Villamaria v CA & Bustamante GR No.

165881 April 19, 2006

FACTS:
- Oscar Villamaria, Jr. was the owner of Villamaria Motors, a sole proprietorship engaged in assembling passenger jeepneys with a public utility
franchise to operate along the Baclaran-Sucat route. By 1995, Villamaria stopped assembling jeepneys and retained only nine, four of which
operated by employing drivers on a “boundary basis.” One of those drivers was respondent Bustamante.
- Bustamante remitted 450 a day to Villamaria as boundary and kept the residue of his daily earnings as compensation for driving the vehicle. In
August 1997, Villamaria verbally agreed to sell the jeepney to Bustamante under a “boundary-hulog scheme”, where Bustamante would remit to
Villamaria P550 a day for a period of 4 years; Bustamane would then become the owner of the vehicle and continue to drive the same under
Villamaria’s franchise, but with Php 10,000 downpayment.
- August 7, 1997, Villamaria executed a contract entitled “Kasunduan ng Bilihan ng Sasakyan sa Pamamagitan ng Boundary Hulog”. The
parties agreed that if Bustamante failed to pay the boundary- hulog for 3 days, Villamaria Motors would hold on to the vehicle until Bustamante
paid his arrears, including a penalty of 50 a day; in case Bustamante failed to remit the daily boundary-hulog for a period of one week, the
Kasunduan would cease to have the legal effect and Bustamante would have to return the vehicle to Villamaria motors.
- In 1999, Bustamante and other drivers who also had the same arrangement failed to pay their respective boundary-hulog. The prompted
Villamaria to serve a “Paalala”. On July 24, 2000. Villamaria took back the jeepney driven by Bustamante and barred the latter from driving the
vehicle.
- Bustamante filed a complaint for Illegal Dismissal.

DECISION OF LOWER COURTS:

*Labor Arbiter: petition dismissed.
*NLRC: dismissed appeal.
*CA: reversed NLRC, awarded Bustamante separation pay and backwages.
Hence, this petition for review on certiorari.

ISSUES:
(1) WON the existence of a boundary-hulog agreement negates the employer-employee relationship between the vendor and vendee
(2) WON the Labor Arbiter has jurisdiction over a complaint for illegal dismissal in such a case.
HELD:
(1) NO. Under the boundary-hulog scheme, a dual juridical relationship is created; that of employer- employee and vendor-vendee. The
Kasanduan did not extinguish the employer employee relationship of the parties existing before the execution of said deed.
a. Under this system the owner/operator exercises control and supervision over the driver. It is unlike in lease of chattels where the lessor loses
complete control over the chattel leased but the lessee is still ultimately responsible for the consequences of its use. The management of the
business is still in the hands of the owner/operator, who, being the holder of the certificate of public convenience, must see to it that the driver
follows the route prescribed by the franchising and regulatory authority, and the rules promulgated with regard to the business operations.
b. The driver performs activities which are usually necessary or desirable in the usual business or trade of the owner/operator. Under the
Kasunduan, respondent was required to remit Php 550 daily to petitioner, an amount which represented the boundary of petitioner as well as
respondent’s partial payment (hulog) of the purchase price of the jeepney. Thus, the daily remittances also had a dual purpose: that of
petitioner’s boundary
and respondent’s partial payment (hulog) for the vehicle.
c. The obligation is not novated by an instrument that expressly recognizes the old one,
changes only the terms of payment and adds other obligations not incompatible with the old
provisions or where the contract merely supplements the previous one.
d. The existence of an employment relation is not dependent on how the worker is paid but on the presence or absence of control over the means
and method of the work. The amount earned in excess of the “boundary hulog” is equivalent to wages and the fact that the power of dismissal
was not mentioned in the Kasunduan did not mean that private respondent never exercised such power, or could not exercise such power.

(2) YES. The Labor Arbiter and the NLRC has jurisdiction under Article 217 of the Labor Code is limited to disputes arising from an employer-
employee relationship which can only be resolved by reference to the Labor Code, other labor statues of their collective bargaining agreement.

OTHER NOTES:
(1) The rule is that the nature of an action and subject matter thereof, as well as, which court or agency of the government has jurisdiction and
the character of the reliefs prayed for, whether or not the complainant/plaintiff is entitled to any or all of such reliefs.
(2) Not every dispute between an employer and employee involves matters that only the Labor Arbiter and the NLRC can resolve in the exercise
of their adjudicatory or quasi-judicial powers. Actions between employers and employees where the employer-employee relationship is merely
incidental is within the exclusive original jurisdiction of the regular courts.

Alhambra vs Cir

HYDRO RESOURCES CONTRACTORS CORP. V. PAGALILUAN

FACTS:

On October 24, 1978, petitioner corporation hired private respondent Aban as its “Legal Assistant.” On September 4, 1980, Aban received a
letter of termination because of his alleged failure to perform his duties well. On October 6, 1980, Aban filed a complaint against the petitioner
for illegal dismissal.

ISSUE:

WON there was an employer-employee relationship between petitioner corporation and Aban.

RULING:
Yes. ABan worked solely for the petitioner and dealt only with legal matters involving said corporation and its employees. It also assisted the
Personnel Officer in processing appointment papers for employees. This latter duty is not an act of lawyer in the exercise of his profession but
rather a duty for the benefit of the corporation.

This is a petition to review on certiorari the resolution of the National Labor Relations Commission (NLRC) which affirmed the labor arbiter's
decision ordering herein petitioner, Hydro Resources Contractors Corporation to reinstate Rogelio A. Aban to his former position without loss of
seniority rights, to pay him 12 months backwages in the amount of P18,000.00 and to pay attorney's fees in the amount of P1,800.00.

On October 24, 1978, petitioner corporation hired the private respondent Aban as its "Legal Assistant." He received a basic monthly salary of
P1,500.00 plus an initial living allowance of P50.00 which gradually increased to P320.00.

On September 4, 1980, Aban received a letter from the corporation informing him that he would be con sidered terminated effective October
4,1980 because of his alleged failure to perform his duties well.

On October 6, 1980, Aban filed a complaint against the petitioner for illegal dismissal.

The labor arbiter ruled that Aban was illegally dismissed. This ruling was affirmed by the NLRC on appeal.

Hence, this present petition.

The only issue raised by the petitioner is whether or not there was an employer-employee relationship between the petitioner corporation and
Aban. The petitioner questions the jurisdiction of the public respondents considering the alleged absence of an employer-employee relationship.

The petitioner contends that its relationship with Aban is that of a client with his lawyer. It is its position that "(a) lawyer as long as he is acting
as such, as long as he is performing acts constituting practice of law, can never be considered an employee. His relationship with those to whom
he renders services, as such lawyer, can never be governed by the labor laws. For a lawyer to so argue is not only demeaning to himself (sic),
but also his profession and to his brothers in the profession." Thus, the petitioner argues that the labor arbiter and NLRC have no juris diction
over the instant case.

The contention is without merit.

A lawyer, like any other professional, may very well be an employee of a private corporation or even of the government. It is not unusual for a
big corporation to hire a staff of lawyers as its in-house counsel, pay them regular salaries, rank them in its table of organization, and otherwise
treat them like its other officers and employees. At the same time, it may also contract with a law firm to act as outside counsel on a retainer
basis. The two classes of lawyers often work closely together but one group is made up of employees while the other is not. A similar arrange -
ment may exist as to doctors, nurses, dentists, public relations practitioners, and other professionals.

This Court is not without a guide in deciding whether or not an employer-employee relation exists between the contending parties or whether or
not the private respondent was hired on a retainer basis.

As stated in the case of Tabas v. California Manufacturing Co., (G.R. No. 80680, January 26, 1989):

"This Court has consistently ruled that the determination of whether or not there is an employer-employee relation depends upon four standards:
(1) the manner of selection and engagement of the putative employee; (2) the mode of payment of wages; (.3) the presence or absence of a power
of dismissal; and (4) the presence or absence of a power to control the putative employee's conduct. Of the four, the right-of-control test has
been held to be the decisive factor."
Aban was employed by the petitioner to be its Legal Assistant as evidenced by his appointment paper (Exhibit "A"). The petitioner paid him a
basic salary plus living allowance. Thereafter, Aban was dismissed on his alleged failure to perform his duties well. (Exhibit "B")

Aban worked solely for the petitioner and dealt only with legal matters involving the said corporation and its employees. He also assisted the
Personnel Officer in processing appointment papers of employees. This latter duty is not an act of a lawyer in the exercise of his profession but
rather a duty for the benefit of the corporation.

The above-mentioned facts show that the petitioner paid Aban's wages, exercised its power to hire and fire the respondent employee and more
important, exercised control over Aban by defining the duties and functions of his work.

Moreover, estoppel lies against the petitioner. It may no longer question the jurisdiction of the labor arbiter and NLRC.

The petitioner presented documents (Exhibits "2" to "19") before the Labor Arbiter to prove that Aban was a managerial employee. Now, it is
disclaiming that Aban was ever its employee. The proper procedure was for the petitioner to prove its allegations that Aban drank heavily,
violated company policies, spent company funds and properties for personal ends, and otherwise led the employer to lose trust and confidence in
him. The real issue was due process, not the specious argument raised in this petition.

The new theory presented before this Court is a last-ditch effort by the petitioner to cover up for the unwarranted dismissal of its employee. This
Court frowns upon such delaying tactics.

The findings of fact of the Labor Arbiter being supported by substantial evidence are binding on this Court. (See Industrial Timber Corp. v.
National Labor Relations Commission, G.R. No. 83616, January 20, 1989).

Considering that the private respondent was illegally dismissed from his employment in 1980, he is entitled to reinstatement to his former or
similar position without loss of seniority rights, if it is still feasible, to backwages without qualification or deduction for three years, (D.M.
Consunjo, Inc. v. Pucan, 159 SCRA 107 (1988); Flores v. Nuestro, G.R. No. 66890, April 15, 1988), and to reasonable attorney's fees in the
amount of P5,000.00. Should reinstatement prove no longer feasible, the petitioner will pay him separation pay in lieu of reinstatement. (City
Trust Finance Corp. v. NLRC, 157 SCRA 87; Santos v. NLRC, 154 SCRA 166; Metro Drug v. NLRC, et al., 143 SCRA 132; Luzon Brokerage
v. Luzon Labor Union, 7 SCRA 116). The amount of such separation pay as may be provided by law or the collective bargaining agreement is
to be computed based on the period from 24 October 1978 (date of first employment) to 4 October 1983 (three years after date of illegal
dismissal). /Manila Midtown Commercial Corporation v. Nuwhrain, 159 SCRA 212 (1988)_/.

WHEREFORE, the petition is hereby DISMISSED for lack of merit. The petitioner is ordered to reinstate the private respondent to his former
or a similar position without loss of seniority rights and to pay three (3) years backwages without qualification or deduction and P5,000.00 in
attorney's fees. Should reinstatement not be feasible, the petitioner shall pay the private respondent termination benefits in addition to the above
stated three years backpay and P5,000.00 attorney's fees.

MANILA GOLF CLUB, INC. VS. INTERMEDIATE APPELLATE COURT

[237 SCRA 207]
Facts:
This is originally filed with the Social Security Commission (SSC) via petitionof 17 persons who styled themselves as ³ Caddies of Manila Golf
and Country Club-PTCCEA´ for the coverage and availment of benefits of the Social Security Act as amended, PTCCEA (Philippine Technical,
Clerical,Commercial Employees Association) a labor organization where which they claim for membership. The same time two other
proceedings were filed and pending. These are certification election case filed by PTCCEA on behalf of the same caddies of Manila Golf and
Country club which was in favor of the caddies and compulsory arbitration case involving PTCCEA and Manila Golf and Country Club which
was dismissed and ruled that there was no employer-employee relationship between the caddies and the club.
Issue:
Whether or not rendering caddying services for members of golf clubs and their guests in said clubs¶ courses or premises are the employees of
such clubs and therefore within the compulsory coverage of the Social Security System (SSS).
SC Ruling:

The Court does not agree that the facts logically point to the employer-employee relationship. In the very nature of things, caddies must submit
to some supervision of their conduct while enjoying the privilege of pursuing their occupation within the premises and grounds of whatever club
they do work in. They work for the club to which they attach themselves on sufferance but, on the other hand, also without having to observe
any working hours, free to leave anytime they please, to stay away for as long they like. These considerations clash frontally with the concept of
employment. It can happen that a caddy who has rendered services to a player on one day may still find sufficient time to work elsewhere. Under
such circumstances, the caddy may leave the premises and to go to such other place of work that he wishes. These are things beyond the control
of the petitioner. The caddy (LLamar) is not an employee of petitioner Manila Golf and Country Club and the petitioner is under no obligation
to report him for compulsory coverage of SSS.

Filamer Christian Institute vs Court of Appeals

Daniel Funtecha was a working student at the Filamer Christian Institute. He was assigned as the school janitor to clean the school 2 hours every
morning. Allan Masa was the son of the school president and at the same time he was the school’s jeepney service driver. On October 20, 1977
at about 6:30pm, after driving the students to their homes, Masa returned to the school to report and thereafter have to go home with the jeep so
that he could fetch the students early in the morning. Masa and Funtecha live in the same place so they usually go home together. Funtecha had a
student driver’s license so Masa let him take the driver’s seat. While Funtecha was driving, he accidentally hit an elderly Kapunan which led to
his hospitalization for 20 days. Kapunan filed a criminal case and an independent civil action based on Article 2180 against Funtecha.

In the independent civil action, the lower court ruled that Filamer is subsidiarily liable for the tortious act of Funcheta and was compelled to pay
for damages based on Article 2180 which provides that employers shall be liable for the damages caused by their employees and household
helpers acting within the scope of their assigned tasks. Filamer assailed the decision and it argued that under Section 14, Rule X, Book III of the
Labor Code IRR, working scholars are excluded from the employment coverage hence there is no employer-employee relations between Filamer
and Funcheta; that the negligent act of Funcheta was due to negligence only attributable to him alone as it is outside his assigned task of being
the school janitor. The CA denied Filamer’s appeal but the Supreme Court agreed with Filamer. Kapunan filed for a motion for reconsideration.

ISSUE: Whether or not Filamer should be held subsidiarily liable.

HELD: Yes. This time, the SC ruled in favor of Kapunan (actually his heirs cause by this time Kapunan was already dead). The provisions of
Section 14, Rule X, Book III of the Labor Code IRR was only meant to provide guidelines as compliance with labor provisions on working
conditions, rest periods, and wages is concerned. This does not in any way affect the provisions of any other laws like the civil code. The IRR
cannot defeat the provisions of the Civil Code. In other words, Rule X is merely a guide to the enforcement of the substantive law on labor.
There is a distinction hence 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.

The present case does not deal with a labor dispute on conditions of employment between an alleged employee and an alleged employer. It
invokes a claim brought by one for damages for injury caused by the patently negligent acts of a person, against both doer-employee and his
employer. 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 void liability under the substantive provisions of
the Civil Code.

Funtecha is an employee of Filamer. He need not have an official appointment for a driver’s position in order that Filamer 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 Filamer (the
act of driving the jeep from the school to Masa’s house is beneficial to the school because this enables Masa to do a timely school transportation
service in the morning). Hence, the fact that Funtecha was not the school driver or was not acting with the scope of his janitorial duties does not
relieve Filamer of the burden of rebutting the presumption juris tantum that there was negligence on its part either in the selection of a servant or
employee, or in the supervision over him. Filamer 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.

CRC Agricultural Trading, et. al. vs. NLRC

G.R. No. 177664, December 23, 2009

Facts:

The present petition traces its roots to the complaint for illegal dismissal filed by the respondent against petitioners CRC Agricultural Trading
and its owner, Rolando B. Catindig (collectively, petitioners), before the Labor Arbiter. In his Sinumpaang Salaysay, the respondent alleged that
the petitioners employed him as a driver. The respondent worked for the petitioners until he met an accident, after which the petitioners no
longer allowed him to work. After six years, the petitioners again hired the respondent as a driver and offered him to stay inside the company’s
premises.

Sometime in March 2003, the petitioners ordered respondent to have the alternator of one of its vehicles repaired. The respondent brought the
vehicle to a repair shop and subsequently gave the petitioners two receipts issued by the repair shop. The latter suspected that the receipts were
falsified and stopped talking to him and giving him work assignments. Petitioners no longer gave him any salary after that. As a result, the
respondent and his family moved out of the petitioners’ compound. The respondent claimed that the petitioners paid him a daily wage of
P175.00, but did not give him service incentive leave, holiday pay, rest day pay, and overtime pay. He also alleged that the petitioners did not
send him a notice of termination.

Issue:

Was respondent’s dismissal justified?

RULING:
No.To justify the dismissal of an employee for a just cause, the employer must furnish the worker with two written notices. The first is the notice
to apprise the employee of the particular acts or omissions for which his dismissal is sought. This may be loosely considered as the charge
against the employee. The second is the notice informing the employee of the employer’s decision to dismiss him. This decision, however, must
come only after the employee is given a reasonable period from receipt of the first notice within which to answer the charge, and ample
opportunity to be heard and defend himself with the assistance of his representative, if he so desires. The requirement of notice is not a mere
technicality, but a requirement of due process to which every employee is entitled.

The employer clearly failed to comply with the two-notice requirement. Nothing in the records shows that the company ever sent the employee a
written notice informing him of the ground for which his dismissal was sought. It does not also appear that the company held a hearing where
the employee was given the opportunity to answer the charges of abandonment. Neither did the company send a written notice to the employee
informing him that his service had been terminated and the reasons for the termination of his employment. Under these facts, the respondent’s
dismissal was illegal.

JOSE SONZA vs. ABS-CBN BROADCASTING CORPORATION

G.R. No. 138051
June 10, 2004

Facts: In May 1994, 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 Tiangco as its 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. ABS-CBN agreed to pay Sonza a monthly talent fee of P310, 000 for the first year and P317, 000 for the second and third year.

On April 1996, Sonza wrote a letter to ABS-CBN where he irrevocably resigned in view of the recent events concerning his program and career.
After the said letter, Sonza filed with the Department of Labor and Employment a complaint alleging that ABS-CBN did not pay his salaries,
separation pay, service incentive pay,13th month pay, signing bonus, travel allowance and amounts under the Employees Stock Option Plan
(ESOP). ABS-CBN contended that no employee-employer relationship existed between the parties. However, ABS-CBN continued to remit
Sonza’s monthly talent fees but opened another account for the same purpose.

The Labor Arbiter dismissed the complaint and found that there is no employee-employer relationship. NLRC affirmed the decision of the Labor
Arbiter. CA also affirmed the decision of NLRC.

Issue: Whether or not there was employer-employee relationship between the parties.

Ruling: Case law has consistently held that the elements of an employee-employer relationship are selection and engagement of the employee,
the payment of wages, the power of dismissal and 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.

Sonza’s services to co-host its television and radio programs are because of his peculiar talents, skills and celebrity status. Independent
contractors often present themselves to possess unique skills, expertise or talent to distinguish them from ordinary employees. The specific
selection and hiring of SONZA, because of his unique skills, talent and celebrity status not possessed by ordinary employees, is a circumstance
indicative, but not conclusive, of an independent contractual relationship. All the talent fees and benefits paid to SONZA were the result of
negotiations that led to the Agreement. For violation of any provision of the Agreement, either party may terminate their relationship. Applying
the control test to the present case, we find that SONZA is not an employee but an independent contractor.

The control test is the most important test our courts apply in distinguishing an employee from an independent contractor. This test is based on
the extent of control the hirer exercises over a worker. The greater the supervision and control the hirer exercises, the more likely the worker is
deemed an employee. The converse holds true as well – the less control the hirer exercises, the more likely the worker is considered an
independent contractor. To perform his work, SONZA only needed his skills and talent. How SONZA delivered his lines, appeared on
television, and sounded on radio were outside ABS-CBN’s control. 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." ABS-CBN’s sole concern was
the quality of the shows and their standing in the ratings.

Clearly, ABS-CBN did not exercise control over the means and methods of performance of Sonza’s work. A radio broadcast specialist who
works under minimal supervision is an independent contractor. Sonza’s work as television and radio program host required special skills and
talent, which SONZA admittedly possesses.

ABS-CBN claims that there exists a prevailing practice in the broadcast and entertainment industries to treat talents like Sonza 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. Individuals with special skills, expertise or talent enjoy the freedom to offer their services as independent contractors. The right
to life and livelihood guarantees this freedom to contract as independent contractors. The right of labor to security of tenure cannot operate to
deprive an individual, possessed with special skills, expertise and talent, of his right to contract as an independent contractor.

Encyclopaedia Britannica, Inc vs. NLRC, G.R. No. 87098, November 4, 1996; 264 SCRA 1

Facts: Private respondent was a sales division manager of private petitioner and was in charge of selling the latter’s products through sales
representatives. As compensation, private respondent receive commissions from the products sold by his agents. After resigning from office to
pursue his private business, he filed a complaint against the petitioner, claiming for non-payment of separation pay and other benefits.

Petitioner alleged that complainant was not its employee but an independent dealer authorized to promote and sell its products and in return,
received commissions therefrom. Petitioner did not have any salary and his income from petitioner was dependent on the volume of sales
accomplished. He had his own office, financed the business expense, and maintained his own workforce. Thus petitioner argued that it had no
control and supervision over the complainant as to the manner and means he conducted his business operations.

The Labor Arbiter ruled that complainant was an employee of the petitioner company. Petioner had control over the complainant since the latter
was required to make periodic reports of his sales activities to the company.

Issue: Whether or not there exists an employer-employee relationship.

Held: No. Control of employee’s conduct is commonly regarded as the most crucial and determinative indicator of the presence or absence of an
employer-employee relationship. Under this, an employer-employee relationship exists where the person for whom the services are performed
reserves the right to control not only the end to be achieved, but also the manner and means to be used in reaching that end.

The fact that petitioner issued memoranda to private respondent and to other division sales managers did not prove that petitioner had actual
control over them. The different memoranda were merely guidelines on company policies which the sales managers follow and impose on their
respective agents.

Singer Sewing Machine vs. Drilon

FACTS:
The respondent union filed a petition for direct certification as the sole and exclusive bargaining agent of all collectors of petitioner company.
The company opposed the petition on the ground that the union members are actually not employees but are independent contractor based on the
collection agency agreement which they signed. The respondent asserted that they perform the most desirable and necessary activities for the
continuous and effective operations of the business of the petitioner. They contended that the collectors are employees because the agent shall
utilize only receipt forms authorized and issued by the company. Monthly collection quota was also required by the company.
ISSUE:
W/N ER-EE relationship exists between petitioner and respondent
HELD:
Applying the control test, there is no ER-EE relationship exists. Hence, if the union members are no temployees, no right for purposes of
bargaining, nor to be certified as such bargaining agent can ever be recognized.Not all collecting agents are employees and neither are all
collecting agents independent contractors. The requirement that collection agents utilize only receipt forms and report forms issued by the
company and reports shall be submitted at least once a week is not necessarily an indication of control over the means by which the job of
collection is to be performed. The monthly collection quota is a normal requirement. It is clear that the company and each collecting agent
intended that the company take control only over the amount of collection, which is the result of the job performed.No such words as to hire and
employ are present. Moreover, the agreement did not fix an amount for wagesnor the required working hours. Compensation is earned only on
the basis of the tangible results produced such as the total collections made. There is also nothing in the agreement which implies control by the
company over the means and methods in achieving the end.Since private respondents are not employees of the company, they are not entitled to
the constitutional right to join or form a labor organization for purposes of collective bargaining.Wherefore, the petition for certification election
is dismissed

ABANTE vs LAMADRID BEARING & PARTS CO.

FACTS: Petitioner was a salesman of respondent company earning a commission of 3% of the total paid up sales covering the whole area of
Mindanao. Aside from selling, he was also tasked with collection. Respondent corporation through its president, often required Abante to report
to a particular area and occasionally required him to go to Manila to attend conferences.

Later on, bad blood ensued between the parties due to some bad accounts that Lamadrid forced petitioner to cover. Later petitioner found out
that respondent had informed his customers not to deal with petitioner since it no longer recognized him as a commission salesman. Petitioner
filed a complaint for illegal dismissal with money claims against respondent company and its president, Jose Lamadrid.

By way of defense, respondents countered that petitioner was not its employee but a freelance salesman on commission basis.

ISSUE: Whether or not petitioner, as a commission salesman, is an employee of respondent corporation.

HELD: To determine the existence of an employee-employer relationship, we apply the four fold test: 1) the manner of selection and
engagement; (2) the payment of wages; (3) the presence or absence of the power of dismissal; and (4) the presence or absence of the power of
control.

Applying the aforementioned test, an employer-employee relationship is notably absent in this case. It is true that he was paid in commission yet
no quota was imposed therefore a dismal performance would not warrant a ground for dismissal. There was no specific office hours he was
required to observe. He was not designated to conduct services at a particular area or time. He pursued his selling without interference or
supervision from the company. The company did not prescribe the manner of selling merchandise. While he was sometimes required to report to
Manila, these were only intended to guide him. Moreover, petitioner was free to offer his services to other companies.

Art. 280 is not a crucial factor because it only determines two kinds of employees. It doen;t apply where there is no employer-employee
relationship. While the term commission under Article 96 of the LC was construed as being included in the term “wage”, there is no categorical
pronouncement that the payment of commission is conclusive proof of the existence of an employee-employer relationship.

The decision of the CA is affirmed.

Phil. Global Communications v. De Vera

Facts:

-Ricardo De Vera is a physician by profession who was enlisted by Philippine Global Communications (PhilCom) to attend to the medical needs
of its employees.
He was hired by PhilCom on a retainer basis. There was a contract between the 2 parties but was only for 1 year, to be extended upon
agreement. De Vera’s contract was extended from 1981 to 1994. In 1995 and 1996, he was retained but only
-through oral agreement.
-At the end of 1996, De Vera’s retainership was ended.
-He then filed a complaint for illegal dismissal with the labor arbiter.
The labor arbiter dismissed the complaint but the decision was reversed by the NLRC, saying that De Vera can be considered a regular employee
of PhilCom. Thus this appeal by PhilCom.

Issue:

W/n there was an employer-employee relationship between PhilCom and De Vera

Ruling:

-NO. Applying the 4-fold test, the SC found that De Vera cannot be considered an employee of PhilCom.
-One reason was because it was De Vera, himself, who dictated to PhilCom what services he was going to render for the company. This was
evident in the letter De Vera sent to the company when he was still proposing his services.
-Also, in another letter to the company, De Vera was dictating to the company the time when he would be coming to work.
-The above two facts point to the fact that the company did not have full control over De Vera’s work.
-It should also be noted that from the time he started to work with petitioner, he never was included in its payroll; was never deducted any
contribution for remittance to the SSS; and was in fact subjected by petitioner to the 10% withholding tax for his professional fee, in accordance
with the NIRC, matters which are simply inconsistent with an EER.
-Also, the records are replete with evidence showing that respondent had to bill petitioner for his monthly professional fees. It simply runs
against the grain of common experience to imagine that an ordinary employee has yet to bill his employer to receive his salary.
-Note also that the power to terminate the parties’ relationship was mutually vested on both.  Either may terminate the arrangement at will, with
or without cause.
It does not also matter that the services that De Vera renders for the company be considered as necessary and desirable because such
qualifications are determinative of whether the employee is regular or casual. The Court held that even if the services rendered are necessary
and desirable, this does not presuppose that there was an EER between the parties. This is precisely why there are independent contractors.

CONSULTA vs CA Case Digest

FACTS:

Consulta was Managing Associate of Pamana. On 1987 she was issued acertification authorizing her to negotiate for and in behalf of PAMANA
with theFederation of Filipino Civilian Employees Association. Consulta was able to secure anaccount with FFCEA in behalf of PAMANA.
However, Consulta claimed that PAMANAdid not pay her commission for the PPCEA account and filed a complaint for unpaidwages or
commission.
ISSUE:

Whether or not Consulta was an employee of PAMANA.

HELD:

The SC held that Pamana was an independent agent and not an employee.The power of control in the four fold test is missing. The manner in
which Consulta was to pursue her tasked activities was not subject to the control of PAMANA. Consulta failed to show that she worked definite
hours. The amount of time, the methods and means, the management and maintenance of her sales division were left to her sound judgment.

Finally, Pamana paid Consulta not for labor she performed but only for the results of her labor. Without results, Consulta’s labor was her own
burden and loss. Her right to compensation, or to commission, depended on the tangible results of her work -whether she brought in paying
recruits.The fact that the appointment required Consulta to solicit business exclusively for Pamana did not mean Pamana exercised control over
the means and methods of Consulta’s work as the term control is understood in labor jurisprudence.

Neither did itmake Consulta an employee of Pamana. Pamana did not prohibit Consulta fromengaging in any other business, or from being
connected with any other company, for as long as the business or company did not compete with Pamana’s business. The exclusivity clause was
a reasonable restriction to prevent similar acts prejudicial toPamana’s business interest.

Article 1306 of the Civil Code provides that “[t]hecontracting parties may establish such stipulation, clauses, terms and conditions as theymay
deem convenient, provided that they are not contrary to law, morals, goodcustoms, public order, or public policy.There being no employer-
employee relationship between Pamana and Consulta, the
Labor Arbiter and the NLRC had no jurisdiction to entertain and rule on Consulta’smoney claim. Consulta’s remedy is to file an ordinary civil
action to litigate her claim
Petition is dismissed
Insular Life Assurance Co vs. Nlrc

Petitioner Insular Life entered into a contract with respondent Basiao where the latter is authorized to solicit for insurance policies. Sometime
later, the parties entered into another contract which caused Basiao to organize an agency in order to fulfill its terms. The contract being
subsequently terminated by petitioner, Basiao sued the latter which prompted also for the termination of their engagement under the first
contract. Basiao thus filed before the Ministry of Labor seeking to recover alleged unpaid commissions. Petitioner contends that Basiao is not an
employee but an independent contractor for which they have no obligation to pay said commissions. The Labor Arbiter found for Basiao ruling
that there exists employer-employee relationship between him and petitioner. NLRC affirmed.

Issue:

Whether or not employer-employee relationship existed between petitioner and Basiao.

Ruling: NO.

In determining the existence of employer-employee relationship, the following elements are generally considered, namely: (1) the selection and
engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control the employees’ conduct —
although the latter is the most important element. It should, however, be obvious that not every form of control that the hiring party reserves to
himself over the conduct of the party hired in relation to the services rendered may be accorded the effect of establishing an employer-employee
relationship between them in the legal or technical sense of the term.

Rules and regulations governing the conduct of the business are provided for in the Insurance Code and enforced by the Insurance
Commissioner. It is, therefore, usual and expected for an insurance company to promulgate a set of rules to guide its commission agents in
selling its policies that they may not run afoul of the law and what it requires or prohibits. None of these really invades the agent’s contractual
prerogative to adopt his own selling methods or to sell insurance at his own time and convenience, hence cannot justifiably be said to establish
an employer-employee relationship between him and the company.

The Court, therefore, rules that under the contract invoked by him, Basiao was not an employee of the petitioner, but a commission agent, an
independent contractor whose claim for unpaid commissions should have been litigated in an ordinary civil action.

RAMOS vs. COURT OF APPEALS

FACTS:
Erlinda Ramos underwent a surgical procedure to remove stone from her gall bladder (cholecystectomy). They hired Dr. Hosaka, a surgeon, to
conduct the surgery at the De Los Santos Medical Center (DLSMC). Hosaka assured them that he would find a good anesthesiologist. But the
operation did not go as planned, Dr. Hosaka arrived 3 hours late for the operation, Dra. Gutierrez, the anesthesiologist “botched” the
administration of the anesthesia causing Erlinda to go into a coma and suffer brain damage. The botched operation was witnessed by Herminda
Cruz, sister in law of Erlinda and Dean of College of Nursing of Capitol Medical Center.

The family of Ramos (petitioners) sued the hospital, the surgeon and the anesthesiologist for damages. The petitioners showed expert testimony
showing that Erlinda's condition was caused by the anesthesiologist in not exercising reasonable care in “intubating” Erlinda. Eyewitnesses
heard the anesthesiologist saying “Ang hirap ma-intubate nito, mali yata ang pagkakapasok. O lumalaki ang tiyan.”

Diagnostic tests prior to surgery showed that Erlinda was robust and fit to undergo surgery.
The RTC held that the anesthesiologist ommitted to exercise due care in intubating the patient, the surgeon was remiss in his obligation to
provide a “good anesthesiologist” and for arriving 3 hours late and the hospital is liable for the negligence of the doctors and for not cancelling
the operation after the surgeon failed to arrive on time. The surgeon, anesthesiologist and the DLSMC were all held jointly and severally liable
for damages to petitioners. The CA reversed the decision of the Trial Court.

ISSUES: Whether or not the private respondents were negligent and thereby caused the comatose condition of Ramos.

HELD:
Yes, private respondents were all negligent and are solidarily liable for the damages.

RATIO:

Res ipsa loquitur – a procedural or evidentiary rule which means “the thing or the transaction speaks for itself.” It is a maxim for the rule that the
fact of the occurrence of an injury, taken with the surrounding circumstances, may permit an inference or raise a presumption of negligence, or
make out a plaintiff’s prima facie case, and present a question of fact for defendant to meet with an explanation, where ordinarily in a medical
malpractice case, the complaining party must present expert testimony to prove that the attending physician was negligent.

This doctrine finds application in this case. On the day of the operation, Erlinda Ramos already surrendered her person to the private respondents
who had complete and exclusive control over her. Apart from the gallstone problem, she was neurologically sound and fit. Then, after the
procedure, she was comatose and brain damaged—res ipsa loquitur!—the thing speaks for itself!

Negligence – Private respondents were not able to disprove the presumption of negligence on their part in the care of Erlinda and their
negligence was the proximate cause of her condition. One need not be an anesthesiologist in order to tell whether or not the intubation was a
success. [res ipsa loquitur applies here]. The Supreme Court also found that the anesthesiologist only saw Erlinda for the first time on the day of
the operation which indicates unfamiliarity with the patient and which is an act of negligence and irresponsibility.

The head surgeon, Dr. Hosaka was also negligent. He failed to exercise the proper authority as the “captain of the ship” in determining if the
anesthesiologist observed the proper protocols. Also, because he was late, he did not have time to confer with the anesthesiologist regarding the
anesthesia delivery.

The hospital failed to adduce evidence showing that it exercised the diligence of a good father of the family in hiring and supervision of its
doctors (Art. 2180). The hospital was negligent since they are the one in control of the hiring and firing of their “consultants”. While these
consultants are not employees, hospitals still exert significant controls on the selection and termination of doctors who work there which is one
of the hallmarks of an employer-employee reationship. Thus, the hospital was allocated a share in the liability.

Damages – temperate damages can and should be awarded on top of actual or compensatory damages in instances where the injury is chronic
and continuing.

CARUNGCONG vs. NLRC Case Digest

Facts: Susan Carungcong began her career in the insurance industry in 1974 as an agent of Sun Life Assurance Company of Canada. She signed
an Agent Agreement with Sun Life. In virtue of which she was designated the latter’s agent to solicit applications for its insurance and annuity
policies.

This contract was superseded some five years later when she signed two (2) new agreements. The first, denominated Career Agent’s or Unit
Manager’s Agreement, dealt with such matters as the agent’s commissions, his obligations, limitations on his authority, and termination of the
agreement by death, or by written notice with or without cause. The second was titled, Manager’s Supplementary Agreement. It explicitly
described as a “further agreement”. Carungcong and Sun Life executed another Agreement named New Business Manager with the function
generally to manage a New Business Office established. This latest Agreement stressed that the New Business Manager in performance of his
duties defined herein, shall be considered an independent contractor and not an employee of Sun Life, and that under no circumstance shall the
New Business Manager and/or his employees be considered employees of Sun Life.

Ms. Eleizer Sibayan, Manager of Sun Life’s Internal Audit Department, commenced an inquiry into the special fund availments of Carungcong
and other New Business Managers. Respondent Lance Kemp, had been receiving reports of anomalies in relation thereto from unit managers and
agents. Thereafter, on January 1990, Carungcong was confronted with and asked to explain the discrepancies set out in Sibayan’s report. She
was given a letter signed by Metron V. Deveza, CLU, Director, Marketing, which advised of the termination of her relationship with Sun Life.

Carungcong promptly instituted proceedings for vindication in the Arbitration Branch of the National Labor Relations Commissions on January
16, 1990. There she succeeded in obtaining a favorable judgment. Labor Arbiter found that there existed an employer-employee relationship
between her and Sun Life. On appeal, the National Labor Relations Commission reversed the Arbiter’s judgment. It affirmed that no
employment relationship existed between Carungcong and Sun Life.

Issue: Whether or not there petitioner was an employee subject to control and supervision by Sun Life.

Ruling: Noteworthy is that this last agreement which emphasized, like the “Career Agent’s or Unit Manager’s Agreement” first signed by her,
that in performance of her duties defined herein. Carungcong would be considered an independent contractor and not an employee of Sun Life,
and that under no circumstance shall the New Business Manager and/or his employees be considered employees of Sun Life.

Carungcong is an independent contractor. It was indicated in the very face of the contract. The rules and regulations of the company is not
sufficient to establish an employer-employee relationship. It does not necessarily create any employer-employee relationship where the
employers’ controls have to interfere in the methods and means by which employee would like employ to arrive at the desired results.
Carungcong admitted that she was free to work as she pleases, at the place and time she felt convenient for her to do so. She was not paid to a
fixed salary and was mainly paid by commissions depending on the volume of her performance.

She was not an employee of Sun Life Co.

COCA COLA VS. CLIMACO DIGEST

FACTS: Respondent Dr. Dean N. Climaco is a medical doctor The Retainer Agreement, which began on January 1, 1988, was renewed
annually (original contract was only good for one year). The last one expired on December 31, 1993. Despite the non-renewal of the Retainer
Agreement, respondent continued to perform his functions as company doctor to Coca-Cola until he received a letter4 dated March 9, 1995 from
petitioner company concluding their retainership agreement effective 30 days from receipt thereof.

It is noted that as early as September 1992, petitioner was already making inquiries regarding his status with petitioner company. Petitioner
company, however, did not take any action. Hence, respondent made another inquiry with the DOLE and SSS. Thereafter, respondent inquired
from the management of petitioner company whether it was agreeable to recognizing him as a regular employee. The management refused to do
so.

FILED TWO COMPLAINTS IN THE NLRC: (1) seeking recognition as a regular employee of petitioner company and prayed for the payment
of all benefits of a regular employee, including 13th Month Pay, Cost of Living Allowance, Holiday Pay, Service Incentive Leave Pay, and
Christmas Bonus; (2) a complaint for illegal dismissal against petitioner company with the NLRC, Bacolod City.

LABOR ARBITER’S DECISION: Case (1) Dismissed, found that petitioner company lacked the power of control over respondent’s
performance of his duties, and recognized as valid the Retainer Agreement between the parties; (2) dismissed the case for illegal dismissal in
view of the previous finding of Labor Arbiter that complainant therein, respondent is not an employee of Coca-Cola Bottlers Phils., Inc.

Respondent appealed both decisions to the NLRC, Fourth Division, Cebu City; Dismissed for lack of merit. MR denied.

APPEAL WITH THE CA: that an employer-employee relationship existed between petitioner company and respondent after applying the four-
fold test.

MR BY PETITONER: The Court of Appeals clarified that respondent was a “regular part-time employee and should be accorded all the
proportionate benefits due to this category of employees of [petitioner] Corporation under the CBA.” It sustained its decision on all other matters
sought to be reconsidered. Hence, this petition.

ISSUE: whether or not there exists an employer-employee relationship between the parties; The resolution of the main issue will determine
whether the termination of respondent’s employment is illegal.

HELD: NO employer-employee relationship.

Four-fold test: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power to
control the employee’s conduct, or the so-called “control test,” considered to be the most important element.

The Court agrees with the finding of the Labor Arbiter and the NLRC that the circumstances of this case show that no employer-employee
relationship exists between the parties. The Labor Arbiter and the NLRC correctly found that petitioner company lacked the power of control
over the performance by respondent of his duties. The Labor Arbiter reasoned that the Comprehensive Medical Plan, which contains the
respondent’s objectives, duties and obligations, does not tell respondent “how to conduct his physical examination, how to immunize, or how to
diagnose and treat his patients, employees of [petitioner] company, in each case.”

petitioner company, through the Comprehensive Medical Plan, provided guidelines merely to ensure that the end result was achieved, but did not
control the means and methods by which respondent performed his assigned tasks.

Because the company lacks the power of control that the contract provides that respondent shall be directly responsible to the employee
concerned and their dependents for any injury, harm or damage caused through professional negligence, incompetence or other valid causes of
action.

Respondent is not at all further required to just sit around in the premises and wait for an emergency to occur so as to enable him from using
such hours for his own benefit and advantage. In fact, complainant maintains his own private clinic attending to his private practice in the city,
where he services his patients, bills them accordingly — and if it is an employee of respondent company who is attended to by him for special
treatment that needs hospitalization or operation, this is subject to a special billing.

An employee is required to stay in the employer’s workplace or proximately close thereto that he cannot utilize his time effectively and gainfully
for his own purpose. Such is not the prevailing situation here.1awphi1. Court finds that the schedule of work and the requirement to be on call
for emergency cases do not amount to such control, but are necessary incidents to the Retainership Agreement.

The Court also notes that the Retainership Agreement granted to both parties the power to terminate their relationship upon giving a 30-day
notice. Hence, petitioner company did not wield the sole power of dismissal or termination.

Considering that there is no employer-employee relationship between the parties, the termination of the Retainership Agreement, which is in
accordance with the provisions of the Agreement, does not constitute illegal dismissal of respondent.

PETITION GRANTED.
FRANCISCO VS. NLRC ET AL DIGEST

FACTS:

1995, Petitioner was hired by Kasei Corporation during its incorporation stage. She was designated as Accountant and Corporate Secretary and
was assigned to handle all the accounting needs of the company. She was also designated as Liaison Officer to the City of Makati to secure
business permits, construction permits and other licenses for the initial operation of the company.

Although she was designated as Corporate Secretary, she was not entrusted with the corporate documents; neither did she attend any board
meeting nor required to do so. She never prepared any legal document and never represented the company as its Corporate Secretary. 1996,
petitioner was designated Acting Manager. Petitioner was assigned to handle recruitment of all employees and perform management
administration functions; represent the company in all dealings with government agencies, especially with the BIR, SSS and in the city
government of Makati; and to administer all other matters pertaining to the operation of Kasei Restaurant which is owned and operated by Kasei
Corporation.

January 2001, petitioner was replaced by a certain Liza R. Fuentes as Manager. Kasei Corporation reduced her salary, she was not paid her mid-
year bonus allegedly because the company was not earning well. On October 2001, petitioner did not receive her salary from the company. She
made repeated follow-ups with the company cashier but she was advised that the company was not earning well. Eventually she was informed
that she is no longer connected with the company.

Since she was no longer paid her salary, petitioner did not report for work and filed an action for constructive dismissal before the labor arbiter.
Private respondents averred that petitioner is not an employee of Kasei Corporation. They alleged that petitioner was hired in 1995 as one of its
technical consultants on accounting matters and act concurrently as Corporate Secretary. As technical consultant, petitioner performed her work
at her own discretion without control and supervision of Kasei Corporation. Petitioner had no daily time record and she came to the office any
time she wanted and that her services were only temporary in nature and dependent on the needs of the corporation.

The Labor Arbiter found that petitioner was illegally dismissed, NLRC affirmed with modification the Decision of the Labor Arbiter. On appeal,
CA reversed the NLRC decision. CA denied petitioner’s MR, hence, the present recourse.

ISSUES:

WON there was an employer-employee relationship between petitioner and private respondent; and if in the affirmative,
Whether petitioner was illegally dismissed.

RULING:

Generally, courts have relied on the so-called right of control test where the person for whom the services are performed reserves a right to
control not only the end to be achieved but also the means to be used in reaching such end. In addition to the standard of right-of-control, the
existing economic conditions prevailing between the parties, like the inclusion of the employee in the payrolls, can help in determining the
existence of an employer-employee relationship.
There are instances when, aside from the employer’s power to control the employee, economic realities of the employment relations help provide
a comprehensive analysis of the true classification of the individual, whether as employee, independent contractor, corporate officer or some
other capacity.

It is better, therefore, to adopt a two-tiered test involving: (1) the employer’s power to control; and (2) the economic realities of the activity or
relationship.

The control test means that there is an employer-employee relationship when the person for whom the services are performed reserves the right
to control not only the end achieved but also the manner and means used to achieve that end.

There has to be analysis of the totality of economic circumstances of the worker. Thus, the determination of the relationship between employer
and employee depends upon the circumstances of the whole economic activity, such as: (1) the extent to which the services performed are an
integral part of the employer’s business; (2) the extent of the worker’s investment in equipment and facilities; (3) the nature and degree of
control exercised by the employer; (4) the worker’s opportunity for profit and loss; (5) the amount of initiative, skill, judgment or foresight
required for the success of the claimed independent enterprise; (6) the permanency and duration of the relationship between the worker and the
employer; and (7) the degree of dependency of the worker upon the employer for his continued employment in that line of business. The proper
standard of economic dependence is whether the worker is dependent on the alleged employer for his continued employment in that line of
business

By applying the control test, it can be said that petitioner is an employee of Kasei Corporation because she was under the direct control and
supervision of Seiji Kamura, the corporation’s Technical Consultant. She reported for work regularly and served in various capacities as
Accountant, Liaison Officer, Technical Consultant, Acting Manager and Corporate Secretary, with substantially the same job functions, that is,
rendering accounting and tax services to the company and performing functions necessary and desirable for the proper operation of the
corporation such as securing business permits and other licenses over an indefinite period of engagement. Respondent corporation had the power
to control petitioner with the means and methods by which the work is to be accomplished.

Under the economic reality test, the petitioner can also be said to be an employee of respondent corporation because she had served the company
for 6 yrs. before her dismissal, receiving check vouchers indicating her salaries/wages, benefits, 13th month pay, bonuses and allowances, as
well as deductions and Social Security contributions from. When petitioner was designated General Manager, respondent corporation made a
report to the SSS. Petitioner’s membership in the SSS evinces the existence of an employer-employee relationship between petitioner and
respondent corporation. The coverage of Social Security Law is predicated on the existence of an employer-employee relationship.
The corporation constructively dismissed petitioner when it reduced her. This amounts to an illegal termination of employment, where the
petitioner is entitled to full backwages
A diminution of pay is prejudicial to the employee and amounts to constructive dismissal. Constructive dismissal is an involuntary resignation
resulting in cessation of work resorted to when continued employment becomes impossible, unreasonable or unlikely; when there is a demotion
in rank or a diminution in pay; or when a clear discrimination, insensibility or disdain by an employer becomes unbearable to an employee.
Petition is GRANTED.

ABS-CBN vs NAZARENO

Facts: Petitioner ABS-CBN Broadcasting Corporation (ABS-CBN) is engaged in the broadcasting business and owns a network of television
and radio stations, whose operations revolve around the broadcast, transmission, and relay of telecommunication signals. It sells and deals in or
otherwise utilizes the airtime it generates from its radio and television operations. It has a franchise as a broadcasting company, and was likewise
issued a license and authority to operate by the National Telecommunications Commission.

Petitioner employed respondents Nazareno, Gerzon, Deiparine, and Lerasan as production assistants (PAs) on different dates. They were
assigned at the news and public affairs, for various radio programs in the Cebu Broadcasting Station. On December 19, 1996, petitioner and the
ABS-CBN Rank-and-File Employees executed a Collective Bargaining Agreement (CBA) to be effective during the period from December 11,
1996 to December 11, 1999. However, since petitioner refused to recognize PAs as part of the bargaining unit, respondents were not included to
the CBA.

On October 12, 2000, respondents filed a Complaint for Recognition of Regular Employment Status, Underpayment of Overtime Pay, Holiday
Pay, Premium Pay, Service Incentive Pay, Sick Leave Pay, and 13th Month Pay with Damages against the petitioner before the NLRC. The
Labor Arbiter rendered judgment in favor of the respondents, and declared that they were regular employees of petitioner as such, they were
awarded monetary benefits. NLRC affirmed the decision of the Labor Arbiter. Petitioner filed a motion for reconsideration but CA dismissed it.

Issue: Whether or not the respondents were considered regular employees of ABS-CBN.

Ruling: The respondents are regular employees of ABS-CBN. It was held that where a person has rendered at least one year of service,
regardless of the nature of the activity performed, or where the work is continuous or intermittent, the employment is considered regular as long
as the activity exists, the reason being that a customary appointment is not indispensable before one may be formally declared as having attained
regular status.

In Universal Robina Corporation v. Catapang, the Court states that the primary standard, therefore, of determining regular employment is the
reasonable connection between the particular activity performed by the employee in relation to the usual trade or business 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 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 a year, even if the performance is not continuous and merely intermittent, the law deems 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 considered regular, but only with respect to such activity and while such activity exists.

Additionally, respondents cannot be considered as project or program employees because no evidence was presented to show that the duration
and scope of the project were determined or specified at the time of their engagement. In the case at bar, however, the employer-employee
relationship between petitioner and respondents has been proven. In the selection and engagement of respondents, no peculiar or unique skill,
talent or celebrity status was required from them because they were merely hired through petitioner’s personnel department just like any ordinary
employee. Respondents did not have the power to bargain for huge talent fees, a circumstance negating independent contractual relationship.
Respondents are highly dependent on the petitioner for continued work. The degree of control and supervision exercised by petitioner over
respondents through its supervisors negates the allegation that respondents are independent contractors.

The presumption is that when the work done is an integral part of the regular business of the employer and when the worker, relative to the
employer, does not furnish an independent business or professional service, such work is a regular employment of such employee and not an
independent contractor. As regular employees, respondents are entitled to the benefits granted to all other regular employees of petitioner under
the CBA . Besides, only talent-artists were excluded from the CBA and not production assistants who are regular employees of the respondents.
Moreover, under Article 1702 of the New Civil Code: “In case of doubt, all labor legislation and all labor contracts shall be construed in favor of
the safety and decent living of the laborer.”

BIG AA MANUFACTURER, Petitioner, vs. EUTIQUIO ANTONIO, JAY ANTONIO,

BigAA Manufacturer vs. Antonio

[G.R. No. 160854March 3, 2006]
Facts:
The respondent employees alleged that as regular employees, they worked for petitioner Big AA
from 8:00 a.m. to 5:00 p.m. in its premises and using its tools and equipment. They received P250 per
day. They allegedthat they were dismissed without just cause and due process.
However, Big AA denied that respondents were its regular employees. Instead, it claimed that
Antonio was one of its independent contractors who used the services of the other respondents.
According to Big AA, its independent contractors were paid by results and were responsible for the
salaries of their own workers. As such, there was no employer-employee relationship between
petitioner and respondents. Big AA explained that it allowed respondents to use its facilities only to
meet job orders. It also denied that respondents were laid-off, since they were merely project
employees.

Issue:
Whether or not respondents are regular employees
Held:

Respondents are regular employees. They were employed for more than one year and their work as
carpenters was necessary or desirable in petitioner’s usual trade or business of manufacturing office
furniture. Under Article 280 of the Labor Code, the applicable test to determine whether an
employment should be considered regular or non-regular is the reasonable connection between the
particular activity performed by the employee in relation to the usual business or trade of the
employer.
Respondents cannot be considered project employees. Petitioner had neither shown that
respondents were hired for a specific project the duration of which was determined at the time of
their hiring nor identified the specific project or phase thereof for which respondents werehired.
Antonio was not an independent contractor for he does not carry a distinct and independent
business, and he does not possess substantial capital or investment in tools, equipment, machinery or
work premises. He works within petitioner’s premises using the latter’s tools and materials and
other facilities for the "proper implementation" of job orders. He is also under petitioner’s control
and supervision. Moreover, the Implementing Guidelines regulating attendance, overtime, deadlines,
penalties; providing petitioner’s right to fire employees or "contractors"; requiring the carpentry
division to join petitioner’s exercise program; and providing rules on machine maintenance, all
reflect control and supervision over respondents

Thelma Dumpit-Murillo vs Court of Appeals

Thelma Dumpit-Murillo was hired by ABC as a newscaster in 1995. Her contract with the TV station was repeatedly renewed until 1999. She
then wrote Jose Javier (VP for News and Public Affairs of ABC) advising him of her intention to renew the contract.

Javier did not respond.

Dumpit then demanded reinstatement as well as her backwages, service incentive leave pays and other monetary benefits.

ABC said they could only pay her backwages but her other claims had no basis as she was not entitled thereto because she is considered as a
talent and not a regular employee.

Dumpit sued ABC. The Labor Arbiter ruled against Dumpit. The National Labor Relations Commission reversed the LA. The Court of Appeals
reversed the NLRC and ruled that as per the contract between ABC and Dumpit, Dumpit is a fixed term employee.

ISSUE: Whether or not Dumpit is a regular employee.

HELD: Yes. Dumpit was a regular employee under contemplation of law. The practice of having fixed-term contracts in the industry does not
automatically make all talent contracts valid and compliant with labor law. The assertion that a talent contract exists does not necessarily prevent
a regular employment status.

The duties of Dumpit as enumerated in her employment contract indicate that ABC had control over the work of Dumpit. Aside from control,
ABC also dictated the work assignments and payment of petitioner’s wages. ABC also had power to dismiss her. All these being present,
clearly, there existed an employment relationship between Dumpit and ABC.

In addition, her work was continuous for a period of four years. This repeated engagement under contract of hire is indicative of the necessity
and desirability of the Dumpit’s work in ABC’s business.

OLDARICO S. TRAVEÑO
vs.
BOBONGON BANANA GROWERS MULTI-PURPOSE COOPERATIVE

FACTS:

Petitioner Oldarico Traveño and his 16 co-petitioners worked at a banana plantation at BobonganSanto Tomas, Davao del Norte. Sometime
in 2000, they filed three separate complaints for illegaldismissal, individually and collectively, with the NLRC against said respondents
including respondent DoleAsia Philippines as it then supposedly owned TACOR, for unpaid salaries, overtime pay, 13th month pay,service
incentive leave pay, damages, and attorney’s fees. DFI answered for itself and TACOR denied that they hired petitioners; That it had an
arrangementwith several landowners for them to extend financial and technical assistance to them for thedevelopment of their
lands into a banana plantation on the condition that the bananas produced thereinwould be sold exclusively to TACOR and it was the landowners
who worked on their own farms and hiredlaborers to assist them and that the landowners themselves decided to form a cooperative in order
tobetter attain their business objectives;The Cooperative failed to file a position paper despite due notice, prompting the Labor Arbiter to
considerit to have waived its right to adduce evidence in its defense.Nothing was heard from respondent Dole AsiaPhilippines.LABOR
ARBITER: Cooperative is guilty of illegal dismissal based on several Orders by the DOLE in anearlier case declaring the Cooperative as the
employer of the 341 workers in the farms of its severalmembers. It dropped the complaints against DFI, TACOR and Dole Asia
Philippines.NLRC: sustained the Labor Arbiter’s ruling that the employer of petitioners is the Cooperative. It partiallygranted petitioners’
appeal, however, by ordering the Cooperative to pay them their unpaid wages, wagedifferentials, service incentive leave pay, and 13th month
pay. It thus remanded the case to the LaborArbiter for computation of those awards.CA: dismissed petitioners’ petition for certiorari on the
ground that the accompanying verification andcertification against forum shopping was defective, it having been signed by only 19 of the 22
thereinnamed petitioners.

ISSUES: (1) WON the petition should be dismissed because of the non-signing of the petitioners;

HELD: For the guidance of the bench and bar, the Court restates in capsule form the jurisprudentialpronouncements already reflected in
Altres v Empleo above respecting non-compliance with therequirements on, or submission of defective, verification and certification
against forum shopping:1) A distinction must be made between non-compliance with the requirement on or submission ofdefective verification,
and non-compliance with the requirement on or submission of defectivecertification against forum shopping.2) As to verification, non-
compliance therewith or a defect therein does not necessarily render thepleading fatally defective. The court may order its submission or
correction or act on the pleadingif the attending circumstances are such that strict compliance with the Rule may be dispensed within order that
the ends of justice may be served thereby. 3) Verification is deemed substantially complied with when one who has ample knowledge toswear to
the truth of the allegations in the complaint or petition signs the verification, and whenmatters alleged in the petition have been made in good
faith or are true and correct. 4) As to certification against forum shopping, non-compliance therewith or a defect therein, unlikein verification, is
generally not curable by its subsequent submission or correction thereof, unlessthere is a need to relax the Rule on the ground of "substantial
compliance" or presence of "specialcircumstances or compelling reasons." 5) The certification against forum shopping must be signed by all the
plaintiffs or petitioners in acase; otherwise, those who did not sign will be dropped as parties to the case. Under reasonable orjustifiable
circumstances, however, as when all the plaintiffs or petitioners share a common
interest and invoke a common cause of action or defense, the signature of only one of them in thecertification against forum shopping
substantially complies with the Rule. 6) Finally, the certification against forum shopping must be executed by the party-pleader, not byhis
counsel. If, however, for reasonable or justifiable reasons, the party-pleader is unable to sign,he must execute a Special Power of Attorney
designating his counsel of record to sign on hisbehalf. (Emphasis and underscoring supplied)The foregoing restated pronouncements were lost in
the challenged Resolutions of the appellate court.Petitioners’ contention that the appellate court should have dismissed the petition only as to the
non-signing petitioners or merely dropped them as parties to the case is thus in order.Instead of remanding the case to the appellate court,
however, the Court deems it more practical to decidethe substantive issue raised in this petition so as not to further delay the disposition of this
case.

ISSUE: (2) won DFI and DPI should be held solidarily liable with Cooperative for petitioner’s illegaldismissal and money claims.

HELD: No they are not solidarily liable. Petition is dismissed. There is no ER-EE relationship betweenpetitioners and Cooperative’s co-
respondents. DFI did not farm out to the Cooperative the performance ofa specific job, work, or service. Instead, it entered into a Banana
Production and Purchase Agreement(Contract) with the Cooperative, under which the Cooperative would handle and fund the production
ofbananas and operation of the plantation covering lands owned by its members in consideration of DFI’scommitment to provide financial and
technical assistance as needed, including the supply of informationand equipment in growing, packing, and shipping bananas. The Cooperative
would hire its own workersand pay their wages and benefits, and sell exclusively to DFI all export quality bananas produced that meetthe
specifications agreed upon. To the Court, the Contract between the Cooperative and DFI, far from being a job contractingarrangement, is in
essence a business partnership that partakes of the nature of a joint venture. The ruleson job contracting are, therefore, inapposite. Further,
petitioners’ claim of employment relationship withthe Cooperative’s herein co-respondents must be assessed on the basis of four standards, viz:
(a) themanner of their selection and engagement (No employment contract was; (b) the mode of payment oftheir wages; (c) the presence or
absence of the power of dismissal; and (d) the presence or absence ofcontrol over their conduct. Most determinative among these factors is the
so-called "control test." There isnothing in the records which indicates the presence of any of the foregoing elements of an employer-employee
relationship. While the Court commiserates with petitioners on their loss of employment, especially now that the Cooperative is no longer a
going concern since it has been dissolved, it cannot simply, by default, holdthe Cooperative’s co-respondents liable for their claims without any
factual and legal justification therefor.The social justice policy of labor laws and the Constitution is not meant to be oppressive of capital.
Enpassant, petitioners are not precluded from pursuing any available remedies against the former members of the defunct Cooperative as their
individual circumstances may warrant.

Meralco vs benamira

Rogelio Benamira et al were security guards who worked for PSI (People’s Security, Inc.). PSI was the security agency contracted by
MERALCO (Manila Electric Company). The contract between PSI and MERALCO expired. MERALCO subsequently contracted ASDAI
(Armed Security and Detective Agency, Inc.) as its new security agency. ASDAI absorbed Benamira et al upon MERALCO’s advice. After two
years, the contract between ASDAI and MERALCO expired. MERALCO subsequently contracted AFSISI (Advance Forces Security and
Investigation Services, Inc.). AFSISI did not schedule any work for Benamira et al. It was interpreted as a constructive dismissal. Benamira sued
MERALO, ASDAI, and AFSISI.

The Labor Arbiter ruled that ASDAI should reinstate Benamira et al and that MERALCO is solidarily liable. No liability for AFSISI. NLRC
affirmed LA. The CA reversed the lower courts. The CA ruled that the employer is actually MERALCO.

ISSUE: Whether or not MERALCO is the employer of the fired security guards.

HELD: No. Under the contract between ASDAI and MERALCO, it can be seen that ASDAI is indeed the employer of the guards. Applying the
4 Fold Test: ASDAI employed the guards when it absorbed them from PSI. ASDAI provided the salaries of the guards (MERALCO merely pays
ASDAI for providing the guards). ASDAI has control over the guards because they are being inspected (MERALCO has the right to conduct its
own inspection as per contract with ASDAI only). ASDAI has the power to terminate the guards, as when they did not provide any tours or
schedules to them.
Further, the services offered by the guards is not necessary to the principal business of MERALCO which is to provide electricity.

AFSISI is not the employer of the guards as well (as claimed by the guards) because AFSISI never absorbed them nor was there any evidence
showing otherwise.

These security agencies are not Labor Only agencies (unlike HR agencies) because they have their own equipments, machineries and in general
they carry their own business.

TAPE vs Servana

Servaña started out as a security for the Agro-Commercial Security Agency (ACSA) since 1987. The agency had a contract with TV network
RPN 9.

On the other hand, Television and Production Exponents, Inc (TAPE). is a company in charge of TV programming and was handling shows like
Eat Bulaga! Eat Bulaga! was then with RPN 9.

In 1995, RPN 9 severed its relations with ACSA. TAPE retained the services of Servaña as a security guard and absorbed him.

In 2000, TAPE contracted the services of Sun Shield Security Agency. It then notified Servaña that he is being terminated because he is now a
redundant employee.

Servaña then filed a case for illegal Dismissal. The Labor Arbiter ruled that Servaña’s dismissal is valid on the ground of redundancy but though
he was not illegally dismissed he is still entitled to be paid a separation pay which is amounting to one month pay for every year of service which
totals to P78,000.00.

TAPE appealed and argued that Servaña is not entitled to receive separation pay for he is considered as a talent and not as a regular employee;
that as such, there is no employee-employer relationship between TAPE and Servaña. The National Labor Relations Commission ruled in favor
of TAPE. It ruled that Servaña is a program employee. Servaña appealed before the Court of Appeals.

The Court of Appeals reversed the NLRC and affirmed the LA. The CA further ruled that TAPE and its president Tuviera should pay for
nominal damages amounting to P10,000.00.

ISSUE: Whether or not there is an employee-employer relationship existing between TAPE and Servaña.

HELD: Yes. Servaña is a regular employee.

In determining Servaña’s nature of employment, the Supreme Court employed the Four Fold Test:

1. Whether or not employer conducted the selection and engagement of the employee.

Servaña was selected and engaged by TAPE when he was absorbed as a “talent” in 1995. He is not really a talent, as termed by TAPE, because
he performs an activity which is necessary and desirable to TAPE’s business and that is being a security guard. Further, the primary evidence of
him being engaged as an employee is his employee identification card. An identification card is usually provided not just as a security measure
but to mainly identify the holder thereof as a bona fide employee of the firm who issues it.

2. Whether or not there is payment of wages to the employee by the employer.

Servaña is definitely receiving a fixed amount as monthly compensation. He’s receiving P6,000.00 a month.

3. Whether or not employer has the power to dismiss employee.

The Memorandum of Discontinuance issued to Servaña to notify him that he is a redundant employee evidenced TAPE’s power to dismiss
Servaña.

4. Whether or not the employer has the power of control over the employee.

The bundy cards which showed that Servaña was required to report to work at fixed hours of the day manifested the fact that TAPE does have
control over him. Otherwise, Servaña could have reported at any time during the day as he may wish.

Therefore, Servaña is entitled to receive a separation pay.

On the other hand, the Supreme Court ruled that Tuviera, as president of TAPE, should not be held liable for nominal damages as there was no
showing he acted in bad faith in terminating Servaña.

Regular Employee Defined:

One having been engaged to perform an activity that is necessary and desirable to a company’s business.

Orozco vs Ca

Facts:
PDI engaged the services of Orozco to write a weekly column for its Lifestyle section. She religiously submitted her articles except for a 6-
month stint when she went to NY City.Nevertheless, she continued to send her articles through mail.She also received compensation for every
column that was published.When Orozco’s column appeared in the newspaper for the last time, her editor, Logarta, told her that the PDI’s
editor-in-chief, Magsanoc, wanted to stop publishing her columns for no reason at all and advised her to talk to the editor-in-chief. When Orozco
talked to Magsanoc, the latter told her that it was the PDI chairperson who wanted to stop the publication of her column.However, when Orozco
talked to Apostol, the latter told her that Magsanoc informed her that the Lifestyle section had already many columnists.PDI claims that
Magsanoc met with the editor of the Lifestyle section 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.Orozco filed a complaint for illegal dismissal. The LA decided in favor of petitioner. On appeal, the NLRC
dismissed the appeal and affirmed the LA’s decision. The CA on the other hand, set aside the NLRC’s decision and dismissed Orozco’s
complaint.

Issue:
Whether petitioner is an employee of PDI.Whether petitioner was illegally dismissed.

Decision:
Petition dismissed. Judgment and Resolution affirmed.Applying the four-fold test, the Court held that PDI lacked control over the petitioner.
Though PDI issued guidelines for the petitioner to follow in the course of writing her columns,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. 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. The apparent limitation that she had to write only on subjects that befitted
the Lifestyle section did not translate to control, but was simply a logical consequence of the fact that her column appeared in that section and
therefore had to cater to the preference of the readers of that section.Orozco in this case is considered as an independent contractor. As stated in
the case of Sonza vs. ABS-CBN,independent contractors often present themselves to possess unique skills, expertise or talent to distinguish them
from ordinary employees. Like the petitioner in the cited 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 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. Hence,
since Orozco is not an employee of PDI, the latter cannot be held guilty of illegally dismissing the petitioner

Melencio Gabriel vs Nelson Bilon

Nelson Bilon, Angel Brazil and Ernesto Pagaygay were jeepney drivers of jeepneys owned by Melencio Gabriel. They are paying P400/day for
their boundary. Later, the drivers were required to pay an additional P50.00 to cover police protection, car wash, deposit fee, and garage fees.

The three drivers refused to pay the additional P50.00. On April 30, 1995, when the drivers reported to work, they were not given any jeepney to
drive. Eventually, they were dismissed. The three drivers sued Gabriel for illegal dismissal.

The Labor Arbiter ruled in favor of the drivers and ordered Gabriel to pay the drivers their backwages and their separation pay amounting to
about a total of P1.03M.

On April 18, 1997, the LA promulgated its decision and on the same day sent a copy thereof to Gabriel but Flordeliza (wife of Gabriel) refused
to receive the copy. Apparently, Gabriel died on April 4, 1997. The copy was re-sent via registered mail on May 28, 1997. Flordeliza appealed to
the LA on June 5, 1997.

The LA dismissed the appeal; it ruled that the appeal was not on time because the promulgation was made on April 18, 1997 and that the appeal
on June 5, 1997 was already beyond the ten day period required for appeal.

The National Labor Relations Commission reversed the LA. It ruled that there was no employee-employer relationship between the drivers and
Gabriel. The Court of Appeals reversed the NLRC but it ruled that the separation pay should not be awarded but rather, the employees should be
reinstated.

ISSUES:

1. Whether or not the appeal before the LA was made on time.

2. Whether or not there was an employer-employee relationship between the drivers and Gabriel.

3. Whether or not there was a strained relation between Gabriel and the drivers.

HELD:
1. Yes. The appeal was made on time because when the promulgation was made Gabriel is already dead. The ten day requirement to make an
appeal is not applicable in this situation because Gabriel was not yet properly substituted by the wife. The counting of the period should be made
starting from the date when the copy was sent via registered mail. Therefore, the appeal filed on June 5 was made on time.

2. Yes. There exists an employer-employee relationship between the drivers and Gabriel. The fact that the drivers do not receive fixed wages but
get only whatever exceeds the so-called “boundary” [that] they pay to the owner/operator is not sufficient to withdraw the relationship between
them from that of employer and employee.

3. No. The award of the separation pay is not proper. It was not shown that there was a strained relationship between Gabriel and the drivers so
as to cause animosity if they are reinstated. The Strained Relations Principle is only applied if it is shown that reinstatement would only cause
antagonism between the employer and the employee; and that the only solution is separation and the payment of separation pay.

Calamba Medical Center, Inc. vs National Labor Relations Commission

Ronaldo Lanzanas and Merceditha Lanzanas are doctors employed by Calamba Medical Center, Inc. They are given a retainer’s fee by the
hospital as well as shares from fees obtained from patients.

One time, Ronaldo was overheard by Dr. Trinidad talking to another doctor about how low the admission rate to the hospital is. That
conversation was reported to Dr. Desipeda who was then the Medical Director of the hospital.

Eventually Ronaldo was suspended. Ronaldo filed a case for Illegal Suspension in March 1998. In the same month, the rank and file employees
organized a strike against the hospital for unfair labor practices. Desipeda eventually fired Ronaldo for his alleged participation in the strike,
which is not allowed under the Labor Code for he is a managerial employee. Desipeda also fired Merceditha on the ground that she is the wife of
Ronaldo who naturally sympathizes with him.

The Labor Arbiter ruled that there was no Illegal Suspension for there was no employer-employee relationship because the hospital has no
control over Ronaldo as he is a doctor who even gets shares from the hospitals earnings.

The National Labor Relations Commission as well as the Court of Appeals reversed the LA.

ISSUE: Whether or not there is an employer-employee relationship?

HELD: Yes. Under the control test, an employment relationship exists between a physician and a hospital if the hospital controls both the means
and the details of the process by which the physician is to accomplish his task. There is control in this case because of the fact that Desipeda
schedules the hours of work for Ronaldo and his wife.

The doctors are also registered by the hospital under the SSS which is premised on an employer-employee relationship.

There is Illegal Dismissal committed against Rolando for there was no notice and hearing held. It was never shown that Rolando joined the
strike. But even if he did, he has the right to do so for he is not a part of the managerial or supervisory employees. As a doctor, their decisions are
still subject to revocation or revision by Desipeda.

There is Illegal Dismissal committed against Merceditha for the ground therefor was not mentioned in Article 282 of the Labor Code.

When is Control (One of the Four Tests of Employer-Employee Relationship) Absent?

Where a person who works for another does so more or less at his own pleasure and is not subject to definite hours or conditions of work, and is
compensated according to the result of his efforts and not the amount thereof, the element of control is absent.

Charlito Penaranda v Banganga Plywood Corporation and Chua

Facts:
Charlito Penaranda was hired as an employee of Baganga Corporation with a monthly salary of P5,000 as Foreman/Boiler Head/ Shift Engineer
to take charge of the operations and maintenance of its steam plant boiler.

He alleges that he was illegally terminated and that his termination was without due process and valid grounds. Furthermore, he was not paid his
OT pay, premium pay for working during holidays, and night shift differentials. So he filed an action for illegal dismissal.

Hudson Chua, the General Manager of Baganga alleges that Penaranda’s separation was done pursuant to Art. 238 of the Labor Code. The
company was on temporary closure due to repair and general maintenance and it applied for clearance with the DOLE to shut down and dismiss
employees. He claims that due to the insistence of complainant, he was paid his separation benefits. But when the company partially re-opened,
Penaranda faild to re-apply.

Chua also alleges that since he is a managerial employee, he is not entitled to OT pay and if ever he rendered services beyond the normal hours
of work, there was no office order/authorization for him to do so.

The Labor Arbiter ruled that there was no illegal dismissal and that Penaranda’s complaint was premature because he was still employed with
Baganga. As regards the benefits, the Labor Arbiter found petitioner entitled to OT pay, premium pay for working on rest days and attorney’s
fees.

On appeal, NLRC deleted the award of OT pay, premium pay and attorney’s fees.

The CA dismissed Penaranda’s Petition for Certiorari based on procedural failures.

Issue:
Whether or not Penaranda is a regular employee entitled to monetary benefits under Art. 82 of the Labor Code.

Held:
NO. Penaranda is part of the managerial staff which takes him out of the coverage of labor standards. The Implementing Rules define members
of a managerial staff as those with the ff. responsibilities:

(1) The primary duty consists of the performance of work directly related to management policies of the employer;
(2) Customarily and regularly exercise discretion and independent judgment;
(3) (i) Regularly and directly assist a proprietor or a managerial employee whose primary duty consists of the management of the establishment
in which he is employed or subdivision thereof; or (ii) execute under general supervision work along specialized or technical lines requiring
special training, experience, or knowledge; or (iii) execute under general supervision special assignments and tasks; and
(4) who do not devote more than 20 percent of their hours worked in a workweek to activities which are not directly and closely related to the
performance of the work described in paragraphs (1), (2), and (3) above."

Petitioner supervised the engineering section of the steam plant boiler. His work involved overseeing the operation of the machines and the
performance of the workers in the engineering section. This work necessarily required the use of discretion and independent judgment to ensure
the proper functioning of the steam plant boiler. As supervisor, petitioner is deemed a member of the managerial staff.

Even Penaranda admitted that he was a supervisor. In his Position Paper, he stated that he was the foreman responsible for the operation of the
boiler. The term foreman implies that he was the representative of management over the workers and the operation of the department. His
classification as supervisor is further evident from the manner his salary was paid. He belonged to the 10% of respondent’s 354 employees who
were paid on a monthly basis; the others were paid only on a daily basis.

*No justification to award overtime pay and premium pay for rest days to Penaranda.

NATIONAL WATERWORKS & SEWERAGE AUTHORITY vs. NWSA CONSOLIDATED UNIONS, ET AL

FACTS: Petitioner National Waterworks & Sewerage Authority is a government-owned and controlled corporation created under Republic Act
No. 1383, while respondent NWSA Consolidated Unions are various labor organizations composed of laborers and employees of the NAWASA.
The other respondents are intervenors Jesus Centeno, et al., hereinafter referred to as intervenors.

The Court of Industrial Relations (now NLRC) conducted a hearing on the controversy then existing between petitioner and respondent unions
specifically the implementation of the 40-Hour Week Law (Republic Act No. 1880)
Respondent intervenors filed a petition in intervention on the issue of additional compensation for night work.

The court ruled that “The NAWASA is an agency not performing governmental functions and, therefore, is liable to pay additional
compensation for work on Sundays and legal holidays conformably to Commonwealth Act No. 444, known as the Eight-Hour Labor Law, even
if said days should be within the staggered five-work days authorized by the President; the intervenors do not fall within the category of
“managerial employees” as contemplated in Republic Act 2377 and so are not exempt from the coverage of the Eight-Hour Labor Law”

ISSUE: Whether the intervenors are “managerial employees” within the meaning of Republic Act 2377 and, therefore, not entitled to the benefits
of Commonwealth Act No. 444, as amended;

HELD: NO.
Section 2 of Republic Act 2377 provides.
“Sec. 2.This Act shall apply to all persons employed in any industry or occupation, whether public or private, with the exception of farm
laborers, laborers who prefer to be paid on piece work basis, managerial employees outside sales personnel, domestic servants — persons in the
personal service of another and members of the family of the employer working for him.
“The term ‘managerial employee’ in this Act shall mean either (a) any person whose primary duty consists of the management of the
establishment in which he is employed or of a customarily recognized department or subdivision thereof, or (b) any officer or member of the
managerial staff.”

One of the distinguishing characteristics by which a managerial employee may be known as expressed in the explanatory note of Republic Act
No. 2377 is that he is not subject to the rigid observance of regular office hours. The true worth of his service does not depend so much on the
time he spends in office but more on the results he accomplishes. In fact, he is free to go out of office anytime.

NON-MANAGERIAL EMPLOYEES COVERED BY COMMONWEALTH ACT NO. 444. — Employees who have little freedom of action
and whose main function is merely to carry out the company’s orders, plans and policies, are not managerial employees and hence are covered
by Commonwealth Act No. 444.
The philosophy behind the exemption of managerial employees from the 8-Hour Labor Law is that such workers are not usually employed for
every hour of work but their compensation is determined considering their special training, experience or knowledge which requires the exercise
of discretion and independent judgment, or perform work related to management policies or general business operations along specialized or
technical lines. For these workers it is not feasible to provide a fixed hourly rate of pay or maximum hours of labor.

The intervenors herein are holding position of responsibility. One of them is the Secretary of the Board of Directors. Another is the private
secretary of the general manager. Another is a public relations officer, and many chiefs of divisions or sections and others are supervisors and
overseers. Respondent court, however, after examining carefully their respective functions, duties and responsibilities found that their primary
duties do not bear any direct relation with the management of the NAWASA, nor do they participate in the formulation of its policies nor in the
hiring and firing of its employees. The chiefs of divisions and sections are given ready policies to execute and standard practices to observe for
their execution. Hence, it concludes, they have little freedom of action, as their main function is merely to carry out the company’s orders, plans
and policies.
Mcleod vs NLRC

FACTS:
On February 2, 1995, John F. McLeod filed a complaint for retirement benefits, vacation and sick leave benefits and other benefits against
Filipinas Synthetic Corporation (Filsyn), Far Eastern Textile Mills, Inc., Sta. Rosa Textiles, Inc., Complainant was the former VP and Plant
Manager of Peggy Mills, Inc.; that he was hired in June 1980 and Peggy Mills closed operations due to irreversible losses but its assets were
acquired by Sta. Rosa Textile Corporation complainant was hired by Sta. Rosa Textile but he resigned and that while complainant was Vice
President and Plant Manager of Peggy Mills, the union staged a strike up to July 1992 resulting in closure of operations due to irreversible losses
as per Notice .The complainant was relied upon to settle the labor problem but due to his lack of attention and absence the strike continued
resulting in closure of the company. Mcleod contends that the corporations are solidarily liable. On 3 April 1998, the Labor Arbiter rendered his
decision in favor of Mcleod The NLRC – Reversed decision CA- Modified the NLRC’s decision. Lim was solidarily liable

Issue:
whether there is merger/ consolidation
w/n Patricio Lim must be solidarily liable with PMI

Held:
There was also no merger or consolidation of PMI and SRTI. Consolidation is the union of two or more existing corporations to form a new
corporation called the consolidated corporation. It is a combination by agreement between two or more corporations by which their rights,
franchises, and property are united and become those of a single, new corporation, composed generally, although not necessarily, of the
stockholders of the original corporations. Merger, on the other hand, is a union whereby one corporation absorbs one or more existing
corporations, and the absorbing corporation survives and continues the combined business.

The parties to a merger or consolidation are called constituent corporations. In consolidation, all the constituents are dissolved and absorbed by
the new consolidated enterprise. In merger, all constituents, except the surviving corporation, are dissolved. In both cases, however, there is no
liquidation of the assets of the dissolved corporations, and the surviving or consolidated corporation acquires all their properties, rights and
franchises and their stockholders usually become its stockholders. The surviving or consolidated corporation assumes automatically the
liabilities of the dissolved corporations, regardless of whether the creditors have consented or not to such merger or consolidation.27 In the
present case, there is no showing that the subject dation in payment involved any corporate merger or consolidation. Neither is there any
showing of those indicative factors that SRTI is a mere instrumentality of PMI.

Moreover, SRTI did not expressly or impliedly agree to assume any of PMI’s debts. 2. In the present case, there is nothing substantial on record
to show that Patricio acted in bad faith in terminating McLeod’s services to warrant Patricio’s personal liability. PMI had no other choice but to
stop plant operations. The work stoppage therefore was by necessity. The company could no longer continue with its plant operations because of
the serious business losses that it had suffered. The mere fact that Patricio was president and director of PMI is not a ground to conclude that he
should be held solidarily liable with PMI for McLeod’s money claims.

The ruling in A.C. Ransom Labor Union-CCLU v. NLRC,59 which the Court of Appeals cited, does not apply to this case. We quote pertinent
portions of the ruling, thus:
(a) Article 265 of the Labor Code, in part, expressly provides: "Any worker whose employment has been terminated as a consequence of an
unlawful lockout shall be entitled to reinstatement with full backwages."
Article 273 of the Code provides that: "Any person violating any of the provisions of Article 265 of this Code shall be punished by a fine of not
exceeding five hundred pesos and/or imprisonment for not less than one (1) day nor more than six (6) months."

(b) How can the foregoing provisions be implemented when the employer is a corporation? The answer is found in Article 212 (c) of the Labor
Code which provides: "(c) ‘Employer’ includes any person acting in the interest of an employer, directly or indirectly. The term shall not include
any labor organization or any of its officers or agents except when acting as employer.". The foregoing was culled from Section 2 of RA 602, the
Minimum Wage Law. Since RANSOM is an artificial person, it must have an officer who can be presumed to be the employer, being the
"person acting in the interest of (the) employer" RANSOM. The corporation, only in the technical sense, is the employer. The responsible officer
of an employer corporation can be held personally, not to say even criminally, liable for non-payment of back wages. That is the policy of the
law.

STANDARD CHARTERED UNION vs STANDARD CHARTERED BANK

Facts

The 1998-2000 Collective Bargaining Agreement between the Standard Chartered Bankemployees Union and the Standard Chartered Bank
expired so the parties tried tor enew it but then a deadlock ensued. Under the old CBA, the following are excluded as appropriate bargaining
unit:

A.All covenanted and assistant officers (now called National Officers)

B. One confidential secretary of each of the:

1.Chief Executive, Philippine Branches

2.Deputy Chief Executive/Head, Corporate Banking Group

3.Head, Finance
4.Head, Human Resources

5.Manager, Cebu

6.Manager, Iloilo

7.Covenanted Officers provided said positions shall be filled by new recruits.

C. The Chief Cashiers and Assistant Cashiers in Manila, Cebu and Iloilo, and in any other branch that the BANK may establish in the country.

D. Personnel of the Telex Department

E. All Security Guards

F. Probationary employees, without prejudice to Article 277 (c) of the Labor Code, as amended by R.A. 6715, casuals or emergency employees;
and

G. One (1) HR Staff

But then in the renewal sought by SCBEU-NUBE,they only wanted the exclusion to apply only to the following employees from the appropriate
bargaining unit.

All managers who are vested with the right to hire and fire employees, confidential employees, those with access to labor relations materials,
Chief Cashiers, Assistant Cashiers, personnel of the Telex Department and one Human Resources (HR) staff.SCBEU-NUBE also averred that
employees assigned in an acting capacity for at least aweek should be given salary raise.A notice of strike was given to the Department of Labor
due to this deadlock.

Then DOLE Secretary Patricia Sto. Tomas issued an order dismissing the Union’s plea.

ISSUE:
Whether or not the confidential employees sought to be removed from the exclusion as appropriate bargaining unit by SCBEU-NUBE holds
ground.

HELD:
No. Whether or not the employees sought to be excluded from the appropriate bargaining unit are confidential employees is a question of fact,
which is not a proper issue in a petition for review under Rule 45 of the Rules of Court. SCBEU-NUBE insists that the foregoing employees are
not confidential employees; however, it failed to buttress its claim. Aside from its generalized arguments, and despite the Secretary's finding that
there was no evidence to support it, SCBEU-NUBE still failed to substantiate its claim. SCBEU-NUBE did not even bother to state the nature of
the duties and functions of these employees, depriving the Court of any basis on which it may be concluded that they are indeed confidential
employees.With regards to the salary increase of employees in acting capacities, the Supreme Court agreed with the Court of Appeals that a
restrictive provision would curtail management's prerogative, and at the same time, recognized that employees should not be made to work in an
acting capacity for long periods of time without adequate
compensation. The usual rule that “employees in acting capacities for at least a month should be given salary raise” is upheld.

Auto Bus Transport vs Bautista DIGEST

Facts:

Bautista, a driver-conductor of the Autobus transport, was dismissed after his failure to pay an amount demanded by the company for the repair
of the bus damaged in an accident caused by him.

He receives compensation by way of commission per travel.

Bautista complained for illegal dismissal with money claims for nonpayment of 13th month pay and service incentive leave pay against Autobus.

Auto Bus’ Defenses:

Bautista’s employment was replete with offenses involving reckless imprudence, gross negligence, and dishonesty supported with copies of
letters, memos, irregularity reports, warrants of arrest;
In the exercise of management prerogative, Bautista was terminated only after providing for an opportunity to explain:
Labor Arbiter dismissed the complaint however awarded Bautista his 13th month pay and service incentive leave pay.

Auto Bus appealed. NLRC deleted the 13th month pay award. In the CA, NLRC’s decision was affirmed.

Issue: Whether or not respondent is entitled to service incentive leave pay.

Held: Yes.

Under Article 95 of the Labor Code, every employee who has rendered at least one year or service shall be entitled to a yearly service incentive
leave of five days with pay. In Section 1, Rule V, Book III of the Implementing Rules and Regulations of the Labor Code, the rule shall apply to
all, except… (d) Field personnel and other employees whose performance is unsupervised by the employer including those who are engaged on
task or contract basis, purely commission basis, or those who are paid in a fixed amount for performing work irrespective of the time consumed
in the performance thereof.
Petitioner’s contention that Bautista is not entitled to service incentive leave because he is paid on a purely commission basis must fail. The
phrase following “Field personnel” should not be construed as a separate classification of employees but is merely an amplification of the
definition of field personnel defined under the Labor Code.

Bautista neither falls under the category field personnel. As defined, field personnel are those whose performance of service is unsupervised by
the employer, the workplace being away from the principal place of business and whose hours and days of work cannot be determined with
reasonable certainty. Bus companies have ways of determining the hours worked by their drivers and conductors with reasonable certainty. The
courts have taken judicial notice of the following:

Along the routes traveled, there are inspectors assigned at strategic places who board the bus to inspect the passengers, the punched tickets, and
the conductor’s reports;
There is a mandatory once-a week car barn or shop day, where the bus is regularly checked;
The drivers and conductors must be at specified place and time, as they observe prompt departure and arrival;
At every depot, there is always a dispatcher whose function is to see to it that the bus and crew leaves and arrives at the estimated proper time.
By these reasons, drivers and conductors are therefore under constant supervision while in the performance of their work.

Far East Agricultural Supply, Inc. vs Jimmy Lebatique

In March 1996, Lebatique was hired as a driver by FAR EAST AGRICULTURAL SUPPLY, INC. with a daily wage of P223.50. His job as a
driver includes the delivery of animal feeds to the clients of the company. He must report either in the morning or in the afternoon to make the
deliveries.

On January 24, 2000, Lebatique was suspended by Manuel Uy (brother of FEASI’s General Manager Alexander Uy) for allegedly using the
company vehicle illegally.

On the same day, Lebatique filed a complaint for nonpayment of overtime pay against Alexander Uy.

Uy summoned Lebatique and asked why he was claiming overtime pay. Lebatique said since he started working with the company he has never
been paid OT pay. Uy consulted with his brother. On January 29, 2000, Uy told Lebatique to look for another job.

Lebatique then filed an Illegal Dismissal case against the company.

The Labor Arbiter ruled in favor of Lebatique. Uy was ordered to reinstate Lebatique and at the same time to pay Lebatique his 13th month pay,
back wages (time when case was pending), service incentive leave pay and OT pay – all amounting to P196,659.72.

Uy argued that Lebatique was not dismissed and that he was merely suspended; that he abandoned his job; and that Lebatique was a field
personnel not entitled to overtime pay and service incentive leave.

ISSUE: Whether or not Lebatique is a field personnel.

HELD: No. Lebatique is a regular employee.

Uy illegally dismissed Lebatique when he told him to look for another job. Judging at the sequence of event, Lebatique earned the ire of Uy
when he filed a complaint for nonpayment of OT pay on the day Lebatique was suspended by Manuel Uy. Such is not a valid reason for
dismissing Lebatique.

Uy cannot therefore claim that he merely suspended Lebatique.

Further, Lebatique did not abandon his job. His filing of this case is proof enough that he had no intention to abandon his job.

To constitute abandonment as a just cause for dismissal, there must be:

(a) absence without justifiable reason; and

(b) a clear intention, as manifested by some overt act, to sever the employer-employee relationship.

None of the above was proven by Uy.

Also, Lebatique is not a field personnel as defined above for the following reasons:

(1) company drivers, including Lebatique, are directed to deliver the goods at a specified time and place;

(2) they are not given the discretion to solicit, select and contact prospective clients; and

(3) Far East issued a directive that company drivers should stay at the client’s premises during truck-ban hours which is from 5:00 to 9:00 a.m.
and 5:00 to 9:00 p.m.

As a regular employee, Lebatique is entitled to service incentive leave and OT pay.

The Supreme Court affirmed the Labor Arbiter’s decision but remanded the case for properly computing Lebatique’s OT pay taking in to
consideration the company’s time keeping records.
Field Personnel Defined

Field personnel are those who regularly perform their duties away from the principal place of business of the employer and whose actual hours
of work in the field cannot be determined with reasonable certainty.