Francisco v NLRC (Labor Standards)

FACTS:
Angelina Francisco was hired by Kasei Corporation during the 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 Liason
Officer to the City of Manila to secure permits for the operation of the company. In
1996, she was designated as Acting Manager. She was assigned to handle
recruitment of all employees and perform management administration functions. In
2001, she was replaced by Liza Fuentes as Manager. Kasei Corporation reduced her
salary to P2,500 per month which was until September. She asked for her salary
but was informed that she was no longer connected to the company. She did not
anymore report to work since she was not paid for her salary. She filed an action for
constructive dismissal with the Labor Arbiter.
Kasei Corporation however averred in its defense that:
- Petitioner had no daily time record and she came to the office any time she
wanted. The company never interfered with her work except that from time to time,
the management would ask her opinion on matters relating to her profession.
- petitioner was not among the employees reported to the BIR, as well as a list of
payees subject to expanded withholding tax which included petitioner. SSS records
were also submitted showing that petitioner's latest employer was Seiji
Corporation
DECISION OF LOWER COURTS:
*Labor arbiter: Francisco was illegally dismissed.
*NLRC: affirmed LA.
*CA: reversed NLRC.
*CA (motion for reconsideration): denied.
Hence, the present petition.
ISSUE/S:
(1) WON there was an employer-employee relationship between petitioner and
private respondent Kasei Corporation; and if in the affirmative,
(2) WON petitioner was illegally dismissed.
HELD:
(1) YES.
The court held that in this jurisdiction, there has been no uniform test to determine
the existence of an employer-employee relation.
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.
The better approach would therefore be to adopt a two-tiered test involving:
*CONTROL TEST - YES
*ECONOMIC CONDITIONS -YES
(1) the putative employers POWER TO CONTROL the employee with respect to the
means and methods by
which the work is to be accomplished; and
(2) the underlying ECONOMIC REALITIES of the activity or relationship.
By applying the control test, there is no doubt that petitioner is an employee of
Kasei Corporation because she was under the direct control and supervision of Seiji
Kamura, the corporations Technical Consultant. It is therefore apparent that
petitioner is economically dependent on respondent corporation for her
continued employment in the latters line of business.
Under the broader economic reality test, the petitioner can likewise be said to be an
employee of respondent corporation because she had served the company for six
years 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 August 1, 1999 to December 18, 2000
In Sevilla v. Court of Appeals, the court observed the need to consider the existing
economic conditions
prevailing between the parties, in addition to the standard of right-of-control like the
inclusion of the employee in the payrolls, to give a clearer picture in determining
the existence of an employer-employee relationship based on an 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
employers business;
(2) the extent of the workers investment in equipment and facilities;
(3) the nature and degree of control exercised by the employer;
(4) the workers 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.
(2) YES, she was illegally dismissed. 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
RATIO:
In affording full protection to labor, this Court must ensure equal work opportunities
regardless of sex, race or creed. Even as we, in every case, attempt to carefully
balance the fragile relationship between employees and employers, we are mindful
of the fact that the policy of the law is to apply the Labor Code to a greater number
of employees. This would enable employees to avail of the benefits accorded to
them by law, in line with the constitutional mandate giving maximum aid and
protection to labor, promoting their welfare and reaffirming it as a primary social
economic force in furtherance of social justice and national development.

SONZA vs. ABS-CBN Case Digest

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 Sonzas services exclusively to ABSCBN 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 Sonzas monthly
talent fees but opened another account for the same purpose.
The Labor Arbiter dismissed the complaint and found that there is no employeeemployer 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 employers power to control the employee on the
means and methods by which the work is accomplished. The last element, the socalled "control test", is the most important element.
Sonzas 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-CBNs 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-CBNs
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 Sonzas work. A radio broadcast specialist who works under minimal
supervision is an independent contractor. Sonzas 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.

Javier vs FlyAce
PETITIONER Bitoy Javier alleged that he was an employee of respondent Fly Ace
Corp., performing various tasks at its warehouse such as cleaning and arranging the
canned items before their delivery to certain locations, except in instances when he
would be ordered to accompany the companys delivery vehicles as pahinante. To
support his claim, Javier adduced no other evidence except an affidavit executed by
one Bengie Valenzuela, who only attested that he would frequently see Javier at the
workplace where he was also hired as stevedore. Does Javiers evidence suffice to
establish employer-employee relationship between Fly Ace and him?
Ruling: No.
Expectedly, opposing parties would stand poles apart and proffer allegations as
different as chalk and cheese. It is, therefore, incumbent upon the Court to
determine whether the party on whom the burden to prove lies was able to hurdle
the same. No particular form of evidence is required to prove the existence of such
employer-employee relationship. Any competent and relevant evidence to prove the
relationship may be admitted. Hence, while no particular form of evidence is
required, a finding that such relationship exists must still rest on some substantial
evidence. Moreover, the substantiality of the evidence depends on its quantitative
as well as its qualitative aspects. Although substantial evidence is not a function of
quantity but rather of quality, the x x x circumstances of the instant case demand
that something more should have been proffered. Had there been other proofs of
employment, such as x x x inclusion in petitioners payroll, or a clear exercise of
control, the Court would have affirmed the finding of employer-employee
relationship. In sum, the rule of thumb remains: the onus probandi falls on
petitioner to establish or substantiate such claim by the requisite quantum of
evidence. Whoever claims entitlement to the benefits provided by law should
establish his or her right thereto x x x. In this case, the labor arbiter and the Court
of Appeals (CA) both concluded that Javier failed to establish his employment with
Fly Ace. All that Javier presented were his self-serving statements purportedly
showing his activities as an employee of Fly Ace. He failed to pass the substantiality
requirement to support his claim. Hence, the Court sees no reason to depart from
the findings of the CA. 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. The lone affidavit executed by one Bengie Valenzuela was
unsuccessful in strengthening Javiers cause. All Valenzuela attested to was that he
would frequently see Javier at the workplace where the latter was also hired as

stevedore. Tthe Court cannot ignore the inescapable conclusion that Javiers mere
presence at the workplace falls short in proving employment therein. The affidavit
could have bolstered Javiers claim of being tasked to clean grocery items when
there were no scheduled delivery trips, but no information was offered simply
because the witness had no personal knowledge of Javiers employment status. The
Court cannot accept Javiers statements, hook, line and sinker. (Bitoy Javier vs. Fly
Ace Corp./Flordelyn Castillo, G.R. No. 192558, Feb. 15, 2012).
The elements to determine the existence of an employment relationship are: (a) the
selection and engagement of the employee; (b) the payment of wages; (c) the
power of dismissal; and (d) the employers power to control the employees
conduct. The most important element is the employers control of the employees
conduct, not only as to the result of the work to be done, but also as to the means
and methods to accomplish it. (AD SONICMIX v. WILMER D. GENOVIA, G.R. No.
169757, November 23, 2011)
Guidelines indicative of labor law "control" do not merely relate to the mutually
desirable result intended by the contractual relationship; they must have the nature
of dictating the means and methods to be employed in attaining the result.
(GREGORIO V. TONGKO v. THE MANUFACTURERS LIFE INSURANCE CO. (PHILS.), INC.
and RENATO A. VERGEL DE DIOS, G.R. No. 167622, 25 January 2011)
The Court is of the considerable view that on Javier lies the burden to pass the wellsettled tests to determine the existence of an employer-employee relationship, viz:
(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. Of
these elements, the most important criterion is whether the employer controls or
has reserved the right to control the employee not only as to the result of the work
but also as to the means and methods by which the result is to be accomplished.
(BITOY JAVIER (DANILO P. JAVIER) v. FLY ACE CORPORATION/FLORDELYN CASTILLO,
G.R. No. 192558, February 15, 2012)
In determining the presence or absence of an employer-employee relationship, the
Court has consistently looked for the following incidents, to wit: (a) the selection
and engagement of the employee; (b) the payment of wages; (c) the power of
dismissal; and (d) the employers 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.

SMCEU v. Judge Bersamira (Review, Art. 212)

G.R. No. 87700

June 13, 1990

J. Melencio-Herrera

Facts:
Sometime in 1983 and 1984, SanMig entered into contracts for
merchandising services with Lipercon and D'Rite. These companies are independent
contractors duly licensed by the DOLE. In said contracts, it was expressly
understood and agreed that the workers employed by the contractors were to be
paid by the latter and that none of them were to be deemed employees or agents of
SanMig. There was to be no employer-employee relation between the contractors
and/or its workers, on the one hand, and SanMig on the other.
Petitioner is the duly authorized representative of the monthly paid rank-and-file
employees of SanMig with whom the latter executed a Collective Bargaining
Agreement effective 1 July 1986 to 30 June 1989. Section 1 of their CBA specifically
provides that "temporary, probationary, or contract employees and workers are
excluded from the bargaining unit and, therefore, outside the scope of this
Agreement."
In a letter dated 20 November 1988, the Union advised SanMig that some Lipercon
and D'Rite workers had signed up for union membership and sought the
regularization of their employment with SMC. The Union alleged that this group of
employees, while appearing to be contractual workers supposedly independent
contractors, have been continuously working for SanMig for a period ranging from 6
months to 15 years and that their work is neither casual nor seasonal as they are
performing work or activities necessary or desirable in the usual business or trade
of SanMig. Thus, it was contended that there exists a "labor-only" contracting
situation. It was then demanded that the employment status of these workers be
regularized.
On 12 January 1989 and 30 January 1989, the Union filed two notices of strike for
unfair labor practice, CBA violations, and union busting. Conciliatory meetings were
then held before the National Conciliation and Mediation Board of DOLE (NCMBDOLE).
Beginning 14 February 1989 until 2 March 1989, series of pickets were staged by
Lipercon and D'Rite workers in various SMC plants and offices.
On 6 March 1989, SMC filed a verified Complaint for Injunction and Damages before
respondent Court enjoining petitioner from representing and/or acting in behalf of
the employees of Lipercon and DRite, and of calling a strike among others.
Respondent Court found the Complaint sufficient in form and substance and issued
a Temporary Restraining Order, and subsequently, an Order granting the complaint
of SanMig.

Issue: Whether or not there exists a labor dispute such that the RTC may not validly
assume jurisdiction to the exclusion of the NCMB-DOLE.

Held: A "labor dispute" as defined in Article 212 (1) of the Labor Code includes "any
controversy or matter concerning terms and conditions of employment or the

association or representation of persons in negotiating, fixing, maintaining,

changing, or arranging the terms and conditions of employment, regardless of
whether the disputants stand in the proximate relation of employer and employee."
While it is SanMig's submission that no employer-employee relationship exists
between itself, on the one hand, and the contractual workers of Lipercon and D'Rite
on the other, a labor dispute can nevertheless exist "regardless of whether the
disputants stand in the proximate relationship of employer and employee" provided
the controversy concerns, among others, the terms and conditions of employment
or a "change" or "arrangement" thereof. Put differently, and as defined by law, the
existence of a labor dispute is not determined by the fact that the plaintiffs and
defendants do not stand in the proximate relation of employer and employee.
That a labor dispute, as defined by the law, does exist here is evident. What the
Union seeks is to regularize the status of the employees contracted by Lipercon and
D'Rite in effect, that they be absorbed into the working unit of SanMig. This matter
definitely dwells on the working relationship between said employees vis-a-vis
SanMig. Terms, tenure and conditions of their employment and the arrangement of
those terms are thus involved bringing the matter within the purview of a labor
dispute. Further, the Union also seeks to represent those workers, who have signed
up for Union membership, for the purpose of collective bargaining. SanMig, for its
part, resists that Union demand on the ground that there is no employer-employee
relationship between it and those workers and because the demand violates the
terms of their CBA. Obvious then is that representation and association, for the
purpose of negotiating the conditions of employment are also involved. Neither can
it be denied that the controversy below is directly connected with the labor dispute
already taken cognizance of by the NCMB-DOLE.
As the case is indisputably linked with a labor dispute, jurisdiction belongs to the
labor tribunals.

Locsin vs. PLDT

GR No. 185251, October 2, 2009
Facts:

On November 1, 1990, respondent Philippine Long Distance Telephone Company

(PLDT) and the Security and Safety Corporation of the Philippines (SSCP) entered
into a Security Services Agreement (Agreement) whereby SSCP would provide
armed security guards to PLDT to be assigned to its various offices. Pursuant to
such agreement, petitioners Raul Locsin and Eddie Tomaquin, among other security
guards, were posted at a PLDT office.
On August 30, 2001, respondent issued a Letter dated August 30, 2001 terminating
the Agreement effective October 1, 2001.
Despite the termination of the
Agreement, however, petitioners continued to secure the premises of their assigned
office. They were allegedly directed to remain at their post by representatives of
respondent. In support of their contention, petitioners provided the Labor Arbiter
with copies of petitioner Locsins pay slips for the period of January to September
2002.
Then, on September 30, 2002, petitioners services were terminated. Thus,
petitioners filed a complaint before the Labor Arbiter for illegal dismissal and
recovery of money claims such as overtime pay, holiday pay, premium pay for
holiday and rest day, service incentive leave pay, Emergency Cost of Living
Allowance, and moral and exemplary damages against PLDT.
The Labor Arbiter rendered a Decision finding PLDT liable for illegal dismissal. It was
explained in the Decision that petitioners were found to be employees of PLDT and
not of SSCP. Such conclusion was arrived at with the factual finding that petitioners
continued to serve as guards of PLDTs offices. As such employees, petitioners were
entitled to substantive and procedural due process before termination of
employment.

Issue:
Is there employer-employee relationship?

Ruling:
Yes. From the foregoing circumstances, reason dictates that we conclude that
petitioners remained at their post under the instructions of respondent. We can
further conclude that respondent dictated upon petitioners that the latter perform
their regular duties to secure the premises during operating hours. This, to our mind
and under the circumstances, is sufficient to establish the existence of an employeremployee relationship.

To reiterate, while respondent and SSCP no longer had any legal relationship with
the termination of the Agreement, petitioners remained at their post securing the
premises of respondent while receiving their salaries, allegedly from SSCP. Clearly,
such a situation makes no sense, and the denials proffered by respondent do not
shed any light to the situation. It is but reasonable to conclude that, with the behest

and, presumably, directive of respondent, petitioners continued with their services.

Evidently, such are indicia of control that respondent exercised over petitioners.

Evidently, respondent having the power of control over petitioners must be

considered as petitioners employerfrom the termination of the Agreement
onwardsas this was the only time that any evidence of control was exhibited by
respondent over petitioners and in light of our ruling in Abella. Thus, as aptly
declared by the NLRC, petitioners were entitled to the rights and benefits of
employees of respondent, including due process requirements in the termination of
their services.

Both the Labor Arbiter and NLRC found that respondent did not observe such due
process requirements. Having failed to do so, respondent is guilty of illegal
dismissal.

Ymbong vs. ABS-CBN G.R. No. 184885

Facts: Petitioner Ernesto G. Ymbong started working for ABS-CBN Broadcasting
Corporation (ABS-CBN) in 1993 at its regional station in Cebu as a television talent,
co-anchoring Hoy Gising and TV Patrol Cebu. His stint in ABS-CBN later extended to
radio when ABS-CBN Cebu launched its AM station DYAB in 1995 where he worked
as drama and voice talent, spinner, scriptwriter and public affairs program anchor.
Like Ymbong, Leandro Patalinghug also worked for ABS-CBN Cebu. Starting 1995, he
worked as talent, director and scriptwriter for various radio programs aired over
DYAB. On January 1, 1996, the ABS-CBN Head Office in Manila issued Policy No. HRER-016 or the Policy on Employees Seeking Public Office. The pertinent portions
read:
1.
Any employee who intends to run for any public office position, must file
his/her letter of resignation, at least thirty (30) days prior to the official filing of the
certificate of candidacy either for national or local election. x x x x
3.
Further, any employee who intends to join a political group/party or even
with no political affiliation but who intends to openly and aggressively campaign for
a candidate or group of candidates (e.g. publicly speaking/endorsing candidate,
recruiting campaign workers, etc.) must file a request for leave of absence subject
to managements approval. For this particular reason, the employee should file the
leave request at least thirty (30) days prior to the start of the planned leave period.
Because of the impending May 1998 elections and based on his immediate
recollection of the policy at that time, Dante Luzon, Assistant Station Manager of
DYAB issued the following memorandum:

TO

FROM

ALL CONCERNED

DANTE LUZON

DATE

MARCH 25, 1998

SUBJECT

AS STATED

Please be informed that per company policy, any employee/talent who wants to run
for any position in the coming election will have to file a leave of absence the
moment he/she files his/her certificate of candidacy.
The services rendered by the concerned employee/talent to this company will then
be temporarily suspended for the entire campaign/election period.
For strict compliance.
After the issuance of the March 25, 1998 Memorandum, Ymbong got in touch with
Luzon. Luzon claims that Ymbong approached him and told him that he would leave
radio for a couple of months because he will campaign for the administration ticket.
It was only after the elections that they found out that Ymbong actually ran for
public office himself at the eleventh hour. Ymbong, on the other hand, claims that
in accordance with the March 25, 1998 Memorandum, he informed Luzon through a
letter that he would take a few months leave of absence from March 8, 1998 to May
18, 1998 since he was running for councilor of Lapu-Lapu City. As regards
Patalinghug, Patalinghug approached Luzon and advised him that he will run as
councilor for Naga, Cebu. According to Luzon, he clarified to Patalinghug that he will
be considered resigned and not just on leave once he files a certificate of candidacy.
Later, Ymbong and Patalinghug both tried to come back to ABS-CBN Cebu.
According to Luzon, he informed them that they cannot work there anymore
because of company policy. This was stressed even in subsequent meetings and
they were told that the company was not allowing any exceptions. ABS-CBN,
however, agreed out of pure liberality to give them a chance to wind up their
participation in the radio drama, Nagbabagang Langit, since it was rating well and
to avoid an abrupt ending. The agreed winding-up, however, dragged on for so long
prompting Luzon to issue to Ymbong the memorandum dated September 14, 1998
automatically terminating them.
Issue: 1. whether Policy No. HR-ER-016 is valid
2. whether the March 25, 1998 Memorandum issued by Luzonsuperseded Policy No.
HR-ER-016
3. whether Ymbong, by seeking an elective post, is deemed to have resigned and
not dismissed by ABS-CBN.
Held: 1.
ABS-CBN had a valid justification for Policy No. HR-ER-016. Its
rationale is embodied in the policy itself, to wit: Rationale: ABS-CBN BROADCASTING
CORPORATION strongly believes that it is to the best interest of the company to
continuously remain apolitical. While it encourages and supports its employees to
have greater political awareness and for them to exercise their right to suffrage, the
company, however, prefers to remain politically independent and unattached to any

political individual or entity. Therefore, employees who [intend] to run for public
office or accept political appointment should resign from their positions, in order to
protect the company from any public misconceptions. To preserve its objectivity,
neutrality and credibility, the company reiterates the following policy guidelines for
strict implementation. We have consistently held that so long as a companys
management prerogatives are exercised in good faith for the advancement of the
employers interest and not for the purpose of defeating or circumventing the rights
of the employees under special laws or under valid agreements, this Court will
uphold them. In the instant case, ABS-CBN validly justified the implementation of
Policy No. HR-ER-016. It is well within its rights to ensure that it maintains its
objectivity and credibility and freeing itself from any appearance of impartiality so
that the confidence of the viewing and listening public in it will not be in any way
eroded. Even as the law is solicitous of the welfare of the employees, it must also
protect the right of an employer to exercise what are clearly management
prerogatives. The free will of management to conduct its own business affairs to
achieve its purpose cannot be denied.
It is worth noting that such exercise of management prerogative has earned a
stamp of approval from no less than our Congress itself when on February 12, 2001,
it enacted Republic Act No. 9006, otherwise known as the Fair Election Act.
Section 6.6 thereof reads:
6.6. Any mass media columnist, commentator, announcer, reporter, on-air
correspondent or personality who is a candidate for any elective public office or is a
campaign volunteer for or employed or retained in any capacity by any candidate or
political party shall be deemed resigned, if so required by their employer, or shall
take a leave of absence from his/her work as such during the campaign period:
Provided, That any media practitioner who is an official of a political party or a
member of the campaign staff of a candidate or political party shall not use his/her
time or space to favor any candidate or political party. [Emphasis and underscoring
supplied.]
2.
The CA correctly ruled that though Luzon, as Assistant Station Manager for
Radio of ABS-CBN, has policy-making powers in relation to his principal task of
administering the networks radio station in the Cebu region, the exercise of such
power should be in accord with the general rules and regulations imposed by the
ABS-CBN Head Office to its employees. Clearly, the March 25, 1998 Memorandum
issued by Luzon which only requires employees to go on leave if they intend to run
for any elective position is in absolute contradiction with Policy No. HR-ER-016
issued by the ABS-CBN Head Office in Manila which requires the resignation, not
only the filing of a leave of absence, of any employee who intends to run for public
office. Having been issued beyond the scope of his authority, the March 25, 1998
Memorandum is therefore void and did not supersede Policy No. HR-ER-016.
Also worth noting is that Luzon in his Sworn Statement admitted the inaccuracy of
his recollection of the company policy when he issued the March 25, 1998
Memorandum and stated therein that upon double-checking of the exact text of the
policy statement and subsequent confirmation with the ABS-CBN Head Office in
Manila, he learned that the policy required resignation for those who will actually

run in elections because the company wanted to maintain its independence. Since
the officer who himself issued the subject memorandum acknowledged that it is not
in harmony with the Policy issued by the upper management, there is no reason for
it to be a source of right for Ymbong.
3.
As Policy No. HR-ER-016 is the subsisting company policy and not Luzons
March 25, 1998 Memorandum, Ymbong is deemed resigned when he ran for
councilor.
We find no merit in Ymbongs argument that [his] automatic termination x x x was
a blatant [disregard] of [his] right to due process as he was never asked to explain
why he did not tender his resignation before he ran for public office as mandated by
[the subject company policy]. Ymbongs overt act of running for councilor of LapuLapu City is tantamount to resignation on his part. He was separated from ABS-CBN
not because he was dismissed but because he resigned. Since there was no
termination to speak of, the requirement of due process in dismissal cases cannot
be applied to Ymbong. Thus, ABS-CBN is not duty-bound to ask him to explain why
he did not tender his resignation before he ran for public office as mandated by the
subject company policy. Petition denied

Case Digest: South East International Rattan & Agbay v.

Coming
G.R. No. 186621 : March 12, 2014
FACTS:

Petitioner South East International Rattan, Inc. (SEIRI) is a domestic corporation

engaged in the business of manufacturing and exporting furniture to various
countries with principal place of business at Paknaan, Mandaue City, while petitioner
EstanislaoAgbay, as per records, is the President and General Manager of SEIRI.

Respondent Jesus J. Coming filed a complaint for illegal dismissal, underpayment of

wages, non-payment of holiday pay, 13th month pay and service incentive leave
pay, with prayer for reinstatement, back wages, damages and attorney fees against
Petitioner.

Respondent alleged that on March 17, 1984, petitioners hired him as Sizing Machine
Operator. He worked from 8:00 a.m. to 5:00 p.m. At first, his compensation was on
span class="SpellE">pakiaobasis but sometime in June 1984, it was fixed at
P150.00 per day paid to him on a weekly basis. In 1990, without any apparent
reason, his employment was interrupted as he was told by petitioners to resume

work in two months time. Being an uneducated person, respondent was persuaded
by the management as well as his brother not to complain, as otherwise petitioners
might decide not to call him back for work. Fearing such consequence, respondent
accepted his fate. Nonetheless, after two months he reported back to work upon
order of management.

Despite being an employee for many years with his work performance never
questioned by petitioners, respondent was dismissed on January 1, 2002 without
lawful cause. He was told that he will be terminated because the company is not
doing well financially and that he would be called back to work only if they need his
services again. Respondent waited for almost a year but petitioners did not call him
back to work. He filed the complaint before the regional arbitration branch.

As their defense, petitioners denied having hired respondent asserting that SEIRI
was incorporated only in 1986, and that respondent actually worked for SEIRI
furniture suppliers because when the company started in 1987 it was engaged
purely in buying and exporting furniture and its business operations were
suspended from the last quarter of 1989 to August 1992. They stressed that
respondent was not included in the list of employees submitted to the Social
Security System (SSS). Moreover, respondent brother, Vicente Coming, executed an
affidavit8 in support of petitionersposition while Allan Mayol and Faustino
Apondarissued notarized certifications9 that respondent worked for them instead.

The Labor Arbiter ruled that respondent is a regular employee of SEIRI and that the
termination of his employment was illegal.

Petitioners appealed to the National Labor Relations Commission (NLRC)-Cebu City.

The NLRC set aside the decision of the LA compelling the respondent to file a
petition for certiorari under Rule 65 before the Court of Appeals. The CA ruled in
favor of the respondent and declared that there existed an employer-employee
relationship between petitioners and respondent who was dismissed without just
and valid cause. Petitioners moved for reconsideration but the same was denied.
Hence, the present petition for review on certiorari.

ISSUE: Whether or not there exists an employer-employee relationship between the

petitioners and the respondent?

HELD: The Court sustains that Decision of the Court of Appeals.

LABOR LAW: employer-employee relationship

In order to establish the existence of an employer-employee relationship, the fourfold test is used, 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 conduct, or the so-called ontrol test.

In resolving the issue of whether such relationship exists in a given case, substantial
evidence or that amount of relevant evidence, which a reasonable mind might
accept, as adequate to justify a conclusion is sufficient.

The petitioners presented the following to support their stance that respondent is
not their employee: (1) Employment Reports to the SSS from 1987 to 2002; (2) the
Certifications issued by Mayol and Apondar; (3) two affidavits of Vicente Coming; (4)
payroll sheets (1999-2000); (5) individual pay envelopes and employee earnings
records (1999-2000); (6) and affidavit of Angelina Agbay(Treasurer and Human
Resources Officer).

The respondent, on the other hand, submitted the affidavit executed by Eleoterio
Brigoli, Pedro Brigoli, Napoleon Coming, EfrenComing and Gil Coming who all
attested that respondent was their co-worker at SEIRI.

The Court in Tan v. Lagrama, 436 Phil. 190, held that the fact that a worker was not
reported as an employee to the SSS is not conclusive proof of the absence of
employer-employee relationship. Otherwise, an employer would be rewarded for his
failure or even neglect to perform his obligation. Nor does the fact that respondent
name does not appear in the payrolls and pay envelope records submitted by
petitioners negate the existence of employer-employee relationship.

As a regular employee, respondent enjoys the right to security of tenure under

Article 279 of the Labor Code and may only be dismissed for just or authorized
causes. Otherwise, the dismissal becomes illegal.

Since respondent dismissal was without valid cause, he is entitled to reinstatement

without loss of seniority rights and other privileges and to his full back wages,
inclusive of allowances and other benefits of their monetary equivalent, computed
from the time his compensation was withheld from him up to the time of his actual
reinstatement.

However, where reinstatement is no long feasible as an option, back wages shall be

computed from the time of the illegal termination up to the finality of the decision.
As an alternative to this, separation pay equivalent to one month salary for every
year of service should likewise be awarded in case reinstatement is not possible.

The present petition for review on certiorari is DENIED.

Case Digest: Tenazas, et al v. Villegas Taxi & Villegas

G.R. No. 192998 : April 2, 2014
BERNARD A. TENAZAS, JAIME M. FRANCISCO AND SIDRO G. ENDRACA, Complainant,
v. VILLEGAS TAXI TRANSPORT AND ROMUALDO VILLEGAS, Respondent.

REYES, J.:

FACTS:

On July 4, 2007, Bernard A. Tenazas (Tenazas) and Jaime M. Francisco (Francisco)

filed a complaint for illegal dismissal against R. Villegas Taxi Transport and/or
Romualdo Villegas (Romualdo) and Andy Villegas (Andy) (respondents). At that time,
a similar case had already been filed by Isidro G. Endraca (Endraca) against the
same respondents. The two (2) cases were subsequently consolidated.In their
position paper, Tenazas, Francisco and Endraca (petitioners) alleged that they were
hired and dismissed by the respondents.

Relaying the circumstances of his dismissal, Tenazas alleged that on July 1, 2007,
the taxi unit assigned to him was sideswiped by another vehicle, causing a dent on

the left fender near the driver seat. The cost of repair for the damage was
estimated at 500.00. Upon reporting the incident to the company, he was scolded
by respondents Romualdo and Andy and was told to leave the garage for he is
already fired. He was even threatened with physical harm should he ever be seen in
the company's premises again. Despite the warning, Tenazas reported for work on
the following day but was told that he can no longer drive any of the company's
units as he is already fired.

Francisco, on the other hand, averred that his dismissal was brought about by the
company's unfounded suspicion that he was organizing a labor union. He was
instantaneously terminated, without the benefit of procedural due process, on June
4, 2007.

Endraca, for his part, alleged that his dismissal was instigated by an occasion when
he fell short of the required boundary for his taxi unit. He related that before he was
dismissed, he brought his taxi unit to an auto shop for an urgent repair. He was
charged the amount of 700.00 for the repair services and the replacement parts. As
a result, he was not able to meet his boundary for the day. Upon returning to the
company garage and informing the management of the incident, his drivers license
was confiscated and was told to settle the deficiency in his boundary first before his
license will be returned to him. He was no longer allowed to drive a taxi unit despite
his persistent pleas.

For their part, the respondents admitted that Tenazas and Endraca were employees
of the company, the former being a regular driver and the latter a spare driver. The
respondents, however, denied that Francisco was an employee of the company or
that he was able to drive one of the company's units at any point in time.

The respondents further alleged that Tenazas was never terminated by the
company. They claimed that on July 3, 2007, Tenazas went to the company garage
to get his taxi unit but was informed that it is due for overhaul because of some
mechanical defects reported by the other driver who takes turns with him in using
the same. He was thus advised to wait for further notice from the company if his
unit has already been fixed. On July 8, 2007, however, upon being informed that his
unit is ready for release, Tenazas failed to report back to work for no apparent
reason.

As regards Endraca, the respondents alleged that they hired him as a spare driver in
February 2001. They allow him to drive a taxi unit whenever their regular driver will
not be able to report for work. In July 2003, however, Endraca stopped reporting for
work without informing the company of his reason. Subsequently, the respondents

learned that a complaint for illegal dismissal was filed by Endraca against them.
They strongly maintained, however, that they could never have terminated Endraca
in March 2006 since he already stopped reporting for work as early as July 2003.
Even then, they expressed willingness to accommodate Endraca should he wish to
work as a spare driver for the company again since he was never really dismissed
from employment anyway.

The Labor Arbiter (LA) rendered a Decision declaring that there was no illegal
dismissal in the case at bar.

The NLRC rendered a Decision, reversing the appealed decision of the LA, holding
that the additional pieces of evidence belatedly submitted by the petitioners
sufficed to establish the existence of employer-employee relationship and their
illegal dismissal. On July 24, 2009, the respondents filed a motion for
reconsideration but the NLRC denied the same.

Unperturbed, the respondents filed a petition for certiorari with the CA. On March
11, 2010, the CA rendered a Decision, affirming with modification the Decision
dated June 23, 2009 of the NLRC. The CA agreed with the NLRCs finding that
Tenazas and Endraca were employees of the company, but ruled otherwise in the
case of Francisco for failing to establish his relationship with the company. It also
deleted the award of separation pay and ordered for reinstatement of Tenazas and
Endraca.

ISSUE: Whether there is an employer-employee relationship and whether there was

an illegal dismissal

HELD: The petition lacks merit.

LABOR LAW: employer-employee relationship

In determining the presence or absence of an employer-employee relationship, the

Court has consistently looked for the following incidents, 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. The last element, the so-called control
test, is the most important element.

There is no hard and fast rule designed to establish the aforesaid elements. Any
competent and relevant evidence to prove the relationship may be admitted.
Identification cards, cash vouchers, social security registration, appointment letters
or employment contracts, payrolls, organization charts, and personnel lists, serve as
evidence of employee status.

In this case, however, Francisco failed to present any proof substantial enough to
establish his relationship with the respondents. He failed to present documentary
evidence like attendance logbook, payroll, SSS record or any personnel file that
could somehow depict his status as an employee. Anent his claim that he was not
issued with employment records, he could have, at least, produced his social
security records which state his contributions, name and address of his employer, as
his co-petitioner Tenazas did. He could have also presented testimonial evidence
showing the respondent's exercise of control over the means and methods by which
he undertakes his work. This is imperative in light of the respondent's denial of his
employment and the claim of another taxi operator, Emmanuel Villegas
(Emmanuel), that he was his employer. Specifically, in his Affidavit, Emmanuel
alleged that Francisco was employed as a spare driver in his taxi garage from
January 2006 to December 2006, a fact that the latter failed to deny or question in
any of the pleadings attached to the records of this case. The utter lack of evidence
is fatal to Francisco's case especially in cases like his present predicament when the
law has been very lenient in not requiring any particular form of evidence or manner
of proving the presence of employer-employee relationship.

In Opulencia Ice Plant and Storage v. NLRC, this Court emphasized, thus:

No particular form of evidence is required to prove the existence of an employeremployee relationship. Any competent and relevant evidence to prove the
relationship may be admitted. For, if only documentary evidence would be required
to show that relationship, no scheming employer would ever be brought before the
bar of justice, as no employer would wish to come out with any trace of the illegality
he has authored considering that it should take much weightier proof to invalidate a
written instrument.

Here, Francisco simply relied on his allegation that he was an employee of the
company without any other evidence supporting his claim. Unfortunately for him, a
mere allegation in the position paper is not tantamount to evidence. Bereft of any
evidence, the CA correctly ruled that Francisco could not be considered an
employee of the respondents.

The CAs order of reinstatement of Tenazas and Endraca, instead of the payment of
separation pay, is also well in accordance with prevailing jurisprudence. In Macasero
v. Southern Industrial Gases Philippines, the Court reiterated, thus:

An illegally dismissed employee is entitled to two reliefs: backwages and

reinstatement. The two reliefs provided are separate and distinct. In instances
where reinstatement is no longer feasible because of strained relations between the
employee and the employer, separation pay is granted. In effect, an illegally
dismissed employee is entitled to either reinstatement, if viable, or separation pay if
reinstatement is no longer viable, and backwages.

The normal consequences of respondents illegal dismissal, then, are reinstatement

without loss of seniority rights, and payment of backwages computed from the time
compensation was withheld up to the date of actual reinstatement. Where
reinstatement is no longer viable as an option, separation pay equivalent to one (1)
month salary for every year of service should be awarded as an alternative. The
payment of separation pay is in addition to payment of backwages.

Clearly, it is only when reinstatement is no longer feasible that the payment of

separation pay is ordered in lieu thereof. For instance, if reinstatement would only
exacerbate the tension and strained relations between the parties, or where the
relationship between the employer and the employee has been unduly strained by
reason of their irreconcilable differences, it would be more prudent to order
payment of separation pay instead of reinstatement.

This doctrine of strained relations, however, should not be used recklessly or

applied loosely nor be based on impression alone. It bears to stress that
reinstatement is the rule and, for the exception of strained relations to apply, it
should be proved that it is likely that if reinstated, an atmosphere of antipathy and
antagonism would be generated as to adversely affect the efficiency and
productivity of the employee concerned.

Moreover, the existence of strained relations, it must be emphasized, is a question

of fact.

In Golden Ace Builders v. Talde, the Court underscored:

Strained relations must be demonstrated as a fact, however, to be adequately

supported by evidence substantial evidence to show that the relationship between

the employer and the employee is indeed strained as a necessary consequence of

the judicial controversy.

After a perusal of the NLRC decision, this Court failed to find the factual basis of the
award of separation pay to the petitioners. The NLRC decision did not state the facts
which demonstrate that reinstatement is no longer a feasible option that could have
justified the alternative relief of granting separation pay instead.

WHEREFORE, in view of the foregoing disquisition, the petition for review on

certiorari is DENIED.

Case Digest: Tongko v. The Manufacturers Life Insurance &

de Dios
G.R. No. 167622, January 25, 2011
FACTS:

Taking from the November 2008 decision, the facts are as follows:

Manufacturers Life Insurance, Co. is a domestic corporation engaged in life

insurance business. De Dios was its President and Chief Executive Officer. Petitioner
Tongko started his relationship with Manulife in 1977 by virtue of a Career Agent's
Agreement.

Pertinent provisions of the agreement state that:

It is understood and agreed that the Agent is an independent contractor and

nothing contained herein shall be construed or interpreted as creating an employeremployee relationship between the Company and the Agent.

a) The Agent shall canvass for applications for Life Insurance, Annuities, Group
policies and other products offered by the Company, and collect, in exchange for
provisional receipts issued by the Agent, money due or to become due to the

Company in respect of applications or policies obtained by or through the Agent or

from policyholders allotted by the Company to the Agent for servicing, subject to
subsequent confirmation of receipt of payment by the Company as evidenced by an
Official Receipt issued by the Company directly to the policyholder.

b) The Company may terminate this Agreement for any breach or violation of any of
the provisions hereof by the Agent by giving written notice to the Agent within
fifteen (15) days from the time of the discovery of the breach. No waiver,
extinguishment, abandonment, withdrawal or cancellation of the right to terminate
this Agreement by the Company shall be construed for any previous failure to
exercise its right under any provision of this Agreement.

c) Either of the parties hereto may likewise terminate his Agreement at any time
without cause, by giving to the other party fifteen (15) days notice in writing.

Sometime in 2001, De Dios addressed a letter to Tongko, then one of the Metro
North Managers, regarding meetings wherein De Dios found Tongko's views and
comments to be unaligned with the directions the company was taking. De Dios also
expressed his concern regarding the Metro North Managers' interpretation of the
company's goals. He maintains that Tongko's allegations are unfounded. Some
allegations state that some Managers are unhappy with their earnings, that they're
earning less than what they deserve and that these are the reasons why Tonko's
division is unable to meet agency development objectives. However, not a single
Manager came forth to confirm these allegations. Finally, De Dios related his worries
about Tongko's inability to push for company development and growth.

De Dios subsequently sent Tongko a letter of termination in accordance with

Tongko's Agents Contract. Tongko filed a complaint with the NLRC against Manulife
for illegal dismissal, alleging that he had an employer-employee relationship with De
Dios instead of a revocable agency by pointing out that the latter exercised control
over him through directives regarding how to manage his area of responsibility and
setting objectives for him relating to the business. Tongko also claimed that his
dismissal was without basis and he was not afforded due process. The NLRC ruled
that there was an employer-employee relationship as evidenced by De Dios's letter
which contained the manner and means by which Tongko should do his work. The
NLRC ruled in favor of Tongko, affirming the existence of the employer-employee
relationship.

The Court of Appeals, however, set aside the NLRC's ruling. It applied the four-fold
test for determining control and found the elements in this case to be lacking,
basing its decision on the same facts used by the NLRC. It found that Manulife did

not exert control over Tongko, there was no employer-employee relationship and
thus the NLRC did not have jurisdiction over the case.

The Supreme Court reversed the ruling of the Court of Appeals and ruled in favor of
Tongko. However, the Supreme Court issued another Resolution dated June 29,
2010, reversing its decision. Tongko filed a motion for reconsideration, which is now
the subject of the instant case.

ISSUE: Whether the Supreme Court erred in issuing the June 29, 2010 resolution,
reversing its earlier decision that an employer-employee relationship existed.

HELD: The petition is unmeritorious.

LABOR LAW Agency; Employer-employee relationships

The Supreme Court finds no reason to reverse the June 29, 2010 decision. Control
over the performance of the task of one providing service both with respect to the
means and manner, and the results of the service is the primary element in
determining whether an employment relationship exists. The Supreme Court ruled
petitioners Motion against his favor since he failed to show that the control Manulife
exercised over him was the control required to exist in an employer-employee
relationship; Manulifes control fell short of this norm and carried only the
characteristic of the relationship between an insurance company and its agents, as
defined by the Insurance Code and by the law of agency under the Civil Code.

In the Supreme Courts June 29, 2010 Resolution, they noted that there are built-in
elements of control specific to an insurance agency, which do not amount to the
elements of control that characterize an employment relationship governed by the
Labor Code.The Insurance Code provides definite parameters in the way an agent
negotiates for the sale of the companys insurance products, his collection activities
and his delivery of the insurance contract or policy. They do not reach the level of
control into the means and manner of doing an assigned task that invariably
characterizes an employment relationship as defined by labor law.

To reiterate, guidelines indicative of labor law "control" do not merely relate to the
mutually desirable result intended by the contractual relationship; they must have
the nature of dictating the means and methods to be employed in attaining the
result. Tested by this norm, Manulifes instructions regarding the objectives and sales
targets, in connection with the training and engagement of other agents, are among

the directives that the principal may impose on the agent to achieve the assigned
tasks.They are targeted results that Manulife wishes to attain through its agents.
Manulifes codes of conduct, likewise, do not necessarily intrude into the insurance
agents means and manner of conducting their sales. Codes of conduct are norms or
standards of behavior rather than employer directives into how specific tasks are to
be done.

In sum, the Supreme Court found absolutely no evidence of labor law control.

Petition is DENIED.

Television and Production Exponents, Inc. vs Roberto

Servaa
542 SCRA 578 Labor Law Labor Standards Regular Employee Employeremployee relationship Four Fold Test

Servaa 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
Servaa as a security guard and absorbed him. In 2000, TAPE contracted the
services of Sun Shield Security Agency. It then notified Servaa that he is being
terminated because he is now a redundant employee. Servaa then filed a case for
illegal Dismissal. The Labor Arbiter ruled that Servaas 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 Servaa 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 Servaa. The National Labor Relations Commission ruled in favor
of TAPE. It ruled that Servaa is a program employee. Servaa 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 Servaa.

HELD: Yes. Servaa is a regular employee.

In determining Servaas nature of employment, the Supreme Court employed the

Four Fold Test:

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

employee.

Servaa 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 TAPEs 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.

Servaa is definitely receiving a fixed amount as monthly compensation. Hes

receiving P6,000.00 a month.

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

The Memorandum of Discontinuance issued to Servaa to notify him that he is a

redundant employee evidenced TAPEs power to dismiss Servaa.

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

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

Therefore, Servaa 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 Servaa.

Regular Employee Defined:

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