Biboso v.
Victoria’s Milling
GR # L-44360 | March 31, 1977
Petition: Petition for Certiorari on the decision of the OP
Petitioner: Regina S. Biboso, Nenita B. Biso, Fe Cubin, Magelende H. Demegilldo,
Emerita O. Panaligan, Nilda P. Tayo, Nelda Tormon, Arde M. Valenciano, Ma.
Linda E. Villa and the Vicmico Supervisory Employees Association (VICSEA)
Respondent: Victorias Milling Company, Inc. and the Office of the President of
the Philippines,
DOCTRINE
There is a safeguard as to the duration of employment being respected and to that
extent, tenure is secure. The moment, however, the period expired in accordance
with contracts freely entered into, they could no longer invoke the constitutional
protection.
FACTS
- Bibos et. al were employed by Victoria’s Milling as academic teachers in
its school (St. Mary Mazzarello).
- Biboso et. al were notified by the school Directress that they were not
going to be rehired for the school year 1973-74.
o The necessary report for such was filed by the school with the
Department of Labor, informing that the teacher’s services
were thus terminated
- Biboso et. al challenged such decision and were quite successful with the
Arbitrator, the former National Labor Relations Commission under
Presidential Decree No. 21, and the Secretary of Labor.
- Victoria’s Milling then appealed to the Office of the President
- OP: Presidential Executive Assistant Clave, dismissed the complaint of
Biboso et. al for reinstatement.
o The OP had examined and analyzed the various contracts.
o The complainants were hired as teachers of the school on a
year-to-year basis and that they reapplied before the expiration
of the contracts and/or signed new ones, as the case may be, if
the school decided to renew the same.
o They all signed identical contracts which provided for a definite
period of employment. The complainants were hired as
temporary and when required or until the contract is supposed
to terminate.
o The Labor Code recognizes the policy of the Bureau of Private
Schools settling the maximum probationary period for teachers
at three years.
o The Labor Code does not set the maximum probationary period
at six months. Under the Labor Code, the probationary period is
the period required to learn a skill, trade, occupation or
profession.
o It was likewise held that the allegation of unfair labor practice is
untenable.
- Hence, this petition.
ISSUE/S
1. W/N the provision of the assuring worker’s security of tenure is applicable to
those whose employment admittedly were on a basis.
RULING & RATIO
1. NO
o The Office of the President exercised its discretion but it cannot
be said that an abuse could rightfully be imputed.
o What is decisive is that petitioners were well aware that their
tenure was for a limited duration. Upon its termination, both
parties to the employment relationship were free to renew it or
to let it lapse.
o It was the decision of the company that it should cease. The
Office of the President could find nothing objectionable when it
determined that the will of the parties as to the limited
duration thereof should be respected.
o However, this is not to assert that the security of tenure
protection of the constitution does not apply to probationary
employees.
 The Labor code provides that "The termination of
employment of probationary employees and those
employed with a fixed period shall be subject to such
regulations as the Secretary of labor may prescribe to
prevent the circumvention of the right of the
employees to be secured in their employment as
provided herein
o Petitioners did not enjoy a permanent status but during such
period of employment, they could remain in their positions and
any circumvention of their rights is subject to inquiry and
correction by the Department of Labor.
o There was the safeguard as to the duration of their
employment being respected. To that extent, their tenure was
secure. The moment, however, the period expired in
 accordance with contracts freely entered into, they could no
longer invoke the constitutional protection.
o It would be a different matter of course had the failure to
renew the contracts of petitioners been justly attributable to
their joining petitioner labor union, Vicmico Supervisoyr
Employees Association. That would be a clear case of an unfair
labor practice.
DISPOSITION WHEREFORE, the petition for certiorari is dismissed.
CANADIAN OPPORTUNITIES UNLIMITED, INC., Petitioner, v. BART Q. DALANGIN,
JR., Respondent.
BRION, J.:
FACTS:
Dalangin was hired by the company in October 2001, as Immigration and Legal
Manager, with a monthly salary of P15,000.00. He was placed on probation for six
months. He was to report directly to the Chief Operations Officer, Annie
Llamanzares Abad. His tasks involved principally the review of the clients
applications for immigration to Canada to ensure that they are in accordance with
Canadian and Philippine laws.
Through a memorandum signed by Abad, the company terminated Dalangins
employment, declaring him "unfit" and "unqualified" to continue as Immigration
and Legal Manager. The following are the reasons for Dalangins termination:
Obstinacy and utter disregard of company policies, Lack of concern for the
company's interest despite having just been employed in the company, lack of
enthusiasm toward work, and lack of interest in fostering relationship with his co-
employees.
Labor Arbiter Eduardo G. Magno declared Dalangins dismissal illegal. On appeal,
the NLRC reversed the LA decision. Dalangin moved for reconsideration, but the
NLRC denied the motion, prompting him to go to the CA on a petition for certiorari
under Rule 65 of the Rules of Court.
In its decision, the CA reversed the NLRC ruling. As the labor arbiter did, the CA
found that the company failed to support, with substantial evidence, its claim that
Dalangin failed to meet the standards to qualify as a regular employee.
The CA denied the company's subsequent motion for reconsideration in its. Hence,
this appeal.
ISSUE: Whether or not Dalangin was validly dismissed
HELD:
Labor Law
In International Catholic Migration Commission v. NLRC, the Court explained that a
probationary employee, as understood under Article 281 of the Labor Code, is one
who is on trial by an employer, during which, the latter determines whether or not
he is qualified for permanent employment. A probationary appointment gives the
employer an opportunity to observe the fitness of a probationer while at work, and
to ascertain whether he would be a proper and efficient employee.
Dalangin was barely a month on the job when the company terminated his
employment. He was found wanting in qualities that would make him a "proper
and efficient" employee or, as the company put it, he was unfit and unqualified to
continue as its Immigration and Legal Manager.
The CA did not believe that the company could fully assess Dalangins performance
within a month. It viewed Dalangins dismissal as arbitrary, considering that the
company had very little time to determine his fitness for the job.
Contrary to the CAs conclusions, we find substantial evidence indicating that the
company was justified in terminating Dalangins employment, however brief it had
been. Time and again, we have emphasized that substantial evidence is such
relevant evidence as a reasonable mind might accept as adequate to support a
conclusion.
Dalangin overlooks the fact, wittingly or unwittingly, that he offered glimpses of his
own behavior and actuations during his four-week stay with the company; he
betrayed his negative attitude and regard for the company, his co-employees and
his work.
Dalangin admitted in compulsory arbitration that the proximate cause for his
dismissal was his refusal to attend the company's "Values Formation Seminar"
scheduled for October 27, 2001, a Saturday. He refused to attend the seminar after
he learned that it had no relation to his duties, as he claimed, and that he had to
leave at 2:00 p.m. because he wanted to be with his family in the province.
When Abad insisted that he attend the seminar to encourage his co-employees to
attend, he stood pat on not attending, arguing that marked differences exist
between their positions and duties, and insinuating that he did not want to join the
other employees. He also questioned the scheduled 2:00 p.m. seminars on
Saturdays as they were not supposed to be doing a company activity beyond 2:00
p.m.
The "Values Formation Seminar" incident is an eye-opener on the kind of person
and employee Dalangin was. The incident also reveals Dalangins lack of interest in
establishing good working relationship with his co-employees, especially the rank
and file; he did not want to join them because of his view that the seminar was not
relevant to his position and duties.
Additionally, very early in his employment, Dalangin exhibited negative working
habits, particularly with respect to the one hour lunch break policy of the company
and the observance of the companys working hours.
However, since the company failed to observe the required due process in
terminating probationary employees, Dalangin is entitled to nominal damages.
GRANTED
Buiser v. Leogardo, Jr.
GR No. L-63316 | 131 SCRA 151 | July 31, 1984
Petition: Petition for review on certiorari
Petitioner: ILUMINADA VER BUISER, MA. CECILIA RILLOACUÑA and MA.
MERCEDES P. INTENGAN
Respondent: HON. VICENTE LEOGARDO, JR., in his capacity as Deputy Minister of
the Ministry of Labor & Employment, and GENERAL TELEPHONE DIRECTORY, CO.,
DOCTRINE
Generally, the probationary period of employment is limited to six (6) months. The
exception to this general rule is when the parties to an employment contract may
agree otherwise, such as when the same is established by company policy or when
the same is required by the nature of work to be performed by the employee.
FACTS
- Buiser, Rilloacuna and Intengan were employed by General Telephone
Directory Co. as sales representative.
- Buiser et al. entered an “Employment Contract (on Probationary Status)”
with GT Directory.
- The employment contact states that:
o The company hereby employs the employee as telephone sales
representative on a probationary status for a period of
eighteen (18) months.
o During the probationary period of employment, the Employee
may be terminated at the pleasure of the company without the
necessity of giving notice of termination or the payment of
termination pay.
o It takes about eighteen (18) months before his worth as a
telephone sales representative can be fully evaluated
- GT Directory prescribed sales quotas to be accomplished by Buiser.
Failing to meet their respective sales quotas, Buiser et al. were dismissed
from the service. Thus, Buiser filed a complaint for illegal dismissal.
- Regional Director Ministry of Labor dismissed the complaint. Buiser
appealed to Deputy Minister Vicente Leogardo, Jr which affirmed the
decision of RD.
- Deputy Minister Leogardo ruled that the petitioners have not attained
permanent status since private respondent was justified in requiring a
longer period of probation, and that the termination of petitioners’
services was valid since the latter failed to meet their sales quotas.
Hence, this petition.
ISSUE/S
2. W/N the 18 months probationary status is allowed.
RULING & RATIO
1. YES
  General Rule: probationary period of employment is limited to six (6)
months.
 Exception:
o parties to an employment contract agreed otherwise,
o established by company policy
o required by the nature of work to be performed by the
employee.
 There is an exercise of managerial prerogatives in requiring a longer
period of probationary employment, especially where the employee
must learn a particular kind of work such as selling, or when the job
requires certain qualifications, skills, experience or training.
 Under the Labor Code, six (6) months is the general probationary period,
but the probationary period is the period needed to determine fitness for
the job. This period, for lack of a better measurement is deemed to be
the period needed to learn the job.
 Moreover, an eighteen-month probationary period is recognized by the
Labor Union GT Directory Co, which is Article V of the Collective
Bargaining Agreement.
DISPOSITION
WHEREFORE, the petition is DISMISSED for lack of merit.
MARIWASA MANUFACTURING v LEOGARDO (Narvasa, 1989)
QUICK FACTS: Dequila, a probationary utility worker of Mariwasa, agreed to have
his probationary period extended for another 3 months after the first 6 months, so
that he may have another chance to improve his performance and qualify as a
regular worker. After the extension, he was terminated.
FACTS: Joaquin A. Dequila (or Dequilla) was hired on probation by Mariwasa
Manufacturing, Inc. as a general utility worker on January 10, 1979. After 6 months,
he was informed that his work was unsatisfactory and had failed to meet the
required standards. To give him another chance, and with Dequila’s written
consent, Mariwasa extended Dequila’s probationary period for another three
months: from July 10 to October 9, 1979. Dequila’s performance, however, did not
improve and Mariwasa terminated his employment at the end of the extended
period. Dequila filed a complaint for illegal dismissal against Mariwasa and its VP
for Administration, Angel T. Dazo, and violation of Presidential Decrees Nos. 928
and 1389. DIRECTOR OF MINISTRY OF LABOR: Complaint is dismissed. Termination
is justified. Thus, Dequila appeals to the Minister of Labor. MINISTER OF LABOR:
Deputy Minister Vicente Leogardo, Jr. held that Dequila was already a regular
employee at the time of his dismissal, thus, he was illegally dismissed. (Initial order:
Reinstatement with full backwages. Later amended to direct payment of Dequila's
backwages from the date of his dismissal to December 20, 1982 only.)
ISSUE: WON employer and employee may, by agreement, extend the probationary
period of employment beyond the six months prescribed in Art. 282 of the Labor
Code?
RULING: YES, agreements stipulating longer probationary periods may constitute
lawful exceptions to the statutory prescription limiting such periods to six months.
The SC in its decision in Buiser vs. Leogardo, Jr. (1984) said that “Generally, the
probationary period of employment is limited to six (6) months. The exception to
this general rule is when the parties to an employment contract may agree
otherwise, such as when the same is established by company policy or when the
same is required by the nature of work to be performed by the employee. In the
latter case, there is recognition of the exercise of managerial prerogatives in
requiring a longer period of probationary employment, such as in the present case
where the probationary period was set for eighteen (18) months, i.e. from May,
1980 to October, 1981 inclusive, especially where the employee must learn a
particular kind of work such as selling, or when the job requires certain
qualifications, skills experience or training.” In this case, the extension given to
Dequila could not have been pre-arranged to avoid the legal consequences of a
probationary period satisfactorily completed. In fact, it was ex gratia, an act of
liberality on the part of his employer affording him a second chance to make good
after having initially failed to prove his worth as an employee. Such an act cannot
now unjustly be turned against said employer's account to compel it to keep on its
payroll one who could not perform according to its work standards. By voluntarily
agreeing to an extension of the probationary period, Dequila in effect waived any
benefit attaching to the completion of said period if he still failed to make the
grade during the period of extension. By reasonably extending the period of
probation, the questioned agreement actually improved the probationary
employee's prospects of demonstrating his fitness for regular employment. Petition
granted. Order of Deputy Minister Leogardo reversed. Case for illegal dismissal is
dismissed.
HOLIDAY INN MANILA V. NLRC GR No. 109114 September 14, 1993Petitioners:
Holiday Inn Manila and/or Hubert Liner and Baby DisquitadoRespondents: NLRC
(2 nd Division) and Elena HonasanPonente: J. Cruz
Facts: On April 15, 1991, Elena Honasan was accepted for on-the-job training as a
telephone operator inHoliday Inn Manila for a period of three (3) weeks. On May
13, 1991, after the completion of her training,she was employed on a
"probationary basis" for a period of six (6) months ending on November 12,
1991.Her employment contract stipulated that the Hotel could terminate her
probationary employment at anytime prior to the expiration of the six-month
period in the event of her failure (a) to learn or progress in her job; (b) to faithfully
observe and comply with the hotel rules and the instructions and orders of
hersuperiors; or (c) to perform her duties according to hotel standards.On
November 8, 1991, Holiday Inn Manila notified her of her dismissal on the ground
that herperformance had not come up to the standards of the Hotel. Hence,
Honasan filed a complaint for illegaldismissal contending that she was already a
regular employee at the time of her separation. Therefore,she was entitled to full
security of tenure. The complaint was dismissed by the Labor Arbiter. On
appeal,the decision was reversed by the NLRC which held that Honasan had
become regular employee and socould not be dismissed as a probationer. NLRC
ordered Holiday Inn Manila to reinstate Honasan to herformer position without
loss of seniority rights and other privileges with backwages without deduction
andqualification.Hence, this petition.
Issue: Whether Elena Honasan was illegally dismissed.
Held: Yes. Elena Honasan was illegally dismissed. She was placed by the petitioner
on probation twice,to wit, (1) during her on-the-job training for three weeks and
(2) during another period of six months. The Hotel’s system of double probation
was a transparent scheme to circumvent the plain mandate of the law and make it
easier for it to dismiss its employees even after they shall have already passed
probation.The petitioners had ample time to terminate Honasan’s services during
her period of probation if they were deemed unsatisfactory.There is also no reason
why the three-week period of on-the-job training should not be includedin the
stipulated six-month period of probation. Since she was accepted on April 15, 1991,
she hadbecome a regular employee of Holiday Inn and acquired full security of
tenure as of October 15, 1991. Asa regular employee, she had acquired the
protection of Art. 279 of the Labor Code stating as follows:Art. 279. Security of
Tenure. In cases of regular employment, the employer shall not terminate
theservices of an employee except for a just cause or when authorized by this Title.
An employee who isunjustly dismissed from work shall be entitled to reinstatement
without loss of seniority rights and otherprivileges and to his full backwages,
inclusive of allowances, and to his other benefits or their monetaryequivalent
computed from the time his compensation was withheld from him up to the time
of his actualreinstatement.The policy of the Constitution is to give the utmost
protection to the working class whensubjected to such maneuvers as the one
attempted by the petitioners. The Supreme Court is fullycommitted to that policy
and has always been quick to rise in defense of the rights of labor.Wherefore, the
petition is DISMISSED, with costs against the petitioner.
SAMEER OVERSEAS PLACEMENT AGENCY v. NLRC, GR No. 132564, 1999-10-20
Facts:
In June 1993, respondent Priscila Endozo applied to petitioner Sameer Overseas
Employment Agency, a local recruitment placement agency, for overseas
employment in Taiwan as a domestic helper. As she was initially found to have a
"minimal spot" she was advised to rest for at... least two (2) months.
On April 6, 1994, petitioner told respondent Endozo that she would be finally
deployed to Taiwan and required her to pay the amount of P30,000.00, which she
did, but petitioner did not issue any receipt.
On April 8, 1994, respondent Endozo left for Taiwan. She was to be employed as a
housemaid of Sung Kui Mei with a monthly salary of NT$13,380.00 for a period of
one year.
However, she stayed in Taiwan only for eleven (11) days as her employer
terminated her services, and sent her home on April 19, 1994 for alleged
incompetence.
Immediately upon her return, she confronted petitioner agency and Rose Mahinay
of said agency told her that she was just unlucky and that she would be refunded
the amount of P50,000.00.
On June 20, 1995, private respondent filed with the Philippine Overseas
Employment Administration a complaint against petitioner for illegal dismissal,
payment of salary corresponding to the unexpired portion of her contract, illegal
exaction, violation of the Labor Code,... falsification of contract of employment,
attorney's fees and costs.
Meantime, on June 7, 1995, Congress enacted Republic Act No. 8042, vesting
jurisdiction over claims of overseas workers with the National Labor Relations
Commission (hereafter NLRC). Consequently, respondent's claim was transferred to
the National Labor Relations Commission,... Arbitration Branch, in San Pablo City.
Labor Arbiter Andres C. Zavalla rendered a decision finding that private respondent
was illegally dismissed and ordering petitioner to pay her salary corresponding to
the unexpired portion of her contract of employment of... eleven (11) months and
nineteen (19) days equivalent to NT$151,996.80, plus ten percent (10%) of the
award equivalent to NT$15,199.68 as attorney's fees.
Issues:
whether the employer in Taiwan could lawfully terminate private respondent's
employment as domestic helper for incompetence during the probationary period
of her employment.
Ruling:
We consider private respondent to have waived the filing of her comment and set
aside the resolution of February 1, 1999.
In this case, the employment contract was for a definite period of one (1) year,
with six (6) months probationary period. After only eleven days of work, the
employer dismissed private respondent without just cause.
In termination cases, the burden of proving just or valid cause for dismissing an
employee rests on the employer.[13] In this case, petitioner was not able to...
present convincing proof establishing respondent Endozo's alleged incompetence.
WHEREFORE, the Court hereby DISMISSES the petition and AFFIRMS the resolution
of the National Labor Relations Commission adopted on November 28, 1997, in
NLRC NCR CA No. 013114-97.
Principles:
It is an elementary rule in the law on labor relations that even a probationary
employee is entitled to security of tenure.[9] A probationary employee can not be
terminated, except for cause.
De Leon vs. NLRC
Facts:
Petitioner Moises de Leon was employed by private respondent La Tondeña Inc. at
the Maintenance Section of its Engineering Department. His work consisted mainly
of painting company building and equipment, and other odd jobs relating to
maintenance. He was paid on a daily basis through petty cash vouchers.
After a service of more than one (1) year, petitioner requested from respondent
that he be included in the payroll of regular workers, instead of being paid through
petty cash vouchers. Private respondent's response to this request was to dismiss
petitioner from his employment. Having been refused reinstatement despite
repeated demands, petitioner filed a complaint for illegal dismissal, reinstatement
and payment of back wages.
Private respondent claimed that petitioner was not a regular employee but only a
casual worker hired allegedly only to paint a certain building in the company
premises, and that his work as a painter terminated upon the completion of the
painting job.
Labor Arbiter Bienvenido ruled in favour of the petitioner
On appeal, however, the decision of the Labor Arbiter was reversed by the First
Division of the National Labor Relations Commission and the motion for
reconsideration was like wise denied.
Issue: Whether or not the petitioner was a regular employee.
Held:Yes.
… Court finds merit in the petition…
The law on the matter is Article 281 of the Labor Code which defines regular and
casual employment as follows:
Art. 281. Regular and casual employment. The provisions of a
written agreement to the contrary notwithstanding and
regardless of the oral agreements of the parties, 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.
An employment shall be deemed to be casual if it is not
covered by the preceding paragraph: Provided, That any
employee who has rendered at least one year of service,
whether such service is continuous or broken, shall be
considered a regular employee with respect to the activity in
which he is employed and his employment shall continue while
such actually exists.
The primary standard, therefore, of determining a regular employment is the
reasonable connection between the particular activity performed by the employee
in relation to the usual business or trade of the employer. The test is whether the
former is usually necessary or desirable in the usual business or trade of the
employer. The connection can be determined by considering the nature of the
work performed and its relation to the scheme of the particular business or trade
in its entirety. Also, if the employee has been performing the job for at least one
year, even if the performance is not continuous or merely intermittent, the law
deems the repeated and continuing need for its performance as sufficient evidence
of the necessity if not indispensability of that activity to the business. Hence, the
employment is also considered regular, but only with respect to such activity and
while such activity exists.
In the case at bar, the respondent company, which is engaged in the business of
manufacture and distillery of wines and liquors, claims that petitioner was
contracted on a casual basis specifically to paint a certain company building and
that its completion rendered petitioner's employment terminated. This may have
been true at the beginning, and had it been shown that petitioner's activity was
exclusively limited to painting that certain building, respondent company's theory
of casual employment would have been worthy of consideration.
However, during petitioner's period of employment, the records reveal that the
tasks assigned to him included not only painting of company buildings, equipment
and tools but also cleaning and oiling machines, even operating a drilling machine,
and other odd jobs assigned to him when he had no painting job. A regular
employee of respondent company, Emiliano Tanque Jr., attested in his affidavit
that petitioner worked with him as a maintenance man when there was no painting
job.
It is self-serving, to say the least, to isolate petitioner's painting job to justify the
proposition of casual employment and conveniently disregard the other
maintenance activities of petitioner which were assigned by the respondent
company when he was not painting. The law demands that the nature and entirety
of the activities performed by the employee be considered. In the case of
petitioner, the painting and maintenance work given him manifest a treatment
consistent with a maintenance man and not just a painter, for if his job was truly
only to paint a building there would have been no basis for giving him other work
assignments In between painting activities.
Furthermore, the petitioner performed his work of painting and maintenance
activities during his employment in respondent's business which lasted for more
than one year, until early January, 1983 when he demanded to be regularized and
was subsequently dismissed. Certainly, by this fact alone he is entitled by law to be
considered a regular employee.
It is of no moment that petitioner was told when he was hired that his employment
would only be casual, that he was paid through cash vouchers, and that he did not
comply with regular employment procedure. Precisely, the law overrides such
conditions which are prejudicial to the interest of the worker whose weak
bargaining position needs the support of the State. That determines whether a
certain employment is regular or casual is not the will and word of the employer, to
which the desperate worker often accedes, much less the procedure of hiring the
employee or the manner of paying his salary. It is the nature of the activities
performed in relation to the particular business or trades considering all
circumstances, and in some cases the length of time of its performance and its
continued existence.
Petition is GRANTED.
Singer Sewing Machine Co. vs. Drilon, et.al GR. No. 91307
FACTS: On February 15, 1989, the respondent union, collectors of Singer Sewing
Machine Company-Singer Machine Collectors Union-Baguio (SIMACUB), filed a
petition for direct certification as the sole and exclusive bargaining agent of all
collectors of Petitioner (“Company”). The Company opposed the petition mainly on
the ground that the union members are actually not employees but are
independent contractors as evidenced by the collection agency agreement which
they signed. Med-Arbiter, finding that there exists an employer-employee
relationship between the union members and the Company, granted the petition
for certification election. On appeal, Secretary of Labor Franklin M. Drilon affirmed
it. Petitioners contend that respondent Labor Secretary disregarded the well-
settled rule that commission agents are not employees but are independent
contractors; the public respondents patently erred in finding that there exists an
employer-employee relationship. The respondents, on the other hand, insist that
the provisions of the Collection Agency Agreement contradict the Company's
position that the union members are independent contractors. To prove that union
members are employees, it is asserted that they "perform the most desirable and
necessary activities for the continuous and effective operations of the business of
the petitioner Company" (citing Article 280 of the Labor Code). Petitioners quote
paragraph 2 of the Collective Agency Agreement which states that an agent shall
utilize only receipt forms authorized and issued by the Company. They also note
paragraph 3 which states that an agent has to submit and deliver at least once a
week or as often as required a report of all collections made using report forms
furnished by the Company. And that monthly collection quota required by the
Company is deemed by respondents as a control measure over the means by which
an agent is to perform his services.
ISSUE: WON private respondents are regular employees of the company on the
alleged ground that they are performing activities desirable or necessary to the
business.
HELD: No. The nature of the relationship between a company and its collecting
agents depends on the circumstances of each particular relationship. Not all
collecting agents are employees and neither are all collecting agents independent
contractors. The collectors could fall under either category depending on the facts
of each case. The Collecting Agency Agreement confirms the status of the collecting
agent in this case as an independent contractor not only because he is explicitly
described as such but also because the provisions permit him to perform collection
services for the company without being subject to the control of the latter except
only as to the result of his work. After a careful analysis of the contents of the
agreement, The Court rules in favor of the petitioner. Further, respondent
Secretary Drilon did not consider existing facts in his decision:
1. The collection agents are not required to observe office hours or report to
Singer's office everyday except, naturally and necessarily, for the purpose of
remitting their collections. 2. The collection agents do not have to devote their
time exclusively for SINGER. There is no prohibition on the part of the collection
agents from working elsewhere. Nor are these agents required to account for their
time and submit a record of their activity. 3. The manner and method of effecting
collections are left solely to the discretion of the collection agents without any
interference on the part of Singer. 4. The collection agents shoulder their
transportation expenses incurred in the collections of the accounts assigned to
them. 5. The collection agents are paid strictly on commission basis. The amounts
paid to them are based solely on the amounts of collection each of them make.
They do not receive any commission if they do not effect any collection even if they
put a lot of effort in collecting. They are paid commission on the basis of actual
collections. 6. The commissions earned by the collection agents are directly
deducted by them from the amount of collections they are able to effect. The net
amount is what is then remitted to Singer." (Rollo, pp. 7-8) The Court finds the
contention of the respondents that the union members are employees under
Article 280 of the Labor Code. The definition that regular employees are those who
perform activities which are desirable and necessary for the business of the
employer is not determinative in this case. Any agreement may provide that one
party shall render services for and in behalf of another for a consideration even
without being hired as an employee. This is precisely true in the case of an
independent contractorship as well in an agency agreement. The Court agrees with
the petitioner’s argument that Article 280 is not the yardstick for determining the
existence of an employment relationship because it merely distinguishes between
two kinds of employees, i.e. regular employees and casual employees, for purposes
of determining the right of an employee to certain benefits, to join or form a union,
or to security of tenure. Article 280 does not apply where the existence of an
employment relationship is in dispute.
Magsalin v. National Organization of Working Men Digest
Magsalin v. National Organization of Working Men
Facts:
1. The private respondents worked as sales route helpers for the petitioner (Coca
Cola) for 5 months and thereafter they were hired on a daily basis. According to the
petitioner, the respondents were merely hired as substitutes for regular helpers
when the latter were unavailable or due to shortage of manpower/high volume of
work. These workers would then wait every morning outside the gates and if hired,
they would be paid their wages at the end of the day.
2. The respondents asked the petitioner to make them regular but the latter
refused. Hence, 23 of these temporary workers filed a case for illegal dismissal.
Issue: W/N the respondents' work is deemed necessary and desirable in the usual
business or trade of the petitioner

RULING: Yes. The repeated hiring of the respondent workers and continuing need
of their daily services clearly attest to the necessity or desirability of their services
in the regular conduct of the business/trade of petitioner.

In determining whether employment is regular or not, the applicable test is the

reasonable connection between a particular activity performed in relation to the
usual business or trade of the employer. The nature of work must be viewed from
the perspective of the business in its entirety and not confined scope.