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G.R. No. 210565
28 JUNE 2016
petitioner respondent
Petition for review on certiorari of CA decision & resolution
Justice Mendoza
Petitioners were directly-hired employees of respondent as Route Helpers. After working for quite some time,

they were allegedly transferred as agency workers to several manpower agencies.

When DOLE conducted an inspection to determine if labor standards were being complied with, petitioners
were declared to be regular employees and that respondent is liable to pay. Petitioners were thereafter
dismissed on various dates, and their claims settled later.
However, the settlement did not include the issues on reinstatement and payment of CBA benefits. Hence,
petitioners filed a complaint for illegal dismissal. Respondent alleged that there was no ER-EE relationship
between them.
LA declared that petitioners were illegally dismissed, and ordered respondent to reinstate them and to pay full
backwages. NLRC affirmed the LA decision.
CA reversed & set aside NLRC decision. The appellate court held that the manpower agency is an independent
contractor that exercises control over the petitioners.

(1) Whether or not an ER-EE relationship exists between the petitioners and respondent.
(2) Whether the manpower agencies are labor-only contractors.


CA decision set aside.
The Court held that petitioners still enjoyed an ER-EE relationship with respondent since becoming employees of

manpower agencies. To determine whether an employment should be considered regular or casual, the
applicable test is the reasonable connection between the particular activity performed by the employee in
relation to the usual business or trade of the employer.
It has been established in jurisprudence that Route Helpers are regular employees of respondent. The repeated
rehiring of respondent workers and the continuing need for their services clearly attest to the necessity or
desirability of their services in the regular conduct of the business or trade of petitioner company.

Furthermore, it has already been established in jurisprudence that the manpower services were a labor-only
contractor since the work performed by the supplied employees were indispensable to the principal business
of respondent. In fact, the manpower agencies were found to not have substantial capital or investment or tool
to engage in job contracting.
Finally, the Court determined the existence of an ER-EE relationship between the parties since the contract of
service between the respondent and the manpower services showed that the former indeed exercised the
power of control over the complainants therein.