GENERAL PRINCIPLES

IN
LABOR LAW

SUBMITTED BY:
Carino-Rebusta, Jenifer
Dacones. Anthony
Macapagao, Connie
Ramirez, Karen Tatiana
Suplico, Marie Joyce

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GENERAL PRINCIPLES IN LABOR LAW

I.

IN GENERAL
COMPONENTS OF LABOR LAW

Labor Standards Law sets out the minimum terms,

conditions and benefits of employment that employers must provide or
comply with and to which employees are entitled as a matter of legal
right. The laws on wages and work hours, on safety and health of
employees, on employment benefits such as paid leaves and medical
services for work-connected injuries.

Labor Relations Law defines the status, rights and duties, as well as
the institutional mechanisms that govern the individual and collective
interactions between employers, employees and their representatives.
Unionization, negotiation, and dispute settlements fall in the area of
labor relations.
LABOR LAW VS. SOCIAL LEGISLATION

Labor Law is a piece of social legislation. It is broadly

classified into labor standards and labor relations. The Labor Code is
the principal labor law of the country. It contains most of our labor
laws, such as those on illegal recruitment, wages of workers, rights of
union members, collective bargaining, and employment termination. It
also deals with the rights of employers, such as the right to make and
enforce reasonable regulations, to reorganize and economize, and lay
off lazy and undisciplined employees.

Social Legislation refers to a broad category of laws that

protect or promote the welfare of society or segments of it in
furtherance of social justice. It is conceptually broader than labor laws.
Some examples are the social security laws, the agrarian reform, and
the law on migrant workers.The aim of which is to even out the playing
field for purposes of fair play between different classes.
BASES OF LABOR LAW

Police Power
It is the inherent power of the state to restrain one's liberty and right
to property to promote the welfare of the people.
Social Justice
Definition under Calalang vs. Williams:
"Social Justice is neither communism, nor
despotism, nor atomism, nor anarchy, but the
humanization of laws and the equalization of social and
economic forces by the state so that justice at its rational
and objectively secular conception may at least be
approximated.
Social Justice means the promotion of the welfare of
all people, the adoption by the government of measures
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calculated to insure the economic stability of all the

component elements of society, through the interrelations
of the members of the community; constitutionally through
the adoption of measures legally justifiable, and extraconstitutionally through the exercise of powers underlying
the time-honored principle of saluspopuliestsupremalex."
II.

FUNDAMENTAL PRINCIPLES
EFFECTIVITY
Art. 2. Date of effectivity. This Code shall take effect six (6) months
after its promulgation.
May 1, 1974 PD No. 442 was signed into law.
November 01, 1974 effectivity date of the Labor Code
Art. 302. Repealing clause. All labor laws not adopted as part of this
Code either directly or by reference are hereby repealed. All provisions
of existing laws, orders, decrees, rules and regulations inconsistent
herewith are likewise repealed.
DECLARATION OF BASIC POLICY
Art. 3. Declaration of basic policy. The State shall afford protection
to labor, promote full employment, ensure equal work opportunities
regardless of sex, race or creed and regulate the relations between
workers and employers. The State shall assure the rights of workers to
self-organization, collective bargaining, security of tenure, and just and
humane conditions of work.
RELATED PROVISIONS
1987 PHILIPPINE CONSTITUTION
The 1987 Philippine Constitution, the supreme law of the land,
mandates the protection of labor and the promotion of their welfare. It
provides the fundamental labor standards and labor relations rights of
the employees.
ART II DECLARATION OF PRINCIPLES AND STATE POLICIES
Section 9. The State shall promote a just and dynamic social order
that will ensure the prosperity and independence of the nation and free
the people from poverty through policies that provide adequate social
services, promote full employment, a rising standard of living, and
an improved quality of life for all.
Section 10. The State shall promote social justice in all phases of
national development.
Section 18. The State affirms labor as a primary social economic
force. It shall protect the rights of workers and promote their welfare.
Section 20. The State recognizes the indispensable role of the private
sector, encourages private enterprise, and provides incentives to
needed investments.

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ARTICLE III, BILL OF RIGHTS

Section 1No person shall be deprived of life, liberty, or property
without due process of law, nor shall any person be denied the equal
protection of the laws.
Section 4No law shall be passed abridging the freedom of speech, of
expression, or of the press, or the right of the people peaceably to
assemble and petition the government for redress of grievances.
Section 8.The right of the people, including those employed in the
public and private sectors, to form unions, associations, or societies for
purposes not contrary to law shall not be abridged.
Article IX-B, THE CIVIL SERVICE COMMISSION
Section 2.
3. No officer or employee of the civil service shall be removed or
suspended except for cause provided by law.
5. The right to self-organization shall not be denied to
government employees.
6. Temporary employees of the Government shall be given such
protection as may be provided by law.

ARTICLE XIII, SOCIAL JUSTICE AND HUMAN RIGHTS

Section 3. The State shall afford full protection to labor, local and
overseas, organized and unorganized, and promote full employment
and equality of employment opportunities for all.
It shall guarantee the rights of all workers to self-organization,
collective bargaining and negotiations, and peaceful concerted
activities, including the right to strike in accordance with law. They
shall be entitled tosecurity of tenure, humane conditions of work, and
a living wage. They shall also participate in policy and decision-making
processes affecting their rights and benefits as may be provided by
law.
The State shall promote the principle of shared responsibility between
workers and employers and the preferential use of voluntary modes in
settling disputes, including conciliation, and shall enforce their mutual
compliance therewith to foster industrial peace.
The State shall regulate the relations between workers and employers,
recognizing the right of labor to its just share in the fruits of
production and the right of enterprises to reasonable returns to
investments, and to expansion and growth.
Section 14. The State shall protect working women by providing safe
and healthful working conditions, taking into account their maternal
functions, and such facilities and opportunities that will enhance their
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welfare and enable them to realize their full potential in the service of
the nation.

NEW CIVIL CODE-Art 1700

The relation between capital and labor are not merely contractual.
They are so impressed with public interest that labor contracts must
yield to the common good. Therefore, such contracts are subject to the
special laws on labor unions, collective bargaining, strikes and
lockouts, closed shops, wages, working conditions, hours of labor and
similar subjects.
RIGHTS OF THE EMPLOYEES
Seven basic constitutional rights of labor

Self-organization
Conduct collective bargaining or negotiation with management
Encourage in peaceful concerted activities including strike in
accordance with the law
Enjoy security of tenure
Work under humane conditions
Receive a living wage
Practice in policy and decision-making processes affecting their rights
and benefits as may be provided by law
MANAGEMENT PREROGATIVES
The hiring, firing, transfer, demotion, and promotion of employees has
been traditionally, identified as a management prerogative subject to
limitations found in law, a collective bargaining agreement or general
principles of fair play and justice. This is a function associated with the
employers inherent right to control and manage effectively its
enterprise. 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.
CONSTRUCTION
Art. 4. Construction in favor of labor. All doubts in the implementation
and interpretation of the provisions of this Code, including its
implementing rules and regulations, shall be resolved in favor of labor.

The policy is to apply the Code to a greater number of employees so

they may avail themselves of the benefits under the law, in line with
the States desire to give maximum aid and protection to labor. (See
Abella, July 20, 1987.)

Court decisions adopt a liberal approach that favors the exercise of

labor rights.

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It is not correct to think that the aim of the law is always to favor
labor. The mandate under Art. 4 is simply to resolve doubt, if any, in
favor of labor. If there is no doubt in implementing and interpreting the
law, labor will enjoy no built-in advantage and the law will have to be
applied as it is.

ADMINISTRATION /APPLICABILITY
Art. 5. Rules and regulations The Department of Labor and
Employment, other government agencies charged with the
administration and enforcement of this Code or any of its parts shall
promulgate the necessary implementing rules and regulations. Such
rules and regulations shall become effective fifteen (15) days after
announcement of their adoption in newspapers of general circulation.
Art. 6. Applicability. All rights and benefits granted to workers under
this Code shall, except as may otherwise be provided herein, apply
alike to all workers, whether agricultural or non-agricultural. (As
amended by Presidential Decree No. 570-A, November 1, 1974)
BOOK V - LABOR RELATIONS
Art. 218. [211]Declaration of Policy. A. It is the policy of the State:
a. To promote and emphasize the primacy of free collective
bargaining and negotiations, including voluntary arbitration,
mediation and conciliation, as modes of settling labor or
industrial disputes;
b. To promote free trade unionism as an instrument for the
enhancement of democracy and the promotion of social
justice and development;
c. To foster the free and voluntary organization of a strong and
united labor movement;
d. To promote the enlightenment of workers concerning their
rights and obligations as union members and as employees;
e. To provide an adequate administrative machinery for the
expeditious settlement of labor or industrial disputes;
f. To ensure a stable but dynamic and just industrial peace; and
g. To ensure the participation of workers in decision and policymaking processes affecting their rights, duties and welfare.
B. To encourage a truly democratic method of
regulating the relations between the employers
and employees by means of agreements freely
entered into through collective bargaining, no
court or administrative agency or official shall
have the power to set or fix wages, rates of pay,
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hours of work or other terms and conditions of

employment, except as otherwise provided under
this Code. (As amended by Section 3, Republic
Act No. 6715, March 21, 1989)
DETERMINATION OF EMPLOYER-EMPLOYEE RELATIONSHIP
1. FRANCISCO VS. NATIONAL LABOR RELATIONS COMMISSION,
500 SCRA 690, G.R. NO. 170087 AUGUST 31, 2006
FACTS: Petitioner was hired by Kasei Corporation as Accountant and
Corporate Secretary and was also designated as a liaison officer. Later,
she was designated as acting manager where she was assigned to
handle recruitment activities and perform management administration
functions; represent the company in all government dealings and
administer all matters pertaining to Kasei Resto. After 5 years, she was
replaced as a manager and was made to sign a prepared resolution for
her replacement with the assurance that she is still connected with the
company.

Consequently, her salary was reduced until later on the

company stopped giver her her salary. She made follow ups about it
but the company said that she was no longer connected with the
company. Francisco then filed a complaint for constructive dismissal
which was favored by the Labor Arbiter, affirmed with modification by
the NLRC and reversed by the CA. Private respondents argued that she
is not an employee and was hired only as a technical consultant and
that she performed her work at her own discretion without control and
supervision of Kasei; that she had no DTR and comes to office any
time she wanted; that her designation depended solely on the will of
the management and her consultancy maybe terminated anytime
considering that her services were only temporary in nature.
ISSUE: Was there an employer-employee relationship?
HELD: The Court previously held in Sevilla v. Court of Appeals, 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
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the inclusion of the employee in the payrolls, can help in determining

the existence of an employer-employee relationship. However, in
certain cases the control test is not sufficient to give a
complete picture of the relationship between the parties, owing
to the complexity of such a relationship where several positions have
been held by the worker. The better approach would therefore be to
adopt a two-tiered test involving: (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. This two-tiered test would take
us into considering the totality of circumstances surrounding the true
nature of the relationship between the parties. 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.
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. She reported for work regularly and served in various
capacities as Accountant, Liaison Officer, Technical Consultant, Acting
Manager and Corporate Secretary, with substantially the same job
functions, that is, rendering accounting and tax services to the
company and performing functions necessary and desirable for the
proper operation of the corporation such as securing business permits
and other licenses over an indefinite period of engagement.

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2. SONZA VS. ABS-CBN BROADCASTING CORPORATION,

431 SCRA 583, G.R. NO. 138051 JUNE 10, 2004
FACT: ABS-CBN and MJMDC signed an agreement wherein the latter
as agent agreed to provide Sonzas services exclusively to the former.
After a couple of years, Sonza wrote to Mr. Lopez calling his attention
to the Agreement and informing him that Sonza irrevocably resigned in
view of the recent events concerning his programs and career. It was
also stated in the letter that Sonza considers the acts of the station
violative of the Agreement and the station as in breach thereof. And
served notice of rescission of the Agreement.
Thereafter, Sonza filed a complaint before the DOLE alleging that ABSCBN did not pay his salaries, separation pay, etc. Respondent filed a
motion to dismiss alleging that there is no employer-employee
relationship between ABS-CBN and Sonza. The Labor Arbiter held that
Sonza was engaged by respondent by reason of peculiar skills and
talent as a TV host and radio broadcaster. Unlike ordinary employee,
he was free to perform the services he undertook to render in
accordance with his own style and that the benefits enjoyed arose
from the specific agreement by the parties and not by reason of
employer-employee relationship.
The NLRC affirmed the Labor Arbiters decision; CA adopted the NLRC
decision.
ISSUE: Was there an employer-employee relationship?
HELD:

The assailed decision was affirmed. Existence of employer-

employee relationship is a question of fact and the Labor Arbiters and

NLRCs

decisions

are

accorded

with

respect

and

finality

when

supported with substantial evidence.

Case law has consistently held that the elements of an employeremployee 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 employee on the means and

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methods by which the work is accomplished. The last element, the socalled control test, is the most important element. All the talent fees
and benefits paid to SONZA were the result of negotiations that led to
the Agreement. If SONZA were ABS-CBNs employee, there would be
no need for the parties to stipulate on benefits such as SSS, Medicare,
x xx and 13th month pay which the law automatically incorporates
into every employer-employee contract. Whatever benefits SONZA
enjoyed arose from contract and not because of an employeremployee 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 wellthe less control the
hirer

exercises,

the

more

likely

the

worker

is

considered

an

independent contractor.
We find that ABS-CBN was not involved in the actual performance that
produced the finished product of SONZAs work. 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.

3. JAVIER VS. FLY ACE CORPORATION,

666 SCRA 383, G.R. NO. 192558 FEBRUARY 15, 2012
FACTS: Petitioner was hired as a pahinante or stevedore at Fly Ace
Corporation. He also cleans and arranges canned items before
delivering it to certain locations, One day, he reported for work but he
was not allowed entry to the premises of the company upon the
instruction of his superior. When he asked why, his superior told him to
ask his daughter, thereafter, he was terminated without notice and
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neither was he given the opportunity to refute the causes of his

dismissal from work. He then filed a complaint before the NLRC for
underpayment of salaries and other labor standard benefits alleging
that he was an employee of Fly Ace but Fly Ave opposed the same and
argued that Javier was contracted by Fly Ace as an extra helper on a
pakyaw basis at 300 per trip. The Labor Arbiter dismissed Javiers
complaint on the ground that Javier failed to present a proof that he
was a regular employee at Fly Ace; no employe ID, no payslip.The
NLRC favored Javier but the CA reinstated Labor Arbiters decision.
ISSUE: Was there an employer-employee relationship?
HELD: As the records bear out, the LA and the CA found Javiers claim
of employment with Fly Ace as wanting and deficient.Elements of
employer-employee relationship do not exist. In this case, the LA and
the CA both concluded that Javier failed to establish his employment
with Fly Ace. By way of evidence on this point, all that Javier presented
were his self-serving statements purportedly showing his activities as
an employee of Fly Ace. Clearly, Javier failed to pass the substantiality
requirement to support his claim. Elements of an employer-employee
relationship do not exist in this case. Theres no competent proof that
Fly Ace engaged Javiers services as a regular employee; that Fly Ace
paid his wages; that Fly Ace has right of control over his conduct.
Javiers allegation did not establish that his relationship with Fly Ace
had the attributed of an employer-employee relationship on the basis
of the four-fold test.
One final note. The Courts decision does not contradict the settled rule
that payment by the piece is just a method of compensation and does
not define the essence of the relation. Payment on a piece-rate basis
does not negate regular employment. The term wage is broadly
defined in Article 97 of the Labor Code as remuneration or earnings,
capable of being expressed in terms of money whether fixed or
ascertained on a time, task, piece or commission basis. Payment by
the piece is just a method of compensation and does not define the
essence of the relations. Nor does the fact that the petitioner is not
covered by the SSS affect the employer-employee relationship.
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However, in determining whether the relationship is that of employer

and employee or one of an independent contractor, each case must be
determined on its own facts and all the features of the relationship are
to be considered.38 Unfortunately for Javier, the attendant facts and
circumstances of the instant case do not provide the Court with
sufficient reason to uphold his claimed status as employee of Fly Ace.

4. San Miguel Corp. Employees Union-PTGWO vs. Bersamira,

186 SCRA 496, G.R. No. 87700 June 13, 1990
Labor dispute exists when the controversy concerns the terms and
conditions of employment.
HELD: While it is SanMigs submission that no employer-employee
relationship exists between itself, on the one hand, and the contractual
workers of Lipercon and DRite on the other, a labor dispute can
nevertheless exist regardless of whether the disputants stand in the
proximate relationship of employer and employee (Article 212 [1]
Labor Code, supra) provided the controversy concerns, among others,
the terms and conditions of employment or a change or
arrangement thereof (ibid). Put differently, and as defined by law,
the existence of a labor dispute is not negatived by the fact that the
plaintiffs and defendants do not stand in the proximate relation of
employer and employee.
5. Locsin vs. Philippine Long Distance Telephone Company,
602 SCRA 740, G.R. No. 185251 October 2, 2009
HELD: It is the so-called control test which constitutes the most
important index of the existence of the employer-employee
relationship that is, whether the employer controls or has reserved the
right to control the employee not only as to the result of the work to
be done but also as to the means and methods by which the same is
to be accomplished. Stated otherwise, an employer-employee
relationship exists where the person for whom the services are
performed reserves the right to control not only the end to be achieved
but also the means to be used in reaching such end.
Four-fold test to determine the existence of the elements of such
relationship
(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.
Control Test; It is an oft-repeated rule that control is the most
important element in the determination of the existence of an
employer-employee relationship.(Tongko v. The Manufacturers Life
Insurance Co. (Phils.) Inc., 570 SCRA 503 (2008)

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6.
People's
Broadcasting(BomboRadyoPhils.,
Inc.)
vs.
Secretary of the Department of Labor and Employment (2012)
HELD: The visitorial and enforcement power of the
Labor and Employment (DOLE) comes into play only
the relationship of employer-employee still exists;
Labor and Employment (DOLE)s power does not
instances, namely:

Department of
in cases when
Department of
apply in two

(a) where the employer-employee relationship has ceased; and

(b) where no such relationship has ever existed.

7. Ymbong vs. ABS-CBNG.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. HR-ER-016 or the Policy on Employees Seeking Public Office. The
pertinent portions read:
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.

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.

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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.
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: whether Policy No. HR-ER-016 is valid
HELD: 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.
It is worth noting that such exercise of management prerogative has
earned a stamp of approval from no less than our Congress itself when
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on February 12, 2001, it enacted Republic Act No. 9006, otherwise

known as the Fair Election Act. Section 6.6 thereof reads:
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.

7. Professional Services Inc. v. Agana (2008)

FACTS: Natividad Agana was rushed to Medical City because of
difficulty of bowel movement and bloody anal discharge. Dr. Ampil
diagnosed her to be suffering from cancer of the sigmoid. Dr. Ampil
performed an anterior resection surgery on her, and finding that the
malignancy spread on her left ovary, he obtained the consent of her
husband, Enrique, to permit Dr. Fuentes to perform hysterectomy on
her. After the hysterectomy, Dr. Fuentes showed his work to Dr. Ampil,
who examined it and found it in order, so he allowed Dr. Fuentes to
leave the operating room. Dr. Ampil was about to complete the
procedure when the attending nurses made some remarks on the
Record of Operation: sponge count lacking 2; announced to surgeon
search done but to no avail continue for closure (two pieces of gauze
were missing). A diligent search was conducted but they could not be
found. Dr. Ampil then directed that the incision be closed.
A couple of days after, she complained of pain in her anal region, but
the doctors told her that it was just a natural consequence of the
surgery. Dr. Ampil recommended that she consult an oncologist to
examine the cancerous nodes which were not removed during the
operation. After months of consultations and examinations in the US,
she was told that she was free of cancer. Weeks after coming back, her
daughter found a piece of gauze (1.5 in) protruding from her vagina,
so Dr. Ampil manually extracted this, assuring Natividad that the pains
will go away. However, the pain worsened, so she sought treatment at
a hospital, where another 1.5 in piece of gauze was found in her
vagina. She underwent another surgery.
Sps. Agana filed a complaint for damages against PSI (owner of
Medical City), Dr. Ampil, and Dr. Fuentes, alleging that the latter are
liable for negligence for leaving 2 pieces of gauze in Natividads body,
and malpractice for concealing their acts of negligence. Enrique Agana
also filed an administrative complaint for gross negligence and
malpractice against the two doctors with the PRC (although only the
case against Dr. Fuentes was heard since Dr. Ampil was abroad).
Pending the outcome of the cases, Natividad died (now substituted by
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her children). RTC found PSI and the two doctors liable for negligence
and malpractice. PRC dismissed the case against Dr. Fuentes. CA
dismissed only the case against Fuentes.
HELD: For purposes of apportioning responsibility in medical
negligence cases, an employer-employee relationship in effect exists
between hospitals and their attending and visiting physicians. [LABOR
LESSON: power to hire, fire, power of control]
Agency principle of apparent authority / agency by estoppel
Imposes liability because of the actions of a principal or employer in
somehow misleading the public into believing that the relationship or
the authority exists [see NCC 1869]
PSI publicly displays in the Medical City lobby the names and
specializations of their physicians. Hence, PSI is now estopped from
passing all the blame to the physicians whose names it proudly
paraded in the public directory, leading the public to believe that it
vouched for their skill and competence.
8. SOUTH EAST INTERNATIONAL RATTAN INC V. JESUS J. COMING
(2014)
FACTS:
Petitioner South East International Rattan is a domestic corporation
engaged in the business of manufacturing and exporting furniture to
various countries. Respondent Coming was hired by petitioner as
Sizing Machine Operator whose work is initially compensated on
pakiao basis but sometime was fixed per day and a work schedule of
8:00am to 5:00pm. Without any apparent reason, his employment was
interrupted as he was told by petitioners to resume work in 2 months
time but was never called back. Respondent thus filed a complaint
before the regional arbitration branch. The Labor Arbiter ruled
respondent as a regular employee of petitioner SEIRI but on appeal,
was reversed by the NLRC. CA then reversed the NLRC decision and
ruled that there existed an employer-employee relationship between
petitioners and respondent
ISSUE: Whether or not there is employer-employee relationship
between petitioner and respondent
HELD: 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
employees conduct, or the so-called control test.
x xx 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 oclock in the morning to 5 oclock in
the afternoon; (4) the mode of payment of petitioners salary was
under their discretion, at first paying him on pakiao basis and
16 | P a g e

thereafter, on daily basis; (5) they implemented company rules and

regulations; (6) [Estanislao] Agbay directly paid petitioners salaries
and controlled all aspects of his employment and (7) petitioner
rendered work necessary and desirable in the business of the
respondent company.
9. BERNARD TENAZAS v. R. VILLEGAS TAXI TRANSPORT (2014)
FACTS:The case at bar is a consolidated cases filed by Bernard A.
Tenazas (Tenazas) and Jaime M. Francisco (Francisco) and Isidro G.
Endraca (Endraca) for a complaint for illegal dismissal against R.
Villegas Taxi Transport and/or Romualdo Villegas (Romualdo) and Andy
Villegas (Andy) (respondents). Tenazas, Francisco and Endraca
(petitioners) alleged that they were hired and dismissed by the
respondents on the following dates:
Date
Hiring

Date
of
Dismissal

Salary

10/1997

07/03/07

Boundary
System

Jaime
M.
Francisco

04/10/04

06/04/07

Boundary
System

Isidro
Endraca

04/2000

03/06/06

Boundary
System7

Name
Bernard
Tenazas

A.

G.

of

Tenazas alleged that the illegal dismissal happened in July 1, 2007

when he reported an accident that caused damage to the assigned taxi
in the amount of P500.00. He was scolded and was told that to leave
the garage for he is already fired. Despite of this, Tenazas reported for
work on the following day but was told that he can no longer drive any
of the companys units as he is already fired.
Francisco, on the other hand, averred that his dismissal was brought
about by the companys 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 was no longer allowed to drive a taxi unit despite his persistent
pleas.
The Respondents, 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 companys units at any point in
time. They further alleged that Tenazas was never terminated by the
company and rather it was Tenaza who 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
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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. 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.
On May 29, 2008, the petitioners, by registered mail, filed a Motion to
Admit Additional Evidence. They alleged that after diligent efforts, they
were able to discover new pieces of evidence that will substantiate the
allegations in their position paper. Attached with the motion are the
following: (a) Joint Affidavit of the petitioners; (2) Affidavit of Good
Faith of Aloney Rivera, a co-driver; 16 (3) pictures of the petitioners
wearing company shirts;17 and (4) Tenazas Certification/Record of
Social Security System (SSS) contributions.
On May 30, 2008, the Labor Arbiter (LA) rendered a Decision
dismissing the instant consolidated complaints for lack of merit. There
was no formal investigations, no show cause memos, suspension
memos or termination memos were never issued. Otherwise stated,
there is no proof of overt act of dismissal committed by herein
respondents. Therefore, the LA was constrained to rule that there was
no illegal dismissal in the case at bar. The situations contemplated by
law for entitlement to separation pay does [sic] not apply.
Petitioners appealed the decision of the LA to the NLRC.
Subsequently, on June 23, 2009, 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 in its
Resolution23 dated September 23, 2009.
Respondents filed a petition for certiorari with the CA. On March
11, 2010, the CA rendered a Decision,24 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. On March 19, 2010, the petitioners filed a motion for
reconsideration but the same was denied by the CA in its
Resolution26 dated June 28, 2010.
Undeterred, the petitioners filed the instant petition for review on
certiorari before the Supreme Court on July 15, 2010.

ISSUE: Whether or not employer-employee

between Francisco and the respondents.
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relationship

exists

HELD: The petition lacked merit.

"[I]n 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."
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 respondents exercise of control over the means
and methods by which he undertakes his work. This is imperative in
light of the respondents 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 Franciscos 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
employer-employee 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
19 | P a g e

not tantamount to evidence. Bereft of any evidence, the CA correctly

ruled that Francisco could not be considered an employee of the
respondents. It is an oft-repeated rule that in labor cases, as in other
administrative and quasi-judicial proceedings, "the quantum of proof
necessary is substantial evidence, or such amount of relevant evidence
which a reasonable mind might accept as adequate to justify a
conclusion." "[T]he burden of proof rests upon the party who asserts
the affirmative of an issue." Corollarily, as Francisco was claiming to be
an employee of the respondents, it is incumbent upon him to proffer
evidence to prove the existence of said relationship.reinstatement no
longer a feasible option.
10.

NELSON V. BEGINO et al., vs. ABS-CBN CORPORATION

FACTS: Respondent ABS-CBN, through Respondent Villafuerte,
engaged the services of Petitioners as cameramen, editors or reporters
for TV Broadcasting. Petitioners signed regularly renewed Talent
Contracts (3 months - 1 year) and Project Assignment Forms which
detailed the duration, budget and daily technical requirements of a
particular project. Petitioners were tasked with coverage of news items
for subsequent daily airings in Respondents TV Patrol Bicol Program.
The Talent Contract has an exclusivity clause and provides that nothing
therein shall be deemed or construed to establish an employeremployee relationship between the parties.
Petitioners filed against Respondents a complaint for regularization
before the NLRC's Arbitration branch.
In support of their complaint, Petitioners claimed that they worked
under the direct control of Respondent Villafuerte - they were
mandated to wear company IDs, they were provided the necessary
equipment, they were informed about the news to be covered the
following day, and they were bound by the companys policy on
attendance and punctuality.
Respondents countered that, pursuant to their Talent Contracts and
Project Assignment Forms, Petitioners were hired as talents to act as
reporters, editors and/or cameramen. Respondents further claimed
they never imposed control as to how Petitioners discharged their
duties. At most, they were briefed regarding the general requirements
of the project to be executed.
While the case was pending, Petitioners contracts were terminated,
prompting the latter to file a second complaint for illegal dismissal.
The Arbitration Branch ruled that Petitioners were regular employees,
and ordered Respondents to reinstate the Petitioners.
The NLRC affirmed the ruling, but the CA overturned the decision.
ISSUE: Whether or not the petitioners are regular employees of
Respondents.

20 | P a g e

HELD: The Court finds the petition impressed with merit.

Of the criteria to determine whether there is an employer-employee
relationship, the so-called "control test" is generally regarded as the
most crucial and determinative indicator of the said relationship.
To determine the existence of said relation, 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 employers 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 employeremployee 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.
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.
Later echoed in Dumpit-Murillo v. Court of Appeals, this Court has
rejected the application of the ruling in the Sonza case to employees
similarly situated as petitioners in ABS-CBN Broadcasting Corporations
v. Nazareno. The following distinctions were significantly observed
between employees like petitioners and television or radio personalities
like Sonza, to wit:
First. In the selection and engagement of respondents, no peculiar or
unique skill, talent or celebrity status was required from them because
they were merely hired through petitioners personnel department just
like any ordinary employee.
Second. The so-called talent fees of respondents correspond to
wages given as a result of an employer-employee relationship.
Respondents did not have the power to bargain for huge talent fees, a
circumstance negating respondent contractual relationship.
Third. Petitioner could always discharge respondents should it find
their work unsatisfactory, and respondents are highly dependent on
the petitioner for continued work,
Fourth. The degree of control and supervision exercised by petitioner
over respondents through its supervisors negates that respondents
are independent contractors.
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.

21 | P a g e

As cameramen, editors and reporters, it appears that Petitioners were

subject to the control and supervision of Respondents which provided
them with the equipment essential for the discharge of their functions.
The exclusivity clause and prohibitions in their Talent Contract were
likewise indicative of Respondents' control over them, however
obliquely worded.
Also,the presumption is that when the work done is an integral part of
the regular business of the employer and when the worker does not
furnish an independent business or professional service, such work is a
regular employment of such employee and not an independent
contractor.

11.

ARIEL L. DAVID, vs.JOHN G. MACASIO

FACTS: In January 2009, Macasio filed before the LA a

complaint against petitioner Ariel L. David, doing business under the
name and style "Yiels Hog Dealer," for non-payment of overtime pay,
holiday pay and 13th month pay. He also claimed payment for moral
and exemplary damages and attorneys fees. Macasio also claimed
payment for service incentive leave (SIL). He alleged before the LA
that he had been working as a butcher for David since January 6,
1995. He also claimed that David exercised effective control and
supervision over his work, pointing out that David: (1) set the work
day, reporting time and hogs to be chopped, as well as the manner by
which he was to perform his work; (2) daily paid his salary of P700.00,
which was increased from P600.00 in 2007, P500.00 in 2006
and P400.00 in 2005; and (3) approved and disapproved his leaves.
Macasio added that David owned the hogs delivered for chopping, as
well as the work tools and implements; the latter also rented the
workplace. Macasio further claimed that David employs about twentyfive (25) butchers and delivery drivers.
In his defense, David claimed that he started his hog dealer business
in 2005 and that he only has ten employees. He alleged that he hired
Macasio as a butcher or chopper on "pakyaw" or task basis who is,
therefore, not entitled to overtime pay, holiday pay and 13th month
pay pursuant to the provisions of the Implementing Rules and
Regulations (IRR) of the Labor Code. David pointed out that Macasio:
(1) usually starts his work at 10:00 p.m. and ends at 2:00 a.m. of the
following day or earlier, depending on the volume of the delivered
hogs; (2) received the fixed amount of P700.00 per engagement,
regardless of the actual number of hours that he spent chopping the
delivered hogs; and (3) was not engaged to report for work and,
accordingly, did not receive any fee when no hogs were delivered.
22 | P a g e

In April 30, 2009 decision, the LA dismissed Macasios complaint for

lack of merit and gave credence to Davids claim that he engaged
Macasio on "pakyaw" or task basis. The LA concluded that as Macasio
was engaged on "pakyaw" or task basis, he is not entitled to overtime,
holiday, SIL and 13th month pay.
In its May 26, 2010 decision, the NLRC affirmed the LA ruling. The
NLRC observed that David did not require Macasio to observe an eight
hour work schedule to earn the fixed P700.00 wage; and that Macasio
had been performing a non-time work, pointing out that Macasio was
paid a fixed amount for the completion of the assigned task,
irrespective of the time consumed in its performance. Since Macasio
was paid by result and not in terms of the time that he spent in the
workplace, Macasio is not covered by the Labor Standards laws on
overtime, SIL and holiday pay, and 13th month pay under the Rules
and Regulations Implementing the 13th month pay law.
Macasio moved for reconsideration19 but the NLRC denied his motion in
its August 11, 2010 resolution prompting Macasio to elevate his case
to the CA via a petition for certiorari. The CA partly granted Macasios
certiorari petition and reversed the NLRCs ruling for having been
rendered with grave abuse of discretion.
While the CA agreed with the LAand the NLRC that Macasio was a task
basis employee, it nevertheless found Macasio entitled to his monetary
claims. Accordingly, the CA awarded Macasios claim for holiday, SIL
and 13th month pay for three years, with 10% attorneys fees on the
total monetary award. The CA, however, denied Macasios claim for
moral and exemplary damages for lack of basis.
David filed the present petition after the CA denied his motion for
reconsideration in the CAs January 31, 2011 resolution.
ISSUE: Whether or not there exists
relationship between Macasio and David.

an

employer-employee

HELD: The Court finds that the claim that no employer-employee

relationship exists was baseless. Employing the control test, the Court
finds that such a relationship exist in the present case.
To determine the existence of an employer-employee relationship, four
elements generally need to be considered, namely: (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. These elements or indicators comprise the so-called "fourfold" test of employment relationship. Macasios relationship with David
satisfies this test.

23 | P a g e

Under this overall setup, all those working for David, including
Macasio, could naturally be expected to observe certain rules and
requirements and David would necessarily exercise some degree of
control as the chopping of the hog meats would be subject to his
specifications. Also, since Macasio performed his tasks at Davids
workplace, David could easily exercise control and supervision over the
former. Accordingly, whether or not David actually exercised this right
or power to control is beside the point as the law simply requires the
existence of this power to control or, as in this case, the existence of
the right and opportunity to control and supervise Macasio.
In sum, the totality of the surrounding circumstances of the present
case sufficiently points to an employer-employee relationship existing
between David and Macasio.

12.
Citibank, N.A. vs. Court of Appeals, 299 SCRA 390, G.R.
No. 108961 November 27, 1998
FACTS: In 1983, Citibank and El Toro Security Agency, Inc. (hereafter
El Toro) entered into a contract for the latter to provide security and
protective services to safeguard and protect the bank's premises,
situated at 8741 Paseo de Roxas, Makati, Metro Manila. Under the
contract, El Toro obligated itself to provide the services of security
guards to safeguard and protect the premises and property of Citibank
against theft, robbery or any other unlawful acts committed by any
person or persons, and assumed responsibility for losses and/or
damages that may be incurred by Citibank due to or as a result of the
negligence of El Toro or any of its assigned personnel
Citibank renewed the security contract with El Toro yearly until
1990. On April 22, 1990, the contract between Citibank and El Toro
expired.
On June 7, 1990, respondent Citibank Integrated Guards Labor
Alliance-SEGA-TUPAS/FSM (hereafter CIGLA) filed with the National
Conciliation and Mediation Board (NCMB) a request for preventive
mediation citing Citibank as respondent therein giving as issues for
preventive mediation the following:
a) Unfair labor practice;
b) Dismissal of union officers/members; and
c) Union busting.
On June 10, 1990, petitioner Citibank served on El Toro a written
notice that the bank would not renew anymore the service agreement
24 | P a g e

with the latter. Simultaneously, Citibank hired another security agency,

the Golden Pyramid Security Agency, to render security services at
Citibank's premises.
On the same date, June 10, 1990, respondent CIGLA filed a
manifestation with the NCMB that it was converting its request for
preventive mediation into a notice of strike for failure of the parties to
reach a mutually acceptable settlement of the issues, which it followed
with a supplemental notice of strike alleging as supplemental issue the
mass dismissal of all union officers and members.
On June 11, 1990, security guards of El Toro who were replaced by
guards of the Golden Pyramid Security Agency considered the nonrenewal of El Toro's service agreement with Citibank as constituting a
lockout and/or a mass dismissal. They threatened to go on strike
against Citibank and picket its premises.
In fact, security guards formerly assigned to Citibank under the
expired agreement loitered around and near the Citibank premises in
large groups of from twenty (20) and at times fifty (50) persons.
On June 14, 1990, respondent CIGLA filed a notice of strike
directed at the premises of the Citibank main office.

HELD:Article 212, paragraph 1 of the Labor Code provides the

definition of a labor dispute. It includes any controversy or matter
concerning terms or 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.
On the basis of the allegations of the complaint, it is safe to conclude
that the dispute involved is a civil one, not a labor dispute.
Consequently, we rule that jurisdiction over the subject matter of the
complaint lies with the regional trial court.
13.
Philippine Airlines, Inc. vs. NLRC, 287 SCRA 672, G.R. No.
120567 March 20, 1998
From the foregoing provisions of law, the power of the NLRC to issue
an injunctive writ originates from any labor dispute upon application
by a party thereof, which application if not granted may cause grave
or irreparable damage to any party or render ineffectual any decision
in favor of such party. The term labor dispute is defined as any
controversy or matter concerning terms and conditions of employment
25 | P a g e

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

maintaining, changing, or arranging the terms and conditions of
employment regardless of whether or not the disputants stand in the
proximate relation of employers and employees.

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