USA College of Law

TIRADOR 2-D is a good day

Case Name Royale Homes Marketing Corporation v. Fidel P. Alcantara
Topic Employer-Employee Relationship
Case No. | Date G.R. No. 195190 | July 28, 2014
Ponente DEL CASTILLO, J.
“Independent Contractors” are not employees of a company where such agreement was
Doctrine explicitly stated in their contract. Being subjected to rules and regulations of a company does
necessarily prove one’s employment as the same is not necessarily “control.”

RELEVANT FACTS
 1994: Royale Homes, a real estate company, appointed Fidel Alcantara as its Marketing Director.
o His work consisted of marketing the real estate inventories of Royale Homes.
 2003: Alcantara was appointed as Division 5 Vice-President for Sales, with the contract as follows:
o For 1 year from January 1, 2003 to December 31, 2003.
o He has to market the real estate inventories on an exclusive basis.
o He will solicit sales “at any time” and “by any manner”, subject to rules, regulations, and code of
ethics promulgated by the company.
o He will be paid in a commission of 0.5% for all option sales from January 1 by all his sales agents.
o Royale Homes has right to terminate agreement if Alcantara violates rules and policies.
o If agree, Alcantara to sign “their” agreement. He signed the agreement.
 October 2003: Alcantara decided to leave the company to join the brokerage company his wife started. His
leaving was signified in a management committee meeting and he was even thrown a despedida party.
 December 2003: Alcantara returned to Royale Homes with a claim of illegal dismissal.
 September 7, 2005: Labor Arbiter holds that Alcantara is an employee, awarding him P277,000.00.
 February 23, 2009: NLRC rules that Alcantara is NOT an employee.
 June 23, 2010: CA reverses NLRC’s decision. They rule that Alcantara IS an employee since he was subjected
to company rules and his dismissal was deemed illegal for lack of due process.
 Petition for Review on Certiorari filed by Royale Homes

ISSUE: W/N Alcantara is an employee of Royale Homes

RULING:
NO. Alcantara is not an employee because his service with Royale Homes did not satisfy the control test.

Applying the control test, Alcantara was not considered to have been under the ‘control’ of Royale Homes as he
was given freedom to achieve the ends required as well as the methods to be utilized. The presence of company
regulations such as pricing, mode of payment, and requirements of prospective buyer merely lay down the
conditions of a sale.

Invoking Insular Life v. NLRC, mere guidelines only promote the result but do not create an employer-employee
relationship. An employer-employee relationship addresses both the result and the means to achieve it.

RULING
GRANTED