USON V.

PLDT EMPLOYEES CREDIT COOPERATIVE

FACTS: Uson was the General Manager of PLDT Employees Credit Cooperative (PECCI) before his alleged dismissal. The
records show that Uson was an active member of PECCI and held various positions. He was committee secretary and director
before his appointment as General Manager. Respondent PECCI is a cooperative registered with the Cooperative Development
Authority (CDA) and established and existing under the laws of the Republic of the Philippines.

PECCI’s Board of Directors passed a Board Resolution appointing Uson as Acting General Manager. His appointment was then
formalized and was embodied in a Board Resolution as well. PECCI released a Management Advisory that announced Uson’s
promotion as General Manager. However, through a board resolution, the PECCI Board of Directors declared as vacant all
appointive positions in the cooperative, including Uson’s position as General Manager. This contentious board resolution was
approved by majority of the incumbent directors.

With this, a letter was sent to Uson requiring him to turn over all of PECCI’s properties which were in his possession or control.
Thereafter, a memorandum, naming several people as newly appointed directors of PECCI was circulated. Uson filed a complaint
for illegal dismissal before the Labor Arbiter (LA).

Uson’s Arguments: He argued that he was a regular employee of PECCI and that he was illegally dismissed. For this
reason, he prayed for reinstatement with back wages and benefits as well as demanded payment of damages from the
newly appointed directors of PECCI.

PECCI’s Arguments: They argued that Uson was a cooperative officer of PECCI and that there existed an intra-
cooperative dispute, which is a matter that should be adjudicated by CDA.

Ruling of the Labor Arbiter

The LA ruled that: (1) Uson, as a General Manager of PECCI, was a regular employee; (2) as a regular employee, Uson
was illegally dismissed from employment when the directors passed the said board resolution; and (3) Uson was
entitled to separation pay. Uson and PECCI separately appealed to the NLRC assailing the LA’s decision.

Uson’s Arguments: He seek payment of monetary claims and his reinstatement as General Manager.

PECCI’s Arguments: Reiterated that the NLRC had no jurisdiction over the intra-cooperative dispute between Uson
and the incumbent directors of PECCI.

Ruling of the NRLC

Party granted Uson’s petition and modified the monetary award due to him. However, the NLRC dismissed PECCI’s
appeal for lack of merit and asserted its jurisdiction.

Ruling of the CA

The CA ruled in favor of PECCI. The CA concluded that:

(1) The LA and NLRC had no jurisdiction over the dispute; thus, their decisions were void and ineffective.
(2) There was an intra-cooperative dispute between Uson, PECCI, and the incumbent directors; and
(3) As a matter of equity, Uson must return to PECCI any and all amounts that he may have received from the voided
judgment award.
 CA dismissed Uson’s complaint for illegal dismissal.

ISSUE: Whether the present case is an intra-cooperative dispute within the jurisdiction of the CDA or an ordinary legal dispute
that the labor tribunals may properly take cognizance of.

RULING: The SC reiterated the decision by the CA that Uson is a cooperative officer and his dismissal from PECCI is an intra-
cooperative dispute. The case at bar does not involve a labor matter for the reason that a complaint for illegal dismissal filed by a
cooperative officer is an intra-cooperative dispute, which is within the jurisdiction of the CDA.

Intra-cooperative disputes are within the jurisdiction of the CDA under the Cooperative Code and the CDA Charter

PECCI is a cooperative that is registered with the CDA and existing under the laws of the Republic of the Philippines. The
Cooperative Code is the law that governs cooperatives. Therefore, the Cooperative Code applies to PECCI, its officers, members,
and any inter-cooperative dispute that may arise.

NOTE: Intra-cooperative disputes are generally settled through the conciliation or mediation mechanisms embodied in the by-
laws of cooperatives and in applicable laws. However, when conciliation or mediation proceedings fail, the matter must be settled
through voluntary arbitration with the CDA. Thus, intra-cooperative disputes involving members or officers of a cooperative
must be resolved through the dispute resolution mechanisms under the Cooperative Code and are within the jurisdiction of the
CDA.

In the case at bar, Uson is a cooperative officer whose dismissal is an intra-cooperative dispute.

To be considered a cooperative officer, the following must concur:

(1) The office must be created by the charter to the by-laws of the cooperative; and
(2) The officer must be elected by the board of directors.

In the case at bar, Uson is a cooperative officer because his position of General Manager was created by the by-laws of PECCI,
and he was elected as General Manager by the PECCI Board of Directors. Moreover, Uson’s dismissal from office is an intra-
cooperative dispute which is beyond the jurisdiction of the labor tribunals.

REPUBLIC V. ASIAPRO COOPERATIVE

SUMMARY OF FACTS: Respondent Asiapro Cooperative is composed of owners-members with primary objectives of
providing them savings and credit facilities and livelihood services. In discharge of said objectives, Asiapro entered into several
service contracts with Stanfilco. Sometime later, the cooperative owners-members requested Stanfilco’s help in registering them
with SSS and remitting their contributions. Petitioner SSS informed Asiapro that being actually a manpower contractor supplying
employees to Stanfilco, it must be the one to register itself with SSS as an employer and remit the contributions. Respondent
continuously ignoring the demand of SSS the latter filed before the SSC. Asiapro alleges that there exists no employer-employee
relationship between it and its owners-members. SSC ruled in favor of SSS. On appeal, CA reversed the decision.

DOCTRINE: The existence of an employer-employee relationship between a cooperative and its owner-members is viable.
FACTS: Respondent Asiapro, as a cooperative, is composed of owners-members. Under its by-laws, owners-members are of two
categories:

(1) Regular member, who is entitled to all the rights and privileges of membership; and
(2) Associate member, who has no right to vote and be voted upon and shall be entitled only to such rights and privileges
provided in its by-laws.

Its primary objectives are to provide savings and credit facilities and to develop other livelihood services for its owners-members.
In the discharge of the aforesaid primary objectives, respondent cooperative entered into several Service Contracts with Stanfilco
- a division of DOLE Philippines, Inc. and a company based in Bukidnon. The owners-members do not receive compensation or
wages from the respondent cooperative. Instead, they receive a share in the service surplus which the respondent cooperative
earns from different areas of trade it engages in. The owner-members get their income from the service surplus generated by the
quality and number of services they rendered, which is determined by the Board of Directors of the respondent cooperative.

In order to enjoy the benefits under the Social Security Law of 1997, the owners-members of the respondent cooperative, who
were assigned to Stanfilco requested the services of the latter to register them with petitioner SSS as self-employed and to remit
their contributions as such. However, petitioner (SSS) informed the CEO and General Manager of respondent cooperative that
based on the Service Contracts it executed with Stanfilco, respondent cooperative is actually a manpower contractor supplying
employees to Stanfilco and for that reason, it is an employer of its owners-members working with Stanfilco. Thus, respondent
cooperative should register itself with petitioner SSS as an employer and make the corresponding report and remittance of
premium contributions in accordance with the Social Security Law of 1997.

ISSUE: Whether or not there is employer-employee relationship between Asiapro and its owners-members.

RULING: YES. In determining the existence of an employer-employee relationship, the following elements are considered: (1)
the selection and engagement of the workers; (2) the payment of wages by whatever means; (3) the power of dismissal; and (4)
the power to control the worker‘s conduct, with the latter assuming primacy in the overall consideration. All the aforesaid
elements are present in this case.

First. It is expressly provided in the Service Contracts that it is the respondent cooperative which has the exclusive discretion in
the selection and engagement of the owners-members as well as its team leaders who will be assigned at Stanfilco.

Second. It cannot be doubted then that those stipends or shares in the service surplus are indeed wages, because these are given to
the owners-members as compensation in rendering services to respondent cooperative‘s client, Stanfilco.

Third. It is also stated in the above-mentioned Service Contracts that it is the respondent cooperative which has the power to
investigate, discipline and remove the owners-members and its team leaders who were rendering services at Stanfilco.

Fourth. In the case at bar, it is the respondent cooperative which has the sole control over the manner and means of performing
the services under the Service Contracts with Stanfilco as well as the means and methods of work. Also, the respondent
cooperative is solely and entirely responsible for its owners-members, team leaders and other representatives at Stanfilco. All
these clearly prove that, indeed, there is an employer-employee relationship between the respondent cooperative and its owners-
members.