O. SOCIAL SECURITY SYSTEM, petitioner, vs.

THE COURT OF APPEALS and CONCHITA AYALDE,

respondents. G.R. No. 100388. December 14, 2000

Jurisprudence:
The essential elements of an employer-employee relationship are: (a) the selection and
engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the
power of control with regard to the means and methods by which the work is to be accomplished,
with the power of control being the most determinative factor.
Facts:
Margarita Tana, widow of the late Ignacio Tana, Sr., became aware of the fact that her
husband's employer, Conchita Ayalde, never reported him for Social Security System (SSS)
coverage. Margarita filed a petition before the Social Security Commission and prayed that
Ayalde be ordered to pay the SSS premium contributions and that SSS should grant her the
funeral and pension benefits due her. The SSS, in a petition-in-intervention, revealed that Ayalde
was never registered as a member-employer of the SSS, and consequently, Tana, Sr. was never
registered as member-employee. Respondent Ayalde belied the allegation that Tana, Sr. was her
employee, admitting only that he was hired intermittently as an independent contractor to plow,
harrow, or burrow the plantation she owned and rented. After hearing both parties, the Social
Security Commission held that Tana, Sr. had been employed continuously from January 1961 to
March 1979 with a salary based on the minimum wage prevailing during his employment. Not
having reported the petitioner's husband for coverage with the SSS, respondent Conchita Ayalde
was made liable to pay damages equivalent to the death benefits and funeral expenses of Tana,
Sr. Not satisfied with the Commission's ruling, Ayalde appealed to the Court of Appeals. The
Court of Appeals rendered judgment in favor of Conchita Ayalde and dismissed the claim of
Margarita Tana. The SSS, as intervenor-appellee, filed a motion for reconsideration, but was
denied.
Issue:
Whether or not an agricultural laborer who was hired on "pakyaw" basis can be considered an
employee entitled to compulsory coverage and corresponding benefits under the Social Security
Law.
Held:
The Supreme Court reversed and set aside the decision of the Court of Appeals and the
resolution of the Social Security Commission was reinstated. There was no shred of evidence to
show that Tana was only a seasonal worker. All witnesses, including Ayalde, testi8ed that Tana
and his family resided in the plantation. The only logical explanation for this set up was that
Tana was working for most part of the year exclusively for Ayalde. A closer scrutiny of the
records revealed that while Ayalde may not have directly imposed on Tana the manner and
methods to follow in performing his tasks, she did exercise control through her overseer. Under
the circumstances, the relationship between Ayalde and Tana has more of the attributes of
employer-employee than that of an independent contractor hired to perform a specific project.