical Center." Carungcong vs NLRC. Sun Life Assurance Co. The contract set out in detail the terms and conditions — particularly those concerning the commissions payable to her — under which her relationship with the company would be governed. who agreed to do the operation. and in turn is compensated according to the result of his efforts and not the amount thereof. The operation was scheduled on June 17. At the very least. each case must be determined by its own facts and all features of the relationship are to be considered. the Manager of Sun Life's Internal Audit Department. it was emphasized. On the following day.‖ policies and other products offered by or distributed through Sun Life and to perform such other duties in connection therewith as Sun Life may require from time to time. Since the ill-fated operation.R. where a person who works for another does so more or less at his own pleasure and is not subject to definite hours or conditions of work.

which CMC considered an emergency. DLSMC cannot be considered an employer of the respondent doctors. Dr. regardless of whether the physician is an independent contractor.R. The elements of the action have been set out as follows: "For a hospital to be liable under the doctrine of apparent authority. Dr. Estrada to use its facilities when Corazon was about to give birth.Issue: WON there was an employee-employer relationship that existed between the Medical Center and Drs. The hospital cannot dismiss the consultant but he may lose his privileges granted by the hospital. an exception to this principle. or should have known. the hiring. While consultants are not technically employees. Dr Estrada noted an increase of her blood pressure and development of leg edema indicating preeclampsia which is a dangerous complication of pregnancy. the control exercised. who attended to Corazon. Court had the occasion to determine the relationship between a hospital and a consultant or visiting physician and the liability of such hospital for that physician's negligence: While "consultants" are not. unless the patient knows. Villaflor. a point which respondent hospital asserts in denying all responsibility for the patient's condition. .. and (4) the power to control not only the end to be achieved. Accordingly. (2) payment of wages. the control exercised. There is. we rule that for the purpose of allocating responsibility in medical negligence cases. Estrada at his home. At the time of Corazon's admission at CMC and during her delivery. The control test is determining. Sycamore Municipal Hospital. After examining Corazon. Corazon died after giving birth to the child. Estrada advised her immediate admission to the Capitol Medical Center. While on her last trimester of pregnancy. Considering these circumstances. In assessing whether such a relationship in fact exists. such fact alone did not make him an employee of CMC. Petitioners charged CMC with negligence in the selection and supervision of defendant physicians and hospital staff. but an independent contractor. the Illinois Supreme Court explained the doctrine of apparent authority in this wise: Under the doctrine of apparent authority a hospital can be held vicariously liable for the negligent acts of a physician providing care at the hospital. the control test is determining. Corazon started to experience mild labor pains prompting Spouses Nogales to see Dr. Estrada? Held: CMC is vicariously liable. assisted by Dr. The hospital’s obligation is limited to providing the patient with the preferred room accommodation and other things that will ensure that the doctor’s orders are carried out. the plaintiff must also prove that the hospital had knowledge of and acquiesced in them. It is undisputed that throughout Corazon's pregnancy. and the right to terminate consultants all fulfill the important hallmarks of an employer-employee relationship. Nogales et al. Petitioners mainly contended that defendant physicians and CMC personnel were negligent in the treatment and management of Corazon's condition. with the exception of the payment of wages. Hosaka and Guiterrez. The hospital may be liable if the physician is the "ostensible" agent of the hospital. Private Hospitals hire. the following elements must be present: (1) selection and engagement of services. The hospital does not hire consultants but it accredits and grants him the privilege of maintaining a clinic and/or admitting patients. which prompted the petitioners to file a complaint for damages against CMC. (2) where the acts of the agent create the appearance of authority. There was no showing that CMC had a part in diagnosing Corazon's condition. Dr. but the means to be used in reaching such an end. Held: No employer-employee between the doctors and hospital. While Dr. an employer-employee relationship in effect exists between hospitals and their attending and visiting physicians. however. the hiring and the right to terminate consultants fulfill the hallmarks of an employer-employee relationship with the exception of payment of wages. and Facts: Corazon was under the exclusive care of Dr Oscar Estrada beginning the fourth month of her pregnancy. In general. it was Dr. the Court finds no single evidence pointing to CMC's exercise of control over Dr. 142625 In Ramos v. technically employees. vs Capitol Medical Center (2006) G. CMC merely allowed Dr. Eventually. This exception is also known as the "doctrine of apparent authority. Court of Appeals. or its agent. such test essentially determines whether an employment relationship exists between a physician and a hospital based on the exercise of control over the physician as to details." In Gilbert v. a plaintiff must show that: (1) the hospital. a hospital is not liable for the negligence of an independent contractorphysician. that the physician is an independent contractor. she was under the exclusive prenatal care of Dr. (3) the power to hire and fire. Estrada and other physicians and a certain nurse for Corazon’s death. The court finds that there is no employer-employee relationship between the doctors and the hospital. It is the patient who pays the consultants. the employer (or the hospital) must have the right to control both the means and the details of the process by which the employee (or the physician) is to accomplish his task In the present case. Issue: WON CMC is vicariously liable for the negligence of Dr. Specifically. fire and exercise real control over their attending and visiting consultant staff. Estrada. It has been consistently held that in determining whether an employer-employee relationship exists between the parties. In applying the four fold test. Estrada is not an employee of CMC. on the basis of the foregoing. acted in a manner that would lead a reasonable person to conclude that the individual who was alleged to be negligent was an employee or agent of the hospital. Estrada enjoyed staff privileges at CMC. Estrada. Around midnight of 25 May 1976. Estrada's treatment and management of Corazon's condition. While the Court in Ramos did not expound on the control test.

ISSUE: Whether or not petitioner. Case Digest EMPERMACO B. There was no specific office hours he was required to observe.(3) the plaintiff acted in reliance upon the conduct of the hospital or its agent. respondents countered that petitioner was not its employee but a freelance salesman on commission basis. He pursued his selling without interference or supervision from the company. When a person needing urgent medical attention rushes to a hospital. JR. the release forms of CMC cannot relieve CMC from liability for the negligent medical treatment of Corazon. . but more importantly because of Dr. Later on. often required Abante to report to a particular area and occasionally required him to go to Manila to attend conferences. the hospital need not make express representations to the patient that the treating physician is an employee of the hospital. (2) the payment of wages. The records show that the Spouses Nogales relied upon a perceived employment relationship with CMC in accepting Dr. Moreover. he cannot bargain on equal footing with the hospital on the terms of admission and operation. Thus. Estrada's services as the obstetrician-gynecologist for Corazon's delivery. The doctrine of apparent authority essentially involves two factors to determine the liability of an independent-contractor physician. there is no showing that before and during Corazon's confinement at CMC. the element is satisfied if the hospital holds itself out as a provider of emergency room care without informing the patient that the care is provided by independent contractors. Moreover. President. Petitioner filed a complaint for illegal dismissal with money claims against respondent company and its president." In other words. as a commission salesman. and (4) the presence or absence of the power of control. HELD: To determine the existence of an employee-employer relationship. Even simple negligence is not subject to blanket release in favor of establishments like hospitals but may only mitigate liability depending on the circumstances. the [CMC]. Estrada's relationship with CMC played a significant role in the Spouses Nogales' decision in accepting Dr. He was not designated to conduct services at a particular area or time. CMC cannot now repudiate such authority. we apply the four fold test: 1) the manner of selection and engagement. The first factor focuses on the hospital's manifestations and is sometimes described as an inquiry whether the hospital acted in a manner which would lead a reasonable person to conclude that the individual who was alleged to be negligent was an employee or agent of the hospital. Later petitioner found out that respondent had informed his customers not to deal with petitioner since it no longer recognized him as a commission salesman. Aside from selling. 159890 May 28. Jose Lamadrid. he was also tasked with collection. respondents. CMC impliedly held out Dr. rather a representation may be general and implied. as earlier stated. Rather. While he was sometimes required to report to Manila. consistent with ordinary care and prudence. Estrada as a member of its medical staff. By way of defense. Respondent corporation through its president. Through CMC's acts. consistent with ordinary care and prudence. In the instant case. Such a person is literally at the mercy of the hospital. an employer-employee relationship is notably absent in this case. In this regard.R. bad blood ensued between the parties due to some bad accounts that Lamadrid forced petitioner to cover. [G. Estrada's services. There can be no clearer example of a contract of adhesion than one arising from such a dire situation. and JOSE LAMADRID." The element of "holding out" on the part of the hospital does not require an express representation by the hospital that the person alleged to be negligent is an employee. petitioner was free to offer his services to other companies. ABANTE. Rogelio testified that he and his wife specifically chose Dr. Estrada was not an employee of CMC. is an employee of respondent corporation. The second factor focuses on the patient's reliance. 2004] FACTS: Petitioner was a salesman of respondent company earning a commission of 3% of the total paid up sales covering the whole area of Mindanao. these were only intended to guide him. Estrada to handle Corazon's delivery not only because of their friend's recommendation. ABANTE vs LAMADRID BEARING & PARTS CO. LAMADRID BEARING & PARTS CORP.. Estrada's "connection with a reputable hospital. the Spouses Nogales knew or should have known that Dr. Estrada was an employee or agent of CMC. CMC clothed Dr. It is true that he was paid in commission yet no quota was imposed therefore a dismal performance would not warrant a ground for dismissal. Estrada with apparent authority thereby leading the Spouses Nogales to believe that Dr. The company did not prescribe the manner of selling merchandise. (3) the presence or absence of the power of dismissal. It is sometimes characterized as an inquiry on whether the plaintiff acted in reliance upon the conduct of the hospital or its agent. petitioner. Applying the aforementioned test. Dr. vs. No.

as well as pre. (b) The payment of wages . the more likely the worker is considered an independent contractor. How SONZA delivered his lines. ABS-CBN could not dictate the contents of SONZA’s script.The control test is the most important test. Medicare. the notice of rescission of Agreement was sent." Normally. thus. This test is based on the extent of control the hirer exercises over a worker.ABS-CBN engaged SONZA’s services to co-host its television and radio programs because of SONZA’s peculiar skills. The Agreement required SONZA to attend only rehearsals and tapings of the shows. Case law has consistently held that the elements of an employer-employee relationship are: (a) The selection and engagement of the employee . being an exclusive talent does not by itself mean that SONZA is an employee of ABS-CBN. and sounded on radio were outside ABS-CBN’s control.000 for the first year and P317. While the term commission under Article 96 of the LC was construed as being included in the term ―wage‖. 280 is not a crucial factor because it only determines two kinds of employees. the rules and standards of performance referred to in the Agreement are those applicable to talents and not to employees of ABS-CBN. travel allowance and amounts due under the Employees Stock Option Plan (ESOP) which was opposed by ABS-CBN on the ground there was no employer-employee relationship existed between the parties. The Agreement stipulates that SONZA shall abide with the rules and standards of performance "covering talents" of ABS-CBN. there is no categorical pronouncement that the payment of commission is conclusive proof of the existence of an employee-employer relationship. However.For violation of any provision of the Agreement. The converse holds true as well – the less control the hirer exercises. appeared on television. 13th month pay. but simply to protect the investment of the broadcast station. The broadcast station normally spends substantial amounts of money. It doen. of an independent contractual relationship. the Agreement prohibited SONZA from criticizing in his shows ABS-CBN or its interests. SONZA only needed his skills and talent. All the talent fees and benefits paid to SONZA were the result of negotiations that led to the Agreement. talent and celebrity status not possessed by ordinary employees. there would be no need for the parties to stipulate on benefits such as "SSS." Even if it suffered severe business losses. ABS-CBN engaged SONZA’s services specifically to co-host the "Mel & Jay" programs. talent and celebrity status. The clear implication is that SONZA had a free hand on what to say or discuss in his shows provided he did not attack ABS-CBN or its interests. not to employees of radio and television stations. ABS-CBN did not assign any other work to SONZA. Issue: WON Sonza was an employee or independent contractor? Held: There was no employer-employee relationship that existed. Sonza vs ABS-CBN (2004) G. Even an independent contractor can validly provide his services exclusively to the hiring party. time and effort "in building up its talents as well as the programs they appear in and thus expects that said talents remain exclusive with the station for a commensurate period of time. SONZA did not have to render eight hours of work per day. On April 1996.and post-production staff meetings. First. If SONZA were ABS-CBN’s employee. At the end of the same month. (c) The power of dismissal . 138051 Facts: In May 1994. The greater the supervision and control the hirer exercises. signing bonus. The hiring of exclusive talents is a widespread and accepted practice in the entertainment industry. In short. The code of conduct imposed on SONZA under the Agreement refers to the "Television and Radio Code of the Kapisanan ng mga Broadcaster sa Pilipinas (KBP). ABS-CBN agreed to pay SONZA’s talent fees as long as "AGENT and Jay Sonza shall faithfully and completely perform each condition of this Agreement. The specific selection and hiring of SONZA. a much higher fee is paid to talents who agree to work exclusively for a particular radio or television station." The KBP code applies to broadcasters. exclusivity is not necessarily the same as control. The decision of the CA is affirmed. ABS-CBN agreed to pay for SONZA’s services a monthly talent fee of P310. Broadcasters are not necessarily employees of radio and television stations.000 for the second and third year of the Agreement. ABS-CBN signed an agreement with Mel & Jay Management and Development Corp for a radio and television program. because of his unique skills.Art. During the life of the Agreement. Lastly. In the broadcast industry. service incentive leave pay. ABS-CBN could not retrench SONZA because ABS-CBN remained obligated to pay SONZA’s talent fees during the life of the Agreement.R. the more likely the worker is deemed an employee. x x x and 13th month pay" which the law automatically incorporates into every employer-employee contract. ABS-CBN would pay the talent fees on the 10th and 25th days of the month. Sonza wrote a letter to ABS-CBN President Eugenio Lopez III about a recent event concerning his programs and career. but that of an independent contractor. . separation pay. This practice is not designed to control the means and methods of work of the talent. To perform his work.t apply where there is no employer-employee relationship. The Agreement does not require SONZA to comply with the rules and standards of performance prescribed for employees of ABS-CBN. Second. either party may terminate their relationship. is a circumstance indicative. (d) The employer’s power to control the employee on the means and methods by which the work is accomplished . Sonza filed a complaint against ABS-CBN before the DOLE for non-payment of salaries. which has been adopted by the COMPANY (ABS-CBN) as its Code of Ethics. but not conclusive. the huge talent fees partially compensates for exclusivity.ABS-CBN directly paid SONZA his monthly talent fees with no part of his fees going to MJMDC. and that the said violation of the company has breached the agreement. Clearly.

Underpayment of Overtime Pay. and in some cases the length of time of its performance and its continued existence. Deiparine. and (2) those casual employees who have rendered at least one year of service. They were issued ABS-CBN employees’ identification cards and were required to work for a minimum of eight hours a day. and that they were permitted to join other productions during their free time are not conclusive of the nature of their employment. 1996 to Dec 11. Issue: WON the respondents are regular employees? The employer-employee relationship between petitioner and respondents has been proven by the ff: Held: Respondents are considered regular employees of ABS-CBN and are entitled to the benefits granted to all regular employees. since petitioner refused to recognize PAs as part of the bargaining unit. the employment is considered regular as long as the activity exists. is deemed regular with respect to the activity performed and while such activity actually exists. The fact that respondents received pre-agreed ―talent fees‖ instead of salaries. etc. There are two kinds of regular employees under the law: (1) those engaged to perform activities which are necessary or desirable in the usual business or trade of the employer. Premium Pay. anchor program interview. 1999. Article 280 of the Labor Code provides: REGULAR AND CASUAL EMPLOYMENT. Gerzon. d) Facilitate.ABS-CBN vs Nazareno (2006) G. respondents filed a Complaint for Recognition of Regular Employment Status. whether continuous or broken. log clerical reports. Service Incentive Pay. or where the work is continuous or intermittent. On Oct 12. prepare schedule of reporters for scheduled news reporting and lead-in or incoming reports. that they did not observe the required office hours. arrange airing of commercial broadcasting based on the daily operations log and digicart of respondent ABS-CBN. 2000.000. regardless of the nature of the activity performed. prepare and arrange airtime schedule for public service announcement and complaints. and that the DYAB studio operations would be handled by the studio technician.R. man based control radio. Facts: ABS-CBN employed respondents Nazareno. They were assigned at the news and public affairs. and Lerasan as production assistants (PAs) on different dates. and f) Record. However. e) Assist. Petitioner and the ABS-CBN Rank-and-File Employees executed a Collective Bargaining Agreement (CBA) to be effective during the period from Dec 11. Any employee who has rendered at least one year of service. Due to a memorandum assigning PA’s to non-drama programs. . What determines whether a certain employment is regular or otherwise is the character of the activities performed in relation to the particular trade or business taking into account all the circumstances. with respect to the activities in which they are employed. arrange personalities for air interviews. b) Coordinate. They are regular employees who perform several different duties under the control and direction of ABS-CBN executives and supervisors.—The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties. Sick Leave Pay. and 13th Month Pay with Damages against the petitioner before the NLRC. c) Coordinate. an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. for various radio programs in the Cebu Broadcasting Station. There was a revision of the schedule and assignments and that respondent Gerzon was assigned as the fulltime PA of the TV News Department reporting directly to Leo Lastimosa. with a monthly compensation of P4. respondents were not included to the CBA. including Sundays and holidays. They were made to: a) Prepare. whether continuous or intermittent. Holiday Pay. The reason being that a customary appointment is not indispensable before one may be formally declared as having attained regular status. 164156 Where a person has rendered at least one year of service.

judgment or foresight required for the success of the claimed independent enterprise. courts have relied on the so-called right of control test 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. Third. In 1996. She was also designated as Liason Officer to the City of Manila to secure permits for the operation of the company. Court of Appeals. the court observed the need to consider the existing economic conditions prevailing between the parties. There can be no other conclusion that petitioner is an employee of respondent Kasei Corporation. a circumstance negating independent contractual relationship. Francisco vs NLRC (2006) 500 SCRA 690 Facts: Petitoner was hired by Kasei Corporation during the incorporation stage. She was assigned to handle recruitment of all employees and perform management administration functions. Respondents did not have the power to bargain for huge talent fees. and is economically dependent upon respondent for her continued employment in that line of business. (6) the permanency and duration of the relationship between the worker and the employer. there is no doubt that petitioner is an employee of Kasei Corporation because she was under the direct control and supervision of Seiji Kamura. there has been no uniform test to determine the existence of an employer-employee relation. (3) the nature and degree of control exercised by the employer. Thus. NLRC affirmed the decision while CA reversed it. Second. The proper standard of economic dependence is whether the worker is dependent on the alleged employer for his continued employment in that line of business. in addition to the standard of right-of-control like the inclusion of the employee in the payrolls. She asked for her salary but was informed that she was no longer connected to the company. The so-called ―talent fees‖ of respondents correspond to wages given as a result of an employer-employee relationship. Petitioner could always discharge respondents should it find their work unsatisfactory. to give a clearer picture in determining the existence of an employer-employee relationship based on an analysis of the totality of economic circumstances of the worker.First. does not furnish an independent business or professional service. such work is a regular employment of such employee and not an independent contractor. In Sevilla v. Respondent Corporation had the power to control petitioner with the means and methods by which the work is to be accomplished. More importantly. The Labor Arbiter found that the petitioner was illegally dismissed. like the inclusion of the employee in the payrolls. relative to the employer. She filed an action for constructive dismissal with the Labor Arbiter.500 per month which was until September. (5) the amount of initiative. In 2001. Kasei Corporation reduced her salary to P2. the corporation’s Technical Consultant. no peculiar or unique skill. The presumption is that when the work done is an integral part of the regular business of the employer and when the worker. Her main job function involved accounting and tax services rendered to Respondent Corporation on a regular basis over an indefinite period of engagement. (4) the worker’s opportunity for profit and loss. The court held that in this jurisdiction. the existing economic conditions prevailing between the parties. she was replaced by Liza Fuentes as Manager. She was designated as accountant and corporate secretary and was assigned to handle all the accounting needs of the company. Petitioner was designated as Acting Manager. The better approach would therefore be to adopt a two-tiered test involving: (1) the putative employer’s power to control the employee with respect to the means and methods by which the work is to be accomplished. skill. She did not anymore report to work since she was not paid for her salary. By applying the control test. . can help in determining the existence of an employer-employee relationship. the determination of the relationship between employer and employee depends upon the circumstances of the whole economic activity. (2) the extent of the worker’s investment in equipment and facilities. and (7) the degree of dependency of the worker upon the employer for his continued employment in that line of business. Generally. The degree of control and supervision exercised by petitioner over respondents through its supervisors negates the allegation that respondents are independent contractors. and respondents are highly dependent on the petitioner for continued work. She was selected and engaged by the company for compensation. with the power to dismiss her for cause. and (2) the underlying economic realities of the activity or relationship. Fourth. Respondent Corporation hired and engaged petitioner for compensation. Held: Petitioner is an employee of Kasei Corporation. Issue: WON there was an employer-employee relationship. such as: (1) the extent to which the services performed are an integral part of the employer’s business. talent or celebrity status was required from them because they were merely hired through petitioner’s personnel department just like any ordinary employee. In addition to the standard of right-of-control. In the selection and engagement of respondents. It is therefore apparent that petitioner is economically dependent on respondent corporation for her continued employment in the latter’s line of business.

in accordance with the National Internal Revenue Code. It should also be emphasized that the SSC.R. The SSC examined the cash vouchers issued by Royal Star to Laudato. petitioner. and Certificates of Appreciation issued by Royal Star to Laudato in recognition of her unselfish and loyal efforts in promoting the company.R. Lazaro also maintained that Laudato was not subjected to definite hours and conditions of work.   A piece of documentary evidence appreciated by the SSC is Memorandum dated 3 May 1980 of Teresita Lazaro. found that Laudato was a sales supervisor and not a mere agent. HELD Applying the four fold test. 138254 Facts: Rosalina Laudato filed a petition before the SSC for social security coverage and remittance of unpaid monthly social security contributions against her three (3) employers. not only as to the result of the work done. Lazaro denied that Laudato was a sales supervisor of Royal Star. June 7. whether the employer controls or has reserved the right to control the employee. he never was included in its payroll. Among them was Angelito Lazaro. the element of control s absent. she could not be deemed an employee of Royal Star. Issue: WON Laudato is considered employee of Royal Star Marketing? Held: Laudato is an employee of Royal Star and as such is entitled to the coverage of Social Security Law. respondent. was never deducted any contribution for remittance to the Social Security System (SSS). The relevant factor remains. Judico. the records are replete with evidence showing that respondent had to bill petitioner for his monthly professional fees. As such. directing that no commissions were to be given on all ―main office‖ sales from walk-in customers and enjoining salesmen and sales supervisors to observe this new policy. In Grepalife v. Laudato alleged that despite her employment as sales supervisor of the sales agents for Royal Star from April of 1979 to March of 1986. RICARDO DE VERA.Lazaro vs Social Security Commission (2004) G. Later. There are several indicators apart from the fact that the power to terminate the arrangement lay on both parties:  from the time he started to work with petitioner. ISSUE Whether or not de Vera is an employee of PhilComm or an independent contractor. De Vera was informed y petitioner that the retainership will be discontinued. . despite the fact that the compensation that the agents on commission received was not paid by the company but by the investor or the person insured. matters which are simply inconsistent with an employer-employee relationship. FACTS De Vera and petitioner company entered into a contract where respondent was to attend to the medical needs of petitioner’s employees while being paid a retainer fee of P4. Lazaro had failed during the said period. he was subjected by petitioner to the ten (10%) percent withholding tax for his professional fee. the Court upheld the existence of an employer-employee relationship between the insurance company and its agents. 2005] PHILIPPINE GLOBAL COMMUNICATIONS. to report her to the SSC for compulsory coverage or remit Laudato’s social security contributions. the determination of employer-employee relationship warrants the application of the “control test. de Vera is not an employee. [G. No. It simply runs against the grain of common experience to imagine that an ordinary employee has yet to bill his employer to receive his salary. proprietor of Royal Star.. The Memorandum evinces the fact that Royal Star exercised control over its sales supervisors or agents such as Laudato as to the means and methods through which these personnel performed their work. averring instead that she was a mere sales agent whom he paid purely on commission basis. as stated earlier. It is an accepted doctrine that for the purposes of coverage under the Social Security Act. As such. 157214. Laudato oversaw and supervised the sales agents of the company. INC. General Manager of Royal Star. Respondent filed a case for illegal dismissal. The fact that Laudato was paid by way of commission does not preclude the establishment of an employer-employee relationship. Finally. 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. calling cards of Royal Star denominating Laudato as a ―Sales Supervisor‖ of the company. Petition granted. and thus was subject to the control of management as to how she implements its policies and its end results. but also as to the means and methods by which the same is accomplished. also as upheld by the Court of Appeals. which is engaged in the business of selling home appliances.” that is.000 per month. vs. The finding of the SSC that Laudato was an employee of Royal Star is supported by substantial evidence.

but it denied that respondents were its regular employees. Alejo. Petitioner surmised that Eutiquio resented the January 10. complainant maintains his own private clinic attending to his private practice in the city. how to immunize. More often than not. Climaco? Held: No employer-employee relationship exists between the parties. It added that since Eutiquio Antonio had refused a job order of office tables. he is not at all further required to just sit around in the premises and wait for an emergency to occur so as to enable him from using such hours for his own benefit and advantage. where he services his patients. Allegedly. In fact. by virtue of a Retainer Agreement for a period of 1 year with a monthly salary of Three Thousand Eight Hundred (P3. Jay as carpenter from 1993-1999. The last one expired on December 31. and Roberto Fabian filed a complaint for illegal lay-off and illegal deductions before the NLRC’s Regional Arbitration Branch No. since they were project employees only. Willie Sy. Instead. vs. which began on January 1." considered to be the most important element. Sy wrote a letter to the Personnel Officer of Coca-Cola Bottlers Phils. its independent contractors were paid by results and were responsible for the salaries of their own workers. Respondents. their prayer for reinstatement and full backwages. He likewise stated that respondent must receive all the benefits and privileges of an employee under Article 157 (b) of the Labor Code. Enrico E. affirmed it is a sole proprietorship registered in the name of Enrico Alejo and engaged in manufacturing office furniture. he wrote a letter addressed to Dr. Felicisimo Antonio. 2006] BIG AA MANUFACTURER.800.. Petitioner also denied that respondents were laid-off by Big AA Manufacturer. or the so-called "control test.m. to 5:00 p. petitioner Big AA Manufacturer. Issue: WON there exists an employer-employee relationship between Coca-Cola and Dr. Philippine College of Occupational Medicine. petitioner claimed that Eutiquio Antonio was one of its independent contractors who used the services of the other respondents. respondent continued to perform his functions as company doctor to Coca-Cola until he received a letter from petitioner company concluding their retainership agreement effective 30 days from receipt thereof. 2000 and sought separation pay from petitioner.and if it is an employee of respondent company who is attended to by him for special treatment that needs hospitalization or operation. Eutiquio was employed as carpenter-foreman from 1991-1999.. The Labor Arbiter and the NLRC correctly found that Coca-Cola lacked the power of control over the performance by respondent of his duties. The Retainer Agreement. It is precisely because the company lacks the power of control that the contract provides that respondent shall be directly responsible to the employee concerned and their dependents for any injury. this is subject to a special billing. having served the company continuously for four (4) years. No. Sr. does not tell respondent "how to conduct his physical examination. Inc. and Leonardo. or how to diagnose and treat his patients.Jay Antonio. III. Felicisimo as carpenter from 1994-1999. their contractual relationship ended. which contains the respondent’s objectives. 146881 Facts: Dr. also as carpenter from 1997-1999. Dr.R. Bacolod City. The respondents alleged that as regular employees. Petitioner. FELICISIMO ANTONIO. employees of Coca-Cola. . vs Dr. at petitioner’s premises using petitioner’s tools and equipment and they received P250 per day. (3) the power of dismissal. EUTIQUIO ANTONIO. 1993. an employee is required to stay in the employer’s workplace or proximately close thereto that he cannot utilize his time effectively and gainfully for his own purpose.m. in determining the existence of an employer-employee relationship. According to respondents. Complainant does not dispute the fact that outside of the two (2) hours that he is required to be at respondent company’s premises. [G. harm or damage caused through professional negligence. as co-respondent in their complaint..Coca-Cola Bottlers Phils. First. The Labor Arbiter reasoned that the Comprehensive Medical Plan. stating that respondent should be considered as a regular part-time physician. 1988. On the other hand.. in each case. Respondents Eutiquio Antonio. they were dismissed without just cause and due process. Despite the non-renewal of the Retainer Agreement. According to petitioner. was renewed annually. duties and obligations. they worked from 8:00 a. a relative of the petitioner’s owner. has invariably adhered to the four-fold test: (1) the selection and engagement of the employee.00). JAY ANTONIO. but did not control the means and methods by which respondent performed his assigned tasks. petitioner stated it allowed respondents to use its facilities to meet job orders. Dean Climaco is a medical doctor who was hired by petitioner Coca-Cola Bottlers Phils. They claimed that they were dismissed on January 11. there was no employer-employee relationship between petitioner and respondents." The Comprehensive Medical Plan. hence. They also impleaded one Hermie Alejo. Leonardo Antonio. However. Sr. In response. incompetence or other valid causes of action. provided guidelines merely to ensure that the end result was achieved. 2000 Implementing Guidelines it issued to improve efficiency and performance. the Acting President and Chairperson of the Committee on Membership. Climaco (2007) G. SR.R. The Court. (2) the payment of wages. and LEONARDO ANTONIO. Petitioner was already making inquiries regarding his status with the company. FACTS Petitioner is a sole proprietorship registered in the name of its proprietor. 160854 March 3. and (4) the power to control the employee’s conduct. bills them accordingly -.

and providing rules on machine maintenance.21Some specific exceptions include project or seasonal employment. all reflect control and supervision over respondents. True. it is constrained to agree with the unanimous ruling of the Court of Appeals. certain forms of employment require the performance of usual or desirable functions and exceed one year but do not necessarily result to regular employment under Article 280 of the Labor Code. Moreover. equipment. NLRC and Labor Arbiter that respondents are petitioner’s regular employees. Attesting to this is petitioner’s admission that it allowed respondents to use its facilities for the "proper implementation" of job orders. respondents cannot be considered project employees. overtime. as admitted by petitioner. Yet. HELD The SC held that considering the submission of the parties. penalties. Petitioner had neither shown that respondents were hired for a specific project the duration of which was determined at the time of their hiring nor identified the specific project or phase thereof for which respondents were hired.ISSUE Whether or not respondents are regular employees of petitioner Big AA. Respondents were employed for more than one year and their work as carpenters was necessary or desirable in petitioner’s usual trade or business of manufacturing office furniture. Petition is denied. machinery or work premises. the Implementing Guidelines regulating attendance. Under Article 280 of the Labor Code. requiring the carpentry division to join petitioner’s exercise program. providing petitioner’s right to fi re employees or "contractors". deadlines. Eutiquio is also under petitioner’s control and supervision.He works within petitioner’s premises using the latter’s tools and materials. . It also agreed that Eutiquio was not an independent contractor for he does not carry a distinct and independent business. in this case. and he does not possess substantial capital or investment in tools. the applicable test to determine whether an employment should be considered regular or non-regular is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer.