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OLONGAPO MAINTENANCE SERVICES VS

CHANTENGCO
Facts: OMSI is a corporation engaged in the business of
providing janitorial and maintenance services to various
clients, including government-owned and controlled
corporations. OMSI hired the respondents as janitors,
grass cutters, and degreasers, and assigned them at
the Ninoy Aquino International Airport (NAIA). On January
14, 1999, OMSI terminated respondents' employment.
Claiming termination without just cause and nonpayment of labor standard benefits, respondents filed a
complaint for illegal dismissal, underpayment of wages,
and non-payment of holiday and service incentive leave
pays, with prayer for payment of separation pay, against
OMSI.
OMSI denied the allegations in the complaint. It
averred that when Manila International Airport Authority
(MIAA) awarded to OMSI the service contracts for the
airport, OMSI hired respondents as janitors, cleaners, and
degreasers to do the services under the contracts. OMSI
informed the respondents that they were hired for the
MIAA project and their employments were coterminous
with the contracts. As project employees, they were not
dismissed from work but their employments ceased when
the MIAA contracts were not renewed upon their
expiration. The termination of respondents employment
cannot, thus, be considered illegal.
Issue: W/N respondents are project based or regular
employees.
HELD: Respondents are regular employees. The
principal test in determining whether an employee is a
project employee is whether:
1. He/she is assigned to carry out a specific project or
undertaking, the duration and scope of which are
specified at the time the employee is engaged in the
project, OR
2. Where the work or service to be performed is seasonal
in nature and the employment is for the duration of the
season.
A true project employee should be assigned to a
project which begins and ends at determined or
determinable times, and be informed thereof at the time of
hiring.
In the instant case, there is no proof that
respondents engagement as project employees has
been predetermined, as required by law. OMSI did not
provide evidence that respondents were informed that they
were to be assigned to a specific project or undertaking
at the time they were hired. The employment contracts
for the specific project signed by the respondents
were never presented. All that OMSI submitted are the
service contracts between OMSI and the MIAA. Clearly,
OMSI failed to establish their case by substantial
evidence.
In termination cases, the burden of proof rests on
the employer to show that the dismissal is for a just cause.
Thus, employers who hire project employees are

mandated to state and prove the actual basis for the


latter's dismissal. Unfortunately for OMSI, it failed to
discharge the burden. All that we have is OMSIs selfserving assertion that the respondents were hired as
project employees.

TONGKO VS. MANUFACTURERS LIFE INSURANCE


FACTS:
The contractual relationship between
Tongko and Manulife had two basic phases. The first
phase began on July 1, 1977, under a Career Agents
Agreement, which provided that the Agent is an
independent contractor and nothing contained herein shall
be construed or interpreted ascreating an employeremployee relationship between the Company and the
Agent. The second phase started in 1983 when Tongko
was named Unit Manager in Manulifes Sales Agency
Organization. In 1990, he became aBranch Manager. In
1996, Tongko became a Regional Sales Manager.
Tongkos gross earnings consisted of commissions,
persistency income, andmanagement overrides. Since the
beginning, Tongko consistently declared himself selfemployed in his income tax returns.
Under oath, he declared his gross business
income and deducted his business expenses to arrive at
his taxable business income. Respondent Renato Vergel
de Dios, sales manager, wrote Tongko a letter dated
November 6, 2001 on concerns that were brought up
during the Metro North Sales Managers Meeting,
expressing dissatisfaction of Tongkos performance in their
agent recruiting business, which resulted in some changes
on how Tongko would conduct his duties, including that
Tongko hire at his expense a competent assistant to
unload him of routine tasks, which he had been
complaining to be too taxing for him. On December 18,
2001, de Dios wrote Tongko another letter which served
as notice of termination of his Agency Agreement with the
company effective fifteen days from the date of the letter.
Tongko filed an illegal dismissal complaint with the
National Labor Relations Commission (NLRC), alleging
that despite the clear terms of the letter terminating his
Agency Agreement, that he was Manulifes employee
before he was illegally dismissed.
The labor arbiter decreed that no employeremployee relationship existed between the parties. The
NLRC reversed the labor arbiters decision on appeal; it
found the existence of an employer-employee relationship
and concluded thatTongko had been illegally dismissed.
The Court of Appeals found that the NLRC gravely abused
its discretion in its ruling and reverted to the labor arbiters
decision that no employer employee relationship existed
between Tongko and Manulife.
ISSUE: Is there an employer-employee relationship
between Tongko and Manulife?
HELD: NO. In the determination of whether an employeremployee relationship exists between 2 parties, this court
applies the four-fold test to determine the existence of the
elements of such relationship.
Jurisprudence is firmly settled that whenever the
existence of an employment relationship is in dispute, four
elements constitute the reliable yardstick: (a) the selection
and engagement of the employee; (b) the payment of
wages; (c) the power of dismissal; and (d) the employers
power to control the employees conduct.

It is the so-called control test which constitutes


the most important index of existence of the employeremployee relationship that is, whether the employer
controls or has reserved the right to control the employee
not only asto the result of the work to be done but also as
to the means and methods by which the same is to be
accomplished. Stated otherwise, an employer-employee
relationship exists where the person for whom the services
are performed reserves the right to control not only the end
to be achieved but also the means to be used in reaching
such end.
In the case at bar, the absence of evidence
showing Manulifes control over Tongkos contractual
duties points to the absence of any employeremployee relationship between Tongko and Manulife.
In the context of the established evidence, Tongko
remained an agent all along; although his subsequent
duties made him a lead agent with leadership role, he was
nevertheless only an agent whose basic contract yields no
evidence of means-and-manner control. Claimant clearly
failed to substantiate his claim of employment relationship
by the quantum of evidence the Labor Code requires.
Tongkos failure to comply with the guidelines of de Dios
letter, as a ground for termination of Tongkos agency, is a
matter that the labor tribunals cannot rule upon in the
absence
of
an
employer-employee
relationship.
Jurisdiction over the matter belongs to the courts applying
the laws of insurance, agency and contracts.
We REVERSE our Decision of November 7, 2008,
GRANT Manulifes motion for reconsideration and,
accordingly, DISMISS Tongkos petition.

OROZCO VS COURT OF APPEALS, PDI


FACTS: In March 1990, PDI engaged the services of
petitioner to write a weekly column for its Lifestyle section.
She religiously submitted her articles every week, except
for a six-month stint in New York City when she,
nonetheless, sent several articles through mail. She
received compensation of P250.00 later increased
to P300.00 for every column published.
On November 7, 1992, petitioners column
appeared in the PDI for the last time. Petitioner claims that
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her then editor, Ms. Lita T. Logarta, told her that
respondent Leticia Jimenez Magsanoc, PDI Editor in
Chief, wanted to stop publishing her column for no reason
at all and advised petitioner to talk to Magsanoc herself.
Petitioner narrates that when she talked to Magsanoc, the
latter informed her that it was PDI Chairperson Eugenia
Apostol who had asked to stop publication of her column,
but that in a telephone conversation with Apostol, the latter
said that Magsanoc informed her (Apostol) that the
Lifestyle section already had many columnists.
On the other hand, PDI claims that in June 1991,
Magsanoc met with the Lifestyle section editor to discuss
how to improve said section. They agreed to cut down the
number of columnists by keeping only those whose
columns were well-written, with regular feedback and
following. In their judgment, petitioners column failed to
improve, continued to be superficially and poorly written,
and failed to meet the high standards of the newspaper.
Hence, they decided to terminate petitioners column.
Aggrieved by the newspapers action, petitioner
filed a complaint for illegal dismissal, backwages, moral
and exemplary damages, and other money claims before
the NLRC.
The main issue we must resolve is whether petitioner
is an employee of PDI, and if the answer be in the
affirmative, whether she was illegally dismissed.
We rule for the respondents. It is true that petitioner herself
admitted that she "was not, and [had] never been
considered respondents employee because the terms of
works
were
arbitrarily
decided
upon
by
the
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respondent." However, the employment status of a
person is defined and prescribed by law and not by what
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the parties say it should be.
This Court has constantly adhered to the "four-fold test" to
determine whether there exists an employer-employee
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relationship between parties. The four elements of an
employment relationship are: (a) the selection and
engagement of the employee; (b) the payment of wages;
(c) the power of dismissal; and (d) the employers power to
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control the employees conduct.
Petitioner has not shown that PDI, acting through its
editors, dictated how she was to write or produce her
articles each week. Aside from the constraints presented
by the space allocation of her column, there were no

restraints on her creativity; petitioner was free to write her


column in the manner and style she was accustomed to
and to use whatever research method she deemed
suitable for her purpose. The apparent limitation that she
had to write only on subjects that befitted the Lifestyle
section did not translate to control, but was simply a logical
consequence of the fact that her column appeared in that
section and therefore had to cater to the preference of the
readers of that section.
The inevitable conclusion is that petitioner was not
respondent PDIs employee but an independent
contractor, engaged to do independent work.
Furthermore, respondent PDI did not supply petitioner with
the tools and instrumentalities she needed to perform her
work. Petitioner only needed her talent and skill to come
up with a column every week. As such, she had all the
tools she needed to perform her work.
Considering that respondent PDI was not petitioners
employer, it cannot be held guilty of illegal dismissal.
WHEREFORE, the foregoing premises considered, the
Petition is DISMISSED. The Decision and Resolution of
the Court of Appeals in CA-G.R. SP No. 50970 are
hereby AFFIRMED.

Bisig Manggagawa sa Tryco vs NLRC (2008) G.R.


151309
Facts:
Tryco and the petitioners signed separate Memoranda of
Agreement (MOA), providing for a compressed workweek
schedule to be implemented in the company effective May
20, 1996. The MOA was entered into pursuant to
Department of Labor and Employment Department Order
(D.O.) No. 21, Series of 1990, Guidelines on the
Implementation of Compressed Workweek. As provided in
the MOA, 8:00a.m. to 6:12p.m., from Monday to Friday,
shall be considered as the regular working hours, and no
overtime pay shall be due and payable to the employee for
work rendered during those hours. The MOA specifically
stated that the employee waives the right to overtime pay
for work rendered after 5p.m. until 6:12p.m. from Monday
to Friday considering that the compressed workweek
schedule is adopted in lieu of the regular workweek
schedule which also consists of 46 hours. However, should
an employee be permitted or required to work beyond
6:12p.m., such employee shall be entitled to overtime pay.
Tryco informed the Bureau of Working Conditions of the
Department of Labor and Employment of the
implementation of a compressed workweek in the
company. In January 1997, BMT and Tryco negotiated for
the renewal of their collective bargaining agreement (CBA)
but failed to arrive at a new agreement.
Issue: WON the MOA providing for compressed workweek
is unenforceable as it is contrary to law.
Held: The MOA is enforceable and binding against the
petitioner.
Where it is shown that the person making the waiver did
so voluntarily, with full understanding of what he was
doing, and the consideration for the quitclaim is credible
and reasonable, the transaction must be recognized as a
valid and binding undertaking. Notably, the MOA complied
with the following conditions set by the DOLE, under D.O.
No. 21, to protect the interest of the employees in the
implementation of a compressed workweek scheme:
1. The employees voluntarily agree to work more
than eight (8) hours a day the total in a week of
which shall not exceed their normal weekly hours
of work prior to adoption of the compressed
workweek arrangement.
2. There will not be any diminution whatsoever in the
weekly or monthly take-home pay and fringe
benefits of the employees.
3. If an employee is permitted or required to work in
excess of his normal weekly hours of work prior to
the adoption of the compressed workweek
scheme, all such excess hours shall be
considered overtime work and shall be
compensated in accordance with the provisions of
the Labor Code or applicable CBA.
4. Appropriate waivers with respect to overtime
premium pay for work performed in excess of eight
(8) hours a day may be devised by the parties to
the agreement.

5. The effectivity and implementation of the new


working time arrangement shall be by agreement
of the parties.
Considering that the MOA clearly states that the employee
waives the payment of overtime pay in exchange of a fiveday workweek, there is no room for interpretation and its
terms should be implemented as they are written.

Equipment Technical Services vs. CA


Facts: Petitioner Equipment Technical Services (ETS) is
engaged in the business of subcontracting plumbing
works, one of its clients is Uniwide Sales, Inc. (Uniwide).
Petitioner Joseph Dequito was the manager of ETS
although CA referred to him as ETS President. On
different occasions ETS hired the services of the private
respondents as pipe filters, plumbers or threaders. When
ETS experienced financial difficulties with Uniwide and
failed to pay for the plumbing work and they were only able
to pay 13th month pay equivalent to 2 weeks salary.
Respondents (Albino et. Al) unhappy with the said pay
filed a case before the NLRC. Another 2 cases was filed
for illegal dismissal and payment of money claims were
ETS refused to hire them for another project and the cases
were consolidated before the labor arbiter. Labor Arbiter
Cuyuca issued a decision that respondents were ETS
regular and not project employees and ETS was adjudged
liable for illegal dismissal and directed to pay respondent
their money claims plus 10% total award for attorneys
fees. ETS appeal and NLRC rendered a resolution
reversing labor arbiters decision about respondents status
of employments and upheld the validity of the monetary
award which included backwages. ETS elevated the case
to CA via petition for certiorari with the contention that
NLRC committed grave abuse of discretion in affirming
monetary reward in favor of respondents despite on its
findings that there was no illegal dismissal. CA rendered
judgment that NLRC resolutions are annulled and set
aside and ordering ETS to pay respondents holiday pay
and service incentive leave pay for the year of 1998 and
the balance on their 13th month pay for the year of 1999.
The case was remanded to Labor Arbiter for the
computation. Respondents filed a MR for the CAs
decision.
Issue: W/N respondents are project employees?

Held: No. Service of project employees is coterminus


(linked that both expire at the same time) with the project
and they may be terminated upon the end or completion of
that project or project phase for which they were hired.
Regular employees enjoy security of tenure and entitled to
hold on to their work or position until their services are
terminated by any of the modes recognized under the
labor code. The principal test for determined whether an
employee is a project employee assigned to carry out a
specific project or undertaking while a regular employee
defined in Art 280 of the Labor Code. CA find that not a
single contract of employment fixing the terms of
employment or duration of Uniwide project, or any other
project submitted by ETS to the Labor Arbiter which
contrary to its allegations that the respondents were
merely contractual employees. Records of payroll and
other documents such as contracts by ETS showing that
respondent were hired for specific projects was not
submitted. Also if respondents were project employees, a
report of termination of employment must be submitted by
ETS. ETS has failed to support their claim that respondent
are project employees. Respondent were initially hired as
project employees but their repeated rehiring to perform
necessary tasks to the usual trade or business of ETS
changed their legal situation to regular employees.
Security of tenure covers both regular and project
employees. The termination must be lawful cause and
must be done in a way which affords them proper notice
and hearing. The burden of proving that an employee had
been dismissed for a lawful cause under the Labor Code
lies with the employer.
Decision: Reinstating decision of Labor Arbiter Cuyuca is
Affirmed with modification that petitioners are joint and
severally ordered to reinstate private respondents with
backwages.