St.

Dominic Savio College

SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

CASE DIGESTS

CASE NO. 8
CASE TITLE: Fuji Television Network vs. Arlene Espiritu
G.R. No. 204944- 45, December 3, 2014

Doctrine: It is the burden of the employer to prove that a person whose services it pays for is an independent contractor
rather than a regular employee with or without a fixed term. That a person has a disease does not per se entitle the employer
to terminate his or her services.

Facts: In 2005, Ms. Arlene Espiritu was engaged by M/s. Fuji Television, Inc. (“Fuji”) as a news correspondent
“tasked to report Philippine news to Fuji through its Manila Bureau field office.” Arlene’s employment contract
initially provided for a term of 1 year but was successively renewed on a yearly basis with salary adjustment
upon every renewal. Subsequently, Ms. Arlene was diagnosed with lung cancer. She thereby informed the
petitioner about her condition however the company did not heed & informed her "that the company will have
a problem renewing her contract". However, she instead that she was still fit to work as certified by her attending
physician. Several verbal & written communication thereafter, both parties signed a non-renewal contract where
it was stipulated that the contract of Ms. Espiritu would no longer be renewed after its expiration. Due to which,
Ms. Espiritu acknowledged receipt of the total amount of her monthly salary from March 2009 to May 2009,
year-end bonus, mid-year bonus, & separation pay.

Consequently, the day after Ms. Espiritu signed the non-renewal contract, she filed a complaint for illegal
dismissal with the NCR Arbitration Branch of NLRC. She claimed that she was left with no other resort but t
sign the non-renewal employee. The CA affirmed the NLRC with the modification that the company
immediately reinstate Ms. Espiritu to her position without loss of seniority rights & pay her back wages, 13th-
month pay, mid-year & year-end bonuses, sick leave & vacation leave with pay until reinstated.

Issue:

1. Whether or not Arlene was a regular employee or a fixed-term contractual employee.

2. Whether or not Arlene was illegally dismissed or not.

Ruling:

1. Yes, Arlene was a regular employee with a fixed term. The test for determining regular employment
is whether there is a reasonable connection between the employee’s activities and the usual business
of the employer. Article 280 provides that the nature of work must be "necessary or desirable in the
usual business or trade of the employer" as the test for determining regular employment. As stated
in ABS-CBN Broadcasting Corporation v. Nazareno: In determining whether employees should be
considered regular or non-regular, the applicable test is the reasonable connection between the particular
activity performed by the employee in relation to the usual business or trade of the employer. The standard,
supplied by the law itself, is whether the work undertaken is necessary or desirable in the usual business or
trade of the employer, a fact that can be assessed by looking into the nature of the services rendered and its
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

relation to the general scheme under which the business or trade is pursued in the usual course. It is
distinguished from a specific undertaking that is divorced from the normal activities required in carrying on a
particular business or trade.

Arlene’s contract indicating a fixed term did not automatically mean that she could never be a regular
employee. This is precisely what Article 280 seeks to avoid. The ruling in Brent remains as the exception
rather than the general rule.

Further, an employee can be a regular employee with a fixed-term contract. The law does not preclude
the possibility that a regular employee may opt to have a fixed-term contract for valid reasons. This was
recognized in Brent: For as long as it was the employee who requested, or bargained, that the contract
has a "definite date of termination," or that the fixed-term contract be freely entered into by the
employer and the employee, then the validity of the fixed-term contract will be upheld.

2. Yes, Arlene was illegally dismissed. Article 279 of the Labor Code provides for the right to security
of tenure and states the following: Art. 279. Security of tenure. In cases of regular employment, the
employer shall not terminate the services of an employee except for a just cause when authorized by
this Title. An employee who is unjustly dismissed from work shall be entitled to reinstatement
without loss of seniority rights and other privileges and to his full back-wages inclusive of
allowances, and to his other benefits or their monetary equivalent computed from the time his
compensation was withheld from him up to the time of his actual reinstatement.

In addition, it was found that Arlene was dismissed because of her health condition. Disease as a ground
for termination is recognized under Article 284 of the Labor Code. There is no evidence showing that
Arlene was accorded due process. After informing her employer of her lung cancer, she was not given
the chance to present medical certificates. Fuji immediately concluded that Arlene could no longer
perform her duties because of chemotherapy. It did not ask her how her condition would affect her work.
Neither did it suggest that she take a leave, even though she was entitled to sick leaves. Worse, it did not
present any certificate from a competent public health authority. What Fuji did was inform her that her
contract would no longer be renewed, and when she did not agree, her salary was withheld. Thus, the
Court of Appeals correctly upheld the finding of the National Labor Relations Commission that for the
failure of Fuji to comply with due process, Arlene was illegally dismissed.
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

CASE DIGESTS

CASE NO. 9
CASE TITLE: Nelson Begino et. al. vs. ABS-CBN Corporation
G.R. No. 199166, April 20, 2015

Doctrine: To determine the existence employer-employee relationship, case law has consistently applied the four-fold test,
to wit: (a) the selection and engagement of the employee; (b) the payment of wages;(c) the power of dismissal; and (d) the
employer's power to control the employee on the means and methods by which the work is accomplished. Of these criteria,
the so-called "control test" is generally regarded as the most crucial and determinative indicator of the presence or absence
of an employer-employee relationship. Under this test, an employer-employee relationship is said to exist where the person
for whom the services are performed reserves the right to control not only the end result but also the manner and means
utilized to achieve the same.

Facts: The respondent M/s. ABS-CBN vide respondent Villafuerte, incepted the services of petitioners as
cameramen, editors/ reporters for TV Broadcasting. The said petitioners signed the renewed Talent Contracts
(3 months-1year) & assignment forms which stipulated the detailed duration, budget & daily technical
requirements of a particular project. Thus, the Talent Contract has an exclusivity clause that provides that
nothing therein shall be deemed or construed to establish an employer-employee relationship between the
parties. Accordingly, petitioners filed against respondents a complaint for regularization before the NLRC.

In light of the aforesaid, petitioners stated that they were under the direct control of Respondent Villafuerte-they
were informed to wear IDs and they were provided the necessary equipment. Furthermore, they were informed
about the news to be covered the following day and bound by the respondent’s punctuality policy. The said
respondents refuted that in accordance with their Talent Contracts & Project Assignment Forms, petitioners
were employed as talents. Moreover, they claimed that they were never forced to their descriptions.

Whilst the case was impending, the contracts of the petitioners were terminated and urged them to file for the
second complaint. The Arbitration Branch ruled that petitioners were regular employees, hence ordered the
opposite party to reinstate them. The NLRC affirmed the ruling, but the CA overturned the decision.

Issue: Whether or not Petitioners are regular employees of Respondents.

Ruling: Yes, Insofar as the nature of one’s employment is concerned, Article 280 of the Labor Code of the
Philippines.

The Court finds that, notwithstanding the nomenclature of their Talent Contracts and/or Project Assignment
Forms and the terms and condition embodied therein, petitioners are regular employees of ABS-CBN. Time and
again, it has been ruled that the test to determine whether employment is regular or not is the reasonable
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

connection between the activity performed by the employee in relation to the business or trade of the
employer.28 As cameramen/editors and reporters, petitioners were undoubtedly performing functions
necessary and essential to ABS-CBN’s business of broadcasting television and radio content. It matters little that
petitioners’ services were engaged for specified periods for TV Patrol Bicol and that they were paid according
to the budget allocated therefor. Aside from the fact that said program is a regular weekday fare of the ABS-
CBN’s Regional Network Group in Naga City, the record shows that, from their initial engagement in the
aforesaid capacities, petitioners were continuously re-hired by respondents over the years. To the mind of the
Court, respondents’ repeated hiring of petitioners for its long-running news program positively indicates that
the latter were ABS-CBN’s regular employees.
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

CASE DIGESTS

CASE NO. 10
CASE TITLE: Villamaria vs. CA and Bustamante
G.R. No. 165881, April 19, 2006

Facts: The petitioner, Mr. Oscar Villamaria Jr. passenger jeepneys by hiring drivers on a boundary basis. On
1997, the petitioner agreed to sell the said jeepney to driver Mr. Bustamante under the “boundary-hulog”
arrangement. The contract was executed & thereby stipulated therein the compliance, prohibitions and
restrictions.

The respondent continued to drive the jeepney in accordance with the supervision and control of the petitioner.
However, the former failed to conform to his obligations which resulted in a notice of compliance and a warning.
In the year 2000, the petitioner took back the jeepney and barred the petitioner from driving the same. Thus, the
petitioner filed a complaint for illegal dismissal. The Labor Arbiter ruled in the favor of respondent, however,
the NLRC reversed the verdict as the juridical relationship between both parties were vendor & vendee.
Consequently, the CA affirmed and upheld the decision of LA on the grounds that the relationship between the
two was dual; Vendor-Vendee & Employer-Employee.

The petitioner claimed that their contract was a combination of Vendor-Vendee & Employer-Employee as they
had clearly arrived at a conditional deed of sale over the jeepney so that their employer-employee relationship
had been transformed into the vendor-vendee relationship.

Issue: Whether or not the existence of a boundary-hulog agreement extinguishes the employer-employee
relationship of the parties.

Ruling: No, the Kasunduan did not extinguish the employer-employee relationship of the parties extant before
the execution of the said deed. The Court agreed with the ruling of the CA that, under the boundary-hulog
scheme incorporated in the Kasunduan, a dual juridical relationship was created between petitioner and
respondent: that of employer-employee and vendor-vendee. The boundary system is a scheme by an
owner/operator engaged in transporting passengers as a common carrier to primarily govern the compensation
of the driver, that is, the latter’s daily earnings are remitted to the owner/operator less the excess of the boundary
which represents the driver’s compensation. Under this system, the owner/operator exercises control and
supervision over the driver.

Under the boundary-hulog scheme, petitioner retained ownership of the jeepney although its material
possession was vested in respondent as its driver. In case respondent failed to make his P550.00 daily installment
payment for a week, the agreement would be of no force and effect and respondent would have to return the
jeepney to petitioner; the employer-employee relationship would likewise be terminated unless petitioner
would allow respondent to continue driving the jeepney on a boundary basis of P550.00 daily despite the
termination of their vendor-vendee relationship.
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

The juridical relationship of employer-employee between petitioner and respondent was not negated by the
foregoing stipulation in the Kasunduan, considering that petitioner retained control of respondent’s conduct as
driver of the vehicle.
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

CASE DIGESTS

CASE NO. 11
CASE TITLE: Bernarte Vs. PBA et, al.,
G.R. No. 192084, September 14, 2011

Facts: Mr. Jose Mel Bernarte & Mr. Renato Guevarra were the complainants stating that they were summoned
to join the PBA as referees. Through the leadership of Commissioner Emilio Bernardino, they sign the contracts
on an annual basis. During the term of Commissioner Eala, however, changes were made to the terms of their
employment. The complainants refuted that they were illegally dismissed. The respondents reverted that the
complainants entered into two contracts of the retainer with the PBA. Complainants were not illegally dismissed
as they were not considered employees. The said respective contracts of retainer were not renewed. The
respondent had the right whether or not to renew the contract of the complainants. The LA ordered that the
dismissal of the petitioner was thereby illegal. In view of that, the LA pronounced the reinstatement of the
petitioner along with the payment of back wages & other damages fees. The NLRC affirmed the Labor Arbiter’s
verdict. Hence, the respondents filed a petition for certiorari with the Court of Appeals, which reversed the
verdict of the NLRC & Labor Arbiter.

Issue: Whether the petitioner is an employee of the respondents, which in turn determines whether the
petitioner was illegally dismissed.

Ruling: To determine the existence of an employer-employee relationship, case law has consistently applied the
four-fold test. In this case, PBA admits repeatedly engaging the petitioner’s services, as shown in the retainer
contracts. PBA pays the petitioner a retainer fee, exclusive of per diem or allowances, as stipulated in the retainer
contract. PBA can terminate the retainer contract for the petitioner’s violation of its terms and conditions. The
contractual stipulations hardly demonstrate control over the means and methods by which the petitioner
performs his work as a referee officiating a PBA basketball game.

Moreover, the following circumstances indicate that petitioner is an independent contractor: (1) the referees are
required to report for work only when PBA games are scheduled, which is three times a week spread over an
average of only 105 playing days a year, and they officiate games at an average of two hours per game; and (2)
the only deductions from the fees received by the referees are withholding taxes. In other words, unlike regular
employees who ordinarily report for work eight hours per day for five days a week, petitioner is required to
report for work only when PBA games are scheduled or three times a week at two hours per game. In addition,
there are no deductions for contributions to the Social Security System, Philhealth or Pag-Ibig, which are the
usual deductions from employees’ salaries.
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

CASE DIGESTS

CASE NO. 12
CASE TITLE: Jesus G. Reyes vs. Glaucoma Research Foundation Inc. Eye

Facts: The petitioner, Mr. Jesus G. Reyes filed a complaint against the respondent M/s. Glaucoma Research
Foundation Inc. Eye with the NLRC on the grounds of illegal dismissal. The respondent hired Mr. Reyes as an
Administrator of its Eye Referral Center (ERC). Subsequently, the respondent suspended the salary of the
petitioner without prior notice however the latter continued working. Due to which, the petitioner wrote a letter
towards the Executive Director of Glaucoma (i.e. Mr. Manuel Agulto) stating that he has not received his salary
along his 14th month pay. In contrary to that, Mr. Manuel said that he is no longer connected with the company
and thereby barred to enter the premises & his office was locked.

The respondent refuted that they hired the petitioner as a consultant or advice in the formulation of an updated
organizational set up; and based on the claim that there must be an administrator for ERC, he designated himself
as such on a trial basis. In light to this, there is no employer-employee relationship since there was no control
over Mr. Reyes in terms of working hours and manner to perform his duties. The Labor Arbiter dismissed the
petitioner’s complaint as he failed to constitute the elements of an employee-employer relationship. Moreover,
a consultant of various government agencies. His actions were not supervised or controlled by the management
of ERC.

The NLRC reversed LA decision as the petitioner was illegally dismissed. The basis of the Labor Arbiter decision
lacked support; it was incumbent for respondents to prove that the dismissal was for cause & effected after due
process was observed. The Court of Appeals denied the petition and affirmed the NLRC decision.

Issue: W/N there was an employer-employee relationship between the parties.

Ruling: NO, The burden of proving that there was a valid dismissal rests on the employer, however, in order
for an illegal dismissal case to prosper, an employee-employer must be established, and it is the burden of the
employee to establish such through substantial evidence The Four-Fold test is used to determine the existence
of an employer-employee relationship: (a) the manner of selection and engagement of the putative employee;
(b) the mode of payment of wages; (c) the presence or absence of power of dismissal; and (d) the presence or
absence of control of the putative employee's conduct. Most determinative among these factors is the so-called
"control test”. The Court agrees with the disquisition of the CA on this matter, to wit: [Respondents'] power to
approve or reject the organizational plans drawn by [petitioner] cannot be the control contemplated in the
"control test." It is but logical that 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. It is undisputed that Reyes was never subject to
definite working hours, as evidenced by the fact that he enters and leaves the office as he pleases and went on
leave without seeking approval there is no employer-employee relationship where supposed employee is not
subject to a set of rules and regulations governing the performance of duties He was also hired as a consultant.
His contention that he was designated in a specific position proves that there exists an employer-employee
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

relationship. However, a mere title does not determine the existence of such 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. Justice is in every case for the deserving,
to be dispensed in the light of the established facts and the applicable law and doctrine.
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

CASE DIGESTS

CASE NO. 13
CASE TITLE: Calalang vs. Williams
G.R. No. 47800 December 2, 1940

Facts: The petitioner, Mr. Calalang is a private citizen and resident of Manila who file a petition for a writ of
prohibition against the respondents. The National Traffic Commission (NTC) in its resolution dated 17th July
1940, provides the prohibition of the animal-drawn vehicles (Kalesa) from passing along Rosario Street until
from Plaza Calderon de la Barca to Dasmariñas Street from 7:30 Am to 12:30 pm and from 1:30 pm to 5:30 pm.

Subsequently, the chairman of the NTC recommended to the Director of Public Works with the approval of the
Secretary of Public Works the adoption of the measure proposed in the resolution aforementioned in pursuance
of the provisions of the Commonwealth Act No. 548 which authorizes said Director with the approval from the
Secretary of the Public Works and Communication to promulgate rules and regulations to regulate and control
the use of and traffic on national roads.

On August 2, 1940, the Director recommended to the Secretary the approval of the recommendations made by
the Chairman of the National Traffic Commission with modifications. The Secretary of Public Works approved
the recommendations on August 10, 1940. The Mayor of Manila and the Acting Chief of Police of Manila have
enforced and caused to be enforced the rules and regulation. As a consequence, all animal-drawn vehicles are
not allowed to pass and pick up passengers in the places above mentioned to the detriment not only of their
owners but of the riding public as well.

Issue: Whether the rules and regulations promulgated by the respondents pursuant to the provisions of
Commonwealth Act NO. 548 constitute an unlawful inference with legitimate business or trade and abridged the
right to personal liberty and freedom of locomotion?

Whether the rules and regulations complained of infringe upon the constitutional precept regarding the
promotion of social justice to insure the well-being and economic security of all the people?

Ruling:
1. No. The promulgation of the Act aims to promote safe transit upon and avoid obstructions on
national roads in the interest and convenience of the public. In enacting said law, the National
Assembly was prompted by considerations of public convenience and welfare. It was inspired by
the desire to relieve congestion of traffic, which is a menace to the public safety. Public welfare
lies at the bottom of the promulgation of the said law and the state in order to promote the
general welfare may interfere with personal liberty, with property, and with business and
occupations. Persons and property may be subject to all kinds of restraints and burdens in order
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

to secure the general comfort, health, and prosperity of the State. To this fundamental aims of
the government, the rights of the individual are subordinated. Liberty is a blessing which should
not be made to prevail over authority because society will fall into anarchy. Neither should
authority be made to prevail over liberty because then the individual will fall into slavery. The
paradox lies in the fact that the apparent curtailment of liberty is precisely the very means of
insuring its preserving.

2. No. Social justice means the promotion of the welfare of all the people, the adoption by the
Government of measures calculated to insure economic stability of all the competent elements of
society, through the maintenance of a proper economic and social equilibrium in the
interrelations of the members of the community, constitutionally, through the adoption of
measures legally justifiable, or extra-constitutionally, through the exercise of powers underlying
the existence of all governments on the time-honored principles of salus populi est suprema lex.

Social justice must be founded on the recognition of the necessity of interdependence among
divers and diverse units of a society and of the protection that should be equally and evenly
extended to all groups as a combined force in our social and economic life, consistent with the
fundamental and paramount objective of the state of promoting health, comfort and quiet of all
persons, and of bringing about “the greatest good to the greatest number.”

The petition is denied with costs against the petitioner.

 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

CASE DIGESTS

CASE NO. 14.

CASE TITLE: Century Properties Inc. vs. Edwin Babiano and Emma Concepcion
G.R. No. 220987, July 5, 2016

Facts:

The respondent Mr. Babiano was hired by the petitioner M/s. Century Properties Inc. as Sales Director which
thereby appointed as the Vice President of Sales. Whilst, the contract of the employment barred him from
disclosing confidential information and working in any business enterprise that is direct competitors of CPI.

After receiving various reports that the respondent provided a competitor with the confidential information in
regard to CPI’s marketing strategies, spread erroneous information towards CPI projects as well as recruiting
CPI’s personnel to join the competitors company and for being AWOL for consecutive days. Due to which,
respondent Babiano was required to explain why he should not charge with conflict of interest, breach of trust
& disloyalty. Consequently, Mr. Babiano rendered his resignation and exposed that he had been hired as VP of
M/s. First aglobal, a competitor of CPI. He received a notice of termination thereafter.

Subsequently, the other respondent Ms. Conception was hired as Sales Agent by CPI and was promoted as
Project Director. Both contract she signed stipulated that there is no employer-employee relationship
between Concepion and CPI. She resigned in 2009. Both filed a complaint before the NLRC, claiming
that their repeated demands for the payment and release of their commissions remained unheeded

Issue:
1. WoN CPI is liable for the unpaid commissions of Babiano

2. WoN CPI is liable for the unpaid commissions of Concepcion

Ruling:

1. NO. In the case at bar, CPI primarily invoked the "Confidentiality of Documents and Non-Compete
Clause" found in Babiano's employment contract to justify the forfeiture of his commissions.

The foregoing clause is not only clear and unambiguous in stating that Babiano is barred
to "work for whatsoever capacity x x x with any person whose business is in direct competition
with [CPI] while [he is] employed and for a period of one year from date of [his] resignation or
termination from the company," it also expressly provided in no uncertain terms that should
Babiano "[breach] any term of [the employment contract], forms of compensation including
commissions and incentives will be forfeited. "Hence, to allow Babiano to freely move to direct
competitors during and soon after his employment with CPI would make the latter's trade
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

secrets vulnerable to exposure, especially in a highly competitive marketing environment. As

such, it is only reasonable that CPI and Babiano agree on such stipulation in the latter's
employment contract in order to afford a fair and reasonable protection to CPI.

2. YES. CPI remains liable for the unpaid commissions of Concepcion in the sum ofP591,953.05

Concepcion's right to her earned commissions is a substantive right which cannot be impaired by an erroneous
computation of what she really is entitled to. Hence, following the dictates of equity and in order to arrive at a
complete and just resolution of the case, and avoid a piecemeal dispensation of justice over the same, the CA
correctly recomputed Concepcion's unpaid commissions, notwithstanding her failure to seek a review of
the NLRC's computation of the same.
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

CASE DIGESTS

CASE NO. 15.

CASE TITLE: Bitoy Javier vs. Fly Ace Corporation / Flordelyn Castillo
G.R. No. 192558, February 15, 2012

Facts: Javier, a worker at Fly Ace who did a variety of tasks for the latter, filed a complaint with the NLRC
alleging underpayment of wages and other benefits under the labor laws.

He claimed that he showed up for work every day between 7:00 a.m. and 5:00 p.m. from Monday through
Saturday; that the company did not provide him with an identification card or pay slips while he was employed;
that when he showed up for work, the security guard would no longer let him enter the building on the orders
of Ruben Ong (Mr. Ong), his superior; and that after pleading with the guard for several minutes to let him in,
he saw Ong who he approached and asked why he was being prevented from entering the property; that Ong
responded by saying, Tanungin mo anak mo; that he learned that Ong had been courting his daughter Annalyn
after the two met at a fiesta celebration in Malabon City; that Annalyn tried to talk to Ong and convince him to
spare her father from trouble but he refused to.

Javier was only summoned around 5 to 6 times a month, whenever the truck of its contractual hauler, Milmar
Hauling Services, wasn't available, according to Fly Ace, who denied having an employer-employee relationship
with him. The case was dismissed by the Labor Arbiter on the grounds that Respondent Fly Ace is not involved
in the trucking industry but rather in the importation and selling of foodstuffs. We give the respondent's
assertion that the complainant was hired on a pakiao basis some credit because a normal hauler is used to deliver
its items.

The NLRC overturned the LA's decision on appeal. It believed that an arrangement on a pakyaw basis did not
rule out the possibility of an employer-employee relationship. Payment based on performance is a form of
compensation; it does not capture the true nature of the relationship. It is merely a means of calculating
remuneration and not a standard for assessing whether an employer-employee relationship exists or not. The
NLRC further argued that it did not follow that a worker was a job contractor and not an employee, just because
the work he was doing was not directly related to the employer's trade or business or the work could be
considered as extra helper, as it was in this case; and that the relationship between an employer and an employee
was one of contracting out the work that was being done.

Issue: Does an employer-employee relationship exist between Javier and Fly Ace, thereby holding the latter
guilty of illegal dismissal?

Ruling: The LA and the CA found Javier's claim of employment with Fly Ace as wanting and deficient. The
Court is constrained to agree. Labor officials are enjoined to use reasonable means to ascertain the facts speedily
and objectively with little regard to technicalities or formalities but nowhere in the rules are they provided a
license to completely discount evidence, or the lack of it. The quantum of proof required, however, must still be
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

satisfied. Hence, when confronted with conflicting versions on factual matters, it is for them in the exercise of
discretion to determine which party deserves credence on the basis of evidence received, subject only to the
requirement that their decision must be supported by substantial evidence. Accordingly, the petitioner needs to
show by substantial evidence that he was indeed an employee of the company against which he claims illegal
dismissal.

While Javier remains firm in his position that as an employed stevedore of Fly Ace, he was made to work in the
company premises during weekdays arranging and cleaning grocery items for delivery to clients, no other proof
was submitted to fortify his claim. The lone affidavit executed by one Bengie Valenzuela was unsuccessful in
strengthening Javiers cause. The Court is of the considerable view that on Javier lies the burden to pass the well-
settled tests to determine the existence of an employer-employee relationship.
 St. Dominic Savio College
SCHOOL OF LAW
Quirino Highway, Pangarap, Caloocan City (North)

Student’s Name: Solis, Angelica D. Course Subject: LABOR LAW I

CASE DIGESTS

CASE NO. 16.

CASE TITLE: Southeast International Rattan Inc. and/or Estanislao Agbay vs. Jesus J. Coming
G.R. No. 186621, March 12, 2014

Facts: M/s. South East International Rattan, the petitioner is a domestic corporation engaged in the business
nature of manufacturing & exporting of furniture to different countries. Mr. Coming being the respondent was
hires by the petitioner as Sizing Machine Operator who work as initially compensated on “pakiao scheme”.
However, there are times he is working fixed per day with the schedule of 8AM-5PM. Subsequently, his work
was interrupted with no reason and resume after 2 months’ time but then the employer never reverted back.
Therefore, the respondent filed a complaint and the Labor Arbiter decided that the respondent is a regular
employee of the petitioner. When the case was escalated in the NLRC, the decision of the LA was thereby
reversed. Contrary to which, CA then overruled the NLRC decision & ordered that there is an existence of an
employer-employee relationship between both parties.

Issue: Whether or not there is employer-employee relationship between petitioner and respondent.

Ruling: Yes, We affirm the CA. To ascertain the existence of employer-employee relationship jurisprudence has
invariably adhered to the four-fold test, to wit: (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.”

x x x As to the “control test”, the following facts indubitably reveal that respondents wielded control over the
work performance of petitioner, to wit: (1) they required him to work within the company premises; (2) they
obliged petitioner to report every day of the week and tasked him to usually perform the same job; (3) they enforced
the observance of definite hours of work from 8 o’clock in the morning to 5 o’clock in the afternoon; (4) the mode
of payment of petitioner’s salary was under their discretion, at first paying him on pakiao basis and thereafter, on
daily basis; (5) they implemented company rules and regulations; (6) [Estanislao] Agbay directly paid petitioner’s
salaries and controlled all aspects of his employment and (7) petitioner rendered work necessary and desirable in
the business of the respondent company.