G.R. No.
155207 August 13, 2008 [R]espondent company exercised full and complete control over the means and method by
WILHELMINA S. OROZCO vs. CA
NACHURA, J.:
FACTS:
In March 1990, Philippine Daily Inquirer 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, petitioner’s column appeared in the PDI for the last time. Petitioner
claims that 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, petitioner’s 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 petitioner’s column.
Aggrieved by the newspaper’s action, petitioner filed a complaint for illegal dismissal,
backwages, moral and exemplary damages, and other money claims before the NLRC.
The Labor Arbiter found that:
which complainant’s work – that of a regular columnist – had to be accomplished. Rather,
this control is manifested and certained in respondents’ admitted prerogative to reject any
article submitted by complainant for publication. By virtue of this power, complainant was
helplessly constrained to adopt her subjects and style of writing to suit the editorial taste of
her editor. Lastly, the fact that her articles were published weekly for three (3) years show
that she was respondent’s regular employee, not a once-in-a-blue-moon contributor who
was not under any pressure or obligation to produce regular articles and who wrote at his
own whim and leisure.
Labor Arbiter Arthur Amansec rendered a Decision in favor of petitioner, in finding
complainant to be an employee of respondent company; ordering respondent company to
reinstate her to her former or equivalent position, with backwages. Respondent company is
also ordered to pay her 13th month pay and service incentive leave pay.
PDI appealed the Decision to the NLRC. The NLRC Second Division dismissed the appeal
thereby affirming the Labor Arbiter’s Decision
The CA set aside the NLRC Decision and dismissed petitioner’s Complaint. It held that the
NLRC mis appreciated the facts and rendered a ruling wanting in substantial evidence. The
CA said:
 First, private respondent admitted that she was and [had] never been considered by
petitioner PDI as its employee. Second, it is not disputed that private respondent
had no employment contract with petitioner PDI. In fact, her engagement to
contribute articles for publication was based on a verbal agreement between her
and the petitioner’s Lifestyle Section Editor. Moreover, it was evident that private
respondent was not required to report to the office eight (8) hours a day. These
undisputed facts negate private respondent’s claim that she is an employee of
petitioner.
Moreover, with regards to the control test, above facts failed to measure up to the control
test necessary for an employer-employee relationship to exist.
ISSUE:
Whether a newspaper columnist is an employee of the newspaper which publishes
the column?
HELD:
Whether petitioner is an employee of PDI, and if the answer be in the affirmative,
whether she was illegally dismissed.
No, We rule for the respondents.
The employment status of a person is defined and prescribed by law and not by what the
parties say it should be.
This Court has constantly adhered to the "four-fold test" to determine whether there exists
an employer-employee 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 employer’s power to control the employee’s
conduct.
Of these four elements, it is the power of control which is the most crucial and most
determinative factor, so important, in fact, that the other elements may even be
disregarded.
Petitioner argues that several factors exist to prove that respondents exercised control over
her and her work, namely:
 As to the Contents of her Column –As admitted, she wanted to write about death in
relation to All Souls Day but was advised not to.
 As to Time Control – The PETITIONER, as a columnist, had to observe the deadlines
of the newspaper for her articles to be published.
 As to Control of Space – The PETITIONER was told to submit only two or three pages
of article for the column, "Feminist Reflections" per week.
 As to Discipline – Over time, the newspaper readers’ eyes are trained or habituated
to look for and read the works of their favorite regular writers and columnists
Given this discussion by petitioner, we then ask the question: Is this the form of control that
our labor laws contemplate such as to establish an employer-employee relationship
between petitioner and respondent PDI?
It is not. Petitioner has misconstrued the "control test," as did the Labor Arbiter and the
NLRC.
The main determinant therefore is whether the rules set by the employer are meant to
control not just the results of the work but also the means and method to be used by the
hired party in order to achieve such results.
 Petitioner believes that respondents’ acts are meant to control how she executes
her work. We do not agree. A careful examination reveals that the factors
enumerated by the petitioner are inherent conditions in running a newspaper. In
other words, the so-called control as to time, space, and discipline are dictated by
the very nature of the newspaper business itself.
We agree with the observations of the Office of the Solicitor General that:
 The Inquirer has no control over [petitioner] as to the means or method used by her
in the preparation of her articles. The articles are done by [petitioner] herself
without any intervention from the Inquirer.
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.
Contrary to petitioner’s protestations, it does not appear that there was any actual restraint
or limitation on the subject matter – within the Lifestyle section – that she could write
about.
Respondent PDI did not dictate how she wrote or what she wrote in her column. Neither did
PDI’s guidelines dictate the kind of research, time, and effort she put into each column. In
fact, petitioner herself said that she received "no comments on her articles…except for her
to shorten them to fit into the box allotted to her column." Therefore, the control that PDI
exercised over petitioner was only as to the finished product of her efforts, i.e., the column
itself, by way of either shortening or outright rejection of the column.
Although petitioner had a weekly deadline to meet, she was not precluded from submitting
her column ahead of time or from submitting columns to be published at a later time. More
importantly, respondents did not dictate upon petitioner the subject matter of her columns,
but only imposed the general guideline that the article should conform to the standards of
the newspaper and the general tone of the particular section.
Where a person who works for another performs his job more or less at his own pleasure, in
the manner he sees fit, not subject to definite hours or conditions of work, and is
compensated according to the result of his efforts and not the amount thereof, no
employer-employee relationship exists.
Aside from the control test, this Court has also used the economic reality test. The
economic realities prevailing within the activity or between the parties are examined, taking
into consideration the totality of circumstances surrounding the true nature of the
relationship between the parties. This is especially appropriate when, as in this case, there is
no written agreement or contract on which to base the relationship. In our jurisdiction, the
benchmark of economic reality in analyzing possible employment relationships for purposes
of applying the Labor Code ought to be the economic dependence of the worker on his
employer.
Petitioner’s main occupation is not as a columnist for respondent but as a women’s rights
advocate working in various women’s organizations. Likewise, she herself admits that she
also contributes articles to other publications. Thus, it cannot be said that petitioner was
dependent on respondent PDI for her continued employment in respondent’s line of
business.
The inevitable conclusion is that petitioner was not respondent PDI’s employee but an
independent contractor, engaged to do independent work.
In our jurisdiction, the Court has held that an independent contractor is one who carries on
a distinct and independent business and undertakes to perform the job, work, or service on
one’s own account and under one’s own responsibility according to one’s own manner and
method, free from the control and direction of the principal in all matters connected with
the performance of the work except as to the results thereof.
The instant case presents a parallel to Sonza case. Petitioner was engaged as a columnist for
her talent, skill, experience, and her unique viewpoint as a feminist advocate. How she
utilized all these in writing her column was not subject to dictation by respondent. As in
Sonza, respondent PDI was not involved in the actual performance that produced the
finished product. It only reserved the right to shorten petitioner’s articles based on the
newspaper’s capacity to accommodate the same. This fact, we note, was not unique to
petitioner’s column. It is a reality in the newspaper business that space constraints often
dictate the length of articles and columns, even those that regularly appear therein.
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 petitioner’s employer, it cannot be held guilty of
illegal dismissal.
JOSE Y. SONZA vs. ABS-CBN BROADCASTING CORPORATION
G.R. No. 138051 June 10, 2004
CARPIO, J.:
FACTS:
In May 1994, respondent ABS-CBN Broadcasting Corporation ("ABS-CBN") signed an
Agreement with the Mel and Jay Management and Development Corporation ("MJMDC").
ABS-CBN was represented by its corporate officers while MJMDC was represented by
SONZA, as President and General Manager, and Carmela Tiangco ("TIANGCO"), as EVP and
Treasurer. Referred to in the Agreement as "AGENT," MJMDC agreed to provide SONZA’s
services exclusively to ABS-CBN as talent for radio and television. The Agreement listed the
services SONZA would render to ABS-CBN.
ABS-CBN agreed to pay for SONZA’s services a monthly talent fee of ₱310,000 for the first
year and ₱317,000 for the second and third year of the Agreement. ABS-CBN would pay the
talent fees on the 10th and 25th days of the month.
On 1 April 1996, SONZA wrote a letter to ABS-CBN’s President, Eugenio Lopez III saying that
Mr. Sonza irrevocably resigned in view of recent events concerning his programs and career.
Hence, consider these acts of the station violative of the Agreement and the station as in
breach thereof. Mr. Sonza informed us that he is waiving and renouncing recovery of the
remaining amount stipulated in Agreement but reserves the right to seek recovery of the
other benefits under said Agreement.
On 30 April 1996, SONZA filed a complaint against ABS-CBN before the Department of Labor
and Employment, National Capital Region in Quezon City. SONZA complained that ABS-CBN
did not pay his salaries, separation pay, service incentive leave pay, 13th month pay, signing
bonus, travel allowance and amounts due under the Employees Stock Option Plan ("ESOP").
On 10 July 1996, ABS-CBN filed a Motion to Dismiss on the ground that no employer-
employee relationship existed between the parties.
Labor Arbiter DECISION
The Labor Arbiter ruled
It must be noted that complainant was engaged by respondent by reason of his peculiar
skills and talent as a TV host and a radio broadcaster. The benefits conferred to complainant
under the May 1994 Agreement are certainly very much higher than those generally given
to employees. Moreover, his engagement as a talent was covered by a specific contract.
Likewise, he was not bound to render eight (8) hours of work per day as he worked only for
such number of hours as may be necessary.
The Labor Arbiter found for respondent citing that SOnza as talent cannot be considered
an employee of petitioner.
SONZA appealed to the NLRC which affirmed the Labor Arbiter’s decision.
SONZA filed a special civil action for certiorari before the Court of Appeals which rendered a
Decision dismissing the case. And affirms NLRC ruling.
ISSUE:
Whether or not employer-employee relationship existed between petitioner and ABS-CBN?
HELD:
NO. Philippine labor laws and jurisprudence define clearly the elements of an employer-
employee relationship, this is the first time that the Court will resolve the nature of the
relationship between a television and radio station and one of its "talents."
SONZA contends that the Labor Arbiter has jurisdiction over the case because he was an
employee of ABS-CBN. On the other hand, ABS-CBN insists that the Labor Arbiter has no
jurisdiction because SONZA was an independent contractor.
Employee or Independent Contractor?
The existence of an employer-employee relationship is a question of fact. SONZA maintains
that all essential elements of an employer-employee relationship are present in this case.
Case law has consistently held that the 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 employer’s power to control the employee on the means
and methods by which the work is accomplished. The last element, the so-called "control
test", is the most important element.
A. Selection and Engagement of Employee
ABS-CBN engaged SONZA’s services to co-host its television and radio programs because of
SONZA’s peculiar skills, talent and celebrity status.
Independent contractors often present themselves to possess unique skills, expertise or
talent to distinguish them from ordinary employees. If SONZA did not possess such unique
skills, talent and celebrity status, ABS-CBN would not have entered into the Agreement with
SONZA but would have hired him through its personnel department just like any other
employee.
B. Payment of Wages
All the talent fees and benefits paid to SONZA were the result of negotiations that led to the
Agreement. If SONZA were ABS-CBN’s employee, there would be no need for the parties to
stipulate on benefits such as "SSS, Medicare, x x x and 13th month pay" which the law
automatically incorporates into every employer-employee contract. Whatever benefits
SONZA enjoyed arose from contract and not because of an employer-employee
relationship.
C. Power of Dismissal
For violation of any provision of the Agreement, either party may terminate their
relationship. SONZA failed to show that ABS-CBN could terminate his services on grounds
other than breach of contract, such as retrenchment to prevent losses as provided under
labor laws.
D. Power of Control
Since there is no local precedent on whether a radio and television program host is an
employee or an independent contractor, we refer to foreign case law in analyzing the
present case.
First, SONZA contends that ABS-CBN exercised control over the means and methods of his
work. SONZA’s argument is misplaced. How SONZA delivered his lines, appeared on
television, and sounded on radio were outside ABS-CBN’s control. SONZA did not have to
render eight hours of work per day. The Agreement required SONZA to attend only
rehearsals and tapings of the shows, as well as pre- and post-production staff meetings.
ABS-CBN could not dictate the contents of SONZA’s script. However, the Agreement
prohibited SONZA from criticizing in his shows ABS-CBN or its interests. Hence, ABS-CBN did
not instruct SONZA how to perform his job. ABS-CBN merely reserved the right to modify
the program format and airtime schedule "for more effective programming."
SONZA further contends that ABS-CBN exercised control over his work by supplying all
equipment and crew. No doubt, ABS-CBN supplied the equipment, crew and airtime needed
to broadcast the "Mel & Jay" programs. However, the equipment, crew and airtime are not
the "tools and instrumentalities" SONZA needed to perform his job. What SONZA
principally needed were his talent or skills and the costumes necessary for his appearance.
Even though ABS-CBN provided SONZA with the place of work and the necessary
equipment, SONZA was still an independent contractor since ABS-CBN did not supervise and
control his work.
Lastly, SONZA insists that the "exclusivity clause" in the Agreement is the most extreme
form of control which ABS-CBN exercised over him.
This argument is futile. Being an exclusive talent does not by itself mean that SONZA is an
employee of ABS-CBN. Even an independent contractor can validly provide his services
exclusively to the hiring party. In the broadcast industry, exclusivity is not necessarily the
same as control. In short, the huge talent fees partially compensates for exclusivity, as in the
present case.
SONZA insists that MJMDC is a "labor-only" contractor and ABS-CBN is his employer.
In a labor-only contract, there are three parties involved: (1) the "labor-only" contractor; (2)
the employee who is ostensibly under the employ of the "labor-only" contractor; and (3) the
principal who is deemed the real employer. Under this scheme, the "labor-only" contractor
is the agent of the principal. The law makes the principal responsible to the employees of
the "labor-only contractor" as if the principal itself directly hired or employed the
employees. These circumstances are not present in this case.
Policy Instruction No. 40
SONZA argues that Policy Instruction No. 40 issued by then Minister of Labor Blas Ople on 8
January 1979 finally settled the status of workers in the broadcast industry. Policy
Instruction No. 40 is a mere executive issuance which does not have the force and effect of
law. There is no legal presumption that Policy Instruction No. 40 determines SONZA’s status.
A mere executive issuance cannot exclude independent contractors from the class of service
providers to the broadcast industry.
Talents as Independent Contractors
The right of labor to security of tenure as guaranteed in the Constitution arises only if
there is an employer-employee relationship under labor laws. Not every performance of
services for a fee creates an employer-employee relationship. To hold that every person
who renders services to another for a fee is an employee - to give meaning to the security of
tenure clause - will lead to absurd results.
FILAMER CHRISTIAN INSTITUTE v. HON. INTERMEDIATE APPELLATE COURT
G.R. No. 75112 August 17, 1992
GUTIERREZ, JR., J.:
FACTS:
Funtecha was a working student, being a part-time janitor and a scholar of petitioner
Filamer. He was, in relation to the school, an employee even if he was assigned to clean the
school premises for only two (2) hours in the morning of each school day.
Having a student driver's license, Funtecha requested the driver, Allan Masa, and was
allowed, to take over the vehicle while the latter was on his way home one late afternoon. It
is significant to note that the place where Allan lives is also the house of his father, the
school president, Agustin Masa. Moreover, it is also the house where Funtecha was allowed
free board while he was a student of Filamer Christian Institute.
Allan Masa turned over the vehicle to Funtecha only after driving down a road, negotiating a
sharp dangerous curb, and viewing that the road was clear. According to Allan's testimony, a
fast moving truck with glaring lights nearly hit them so that they had to swerve to the right
to avoid a collision. Upon swerving, they heard a sound as if something had bumped against
the vehicle, but they did not stop to check. Actually, the Pinoy jeep swerved towards the
pedestrian, Potenciano Kapunan who was walking in his lane in the direction against
vehicular traffic, and hit him.
ISSUE:
Whether or not petitioner is not liable for the injuries caused by Funtecha on the grounds
that he was not an authorized driver and was merely a working scholar who, under Section
14, Rule X, Book III of the Rules and Regulations Implementing the Labor Code is not
considered an employee of the petitioner?
HELD:
The petitioner is liable.
It is indubitable under the circumstances that the school president had knowledge that
the jeep was routinely driven home for the said purpose. Moreover, it is not improbable
that the school president also had knowledge of Funtecha's possession of a student driver's
license and his desire to undergo driving lessons during the time that he was not in his
classrooms.
In learning how to drive while taking the vehicle home in the direction of Allan's house,
Funtecha definitely was not having a joy ride. Funtecha was not driving for the purpose of
his enjoyment or for a "frolic of his own" but ultimately, for the service for which the jeep
was intended by the petitioner school. Therefore, the Court is constrained to conclude that
the act of Funtecha in taking over the steering wheel was one done for and in behalf of his
employer for which act the petitioner-school cannot deny any responsibility by arguing that
it was done beyond the scope of his janitorial duties. The clause "within the scope of their
assigned tasks" for purposes of raising the presumption of liability of an employer, includes
any act done by an employee, in furtherance of the interests of the employer or for the
account of the employer at the time of the infliction of the injury or damage. Even if
somehow, the employee driving the vehicle derived some benefit from the act, the
existence of a presumptive liability of the employer is determined by answering the
question of whether or not the servant was at the time of the accident performing any act
in furtherance of his master's business.
Section 14, Rule X, Book III of the Rules implementing the Labor Code, on which the
petitioner anchors its defense is merely a guide to the enforcement of the substantive law
on labor. The Court, thus, makes the distinction and so holds that Section 14, Rule X, Book
III of the Rules is not the decisive law in a civil suit for damages instituted by an injured
person during a vehicular accident against a working student of a school and against the
school itself.
Hence, the reliance on the implementing rule on labor to disregard the primary liability of an
employer under Article 2180 of the Civil Code is misplaced. An implementing rule on labor
cannot be used by an employer as a shield to avoid liability under the substantive
provisions of the Civil Code.
either in the selection of a servant or employee, or in the supervision over him. The
petitioner has failed to show proof of its having exercised the required diligence of a good
father of a family over its employees Funtecha and Allan.
Furthermore, the petitioner has failed to prove that it had imposed sanctions or warned its
employees against the use of its vehicles by persons other than the driver.
The petitioner, thus, has an obligation to pay damages for injury arising from the unskilled
manner by which Funtecha drove the vehicle. In the absence of evidence that the petitioner
had exercised the diligence of a good father of a family in the supervision of its employees,
the law imposes upon it the vicarious liability for acts or omissions of its employees. The
liability of the employer is, under Article 2180, primary and solidary. However, the employer
shall have recourse against the negligent employee for whatever damages are paid to the
heirs of the plaintiff.
For the purpose of recovering damages under the prevailing circumstances, it is enough
that the plaintiff and the private respondent heirs were able to establish the existence of
employer-employee relationship between Funtecha and petitioner Filamer and the fact
that Funtecha was engaged in an act not for an independent purpose of his own but in
furtherance of the business of his employer. A position of responsibility on the part of the
petitioner has thus been satisfactorily demonstrated.

There is evidence to show that there exists in the present case an extra-contractual
obligation arising from the negligence or reckless imprudence of a person "whose acts or
omissions are imputable, by a legal fiction, to other(s) who are in a position to exercise an
absolute or limited control over (him)."

Funtecha is an employee of petitioner Filamer. He need not have an official appointment

for a driver's position in order that the petitioner may be held responsible for his grossly
negligent act, it being sufficient that the act of driving at the time of the incident was for
the benefit of the petitioner. Hence, the fact that Funtecha was not the school driver or was
not acting within the scope of his janitorial duties does not relieve the petitioner of the
burden of rebutting the presumption juris tantum that there was negligence on its part