JESUS G.

REYES, Petitioner,
vs.
GLAUCOMA RESEARCH FOUNDATION, INC., EYE REFERRAL CENTER and MANUEL B.
AGULTO

Facts: On August 2003, Reyes was hired by Glaucoma as administrator of its Eye
Referral Center. He performed his duties as administrator and continuously received his
monthly salary until the end of January 2005. Next month, his salary was withheld
without notice but he still continued to report for work; on April, he wrote a letter to
Agulto, Executive Director of the corporation but did not receive any response. He was
informed by Agulto’s assistant that he was no longer Administrator. His office was
padlocked and closed without notice.

Respondents argue that they engaged his services as a consultant in the formulation of
an updated organizational set-up and employees' manual. He later designated himself
as administrator on a trial basis. There is no employer-employee relationship between
them because respondents had no control over petitioner in terms of working hours as
he reports for work at anytime of the day and leaves as he pleases. They also had no
control as to the manner in which he performs his alleged duties as consultant. He was
the one who voluntarily severed his relations with the company when his relations with
them turned sour. Reyes filed complaint for illegal dismissal which the LA dismissed as
he failed to establish that the elements of an employer-employee relationship existed
between him and respondents. NLRC reversed LA’s decision. On petition for certiorari
CA held that the LA was correct in ruling that, under the control test and the economic
reality test, no employer-employee relationship existed between respondents and
Reyes.

Ruling: In an illegal dismissal case, the burden rests on the employer to prove that its
dismissal of an employee was for a valid cause. However, before a case for illegal
dismissal can prosper, an employer-employee relationship must first be established.
Thus, in filing a complaint before the LA for illegal dismissal, based on the premise that
he was an employee of respondents, it is incumbent upon petitioner to prove the
employer-employee relationship by substantial evidence. The issue of whether or not an
employer-employee relationship existed between petitioner and respondents is
essentially a question of fact.

The factors that determine the issue include who has the power to select the employee,
who pays the employee’s wages, who has the power to dismiss the employee, and who
exercises control of the methods and results by which the work of the employee is
accomplished. Although no particular form of evidence is required to prove the
existence of the relationship, and any competent and relevant evidence to prove the
relationship may be admitted, a finding that the relationship exists must nonetheless
rest on substantial evidence, which is that amount of relevant evidence that a
reasonable mind might accept as adequate to justify a conclusion.

The power of the employer to control the work of the employee is considered the most
significant determinant. This test is premised on whether the person for whom the
services are performed reserves the right to control both the end achieved and the
manner and means used to achieve that end. [Respondents'] power to approve or reject
the organizational plans drawn by [petitioner] cannot be the control contemplated in the
"control test." One who commissions another to do a piece of work should have the right
to accept or reject the product. The important factor to consider in the "control test" is
still the element of control over how the work itself is done, not just the end result
thereof. Where a person who works for another performs his job more or less at his own
pleasure, in the manner he sees fit, not subject to definite hours or conditions of work,
and is compensated according to the result of his efforts and not the amount thereof, no
employer-employee relationship exists.

Petitioner was never subject to definite working hours. He never denied that he goes to
work and leaves therefrom as he pleases. In fact, on December 1-31, 2004, he went on
leave without seeking approval from the officers of respondent company. On the
contrary, his letter simply informed respondents that he will be away for a month and
even advised them that they have the option of appointing his replacement during his
absence.

Supreme Court has also used the economic reality test in determining whether an
employer-employee relationship exists between the parties where the economic realities
prevailing within the activity or between the parties are examined, taking into
consideration the totality of circumstances surrounding the true nature of the
relationship between the parties. This is especially appropriate when, as in this case,
there is no written agreement or contract on which to base the relationship. The
benchmark of economic reality in analyzing possible employment relationships for
purposes of applying the Labor Code ought to be the economic dependence of the
worker on his employer. In the instant case, as shown by the resume of [petitioner], he
concurrently held consultancy positions with the Manila International Airport Authority
and the Anti-Terrorist Task Force for Aviation and Air Transportation Sector during his
stint with the Eye Referral Center. It cannot be said that the [petitioner] was wholly
dependent on [respondent].

Also, the fact alone that petitioner was designated as an administrator does not
necessarily mean that he is an employee of respondents. Mere title or designation in a
corporation will not, by itself, determine the existence of an employer-employee
relationship.

While the Constitution is committed to the policy of social justice and the protection of
the working class, it should not be supposed that every labor dispute will be
automatically decided in favor of labor. Management also has its rights which are
entitled to respect and enforcement in the interest of simple fair play.