FUJI TELEVISION NETWORK, INC. v. ARLENE S.

ESPIRITU
G.R. No. 204944-45, December 03, 2014
Leonen, J.

FACTS:
Arlene S. Espiritu was engaged by Fuji Television Network, Inc. (“Fuji”) as
a news correspondent/producer. Her contract was initially for only one year
but was successively renewed on a yearly basis with salary adjustment
every renewal.

In 2009, Arlene and Fuji signed a non renewal of contract after its
expiration on May 31, 2009. Arlene received the total amount of
US$18,050.00 as her monthly salary from March to May 2009, year-end
bonus, mid-year bonus and separation pay. Arlene signed the said contract
with the initials UP for Under Protest. She subsequently filed a case for
illegal dismissal and attorney’s fees with NCR Arbitration Branch of the
NLRC. She alleged that she was forced to sign the said non-renewal when
Fuji found out of her illness, and they withheld her salaries from March to
April 2009 when she refused to sign it.

LA decided to dismiss the complaint, applying the ruling in the Sonza case,
and the four fold test, Arlene was not Fuji’s employee, she is an
independent contractor. The NLRC reversed the said ruling by the LA,
stating that Arlene was a regular employee with respect to the activities for
which she was employed since she continuously rendered services that
were deemed necessary and desirable to Fuji’s business. The Court of
Appeals affirmed the NLRC’s decision, ordering further that Arlene be
reinstated to her former position without loss of seniority rights.

Thus the present case.

ISSUE:
Whether the NLRC and CA are correct in ruling that Arlene is an employee
of the Fuji?
RULING:

YES. The Court of Appeals did not err when it relied on the ruling in
Dumpit-Murillo and affirmed the ruling of the National Labor Relations
Commission finding that Arlene was a regular employee.

The four-fold test can be used in determining whether an employer-

employee relationship exists. The elements of the four-fold test are the
following: (1) the selection and engagement of the employee; (2) the
payment of wages; (3) the power of dismissal; and (4) the power of
control, which is the most important element. The power to control refers
to the existence of the power and not necessarily to the actual exercise
thereof, nor is it essential for the employer to actually supervise the
performance of duties of the employee. It is enough that the employer has
the right to wield that power. Meanwhile, there are different kinds of
independent contractors: those engaged in legitimate job contracting and
those who have unique skills and talents that set them apart from ordinary
employees. No employer-employee relationship exists between
independent contractors and their principals. In several Supreme Court
decisions, they found that workers were found to be independent
contractors because of their unique skills and talents and the lack of control
over the means and methods in the performance of their work.

In the present case, Arlene was hired by Fuji as a news producer, but there
was no showing that she was hired because of unique skills that would
distinguish her from ordinary employees. Neither was there any showing
that she had a celebrity status. Fuji had the power to dismiss Arlene, as
provided for in her professional employment contract. Her contract also
indicated that Fuji had control over her work because she was required to
work for eight (8) hours from Monday to Friday, although on flexible time.
On the power to control, Arlene alleged that Fuji gave her instructions on
what to report. Even the mode of transportation in carrying out her
functions was controlled by Fuji.

Thus, the Court of Appeals did not err when it upheld the findings of the
National Labor Relations Commission that Arlene was not an independent
contractor.
COMPARISON OF THE SONZA AND THE DUMPIT MORILLO CASE:
Sonza Case
Ruling of the Court Independent Contractor
Selection and Sonza was engaged by
engagement of the ABS-CBN for his unique
skills, talent and celebrity
employee status not possessed by
ordinary employees.”
Payment of Wages Sonza’s talent fee
amounted to P317,000.00
per month
Power of Dismissal Sonza was unable to prove
that ABS-CBN could
terminate his services apart
from breach of contract.
ABS-CBN continued to
pay his talent fee under
their agreement, even
though his programs were
no longer broadcasted.
Power of Control ABS-CBN did not control
how Sonza delivered his
lines, how he appeared on
television, or how he
sounded on radio. All that
Sonza needed was his
talent.
Dumpit-Morillo Case
Employer-Employee
relationship exists
Dumpit-Murillo was hired
by ABC as a newscaster
and co-anchor.
Dumpit-Murillo’s monthly
salary was P28,000.00
Dumpit-Murillo was found
to have been illegally
dismissed by her employer
when they did not renew
her contract on her fourth
year with ABC
In Dumpit-Murillo, the
duties and responsibilities
enumerated in her contract
was a clear indication that
ABC had control over her
work.