Labor Law Rev - Parts i - V Digests

8/9/2019 Labor Law Rev - Parts i - V Digests

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Labor Law Review Digests 1Dean Abad – 2nd sem AY 2012-2013

GENERAL CONSIDERATIONS

I. EMPLOYER-EMPLOYEE RELATIONSHIP

LVN PICTURES, INC. v. PHILIPPINE MUSICIANSGUILD

Facts: The Philippine !si"ians #!ild$ "omposed o% &'( o% all the m!si"ians pla)ing %or the m!si"alre"ordings o% L*+ Pi"t!res$ ,n"$ .ampag!itaPi"t!res$ ,n" and Premiere Prod!"tions$ ,n"$ /led apetition be%ore the o!rt o% ,nd!strial Relationspra)ing that it be "erti/ed as the sole and e"l!sivebargaining agen") %or all m!si"ians woring in thesaid "ompanies ,n their Answer$ the "ompaniesdenied that the) have an) m!si"ians as emplo)eesand alleged that these m!si"ians are mereindependent "ontra"tors

The lower "o!rt s!stained the theor) o% the #!ildand granted the peti tion A motion %orre"onsideration was /led b!t the same was deniedb) the "o!rt en"e$ L*+ Pi"t!res /led a petition %orreview on "ertiorari

Issue: 45+ the m!si"ians are emplo)ees o% the/lm "ompanies

He!: Yes$ the m!si"ians are emplo)ees o% the /lm"ompanies

To determine 45+ the m!si"ians are emplo)ees orindependent "ontra"ts o% the /lm "ompanies$ the"o!rt !sed the right o% "ontrol test 6nder this test$an emplo)er-emplo)ee relationship eists where theperson %or whom the servi"es are per%ormedreserves the right to "ontrol not onl) the end to bea"hieved$ b!t also the manner and means to be!sed in rea"hing the end

Appl)ing the %oregoing test in the present "ase$ theo!rt %o!nd that L*+ has right o% "ontrol over them!si"ians as shown 718 b) "alling the m!si"iansthro!gh 9"all slips: in the name o% the "ompan)$ 728b) arranging s"hed!les in its st!dio %or re"ordingsessions$ 738 b) %!rnishing transportation and mealsto m!si"ians$ and 7;8 b) s!pervising and dire"ting indetail$ thro!gh the motion pi"t!re dire"tor$ theper%orman"e o% the m!si"ians be%ore the "amera$ inorder to s!it the m!si" the) are pla)ing to thepi"t!re whi"h is being wages %rom the"ooperative b!t instead re"eive a share in theservi"e s!rpl!s$ as determined b) the ?oard o% Dire"tors o% the "ooperative$ whi"h is earned b)Asiapro %rom di@erent areas o% trade it engages in

,n order to eno) the bene/ts !nder the ... Law$the owners-members o% the "ooperative who wereassigned to .tan/l"o reB!ested the latter to registerthem with ... as sel%-emplo)ed and to remit their"ontrib!tions as s!"h owever$ based on the.ervi"e ontra"ts it ee"!ted with .tan/l"o$ it is"lear that the "ooperative is a"t!all) a manpower"ontra"tor and the emplo)er o% the owners-

members woring with .tan/l"o en"e ...instr!"ted Asiapro to register itsel% with ... asemplo)er Asiapro ignored s!"h demand o% ...en"e$ ... /led a petition be%ore the .. dire"tingAsiapro or$ in the alternative$ .tan/l"o$ to registeras an emplo)er o% the owners-members o% AsiaproAsiapro /led its Answer with TD alleging the noemplo)er-emplo)ee relationship eists between itand its owners-members The .. denied the TDA motion %or re"onsideration was /led b!t the samewas denied b) the .. Asiapro /led a petition %or"ertiorari be%ore the A$ whi"h was granted b) thelatter ... /led a motion %or re"onsideration b!t thesame was denied b) the A en"e$ this peti tion

Issue: 45+ there is emplo)er-emplo)eerelationship between Asiapro and its owners-members

He!: Yes

The ; elements %or the eisten"e o% an emplo)er-emplo)ee relationship areC

1 sele"tion and engagement o% theemplo)ees

2 pa)ment o% wages3 power o% dismissal; power to "ontrol the emplo)ees: "ond!"t

The o!rt %o!nd all elements o% an emplo)er-emplo)ee relationship are present in this "ase

1 ,t is epressl) provided in the .ervi"e ontra"tsthat it is Asiapro whi"h has the e"l!sivedis"retion in the sele"tion and engagement o% the owners-members as well as its team leaders

who will be assigned at .tan/l"o2 The weel) stipends or the so-"alled shares in

the servi"e s!rpl!s given b) Asiapro to itsowners-members were in realit) wages$ as thesame were eB!ivalent to an amo!nt not lowerthan that pres"ribed b) eisting labor laws$r!les and reg!lations

3 ,t is epressl) provided in the .ervi"e ontra"tsthat it is Asiapro whi"h has the power toinvestigate$ dis"ipline and remove the owners-members and its team leaders who wererendering servi"es at .tan/l"o

; ,t is Asiapro whi"h has the sole "ontrol over themanner and means o% per%orming the servi"es

!nder the .ervi"e ontra"ts with .tan/l"o aswell as the means and methods o% wor

,n addition$ the o!rt di@erentiated the present "asewith Cooperative Rural Bank of Davao City, Inc. v.Ferrer-Calleja$ eplaining that the said "ase wasmade in "ontet o% 45+ an emplo)ee who is also amember o% the "ooperative "an eer"ise the right tobargain "olle"tivel) with the "ooperative while theiss!e in the present "ase is 45+ an emplo)er-emplo)ee relationship eist between the"ooperative and an owner-member

ORO#CO v. FIFTH DIVISION OF THE COURT OFAPPEALS

Facts: ,n ar"h 1&&0$ PD, engaged the servi"es o% 5ro"o to write a weel) "ol!mn %or its Li%est)lese"tion .he religio!sl) s!bmitted her arti"les ever)wee$ e"ept %or a si-month stint in +ew Yor it)when she$ nonetheless$ sent several arti"les thro!ghmail .he re"eived "ompensation o% P2'0$ whi"hwas later in"reased to P300$ %or ever) "ol!mnp!blished ,n 1&&2$ PD, de"ided to terminatepetitioner:s "ol!mn on the gro!nd that 5ro"o %ailedto improve her "ol!mn Aggrieved$ 5ro"o /leda"omplaint %or illegal dismissal be%ore the +LR


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The Labor Arbiter r!led ,n %avor o% 5ro"o on thegro!nd that PD, eer"ised %!ll and "omplete "ontrolover the means and method b) whi"h 5ro"o:s worhad to be a""omplished 5n appeal$ the +LR!pheld the de"ision o% the Labor Arbiter 4hen the"ase was elevated to the A$ the latter reversed the+LR and r!led that 5ro"o is not an emplo)ee o%

PD, A motion %or re"onsideration was /led b!t thesame was denied b) the A en"e$ this peti tion

Issue: 45+ a newspaper "ol!mnist is an emplo)eeo% the newspaper whi"h p!blishes the "ol!mn

He!: +o$ a newspaper "ol!mnist is an independent"ontra"tor

An emplo)er-emplo)ee relationship eists where theemplo)er has a right to "ontrol the "ond!"t o% theemplo)ee in relation to his wor The o!rtemphasied$ however$ that not ever) %orm o% "ontrolwill have the e@e"t o% establishing an emplo)er-

emplo)ee relationship A line sho!ld be drawnbetween r!les that merel) serve as g!idelines$whi"h onl) promote the res!lt and r!les that / themethodolog) and bind or restri"t the part) hired tothe !se o% s!"h means o% methods ,n "ase o% the%ormer$ no emplo)er-emplo)ee relationship eistswhile in the "ase o% the latter$ emplo)er-emplo)eerelationship eists

,n the present "ase$ the r!les laid down b) PD, as totitle$ spa"e and dis"ipline are inherent "onditions inr!nning a newspaper 5ro"o has not shown thatPD, di"tated how she was to write or prod!"e herarti"les ea"h wee There were no restraints on her

"reativit) The apparent limitation that she had towrite onl) on s!be"ts that bene/tted the li%est)lese"tion was simpl) a logi"al "onseB!en"e o% the %a"tthat her "ol!mn appeared in that se"tion ,naddition$ PD,:s power to approve or ree"t an)spe"i/" arti"le she wrote "annot be the "ontrol"ontemplated in the E"ontrol testF$ as it is b!tlogi"al that one who "ommissions another to do apie"e o% wor sho!ld have the right to a""ept orree"t the prod!"t oreover$ altho!gh 5ro"o had aweel) deadline to meet$ she was not pre"l!ded%rom s!bmitting her "ol!mn ahead o% time or %roms!bmitting "ol!mns to be p!blished at a later timeore importantl)$ PD, did not di"tate !pon 5ro"o

the s!be"t matter o% her "ol!mns$ b!t onl) imposedthe general g!ideline that the arti"le sho!ld

"on%orm to the standards o% the newspaper and thegeneral tone o% the parti"!lar se"tion

Aside %rom "ontrol test$ the o!rt also !sed thee"onomi" realit) test 6nder this test$ the e"onomi"realities prevailing within the a"tivit) or betweenthe parties are eamined$ taing into "onsideration

the totalit) o% "ir"!mstan"es s!rro!nding the tr!enat!re o% the relationship between the parties ,no!r !risdi"tion$ the ben"hmar o% e"onomi" realit)in anal)ing possible eno)ment %or p!rposes o% appl)ing the Labor o!ght to be the e"onomi"dependen"e o% the worer on his emplo)er ,n thepresent "ase$ the main o""!pation o% 5ro"o is notas a "ol!mnist b!t as a women:s rights advo"ateworing in vario!s women:s organiations .he also"ontrib!tes arti"les to other p!bli"ations Th!s$ it"annot be said that 5ro"o is dependent on PD, %orher "ontin!ed emplo)ment in PD,:s line o% b!siness

SOCIAL SECURITY SYSTEM v. CA

Facts: argarita Tana$ widow o% ,sagani Tana$ Gr$/led a petition be%ore the ..$ pra)ing that an5rder be iss!ed dire"ting on"hita A)alde andAntero aghari to pa) the premi!m "ontrib!tions o% ,gnanio and report his name %or ... "overage and... to grant argarita the %!neral and pensionbene/ts d!e her ,n her petition$ she alleged that,sagani was an emplo)ee o% A)alde as a %armhand inthe 2 s!gar"anes owned b) the latter .he %!rtheralleged that ,sagani wored "ontin!o!sl) %or H da)sa wee$ ; wees a month and %or 12 months ever))ear %rom Gan!ar) 1&H1 to April 1&I& ,sagani

allegedl) re"eived a reg!lar salar) a""ording to theprevailing minim!m wage .everal ded!"tions s!"has so"ial se"!rit) "ontrib!tions$ medi"al andemplo)ees "ompensation premi!ms$ were made%rom ,sagani:s wages ,t was onl) a%ter ,sagani:sdeath that it was dis"overed that ,sagani was neverreported %or "overage nor were his "ontrib!tionsremitted to the ...

A)alde mainl) denied the allegation that ,saganiwas her emplo)ee$ admitting onl) that he was hiredintermittentl) as independent "ontra"tor to plow$harrow$ or b!rrow the %ormer:s ha"ienda

A%ter hearing$ .. iss!ed a Resol!tion /nding that,sagani was an emplo)ee o% A)alde %rom 1&H1 to

1&I& and ordered the latter to pa) damages ThisResol!tion was reversed b) the A and r!led %or thedismissal o% argarita:s "omplaint

Issue: 45+ an agri"!lt!ral laborer "an be"onsidered an emplo)ee

He!: Yes

A)alde presented mere sampling o% pa)rolls Thesedo"!ments are not onl) la"ing$ the) are also!nworth) o% "reden"e The %a"t that ,gano"io:sname does not appear in the pa)rolls %or the )ears1&I'$ 1&IH and part o% 1&IJ and 1&I&$ is no proo% that he did not wor in da ?I0 in the )ears 1&H1to 1&I;$ and the rest o% 1&IJ and 1&I& Thevera"it) o% the alleged pa)rolls are do!bt%!l"onsidering that the laborers named therein neveraKed their signat!res to show that the) a"t!all)re"eived the amo!nts indi"ated "orresponding totheir names Also$ no re"ord was shown pertaining

to da ?-1'-$ where ,gna"io was s!pposed tohave wored =ven A)alde admitted that she hired,gna"io as EaradorF and sometimes as laborerd!ring milling in da ?-1'-

oreover$ while A)alde ma) not have dire"tl)imposed on ,gna"io the manner and methods to%ollow in per%orming his tass$ she did eer"ise"ontrol thro!gh her overseer ?e that as it ma)$ thepower o% "ontrol re%ers merel) to the eisten"e o% the power ,t is not essential %or the emplo)er toa"t!all) s!pervise the per%orman"e o% d!ties o% theemplo)ee it is s!K"ient that the %ormer has a rightto wield the power ertainl)$ A)alde wielded the

power to hire or dismiss$ to "he" on the wor$ be itin progress or B!alit)$ o% the laborers As theowner>lessee o% the plantations$ she possessed thepower to "ontrol ever)one woring therein andever)thing taing pla"e therein

There are other eB!all) important "onsiderationswhi"h s!pport the "on"l!sion that ,gna"io was notan independent "ontra"tor Mirst$ ,gna"io "annot besaid to be engaged in a distin"t o""!pation orb!siness is "arabao and plow ma) be !se%!l in hislivelihood$ b!t he is not independentl) engaged inthe b!siness o% %arming or plowing .e"ond$ he hadbeen woring e"l!sivel) %or A)alde %or 1J )ears

prior to his demise Third$ there is no disp!te thatA)alde was in the b!siness o% growing s!gar"ane in


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the two plantations %or "ommer"ial p!rposes Thereis also no B!estion that plowing or preparing the soil%or planting is a maor part o% the reg!lar b!sinesso% A)alde

INSULAR LIFE v. NLRC

Facts: ,n 1&HJ$ ,ns!lar Li%e and ?asiao entered intoa "ontra"t whereb) the latter was a!thoried tosoli"it appli"ations %or ins!ran"es and ann!ities ,nret!rn$ he wo!ld re"eive "ompensation in the %ormo% "ommissions The "ontra"t liewise "ontainedprovisions governing the relations o% the parties$ thed!ties o% the agent$ the a"ts prohibited to him$ andthe modes o% termination o% the agreement

,n 1&I2$ the parties entered into another "ontra"t$ie Agen") anager:s ontra"t To implement s!"h"ontra"t$ ?asiao organied an oK"e while %!l/llinghis "ommitments !nder the /rst "ontra"t

,n 1&I&$ ,ns!lar Li%e terminated the Agen")anager:s ontra"t ?asiao s!e ,ns!lar Li%e$ whi"hprompted the latter to terminate also hisengagement !nder the /rst "ontra"t Therea%ter$?asiao /led a "omplaint with the inistr) o% Labor%or re"over) o% "ommissions pl!s attorne):s %eesMor its de%ense$ ,ns!lar Li%e "hallenged the !risdi"tion o% the inistr) alleging that ?asiao isonl) an independent "ontra"tor and not anemplo)ee

The Labor Arbiter$ as aKrmed b) the +LR$ %o!nd%or ?asiao and r!led that an emplo)er-emplo)ee

relationship has been established between ,ns!larLi%e and ?asiao en"e$ this petition

Issue: 45+ ?asiao is an emplo)ee o% ,ns!lar Li%e

He!: +o

,t has been established that E"ontrol testF is a validtest o% the "hara"ter o% a "ontra"t or agreement torender servi"e owever$ not ever) %orm o% "ontrolwill have the e@e"t o% establishing an emplo)er-emplo)ee relationship A line sho!ld be drawnbetween r!les that merel) serve as g!idelines$whi"h onl) promote the res!lt and r!les that / the

methodolog) and bind or restri"t the part) hired tothe !se o% s!"h means o% methods ,n "ase o% the

%ormer$ no emplo)er-emplo)ee relationship eistswhile in the "ase o% the latter$ emplo)er-emplo)eerelationship eists

The distin"tion a"B!ires parti"!lar relevan"e in the"ase o% an enterprise a@e"ted with p!bli" interest$as is the b!siness o% ins!ran"e$ and is on that

a""o!nt s!be"t to reg!lation b) the .tate withrespe"t$ not onl) to the relations between ins!rerand ins!red b!t also to the internal a@airs o% theins!ran"e "ompan) R!les and reg!lations governingthe "ond!"t o% the b!siness are provided %or in the,ns!ran"e ode and en%or"ed b) the ,ns!ran"eommissioner ,t is$ there%ore$ !s!al and epe"ted%or an ins!ran"e "ompan) to prom!lgate a set o% r!les to g!ide its "ommission agents in selling itspoli"ies that the) ma) not r!n a%o!l o% the law andwhat it reB!ires or prohibits 5% s!"h a "hara"ter arethe r!les whi"h pres"ribe the B!ali/"ations o% persons who ma) be ins!red$ s!be"t ins!ran"eappli"ations to pro"essing and approval b) the

ompan)$ and also reserve to the ompan) thedetermination o% the premi!ms to be paid and thes"hed!les o% pa)ment None of these really invadesthe agents contractual prerogative to adopt hiso!n selling "ethods or to sell insurance at his o!nti"e and convenience$ hen"e "annot !sti/abl) besaid to establish an emplo)er-emplo)ee relationshipbetween him and the "ompan)

TONG$O v. MANUFACTURER%S LIFE INSURANCECO., INC.

Facts: an!li%e is a domesti" "orporation engaged

in li%e ins!ran"e b!siness Renato A *ergel De Dioswas$ d!ring the period material$ its President andhie% =e"!tive 5K"er #regorio * Tongo startedhis pro%essional relationship with an!li%e on G!l)1$1&II b) virt!e o% a areer AgentNs Agreement7Agreement8 he ee"!tedwith an!li%e

,n the Agreement$ it is provided thatC

E,t is !nderstood and agreed that the Agent is anindependent "ontra"tor and nothing "ontainedherein shall be "onstr!ed or interpreted as "reatingan emplo)er-emplo)ee relationship between theompan) and the Agent

The ompan) ma) terminate this Agreement %oran) brea"h or violation o% an) o% the provisionshereo% b) the Agent b) giving written noti"e to theAgent within /%teen 71'8 da)s %rom the time o% thedis"over) o% the brea"h +o waiver$ eting!ishment$abandonment$ withdrawal or "an"ellation o% theright to terminate this Agreement b) the ompan)

shall be "onstr!ed %or an) previo!s %ail!re toeer"ise its right !nder an) provision o% thisAgreement

=ither o% the parties hereto ma) liewise terminatehis Agreement at an)time witho!t "a!se$ b) givingto the other part) /%teen 71'8 da)s noti"e inwritingF

,n 1&J3$ Tongo was named as a 6nit anager inan!li%eNs .ales Agen") 5rganiation ,n 1&&0$ hebe"ame a ?ran"h anager As the A %o!nd$ TongoNs gross earnings %rom his wor at an!li%e$"onsisting o% "ommissions$ persisten") in"ome$ and

management overrides The problem startedsometime in 2001$ when an!li%e instit!tedmanpower development programs in the regionalsales management level Relative thereto$ De Diosaddressed a letter dated +ovember H$ 2001 to Tongo regarding an 5"tober1J$ 2001 etro +orth.ales anagers eeting .tating that Tongo:sRegion was the lowest per%ormer 7on a per anagerbasis8 in terms o% re"r!iting in2000 and$ as o% toda)$"ontin!es to remain one o% the laggards in this area

5ther iss!es wereCO.ome anagers are !nhapp)with their earnings and wo!ld want to revert to theposition o% agentsO And O.ales anagers are doing

what the "ompan) ass them to do b!t$ in thepro"ess$ the) earn lessO Tongo was thenterminated

There%rom$ Tongo /led a omplaint dated+ovember 2'$ 2002 with the +LR against an!li%e%or illegal dismissal ,n the omplaint ,n a De"isiondated April 1'$ 200;$ Labor Arbiter dismissed the"omplaint %or la" o% an emplo)er-emplo)eerelationship

The +LRNs Mirst Division$ while /nding an emplo)er-emplo)ee relationship between an!li%e and Tongoappl)ing the %o!r-%old test$ held an!li%e liable %or

illegal dismissal Th!s$ an!li%e /led an appeal withthe A Therea%ter$ the A iss!ed the assailed


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Labor Law Review Digests ;Dean Abad – 2nd sem AY 2012-2013

De"ision dated ar"h 2&$ 200'$ /nding the absen"eo% an emplo)er-emplo)ee relationship between theparties and deeming the +LR with no !risdi"tionover the "ase en"e$ this petition

Issues:1 45+ Tongo was an emplo)ee o% an!li%e

2 45+ Tongo was illegall) dismissed

He!:1 Yes

,n the instant "ase$ an!li%e had the power o% "ontrol over Tongo that wo!ld mae him itsemplo)ee .everal %a"tors "ontrib!te to this"on"l!sion

,n the Agreement dated G!l) 1$ 1&II ee"!tedbetween Tongo and an!li%e$ it is providedthatC

EThe Agent hereb) agrees to "ompl) with all

reg!lations and reB!irements o% the ompan)as herein provided as well as maintain astandard o% nowledge and "ompeten") in thesale o% the ompan)Ns prod!"ts whi"h satis/esthose set b) the ompan) and s!K"ientl)meets the vol!me o% new b!siness reB!ired o% Prod!"tion l!b membershipF

6nder this provision$ an agent o% an!li%e m!st"ompl) with three 738 reB!irementsC 718"omplian"e with the reg!lations andreB!irements o% the "ompan) 728 maintenan"eo% a level o% nowledge o% the "ompan)Nsprod!"ts that is satis%a"tor) to the "ompan)

and 738 "omplian"e with a B!ota o% newb!sinesses Among the "ompan) reg!lations o% an!li%e are the di@erent "odes o% "ond!"t s!"has the Agent ode o% ond!"t$ an!li%eMinan"ial ode o% ond!"t$ and an!li%eMinan"ial ode o% ond!"t Agreement$ whi"hdemonstrate the power o% "ontrol eer"ised b)the "ompan) over Tongo The %a"t that Tongowas obliged to obe) and "ompl) with the "odeso% "ond!"t was not disowned b) respondents

Th!s$ with the "ompan) reg!lations andreB!irements alone$ the %a"t that Tongo was anemplo)ee o% an!li%e ma) alread) be

established ertainl)$ these reB!irements"ontrolled the means and methods b) whi"h

Tongo was to a"hieve the "ompan)Ns goalsore importantl)$ an!li%eNs eviden"eestablishes the %a"t that Tongo was tased toper%orm administrative d!ties that establisheshis emplo)ment with an!li%e Additionall)$ itm!st be pointed o!t that the %a"t that Tongowas tased with re"r!iting a "ertain n!mber o%

agents$ in addition to his other administrative%!n"tions$ leads to no other "on"l!sion that hewas an emplo)ee o% an!li%e

2 Yesan!li%e %ailed to "ite a single iota o% eviden"eto s!pport its "laims an!li%e did not evenpoint o!t whi"h order or r!le that Tongodisobe)ed ore importantl)$ an!li%e did notpoint o!t the spe"i/" a"ts that Tongo wasg!ilt) o% that wo!ld "onstit!te gross andhabit!al negle"t o% d!t) or disobedien"ean!li%e merel) "ited TongoNs alleged Olaggardper%orman"e$O witho!t s!bstantiating s!"h

"laim$ and eB!ated the same to disobedien"eand negle"t o% d!t) Apropos thereto$ Art 2II$par 7b8$ o% the Labor ode mandates in epli"itterms that the b!rden o% proving the validit) o% the termination o% emplo)ment rests on theemplo)er Mail!re to dis"harge this evidentialb!rden wo!ld ne"essaril) mean that thedismissal was not !sti/ed$ and$ there%ore$illegal

&ARDIN, ET AL. v. NLRC

Facts: Petitioners were drivers o% Philama

,nternational$ ,n"$ a domesti" "orporation engagedin the operation o% E#oodman TaiF Petitioners!sed to drive Philama:s tai"abs ever) other da) ona 2;-ho!r wor s"hed!le !nder the bo!ndar)s)stem$ where the) earned an average o% P;00dail) Philama reg!larl) ded!"ts P30 %rom thepetitioners: dail) earnings s!pposedl) %or thewashing o% the tai !nits ?elieving that theded!"tion is illegal$ petitioners de"ided to %orm alabor !nion

6pon learning abo!t the plan$ Philama re%!sed tolet petitioners drive the tai"abs Aggrieved$petitioners /led a "omplaint %or !n%air labor

pra"ti"e$ illegal dismissal and illegal ded!"tion TheLabor Arbiter dismissed the "omplaint %or la" o%

merit 5n appeal$ the +LR reversed the LA andr!led that petitioners are emplo)ees o% Philama andde"lared the latter g!ilt) o% illegal dismissal 5nse"ond motion %or re"onsideration$ the +LRreversed its de"ision and r!led that no emplo)er-emplo)ee relationship eists between petitionersand Philama The peti tioners so!ght

re"onsideration b!t the same was denied b) the+LR en"e$ this petition

Issue: 45+ the petitioners 7eepne) drivers8 areemplo)ees or Philima

He!: Yes

,n the "ase o% eepne) owners>operators and eepne) drivers$ the %ormer eer"ise s!pervision and"ontrol over the latter The management o% theb!siness is in the ownerNs hands The owner asholder o% the "erti/"ate o% p!bli" "onvenien"e m!stsee to it that the driver %ollows the ro!te pres"ribed

b) the %ran"hising a!thorit) and the r!lesprom!lgated as regards its operation +ow$ the %a"tthat the drivers do not re"eive /ed wages b!t getonl) that in e"ess o% the so-"alled Obo!ndar)O the)pa) to the owner>operator is not s!K"ient towithdraw the relationship between them %rom thato% emplo)er and emplo)ee en"e$ petitioners are!ndo!btedl) emplo)ees o% private respondentbe"a!se as tai drivers the) per%orm a"tivitieswhi"h are !s!all) ne"essar) or desirable in the!s!al b!siness or trade o% their emplo)er

ROSARIO "ROTHERS v. OPLE

Facts: Private respondents are tailors$ pressers$stit"hers and similar worers hired b) Rosario?rothers in its tailoring department ,n 1&II$ privaterespondents /led a "omplaint against the "ompan)%or violation o% PD J'1 713th month pa)8 and PD1123 7=mergen") Living Allowan"e8 be%ore theRegional 5K"e o% the Department o% Labor TheLabor Arbiter dismissed the "omplaint !pon /ndingthat private respondents are not emplo)ees o% Rosario ?rothers The) were therea%ter dismissed b)the "ompan)$ whi"h prompted them to /le a "ase%or illegal dismissal eanwhile$ the +LR aKrmedthe de"ision o% the LA owever$ the inister o%

Labor reversed the +LR resol!tion and r!led thatprivate respondents are emplo)ees o% the "ompan)


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Issue: 45+ an emplo)er-emplo)ee relationshipeists between the private respondents 7tailors$pressers$ stit"hers and similar worers8 and Rosario?rothers

He!: Yes

The eisten"e o% emplo)er-emplo)ee relationship isdetermined b) the %ollowing elements$ namel)C 718the sele"tion and engagement o% the emplo)ee 728the pa)ment o% wages 738 the power o% dismissaland 7;8 the power to "ontrol emplo)eesN "ond!"taltho!gh the latter is the most important element5n the other hand$ an independent "ontra"tor isone who eer"ises independent emplo)ment and"ontra"ts to do a pie"e o% wor a""ording to his ownmethods and witho!t being s!be"ted to "ontrol o% his emplo)er e"ept as to the res!lt o% his wor

1 The sele"tion and hiring o% private respondents

were done b) the petitioner$ thro!gh the master"!tter o% its tailoring department who was a reg!laremplo)ee The pro"ed!re was modi/ed when theemplo)ment o% personnel in the tailoringdepartment was made b) the management itsel% a%ter the appli"antsN B!ali/"ations had been passed!pon b) a "ommittee o% %o!r Later$ %!rther approvalb) the Personnel Department was reB!ired

2 Private respondents re"eived their weel) wageson pie"e-wor basis whi"h is within the s"ope andmeaning o% the term OwageO as de/ned !nderArti"le &I7%8 o% the Labor ode rem!neration orearnings$ however$ designated$ "apable o% being

epressed in terms o% mone)$ whether /ed oras"ertained on a time$ tas$ pie"e$ or "ommissionbasis$ or other method o% "al"!lating the same$whi"h i s pa)able b) an emplo)er to anemplo)eeQ

3 Petitioner had the power to dismiss privaterespondents$ as shown b) the vario!s memorandaiss!ed %or stri"t "omplian"e b) private respondents$violations o% whi"h$ in etreme "ases$ are gro!nds%or o!tright dismissal ,n %a"t$ the) were dismissedon 02 Gan!ar) 1&IJ$ altho!gh$ the dismissal wasde"lared illegal b) the Labor Arbiter The "ase ispending appeal with the +LR

; Private respondentsN "ond!"t in the per%orman"eo% their wor was "ontrolled b) petitioner$ s!"h asC718 the) were reB!ired to wor %rom onda) thro!gh.at!rda) 728 the) wored on ob orders witho!twaiting %or the deadline 738 the) were to observe"leanliness in their pla"e o% wor and were notallowed to bring o!t tailoring shop patterns and 7;8

the) were s!be"t to B!alit) "ontrol b) petitioner

' Private respondents were allowed to register with... as emplo)ees o% petitioner and premi!ms wereded!"ted %rom their wages !st lie its otheremplo)ees And$ withholding taes were alsoded!"ted %rom their wages %or transmittal to the?,R

FULACHE v. A"S-C"N

Facts: Petitioners /led "omplaint %or reg!lariation$!n%air labor pra"ti"es and several mone) "laims

against A?.-?+ eb! The) alleged that the) weree"l!ded %rom the ?A ee"!ted b) A?.-?+ Ran-and-Mile =mplo)ees 6nion with the "ompan) on thegro!nd that the) were "onsidered temporar) andnot reg!lar emplo)ees 5n the other hand$ A?.-?+alleged that petitioners were independent"ontra"tors>o@ "amera talents$ and the) were notentitled to the bene/ts and privileges o% reg!laremplo)ees

The Labor Arbiter iss!ed a de"ision holding that thepetitioners were reg!lar emplo)ees o% A?.-?+ andare entitled to the bene/ts and privileges o% reg!laremplo)ees A?.-?+ appealed the LA r!ling be%ore

the +LR Mo!rth Division

4hile the appeal was pending$ A?.-?+ dismissed ;o% the petitioners %or their re%!sal to sign !p"ontra"ts o% emplo)ment with servi"e "ontra"torAble .ervi"es Aggrieved$ the) /led a "omplaint %orillegal dismissal ,n its de%ense$ A?.-?+ allegedthat the) !ndertoo a "omprehensive review o% itsorganiational str!"t!re and de"ided to "o!rsethro!gh legitimate servi"e "ontra"tors the servi"esprovided b) the petitioners The Labor Arbiterdismissed the "omplaint %or illegal dismissal on thegro!nd that the dismissal was a!thoried !nder thelaw 7red!ndan")8

5n appeal$ the +LR iss!ed a oint de"ision andr!led that there was emplo)er-emplo)eerelationship between petitioners and A?.-?+ andthat the ; petitioners were illegall) dismissed

?oth parties moved %or re"onsideration The +LRresolved these motions b) r!ling that the petitioners

are emplo)ees o% A?.-?+ and that there was noillegal dismissal

The petitioners /led a petition %or "ertiorari "harging+LR with grave ab!se o% dis"retion The A heldthat the petitioners are not entitled to ?A bene/tsand that the dismissal was legal

Issue: 45+ the petitioners are reg!lar emplo)ees$and th!s "overed b) the ?A

He!: Yes

As reg!lar emplo)ees$ petitioners %all within the

"overage o% the bargaining !nit and are there%oreentitled to ?A bene/ts as a matter o% law and"ontra"t 6nder the terms o% the ?A$ petitionersare members o% the appropriate bargaining !nitbe"a!se the) are reg!lar ran-and-/le emplo)eesand do not belong to an) o% the e"l!ded"ategories ost importantl)$ the labor arbiter:sde"ision o% Gan!ar) 1I$ 2002 – aKrmed all the wa)to the A – r!led against the "ompan):s s!bmissionthat the) are independent "ontra"tors Th!s$ asreg!lar ran-and-/le emplo)ees$ the) %all within the?A "overage And$ !nder the ?A:s epress terms$the) are entitled to its bene/ts

?A "overage is not onl) a B!estion o% %a"t$ b!t o% law and "ontra"t The %a"t!al iss!e is whether thepetitioners are reg!lar ran-and-/le emplo)ees o% the "ompan) The trib!nals below !ni%orml)answered this B!estion in the aKrmative Mrom this%a"t!al /nding


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"ertain lo"ations$ e"ept in instan"es when he wo!ldbe ordered to a""ompan) the "ompan):s deliver)vehi"les as pahinante To s!pport his "laim$ Gavieradd!"ed no other eviden"e e"ept an aKdavitee"!ted b) one ?engie *alen!ela$ who onl)attested that he wo!ld %reB!entl) see Gavier at theworpla"e where he was also hired as stevedore

Issue: Does Gavier:s eviden"e s!K"e to establishemplo)er-emplo)ee relationship between Ml) A"eand himS

He!: +o

=pe"tedl)$ opposing parties wo!ld stand polesapart and pro@er allegations as di@erent as "haland "heese ,t is$ there%ore$ in"!mbent !pon theo!rt to determine whether the part) on whom theb!rden to prove lies was able to h!rdle the sameE+o parti"!lar %orm o% eviden"e is reB!ired to provethe eisten"e o% s!"h emplo)er-emplo)ee

relationship An) "ompetent and relevant eviden"eto prove the relationship ma) be admitted en"e$while no parti"!lar %orm o% eviden"e is reB!ired$ a/nding that s!"h relationship eists m!st still reston some s!bstantial eviden"e oreover$ thes!bstantialit) o% the eviden"e depends on itsB!antitative as well as its B!alitative aspe"tsFAltho!gh s!bstantial eviden"e is not a %!n"tion o% B!antit) b!t rather o% B!al it)$ the "ir"!mstan"es o% the instant "ase demand thatsomething more sho!ld have been pro@ered adthere been other proo%s o% emplo)ment$ s!"h as in"l!sion in petitioner:s pa)roll$ or a "lear eer"iseo% "ontrol$ the o!rt wo!ld have aKrmed the /nding

o% emplo)er-emplo)ee relationshipF

,n s!m$ the r!le o% th!mb remainsC the on!sprobandi %alls on petitioner to establish ors!bstantiate s!"h "laim b) the reB!isite B!ant!m o% eviden"e E4hoever "laims entitlement to thebene/ts provided b) law sho!ld establish his or herright thereto F

,n this "ase$ the labor arbiter and the o!rt o% Appeals 7A8 both "on"l!ded that Gavier %ailed toestablish his emplo)ment with Ml) A"e All that Gavier presented were his sel%-serving statementsp!rportedl) showing his a"tivities as an emplo)ee o%

Ml) A"e e %ailed to pass the s!bstantialit)reB!irement to s!pport his "laim en"e$ the o!rt

sees no reason to depart %rom the /ndings o% theA

4hile Gavier remains /rm in his position that as anemplo)ed stevedore o% Ml) A"e$ he was made towor in the "ompan) premises d!ring weeda)sarranging and "leaning gro"er) items %or deliver) to

"lients$ no other proo% was s!bmitted The loneaKdavit ee"!ted b) one ?engie *alen!ela was!ns!""ess%!l in strengthening Gavier:s "a!se All*alen!ela attested to was that he wo!ld %reB!entl)see Gavier at the worpla"e where the latter wasalso hired as stevedore Tthe o!rt "annot ignorethe ines"apable "on"l!sion that Gavier:s merepresen"e at the worpla"e %alls short in provingemplo)ment therein The aKdavit "o!ld havebolstered Gavier:s "laim o% being tased to "leangro"er) items when there were no s"hed!leddeliver) trips$ b!t no in%ormation was o@ered simpl)be"a!se the witness had no personal nowledge o% Gavier:s emplo)ment stat!s The o!rt "annot

a""ept Gavier:s statements$ hoo$ line and siner

II. &O" CONTRACTING ' LA"OR ONLYCONTRACTING

ASIAN ALCOHOL CORPORATION v. NLRCFacts: D!e to mo!nting b!siness losses$ theParsons %amil) sold their maorit) rights to Prioroldings$ ,n" onseB!entl)$ Prior oldings tooover its management and operation

To thwart %!rther losses$ Prior oldings implementeda reorganiational plan and other "ost-saving

meas!res$ whi"h res!lted to the separation o% 11I7I2 – red!ndant positionsC 21 – !nion members '1 –non-!nion members8 o!t o% 3H0 emplo)ees %romservi"es

H separated emplo)ees$ all assigned at the Repairand aintenan"e .e"tion o% the P!l!p!ndan Plant$/led "omplaints %or illegal dismissal$ alleging thatAsian Al"ohol !sed the retren"hment program as as!bter%!ge %or !nion b!sting

The LA dismissed the "omplaint 5n appeal$ the+LR reversed the LA and r!led that the positions o% the PRs were not red!ndant 7the) were repla"ed b)

"as!als8 +LR denied R en"e$ this petition %or"ertiorari

Issue: 45+ the availment o% the servi"es o% anindependent "ontra"tor to repla"e the servi"es o% the terminated emplo)ees is valid

He!: Yes1 *alid retren"hment 7reB!irementsC a reasonable

and ne"essar) bwritten noti"e is served"pa)ment d good %aith and e %air andreasonable "riteria8 with proo% never"ontested

2 Red!ndan")$ "onsidered as retren"hmentmeas!re$ is valid ,t eists when the servi"e"apabilit) o% the wor %or"e is in e"ess o% what isreasonabl) needed 7reB!irementsC a writtennoti"e is served b pa)ment " good %aith andd %air and reasonable "riteria8 4ater wells - lease "ontra"t was terminated

water had be"ome salt) wells had to be"losed

?riB!etting plant operation – shi%ted to !se

o% b!ner %!el need onl) 2 operators *era)owas the oldest 7age ph)si"al strength8

e"hani" – more "ost eK"ient to maintainme"hani"s Ama"io – least eK"ient d!e topoor health "ondition

3 ReC hiring o% "as!als The red!"tion o% the n!mber o% worers in a"ompan) made ne"essar) b) the introd!"tion o% anindependent "ontra"tor is !sti/ed when the latter is!ndertaen in order to e@e"t!ate more e"onomi"and eK"ient methods o% prod!"tion ,n this "ase$PRs %ailed to present an) proo% that themanagement a"ted in a mali"io!s or arbitrar)manner in engaging the servi"es o% an independent

"ontra"tor in its operations Th!s$ there is no basisto inter%ere with the bona /de de"ision o%management to e@e"t more e"onomi" and eK"ientmethods o% prod!"tion

COCA-COLA "OTTLERS PHILIPPINES, INC. v.DELA CRU#

Facts: Respondents /led "omplaints %orreg!lariation with mone) "laims against o"a-ola The) alleged that the) are ro!te helpers assigned towor in the tr!"s o% o"a-ola The) go %rom theo"a-ola sales oK"e or plants to "!stomer o!tlets

The) were hired either dire"tl) b) the petitioner orb) its "ontra"tors The servi"es the) render are


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Labor Law Review Digests IDean Abad – 2nd sem AY 2012-2013

ne"essar) and desirable in the reg!lar b!siness o% o"a-ola The) also alleged that the) wored!nder the "ontrol and s!pervision o% o"a-ola:ss!pervisors who prepared their wor s"hed!les andassignments Also$ the) alleged that Peerless and="ellent did not have s!K"ient "apital orinvestment to provide servi"es to o"a-ola Th!s$

Peerless and ="ellent are in the nat!re o% Elabor-onl)F "ontra"ts prohibited b) law

The LA dismissed the "omplaint %or la" o% !risdi"tion$ /nding that the respondents areemplo)ees o% Peerless and ="ellent This wasaKrmed b) the +LR The A reversed and r!ledthat Peerless and ="ellent were engaged in labor-onl) "ontra"ting 7ne"essar) and desirable no proo% to show s!K"ient "apital8 en"e$ this petition

Issue: 45+ Peerless and ="ellent are engaged inlabor-onl) "ontra"ting

He!: Yes The o!rt noted that the "ontra"t is not the /nalword on how the "ontra"ted worers relate to theprin"ipal and the p!rported "ontra"tor therelationships m!st be tested on the basis o% howthe) a"t!all) operate The legitimate ob "ontra"torm!st have the capitali#ation and e$uip"ent to!ndertae the sale and distrib!tion o% theman!%a"t!rer:s prod!"ts$ and m!st do it on its o!nusing its o!n "eans and selling "ethods

,n this "ase$ the "o!rt noted that both the Peerlessand the ="ellent "ontra"ts show that theirobligation was solel) to provide the "ompan) with

Ethe servi"es o% "ontra"t!al emplo)ees$F andnothing more These "ontra"ted servi"es were %orthe handling and deliver) o% the "ompan):sprod!"ts and allied servi"es Mollowing D5 1J-02and the "ontra"ts that spoe p!rel) o% the s!ppl) o% labor$ Peerless and ="ellent are "onsidered labor-onl) "ontra"tors !nless the) "o!ld prove that the)had the reB!ired "apitaliation and the right o% "ontrol over their "ontra"ted worers owever$other than petitioner:s bare allegation$ no proo% waspresented to show that Peerless and ="ellent hads!bstantial "apital$ tools or investment !sed dire"tl)in providing the "ontra"ted servi"es

The "ontra"tors were not independentl) selling anddistrib!ting "ompan) prod!"ts$ !sing their own

eB!ipment$ means and methods o% selling anddistrib!tion the) onl) s!pplied the manpower thathelped the "ompan) in the handing o% prod!"ts %orsale and distrib!tion The o!rt held that p!res!ppl) o% manpower with the tas o% assisting insales and distrib!tion "ontrolled b) a prin"ipal %allswithin prohibited labor-onl) "ontra"ting Th!s$ the

"ontra"ted personnel$ engaged in "omponent%!n"tions in the main b!siness o% the "ompan)!nder the latter:s s!pervision and "ontrol$ "annotb!t be reg!lar "ompan) emplo)ees

TEMIC AUTOMOTIVE PHILS. v. TEMICAUTOMOTIVE PHILS. INC. EMPLOYEES UNION-FF(

Facts: Temi" A!tomotive is a "ompan) engaged inthe man!%a"t!re o% ele"troni" brae s)stems and"om%ort bod) ele"troni"s %or a!tomotive vehi"les$ ?)pra"ti"e$ it "ontra"ts o!t some o% the wor in the

wareho!se department$ to three independentservi"e providers or %orwarders These %orwardersalso have their own emplo)ees who hold thepositions o% "ler$ material handler$ s)stem en"oderand general "ler The reg!lar emplo)ees o% thepetitioner and those o% the %orwarders share thesame wor area and !se the same eB!ipment$ toolsand "omp!ters all belonging to the petitioner

This arrangement gave rise to a !nion grievan"e onthe iss!e o% the s"ope and "overage o% the"olle"tive bargaining !nit The !nion th!s demandedthat the %orwardersN emplo)ees be absorbed intothe petitionerNs reg!lar emplo)ee %or"e and be given

positions within the bargaining !nit

The *ol!ntar) Arbitrator r!led that Temi" validl)"ontra"ted o!t its %orwarding servi"es b!t wentbe)ond the limits o% the legall) allowable"ontra"ting o!t be"a!se the %orwarders: emplo)eesen"roa"hed !pon the %!n"tion o% petitioner:s ran-and-/le emplo)ees Th!s$ *A "on"l!ded that the"ontra"tors: emplo)ees are emplo)ees o% the"ompan) This was aKrmed b) the A en"e$ thispetition

Issue: 45+ there was a valid o!tso!r"ing

He!: Yes

The emplo)er was within its right in entering the%orwarding agreements with the %orwarders as aneer"ise o% its management prerogative Temi":sde"lared obe"tive %or the arrangement is to a"hievegreater e"onom) and eK"ien") in its operations – a!niversall) a""epted b!siness obe"tive andstandard that the !nion has never B!estioned +o

eviden"e or arg!ment B!estions the "ompan):sbasi" obe"tive o% a"hieving Egreater e"onom) andeK"ien") o% operationsF The %orwardingarrangement has been in pla"e sin"e 1&&J and noeviden"e has been presented showing that an)reg!lar emplo)ee has been dismissed or displa"edb) the %orwarders: emplo)ees sin"e then Also$ noeviden"e was presented showing that theo!tso!r"ing has res!lted in a red!"tion o% worho!rs or the splitting o% the bargaining !nit – e@e"tsthat !nder the implementing r!les o% Art 10H "anmae a "ontra"ting arrangement illegal

The similarities in their %!n"tions do not ne"essaril)

mean that all these emplo)ees wor %or the"ompan) The reg!lar "ompan) emplo)ees wor %orthe "ompan) !nder its s!pervision and "ontrol$ b!t%orwarder emplo)ees wor %or the %orwarder in the%orwarder:s own operation that is itsel% a "ontra"tedwor %rom the "ompan) oreover$ it was proventhat the wor done b) the "ontra"tors: emplo)eeswas predominantl) related to %orwarding or theshipment or transport o% the petitioner:s /nishedgoods to overseas destinations$ parti"!larl) to#erman) and 6.A

ALIVIADO v. P'G

Facts: Petitioners wored as mer"handisers o% PU# The) all individ!all) signed emplo)ment "ontra"tswith either Promm-#em or .AP. %or periods o% moreor less ' months at a time The) were assigned atdi@erent o!tlets$ s!permarets and stores wherethe) handled all the prod!"ts o% PU# The) re"eivedtheir wages %rom Promm-#em or .AP..!bseB!entl)$ petitioners /led a "omplaint againstPU# %or reg!lariation$ servi"e in"entive leave pa)and other bene/ts with damages The "omplaintwas later amended to in"l!de the matter o% theirs!bseB!ent dismissal

The LA dismissed the "omplaint %or la" o% merit andr!led that there was no emplo)er-emplo)ee


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relationship between petitioners and PU# e also%o!nd that Promm-#em and .AP. were legitimateindependent ob "ontra"tors The LA de"ision wasaKrmed b) the +LR and the A en"e$ thispetition

Issue: 45+ PU# is the emplo)er o% petitioners

He!. V!ali%),n order to determine whether PU# is the emplo)ero% petitioners$ it is ne"essar) to /rst determinewhether Promm-#em and .AP. are labor-onl)"ontra"tors or legitimate ob "ontra"tors There isOlabor-onl)O "ontra"ting where the person s!ppl)ingworers to an emplo)er does not have s!bstantial"apital or investment in the %orm o% tools$eB!ipment$ ma"hineries$ wor premises$ amongothers$ and the worers re"r!ited and pla"ed b)s!"h person are per%orming a"tivities whi"h aredire"tl) related to the prin"ipal b!siness o% s!"hemplo)er ,n s!"h "ases$ the person or intermediar)

shall be "onsidered merel) as an agent o% theemplo)er who shall be responsible to the worers inthe same manner and etent as i% the latter weredire"tl) emplo)ed b) him

The o!rt held that Promm-#em "annot beregarded as labor-onl) "ontra"tor b!t a legitimateindependent "ontra"tor be"a!se the /nan"ialstatement o% Promm-#em shows that it hasa!thoried "apital sto" o% P1 million and a paid-in"apital$ or "apital available %or operations$ o% P'00$00000 as o% 1&&0 ,t also has long term assetsworth P;32$ J&'2J and "!rrent assets o% PI1&$0;232 Promm-#em has also proven that it

maintained its own wareho!se and oK"e spa"e witha mer"handising b!siness Promm-#em also has other "lients aside %rom PU#

5n the other hand$ the A5, o% .AP. shows that ithas a paid-in "apital o% onl) P31$ 2'000 There is noother eviden"e presented to show how m!"h itsworing "apital and assets are M!rthermore$ thereis no showing o% s!bstantial investment in tools$eB!ipment or other assets onsidering that .AP.has no s!bstantial "apital or investment and theworers it re"r!ited are per%orming a"tivities whi"h

are dire"tl) related to the prin"ipal b!siness o% PU#$the "o!rt held that .AP. is engaged in Olabor-onl)

"ontra"tingO The "ontra"tor is "onsidered merel) anagent o% the prin"ipal emplo)er and the latter isresponsible to the emplo)ees o% the labor-onl)"ontra"tor as i% s!"h emplo)ees had been dire"tl)emplo)ed b) the prin"ipal emplo)er

PAL v. LIGAN

FactsC PAL and .)nerg) .ervi"es orporationentered into an Agreement as prin"ipal and"ontra"tor$ respe"tivel)$ whereb) .)nerg)!ndertoo to provide loading$ !nloading$ deliver) o% baggage and "argo and other related servi"es toand %rom PAL:s air"ra%t at the a"tan .tation TheAgreement epressl) provided that .)nerg) was anindependent "ontra"tor and that there wo!ld be noemplo)er-emplo)ee relationship between .)nerg)and>or its emplo)ees on the one hand$ and PAL onthe other

.)nerg) assigned Ligan and the other respondentsto PAL in 1&&1 ,n 1&&2$ Respondents /led"omplaints be%ore the +LR %or !nderpa)ment$ non-pa)ment o% premi!m pa) %or holida)s$ premi!mpa)s %or rest da)s$ servi"e in"entive leave pa)$ 13thmonth pa) and allowan"es$ and %or reg!lariation o% emplo)ment stat!s with PAL against .)nerg)$

The LA %o!nd .)nerg) to be an independent"ontra"tor and dismissed respondents: "omplaint %orreg!lariation$ b!t granted their mone) "laims 5nappeal$ the +LR de"lared that .)nerg) was a labor-onl) "ontra"tor and ordered PAL to a""eptrespondents as its reg!lar emplo)ees 5nl) PAL

assailed the +LR de"ision The A aKrmed the+LR

Issue: 45+ .)nerg) is a labor-onl) "ontra"tor

He!: YesMor labor-onl) "ontra"ting to eist$ an) o% the 2elements m!st be presentC

7i8 The "ontra"tor or s!b"ontra"tor does not haves!bstantial "apital or investment whi"h relates tothe ob$ wor or servi"e to be per%ormed and theemplo)ees re"r!ited$ s!pplied$ or pla"ed b) s!"h"ontra"tor or s!b"ontra"tor are per%orminga"tivities whi"h are dire"tl) related to the main

b!siness o% the prin"ipal$ or

7ii8 The "ontra"tor does not eer"ise the right to "ontrolover the per%orman"e o% the wor o% the"ontra"t!al emplo)ee

,n this "ase$ the wor per%ormed b) almost all o% therespondentsWloading and !nloading o% baggageand "argo o% passengersWis dire"tl) related to the

main b!siness o% PAL And the eB!ipment !sed b)respondents as station loaders$ s!"h as trailers and"onve)ors$ are owned b) PAL The re"ords also showthat PAL %ailed to present eviden"e that .)nerg) hads!K"ient "apital to engage in legitimate"ontra"ting ore signi/"antl)$ however$ is thatrespondents wored alongside PAL:s reg!laremplo)ees who were per%orming identi"al wor

oreover$ while PAL "laims that it was .)nerg):ss!pervisors who a"t!all) s!pervised respondents$ it%ailed to present eviden"e thereon ,t did not evenspe"i%) who the .)nerg) s!pervisors assigned at theworpla"e were PAL even admitted that it /es the

respondents: wor s"hed!le as their wor wasdependent on the %reB!en") o% plane arrivals PAL:smanagers and s!pervisors approved respondents:weel) wor assignments$ and respondents andother reg!lar PAL emplo)ees were all re%erred to asEstation attendantsF o% PAL:s "argo operation andair%reight servi"es

"A"AS v. LOREN#O SHIPPING CORPORATION

Facts: L. is a d!l) organied domesti" "orporationengaged in the shipping ind!str) L. entered into a#eneral =B!ipment aintenan"e Repair and

anagement .ervi"es Agreement 7Agreement8 with?est anpower .ervi"es$ ,n" 7?.,8$ whereb) thelatter !ndertoo to provide maintenan"e and repairservi"es to L.:s "ontainer vans$ heav) eB!ipment$trailer "hassis$ and generator sets$ and to provide"he"ers to inspe"t all "ontainers re"eived %orloading to and>or !nloading %rom its vessels

.im!ltaneo!s with the ee"!tion o% the Agreement$L. leased its eB!ipment$ tools$ and tra"tors to?., The period o% lease was "otermino!s with theAgreement Therea%ter$ ?., then hired petitionersto wor at L.

,n .eptember 2003$ petitioners /led with the LA a"omplaint %or reg!lariation against L. and ?.,


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Labor Law Review Digests &Dean Abad – 2nd sem AY 2012-2013

,n 2003$ L. terminated the AgreementonseB!entl)$ petitioners lost their emplo)ment

?., asserted that it is an independent "ontra"tor,t averred that it was willing to reg!lariepetitioners however$ some o% them la"ed thereB!isite B!ali/"ations %or the ob L. averred that

petitioners were emplo)ees o% ?., and wereassigned to L. b) virt!e o% the Agreement ?., isan independent ob "ontra"tor with s!bstantial"apital or investment in the %orm o% tools$eB!ipment$ and ma"hiner) ne"essar) in the "ond!"to% its b!siness

The LA dismissed the "omplaint on the gro!nd thatpetitioners were emplo)ees o% ?., ,t was ?.,whi"h hired petitioners$ paid their wages$ andeer"ised "ontrol over them The +LR reversed theLA en"e$ this petition

Issue: 45+ ?., is engaged in labor-onl)

"ontra"ting

He!: Yes

The "hara"ter o% the b!siness$ ie$ whether as labor-onl) "ontra"tor or as ob "ontra"tor$ sho!ld bemeas!red in terms o%$ and determined b)$ the"riteria set b) stat!te The parties "annot di"tate b)the mere epedien"e o% a !nilateral de"laration in a"ontra"t the "hara"ter o% their b!siness

18 Petitioners wored at L.:s premises$ andnowhere else There was no showing that it was?., whi"h established petitioners: woring

pro"ed!re and methods$ whi"h s!pervisedpetitioners in their wor$ or whi"h eval!ated thesame 7absol!te la" o% eviden"e8

28 L. was !nable to present proo% that ?., hads!bstantial "apital 4hat is "lear was that theeB!ipment !sed b) ?., were owned b)$ andmerel) rented %rom$ L.

38 Petitioners per%ormed a"tivities whi"h weredire"tl) related to the main b!siness o% L. Thewor o% petitioners as "he"ers$ welders$ !tilit) men$drivers$ and me"hani"s "o!ld onl) be "hara"teriedas part o%$ or at least "learl) related to$ and in the

p!rs!it o%$ L.:s b!siness

;8 ?., had no other "lient e"ept %or L. 7notre%!ted8erti/"ate o% Registration iss!ed b) the D5L= is not"on"l!sive eviden"e o% s!"h stat!s The %a"t o% registration simpl) prevents the legal pres!mptiono% being a mere labor-onl) "ontra"tor %rom arising

SMC v. MAERC INTEGRATED SERVICES, INC., ETAL.

Facts: 2&1 worers /led their "omplaints against. and aer" ,ntegrated .ervi"es$ ,n"$ %or illegaldismissal$ !nderpa)ment o% wages$ non-pa)ment o% servi"e in"entive leave pa)s and other laborstandards bene/ts$ and %or separation pa)s The"omplainants alleged that the) were hired b) .thro!gh its agent or intermediar) A=R to wor in2 designated worpla"es in anda!e it) The)washed and segregated vario!s inds o% empt)bottles !sed b) . to sell and distrib!te its beer

beverages to the "ons!ming p!bli" The) were paidon a per pie"e or paiao basis e"ept %or a %ew whowored as "he"ers and were paid on dail) wagebasis Also$ the) alleged that long be%ore ."ontra"ted the servi"es o% A=R$ a maorit) o% them had alread) been woring %or . !nder theg!ise o% being emplo)ees o% another "ontra"tor$ Gopard .ervi"es$ !ntil the servi"es o% the latter wereterminated on 31 Gan!ar) 1&JJ

The LA rendered a de"ision holding that A=R wasan independent "ontra"tor The +LR r!led thatA=R was a labor-onl) "ontra"tor and that"omplainants were emplo)ees o% . This was

aKrmed b) the A en"e$ this petition

Issue: 45+ the A=R is engaged in labor-onl)"ontra"ting

He!: Yes A=R emplo)ees are .:s emplo)ees

,n as"ertaining an emplo)er-emplo)ee relationship$the %ollowing %a"tors are "onsideredC 7a8 thesele"tion and engagement o% emplo)ee 7b8 thepa)ment o% wages 7"8 the power o% dismissal and$7d8 the power to "ontrol an emplo)eeNs "ond!"t

7a8 . pla)ed a large and indispensable part in the

hiring o% A=RNs worers ,t also appears thatmaorit) o% the "omplainants had alread) been

woring %or . long be%ore the signing o% theservi"e "ontra"t between . and A=R in 1&JJoreover$ the in"orporators o% A=R admittedhaving s!pplied and re"r!ited worers %or . evenbe%ore A=R was "reated and that the"omplainants who were then alread) woring %or. were made to go thro!gh the motion o%

appl)ing %or wor with A=R

7b8 Pa)ment o% worersN wages$ . ass!med theresponsibilit) o% pa)ing %or the mandated overtime$holida) and rest da) pa)s o% the A=R worers. also paid the emplo)erNs share o% the ... andedi"are "ontrib!tions$ the 13th month pa)$in"entive leave pa) and maternit) bene/ts

7"8 . maintained a "onstant presen"e in theworpla"e thro!gh its own "he"ers Theresponsibilit) o% wat"hing over the A=R worersb) A=R personnel be"ame s!per

"erti/"ation ele"tion imberl) lar and 6=,-PT#45 "hallenged the H; "as!al worers on the


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gro!nd that the) are emplo)ees o% RA+ The"erti/"ation ele"tion was held b!t the ballots o% theH; "as!als were segregated ,L6.A+-5LAL,A /led amotion to open and "o!nt the "hallenged ballots$arg!ing that the) are emplo)ees o% imberl) lar

The inister o% Labor iss!ed a de"ision r!ling that

the "as!al emplo)ees not per%orming anitorial and)ard maintenan"e servi"es are deemed labor-onl)"ontra"t!al and th!s$ have attained the stat!s o% reg!lar emplo)ees Rs – denied

Issue: 45+ worers not per%orming anitorial or)ard maintenan"e servi"e be"ame reg!laremplo)ees o% imberl)

He!: Yes

2 inds o% emplo)eesC18 =ngaged to per%orm a"tivities whi"h are !s!all)

ne"essar) or desirable in the !s!al b!siness or

trade o% emplo)er28 Rendered at least 1 )ear o% servi"e$ whether

"ontin!o!s or broen$ with respe"t to the a"tivit)in whi"h the) are emplo)ed the) %all !nder this "ategor)

owever$ this wo!ld not render the servi"e "ontra"tbetween imberl) and Ran illegal The o!rt notedthat the servi"e "ontra"ts ee"!ted betweenimberl) and Ran$ with respe"t to the worersper%orming anitorial and )ard maintenan"e servi"eis legal as it is s!pported b) s!bstantial and"onvin"ing eviden"e

The o!rt also too !di"ial noti"e o% the generalpra"ti"e adopted in several government and privateinstit!tions and ind!stries o% hiring a anitorialservi"e on an independent "ontra"tor basisM!rthermore$ the o""asional dire"tives ands!ggestions o% ,?=RLY are ins!K"ient to erodeprimar) and "ontin!o!s "ontrol over the emplo)eeso% the independent "ontra"tor

Lastl)$ the d!ties per%ormed b) these worers arenot independent and integral steps in or aspe"ts o% the essential operations o% ,?=RLY whi"h isengaged in the man!%a"t!re o% "ons!mer paperprod!"ts and "igarette paper$ hen"e said worers

"annot be "onsidered reg!lar emplo)ees

III. PRO"ATIONARY EMPLOYMENT

"UISER, ET AL. v. LEOGARDO, ET AL.

Facts: Petitioners were emplo)ed b) the privaterespondent #=+=RAL T=L=P5+= D,R=T5RY

5PA+Y as sales representatives and "harged withthe d!t) o% soli"iting advertisements %or in"l!sion ina telephone dire"tor) ,n their emplo)ment "ontra"t7on probationar) stat!s8$ it was stip!lated that thepetitioners will be on a probationar) stat!s %or aperiod o% 1J months The "ompan) then pres"ribedsales B!otas to be a""omplished or met b) thepetitioners

Mailing to meet their respe"tive sales B!otas d!ringthe probationar) period b!t almost a )ear a%ter the)ee"!ted the "ontra"t$ the petitioners weredismissed %rom the servi"e b) the privaterespondent Aggrieved$ the) /led a "omplaint %or

illegal dismissal against the "ompan)

The Regional Dire"tor dismissed the "omplaints andr!led that the petitioners have not attainedpermanent stat!s sin"e private respondent was !sti/ed in reB!iring a longer period o% probation$and that the termination o% petitionersN servi"es wasvalid sin"e the latter %ailed to meet their salesB!otas 5n appeal$ Dep!t) inister aKrmed the RDDe"isionen"e$ this petition %or "ertiorari

Issue: 45+ the probationar) emplo)ment o% 1Jmonths is valid

He!: Yes#enerall)$ the probationar) period o% emplo)ment islimited to H months The e"eption to this generalr!le is when the parties to an emplo)ment "ontra"tma) agree otherwise$ s!"h as when the same isestablished b) "ompan) poli") or when the same isreB!ired b) the nat!re o% wor to be per%ormed b)the emplo)ee ,n the latter "ase$ there is re"ognitiono% the eer"ise o% managerial prerogatives inreB!iring a longer period o% probationar)emplo)ment$ s!"h as in the present "ase where theprobationar) period was set %or 1J months$espe"iall) where the emplo)ee m!st learn a

parti"!lar ind o% wor s!"h as selling$ or when the

ob reB!ires "ertain B!ali/"ations$ sills$ eperien"eor training

,n this "ase$ it is shown that the "ompan) needs atleast 1J months to determine the "hara"ter andselling "apabilities o% the petitioners as salesrepresentatives The ompan) is engaged in

advertisement and p!bli"ation in the Yellow Pages o% the PLDT Telephone Dire"tories P!bli"ation o% soli"ited ads are onl) made a )ear a%ter the sale hasbeen made and onl) then win the "ompan) be ableto eval!ate the eK"ien")$ "ond!"t$ and sellingabilit) o% its sales representatives$ the eval!ationbeing based on the p!blished ads oreover$ aneighteen month probationar) period is re"ogniedb) the Labor 6nion in the private respondent"ompan)$ whi"h is Arti"le * o% the olle"tive?argaining Agreement

Lastl)$ the ver) "ontra"ts o% emplo)ment signedand a"B!ies"ed to b) the petitioners spe"i/"all)

indi"ate that Othe "ompan) hereb) emplo)s theemplo)ee as telephone sales representative on aprobationar) stat!s %or a period o% 1J months Thisstip!lation is not "ontrar) to law$ morals and p!bli"poli")

A.M. ORETA ' CO., INC. v. NLRC

Facts: #r!lla was engaged b) =+D=5$ thro!ghA 5reta U o$ ,n"$ as a "arpenter in its proe"t in Geddah$ .a!di Arabia The "ontra"t o% emplo)mentwas %or a period o% 12 months4hile woring at the obsite in Geddah$ he met an

a""ident whi"h %ra"t!red his l!mbar vertebrae Th!s$ he was "on/ned in a hospital %or 12 da)s Therea%ter$ #r!lla was dis"harged %rom the hospitaland was told that he "o!ld res!me his normald!ties

A %ew da)s a%ter he reported ba" to wor$ here"eived a noti"e o% termination Th!s$ he /led a"omplaint %or illegal dismissal against A 5reta Uo$ ,n" and =+D=5 with the P5=A

P5=A held that the dismissal was illegal 5n appeal$the +LR aKrmed in toto the P5=A de"ision en"e$this petition$ whereb) A 5reta U o$ ,n" arg!ed

that #r!lla was still a probationar) emplo)ee and


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that his dismissal was !sti/ed on the basis o% his!nsatis%a"tor) per%orman"e

Issue: 45+ #r!lla was a probationar) emplo)ee

He!: +o,n all "ases involving emplo)ees engaged on

probationar) period basis$ the emplo)er shall maenown to the emplo)ee at the time he is hired$ thestandards b) whi"h he will B!ali%) as a reg!laremplo)ee

,n this "ase$ nowhere in the emplo)ment "ontra"tee"!ted between petitioner "ompan) andrespondent #r!lla is there a stip!lation that thelatter shall !ndergo a probationar) period %or threemonths be%ore he "an B!ali%) as a reg!laremplo)ee There is also no eviden"e on re"ordshowing that the respondent #r!lla has beenappraised o% his probationar) stat!s and thereB!irements whi"h he sho!ld "ompl) in order to be

a reg!lar emplo)ee ,n the absen"e o% thisreB!isites$ there is !sti/"ation in "on"l!ding thatrespondent #r!lla was a reg!lar emplo)ee at thetime he was dismissed b) petitioner

As s!"h$ he is entitled to se"!rit) o% ten!re d!ringhis period o% emplo)ment and his servi"es "annotbe terminated e"ept %or !st and a!thoried "a!sesen!merated !nder the Labor ode and !nder theemplo)ment "ontra"t

MARI(ASA MANUFACTURING, INC. v.LEOGARDO

Facts: DeB!ila was hired on probation b) ariwasaas a general !tilit) worer on Gan!ar) 10$ 1&I&6pon the epiration o% the probationar) period o% simonths$ DeB!ila was in%ormed b) his emplo)er thathis wor had proved !nsatis%a"tor) and had %ailed tomeet the reB!ired standards To give him a "han"eto improve his per%orman"e and B!ali%) %or reg!laremplo)ment$ instead o% dispensing with his servi"ethen and there$ with his written "onsent ariwasaetended his probation period %or another 3 monthsowever$ his per%orman"e did not improve Th!s$his emplo)ment was terminated at the end o% theetended period

DeB!ila /led a "omplaint %or illegal dismissal withthe inistr) o% Labor against ariwasa

The RD dismissed the "omplaint and r!led that thetermination o% DeB!ilaNs emplo)ment was !sti/ed 5n appeal$ the inister reversed and held thatDeB!ila was alread) a reg!lar emplo)ee at the time

o% his dismissal$ there%ore$ "o!ld not have beenlaw%!ll) dismissed %or %ail!re to meet "ompan)standards as a probationar) worer en"e$ thispetition

Issue: 45+ the emplo)er and emplo)ee ma) b)agreement etend the probationar) period o% emplo)ment be)ond H months

He!: Yes1 An etension ma) law%!ll) be "ovenanted$notwithstanding the seemingl) restri"tive lang!ageo% Art 2J2 The o!rt "ited Buiser vs. %eogardo, &r $where the o!rt held thatC

E#enerall)$ the probationar) period o% emplo)ment is limited to si 7H8 months Thee"eption to this general r!le is when the partiesto an emplo)ment "ontra"t ma) agree otherwise$s!"h as when the same is established b)"ompan) poli") or when the same is reB!ired b)the nat!re o% wor to be per%ormed b) theemplo)ee ,n the latter "ase$ there is re"ognitiono% the eer"ise o% managerial prerogatives inreB!iring a longer period o% probationar)emplo)ment$ espe"iall) where the emplo)eem!st learn a parti"!lar ind o% wor s!"h asselling$ or when the ob reB!ires "ertainB!ali/"ations$ sills eperien"e or trainingF

2 There is no indi"ation that the etension to whi"hDeB!ila gave his agreement was a mere stratagemo% petitioners to avoid the legal "onseB!en"es o% aprobationar) period satis%a"toril) "ompleted Theo!rt noted that the etension o% DeB!ilaNsprobation was an a"t o% liberalit) on the part o% hisemplo)er a@ording him a se"ond "han"e to maegood a%ter having initiall) %ailed to prove his worthas an emplo)ee

3 ?) vol!ntaril) agreeing to an etension o% theprobationar) period$ DeB!ila in e@e"t waived an)bene/t atta"hing to the "ompletion o% said period i%

he still %ailed to mae the grade d!ring the period o% etension The o!rt /nds nothing in the law whi"h

b) an) %air interpretation prohibits s!"h a waiverAnd no p!bli" poli") prote"ting the emplo)ee andthe se"!rit) o% his ten!re is served b) pres"ribingvol!ntar) agreements whi"h$ b) reasonabl)etending the period o% probation$ a"t!all) improveand %!rther a probationar) emplo)eeNs prospe"ts o% demonstrating his /tness %or reg!lar emplo)ment

HOLIDAY INN MANILA v. NLRC

Facts: onasan was emplo)ed b) olida) ,nn %orEon-the-ob-trainingF as a telephone operator %or aperiod o% 3 wees A%ter "ompleting her training$ shewas emplo)ed on a probationar) basis %or a periodo% H months ,n her emplo)ment "ontra"t$ it wasstip!lated that her probationar) emplo)ment ma)be terminated at an) time prior to the epiration o% the H-month periodMo!r da)s be%ore the epiration o% her "ontra"t$olida) ,nn noti/ed her o% her dismissal on the

gro!nd that her per%orman"e had not "ome !p tothe standards o% the hotel Th!s$ onasan /led a"omplaint %or illegal dismissal

The LA dismissed the "omplaint on the gro!nd thatthe dismissal was !sti/ed 5n appeal$ the +LRreversed the LA de"ision and r!led that onasanhad be"ome a reg!lar emplo)ee and th!s$ "o!ld notbe dismissed as a probationer en"e$ this petition

Issue: 45+ onasan is still a probationar)emplo)ee

He!: +o

Probation is the period d!ring whi"h the emplo)erma) determine i% the emplo)ee is B!ali/ed %orpossible in"l!sion in the reg!lar %or"e ,n the "ase atbar$ the period was %or three wees$ d!ringonasanNs on-the-ob training 4hen her servi"eswere "ontin!ed a%ter this training$ the petitioners ine@e"t re"ognied that she had passed probation andwas B!ali/ed to be a reg!lar emplo)ee

onasan was "ertainl) !nder observation d!ring herthree-wee on-the-ob training ,% her servi"esproved !nsatis%a"tor) then$ she "o!ld have beendropped as earl) as d!ring that period ?!t she wasnot 5n the "ontrar)$ her servi"es were "ontin!ed$

pres!mabl) be"a!se the) were a""eptable$


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altho!gh she was %ormall) pla"ed this time onprobation

=ven i% it be s!pposed that the probation did notend with the three-wee period o% on-the-obtraining$ there is still no reason wh) that periodsho!ld not be in"l!ded in the stip!lated si-month

period o% probation onasan was a""epted %or on-the-ob training on April 1'$ 1&&1 Ass!ming thather probation "o!ld be etended be)ond that date$it nevertheless "o!ld "ontin!e onl) !p to 5"tober1'$ 1&&1$ a%ter the end o% si months %rom theearlier date 6nder this more lenient approa"h$ shehad be"ome a reg!lar emplo)ee o% olida) ,nn anda"B!ired %!ll se"!rit) o% ten!re as o% 5"tober 1'$1&&1

The "onseB!en"e is that she "o!ld no longer bes!mmaril) separated on the gro!nd invoed b) thepetitioners

ST. THERESITA%S ACADEMY, ET AL. v NLRC

Facts: Ariola had been emplo)ed as a s"hooltea"her b) .t Theresita:s A"adem) %rom 1&'; !ntilshe retired in 1&IH$ or %or 22 "ontin!o!s )ears ,n1&I&$ the other .!perior invited her to go ba" asa s"hool tea"her be"a!se the s"hool neededB!ali/ed and good tea"hers in ath and =nglishAriola a""epted on the "ondition that she sho!ld be"onsidered a reg!lar tea"her The "ondition wasa""epted b) the s"hool Th!s$ she signed a "ontra"twith the s"hool whi"h was renewed )earl)

An iss!e arose with regard to the pa)ment o% s!mmer living allowan"e ?e"a!se o% this$ thes"hool management iss!ed a board resol!tionwhere it was resolved that an) rehired retiree shallnoti/ed that their "ontra"t will not be renewed %orthe "oming )ear

A%ter ; )ears o% "ontin!o!s satis%a"tor) servi"e$"omplainant was noti/ed that her "ontra"t will notbe renewed Aggrieved$ she /led a "omplaint %orillegal dismissal The LA and +LR r!led in %avor o% Ariola en"e$ this petition

Issue: 45+ Ariola is a probationar) emplo)ee

He!: +o

A%ter Ariola retired in 1&IH$ she was rehired three738 )ears later and rendered %o!r 7;8 more )ears o% satis%a"tor) servi"e to the petitioner in the s"hool)ears 1&I&-1&J0$ 1&J0-1&J1$ 1&J1-1&J2$ and 1&J2-1&J3

4hen she was rehired in 1&I& she did not have to

!ndergo the 3-)ear probationar) emplo)ment %ornew tea"hers %or her tea"hing "ompeten"e hadalread) been tried and tested d!ring her 22 )ears o% servi"e to the s"hool in 1&'; to 1&IH .he re-entered the servi"e in 1&I& as a reg!lar orpermanent tea"her .he "o!ld not be dis"hargedsolel) on a""o!nt o% the epiration o% her %o!rthann!al "ontra"t .he "o!ld onl) be dismissed %or"a!se and with d!e pro"ess$ as provided in Arti"le2I& o% the Labor ode

PINES CITY EDUCATIONAL CENTER v. NLRC

Facts: PRs were all emplo)ed as tea"hers onprobationar) basis b) Pines it) =d!"ational enterAll PRs$ e"ept %or 2$ signed "ontra"ts o% emplo)ment %or a /ed d!ration D!e to theepiration o% their "ontra"ts and poor per%orman"eas tea"hers$ the) were in%ormed that their "ontra"twill not be renewed

Aggrieved$ PRs /led a "omplaint %or illegal dismissal The LA r!led in %avor o% PRs and ordered theirreinstatement ,n s!pport o% his de"ision$ heeplained that the "ontra"ts were vag!e and do notin"l!de spe"i/" des"ription o% d!ties andassignments o% PR 5n appeal$ the +LR aKrmed in

toto the LA de"ision en"e$ this petition

Issue: 45+ the period stip!lated in the "ontra"t isvalid

He!: Yes The o!rt "ited the "ase o% Brent 'chool, Inc. et al.v. (a"ora, et al.$ where the o!rt held that Art 2J0sho!ld have no appli"ation to instan"es where a/ed period o% emplo)ment was agreed !ponnowingl) and vol!ntaril) b) the parties$ witho!tan) %or"e$ d!ress or improper press!re bro!ght tobear !pon the emplo)ee and absent an) other"ir"!mstan"es vitiating his "onsent$ or where it

satis%a"toril) appears that the emplo)er oremplo)ee dealt with ea"h other on more or less

eB!al terms with no moral dominan"e whateverbeing eer"ised b) the %ormer over the latter

,n the present "ase$ however$ the o!rt made adistin"tion

,nso%ar as the private respondents who nowingl)

and vol!ntaril) agreed !pon /ed periods o% emplo)ment are "on"erned$ their servi"es werelaw%!ll) terminated b) reason o% the epiration o% the periods o% their respe"tive "ontra"ts These areDangwa ?entre$ Apollo Riba)a$ .r$ R!perta Riba)a$*irginia ?oado$ e"ilia =mo"ling$ Gose ?entre$ LeilaDoming!e and Rose Ann ?erm!de Th!s$ p!bli"respondent "ommitted grave ab!se o% dis"retion inaKrming the de"ision o% the Labor Arbiter orderingthe reinstatement and pa)ment o% %!ll ba"wagesand other bene/ts and privileges

4ith respe"t to private respondents Roland Pi"artand L!"ia han$ both o% whom did not sign an)

"ontra"t /ing the periods o% their emplo)ment norto have nowingl) and vol!ntaril) agreed !pon /edperiods o% emplo)ment$ petitioners had the b!rdeno% proving that the termination o% their servi"es waslegal As probationar) emplo)ees$ the) are liewiseprote"ted b) the se"!rit) o% ten!re provision o% theonstit!tion onseB!entl)$ the) "annot beremoved %rom their positions !nless %or "a!se

PHILIPPINE DAILY IN)UIRER, INC. v. MAGTI"AY, &R.

Facts: ,n 1&&'$ PD, hired agtiba)$ on "ontra"t!al

basis$ to assist$ %or a period o% ' months$ the reg!larphone operator ?e%ore the epiration o% his"ontra"t!al emplo)ment$ he and PD, agreed to a 1'-da) "ontra"t etension$ !nder the same "onditionsas the eisting "ontra"t

A%ter the epiration o% agtiba):s "ontra"t!alemplo)ment$ as etended$ PD, anno!n"ed the"reation and availabilit) o% a new position %or ase"ond telephone operator who wo!ld !ndergoprobationar) emplo)ment agtiba) applied andwas a""epted %or this position

A wee be%ore the end o% the H-month probationar)

period$ PD, oK"ers handed agtiba) his terminationpaper$ on the gro!nd o% his alleged %ail!re to meet


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"ompan) standards Aggrieved$ agtiba)immediatel) /led a "omplaint %or illegal dismissaland damages be%ore the Labor Arbiter$ arg!ing thathe had be"ome a reg!lar emplo)ee b) operation o% law$ "onsidering that he had been emplo)ed b) andhad wored %or PD, %or a total period o% ten months$ie$ %o!r months more than the maim!m si-month

period provided %or b) law on probationar)emplo)ment$ and that there was no basis %or hisdismissal

The LA dismissed the "omplaint and r!led thatagtiba):s previo!s "ontra"t!al emplo)ment$ aslater etended b) 1' da)s$ "annot be "onsidered aspart o% his s!bseB!ent probationar) emplo)ment5n appeal$ the +LR reversed the LA de"ision andr!led that agtiba):s probationar) emplo)ment hadripened into a reg!lar one and th!s$ he was illegall)dismissed This was !pheld b) the A en"e$ thispetition

Issue: 45+ the dismissal is valid

He!: Yes#ranting PD,:s petition$ the .!preme o!rt held thatPD, was onl) eer"ising its stat!tor) hiringprerogative when it re%!sed to hire agtiba) on apermanent basis !pon his %ail!re to meet the levelo% "ompeten") and pro%essionalism PD, epe"ts%rom its emplo)ees =stablishing that agtiba) hadnot )et a"hieved reg!lar emplo)ee stat!s as the si-month probationar) period had not lapsed$ the .r!led that the +LR "ommitted grave ab!se o% dis"retion amo!nting to la" or e"ess o% !risdi"tionwhen it disregarded the s!bstantial eviden"e

s!pporting PD,:s dismissal o% agtiba) noting thatthe dismissed emplo)ee has not denied that hewent thro!gh an orientation where he was apprisedon the "ompan):s r!les and reg!lations andemplo)ment standards nor that he "ommitted thea"ts o% violations "ited b) PD, The . th!s held thatit was an error on the part o% the A to !phold the+LR:s !dgment$ assailing the A:s s!ggestion thatagtiba) o!ght to have been made to !nderstandd!ring his brie/ng and orientation that he isepe"ted to obe) and "ompl) with "ompan) r!lesand reg!lations The o!rt %!rther held thatE"ommon ind!str) pra"ti"e and ordinar) h!maneperien"e do not s!pport the A:s post!re All

emplo)ees$ be the) reg!lar or probationar)$ areepe"ted to "ompl) with "ompan)-imposed r!les

and reg!lations$ else wh) establish them in the /rstpla"e Probationar) emplo)ees !nwilling to abide b)s!"h r!les have no right to epe"t$ m!"h lessdemand$ permanent emplo)mentF Mindings!K"ient %a"t!al and legal basis$ the .!preme o!rtth!s reversed and set aside the A r!ling andde"lared as n!ll and void the resol!tion o% +LR

The earlier de"ision o% the Labor Arbiter dismissingagtiba):s "omplaint was in e@e"t reinstated

(OODRIDGE SCHOOL v. PE "ENITO

Facts: Respondents were hired in G!ne 1&&& asprobationar) emplo)ees b) 4oodridge ."hool %or aperiod o% 3 )ears ,n Mebr!ar) 2001$ respondentspresented 4oodridge with a ani%esto regarding"ertain iss!es "on"erning the s"hool

A "on%rontation was held b!t not settlement wasarrived at Th!s$ respondents /led a %ormal

"omplaint with D=. reB!esting the latter %or a%ormal investigation D!ring the penden") o% the"ase$ the respondents also appeared on televisionand spoe over the radio on the alleged +=AT>+.ATanomal)

4oodridge sent emoranda to respondents pla"ingthem !nder preventive s!spension and reB!iringthem to eplain in writing wh) the) sho!ld not bes!spended 4oodridge therea%ter iss!ed +oti"es o% Termination to Respondents on the gro!nd thatthe) did not B!ali%) as reg!lar emplo)ee %or their%ail!re to meet the per%orman"e standards madenown to them at the start o% their probationar)

period

Respondents /led a "omplaint %or illegal s!spension$whi"h was later amended to in"l!de illegaldismissal

The LA dismissed the "omplaint and r!led that thedismissal o% the probationar) emplo)ees was !sti/ed 7per%orman"e and serio!s mis"ond!"t8 Thiswas aKrmed b) the +LR owever$ the Areversed and r!led that respondents did not %ail toB!ali%) %or permanent emplo)ment$ as there was nos!K"ient eviden"e to prove the same$ and that thedismissal was tainted with bad %aith en"e$ this

petition

Issue: 45+ the dismissal o% the probationar)emplo)ees was valid

He!: +oA probationar) emplo)ee eno)s se"!rit) o% ten!rein the sense that d!ring his emplo)mentprobationar) emplo)ment$ he "annot be dismissed

e"ept %or "a!se or when he %ails to B!ali%) as areg!lar emplo)ee in a""ordan"e with reasonablestandards made nown to him at the time o% engagement The probationar) emplo)ee:s se"!rit)o% ten!re is limited to the period o% probation

,n this "ase$ the noti"es o% termination sent b)petitioner to respondents stated that the latter%ailed to B!ali%) as reg!lar emplo)ees owever$nowhere in the noti"es did petitioner eplain thedetails o% said E%ail!re to B!ali%)F and the standardsnot met b) respondents 4e "an onl) spe"!latethat this "on"l!sion was based on the alleged a"tso% respondents in !ttering de%amator) remars

against the s"hool and the s"hool prin"ipal %ail!reto report %or wor %or two or three times going to"lass witho!t wearing proper !ni%orm dela) in thes!bmission o% "lass re"ords and non-s!bmission o% "lass s)llabi Yet$ other than bare allegations$petitioner %ailed to s!bstantiate the same b)do"!mentar) eviden"e onsidering thatrespondents were on probation %or three )ears$ andthe) were s!be"ted to )earl) eval!ation b) thest!dents and b) the s"hool administrators 7prin"ipaland vi"e-prin"ipal8$ it is sa%e to ass!me that theres!lts thereo% were de/nitel) do"!mented Ass!"h$ petitioner sho!ld have presented theeval!ation reports and other related do"!ments to

s!pport its "laim$ instead o% rel)ing solel) on theaKdavits o% their witnesses The !navoidablein%eren"e$ there%ore$ remains that the respondents:dismissal is invalid

IV. $INDS OF EMPLOYMENT

DE LEON v. NLRC

FACTS: Petitioner oises de Leon was emplo)ed b)private respondent La TondeZa ,n" 7LT,8 onDe"ember 11$ 1&J1$ at the aintenan"e .e"tion o% its =ngineering Department in Tondo$ anila is

wor "onsisted mainl) o% painting "ompan) b!ildingand eB!ipment$ and other odd obs relating to


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Labor Law Review Digests 1;Dean Abad – 2nd sem AY 2012-2013

maintenan"e e was paid on a dail) basis thro!ghpett) "ash vo!"hers

,n the earl) part o% Gan!ar)$ 1&J3$ a%ter a servi"e o% more than one 718 )ear$ petitioner reB!ested %romrespondent "ompan) that he be in"l!ded in thepa)roll o% reg!lar worers$ instead o% being paid

thro!gh pett) "ash vo!"hers ,n response$ LT,dismissed him aving been re%!sed reinstatementdespite repeated demands$ petitioner /led a"omplaint %or illegal dismissal$ reinstatement andpa)ment o% ba"wages be%ore the 5K"e o% theLabor Arbiter o% the then inistr) now Departmento% Labor and =mplo)ment

Petitioner alleged that he was dismissed %ollowinghis reB!est to be treated as a reg!lar emplo)eethat his wor "onsisted o% painting "ompan)b!ildings and maintenan"e "hores lie "leaning andoperating "ompan) eB!ipment$ assisting =miliano TanB!e Gr$ a reg!lar maintenan"e man and that

wees a%ter his dismissal$ he was re-hired b) therespondent "ompan) indire"tl) thro!gh the *itas-agsa)sa) *illage Livelihood o!n"il$ a laboragen") o% respondent "ompan)$ and was made toper%orm the tass whi"h he !sed to do =miliano TanB!e Gr "orroborated these averments o% petitioner in his aKdavit

5n the other hand$ private respondent "laimed thatpetitioner was not a reg!lar emplo)ee b!t onl) a"as!al worer hired allegedl) onl) to paint a "ertainb!ilding in the "ompan) premises$ and that his woras a painter terminated !pon the "ompletion o% thepainting ob

Labor Arbiter r!led in %avor o% De Leon and orderedhis reinstatement with %!ll ba"wages and otherbene/ts

5n appeal$ however$ the +LR reversed the LANsde"ision$ reasoning that petitionerNs ob "annot be"onsidered as ne"essar) or desirable in the !s!alb!siness or trade o% the emplo)er be"a!se$OPainting the b!siness or %a"tor) b!ilding is not apart o% the respondentNs man!%a"t!ring or distillingpro"ess o% wines and liB!orsO

ISSUE: 45+ De Leon was a reg!lar == at the time

o% dismissal 45+ LT, is g!ilt) o% illegall) dismissinghim

HELD: Yes An emplo)ment is deemed reg!lar whenthe a"tivities per%ormed b) the emplo)ee are!s!all) ne"essar) or desirable in the !s!al b!sinessor trade o% the emplo)er +ot "onsidered reg!lar arethe so-"alled Oproe"t emplo)mentO the "ompletionor termination o% whi"h is more or less determinable

at the time o% emplo)ment$ s!"h as those emplo)edin "onne"tion with a parti"!lar "onstr!"tion proe"tand seasonal emplo)ment whi"h b) its nat!re isonl) desirable %or a limited period o% time owever$an) emplo)ee who has rendered at least one )ear o% servi"e$ whether "ontin!o!s or intermittent$ isdeemed reg!lar with respe"t to the a"tivit) heper%ormed and while s!"h a"tivit) a"t!all) eists

The primar) standard$ there%ore$ o% determining areg!lar emplo)ment is the reasonable "onne"tionbetween the parti"!lar a"tivit) per%ormed b) theemplo)ee in relation to the !s!al b!siness or tradeo% the emplo)er The test is whether the %ormer is

!s!all) ne"essar) or desirable in the !s!al b!sinessor trade o% the emplo)er The "onne"tion "an bedetermined b) "onsidering the nat!re o% the worper%ormed and its relation to the s"heme o% theparti"!lar b!siness or trade in its entiret) Also$ i% the emplo)ee has been per%orming the ob %or atleast one )ear$ even i% the per%orman"e is not"ontin!o!s or merel) intermittent$ the law deemsthe repeated and "ontin!ing need %or itsper%orman"e as s!K"ient eviden"e o% the ne"essit)i% not indispensabilit) o% that a"tivit) to theb!siness en"e$ the emplo)ment is also "onsideredreg!lar$ b!t onl) with respe"t to s!"h a"tivit) andwhile s!"h a"tivit) eists

,n the "ase at bar$ the respondent "ompan)$ whi"his engaged in the b!siness o% man!%a"t!re anddistiller) o% wines and liB!ors$ "laims that petitionerwas "ontra"ted on a "as!al basis spe"i/"all) topaint a "ertain "ompan) b!ilding and that its"ompletion rendered petitionerNs emplo)mentterminated This ma) have been tr!e at thebeginning$ and had it been shown that petitionerNsa"tivit) was e"l!sivel) limited to painting that"ertain b!ilding$ respondent "ompan)Ns theor) o% "as!al emplo)ment wo!ld have been worth) o% "onsideration owever$ d!ring petitionerNs period o% emplo)ment$ the re"ords reveal that the tass

assigned to him in"l!ded not onl) painting o% "ompan) b!ildings$ eB!ipment and tools b!t also

"leaning and oiling ma"hines$ even operating adrilling ma"hine$ and other odd obs assigned to himwhen he had no painting ob A reg!lar emplo)ee o% respondent "ompan)$ =miliano TanB!e Gr$ attestedin his aKdavit that petitioner wored with him as amaintenan"e man when there was no painting ob

,t is not tenable to arg!e that the painting andmaintenan"e wor o% petitioner are not ne"essar) inrespondentNs b!siness o% man!%a"t!ring liB!ors andwines$ !st as it "annot be said that onl) those whoare dire"tl) involved in the pro"ess o% prod!"ingwines and liB!ors ma) be "onsidered as ne"essar)emplo)ees 5therwise$ there wo!ld have been noneed %or the reg!lar aintenan"e .e"tion o% respondent "ompan)Ns =ngineering Department$manned b) reg!lar emplo)eesPetition granted LA order reinstated

MAGSALIN, ET AL. v. NATIONAL

ORGANI#ATION OF (OR$ING MEN, ET AL.

FACTSCo o"a-ola ?ottlers Phils engaged the servi"es o%

respondent worers as Esales ro!te helpersF %ora limited period o% 'months and a%ter that$ the)were emplo)ed on a da)-to-da) basis

o A""ording to o"a-ola$ respondent worerswere hired to s!bstit!te %or reg!lar sales ro!tehelpers whenever the latter wo!ld be!navailable or when there wo!ld be an!nepe"ted shortage o% manpower in an) o% itswor pla"es or an !n!s!all) high vol!me o% wor The pra"ti"e was %or the worers to wait

ever) morning o!tside the gates o% the salesoK"e o% petitioner "ompan) ,% th!s hired$ theworers wo!ld then be paid their wages at theend o% the da) Respondent worers$ whenhired$ wo!ld go with ro!te salesmen on boarddeliver) tr!"s and !ndertae the laborio!s taso% loading and !nloading so%tdrin prod!"ts o% o"a-ola to its vario!s deliver) points

o Respondent worers ased %or reg!larappointments whi"h the o"a-ola re%!sed 23o% the Ftemporar)F worers 7hereinrespondents8 /led with the +LR a "omplaint %orthe reg!lariation o% their emplo)ment witho"a-ola The "omplaint was later amended

and the "omplainants totaled /%t)-eight 7'J8worers laiming that o"a-ola meanwhile


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Labor Law Review Digests 1'Dean Abad – 2nd sem AY 2012-2013

terminated their servi"es$ respondent worers/led a noti"e o% strie and a "omplaint %or illegaldismissal and !n%air labor pra"ti"e with the+LR

o The parties agreed to s!bmit the "ontrovers)$in"l!ding the iss!e raised in the "omplaint %orreg!lariation o% emplo)ment$ %or vol!ntar)

arbitrationo The vol!ntar) arbitrator dismissed the

"omplaint on the thesis that respondents 7then"omplainants8 were not reg!lar emplo)ees o% o"a-ola

o 6pon appeal$ the A reversed the r!ling andde"lared the worers as reg!lar emplo)ees o% o"a-ola ?ottlers Phils$ ,n" and theirdismissal %rom emplo)ment as illegal Rdenied

ISSUEC 45+ the nat!re o% wor o% respondents isne"essar) and desirable in the !s!al b!siness ortrade o% o"a-ola hen"e the) "an be "onsidered

reg!lar emplo)ees

HELDC Y=.o The basi" law on the "ase is Arti"le 2J01 o% the

Labor ode =ven while the lang!age o% lawmight have been more de/nitive$ the "larit) o% its spirit and intent$ i.e., to ens!re a Ereg!larF

1 )rt. *+.Regular and Casual "ploy"ent – Theprovisions o% written agreement to the "ontrar)notwithstanding and regardless o% the oral agreemento% the parties$ an emplo)ment shall be deemed to bereg!lar where the emplo)ee has been engaged toper%orm a"tivities whi"h are !s!all) ne"essar) or

desirable in the !s!al b!siness or trade o% theemplo)er$ e"ept where the emplo)ment has been/ed %or a spe"i/" proe"t or !ndertaing the"ompletion or termination o% whi"h has beendetermined at the time o% the engagement o% theemplo)ee or where the wor or servi"es to beper%ormed is seasonal in nat!re and the emplo)ment is%or the d!ration o% the seasonEAn emplo)ment shall bedeemed to be "as!al i% it is not "overed b) thepre"eding paragraphC Provided$ That$ an) emplo)eewho has rendered at least one )ear o% servi"e$ whethers!"h servi"e is "ontin!o!s or broen$ shall be"onsidered a reg!lar emplo)ee with respe"t to thea"tivit) in whi"h he is emplo)ed and his emplo)mentshall "ontin!e while s!"h a"tivit) eists

worer:s se"!rit) o% ten!re$ however$ "an hardl)be do!bted

o I* !ete+** /0et0e+ a* e123e*ts02u! 4e c2*s!e+e! +eua+ 2+ *2*-+eua+, t0e a11ca4e test s t0e+eas2*a4e c2**ect2* 4et/ee* t0e1a+tcua+ actvt3 1e+52+e! 43 t0e

e123ee * +eat2* t2 t0e usua 4us*ess2+ t+a!e 25 t0e e123e+. The sta*!a+!$s!pplied b) the law itsel%$ is whether the wor!ndertaen is ne"essar) or desirable in the!s!al b!siness or trade o% the emplo)er$ a %a"tthat "an be assessed b) looing into the nat!reo% the servi"es rendered and its relation to thegeneral s"heme !nder whi"h the b!siness ortrade is p!rs!ed in the !s!al "o!rse ,t isdisting!ished %rom a spe"i/" !ndertaing that isdivor"ed %rom the normal a"tivities reB!ired in"arr)ing on the parti"!lar b!siness or trade

o "ut, at02u0 t0e /2+6 t2 4e 1e+52+e! s2*3 52+ a s1ec7c 1+28ect 2+ seas2*a,

/0e+e a 1e+s2* t0us e*ae! 0as 4ee*1e+52+* t0e 824 52+ at east 2*e 3ea+,eve* 5 t0e 1e+52+a*ce s *2t c2*t*u2us2+ s e+e3 *te+tte*t, t0e a/ !eest0e +e1eate! a*! c2*t*u* *ee! 52+ ts1e+52+a*ce as 4e* su9ce*t t2 *!catet0e *ecesst3 2+ !es+a4t3 25 t0atactvt3 t2 t0e 4us*ess 2+ t+a!e 25 t0ee123e+. The emplo)ment o% s!"h person isalso then deemed to be reg!lar with respe"t tos!"h a"tivit) and while s!"h a"tivit) eists

o ,%$ as so arg!ed b) petitioner "ompan)$ onl)those whose wor are dire"tl) involved in theprod!"tion o% so%tdrins ma) be held per%orming

%!n"tions ne"essar) and desirable in its !s!alb!siness or trade$ there wo!ld have then beenno need %or it to even maintain reg!lar tr!"sales ro!te helpers T0e *atu+e 25 t0e /2+6 1e+52+e! ust 4e ve/e! 5+2 a1e+s1ectve 25 t0e 4us*ess 2+ t+a!e * tse*t+et3 a*! *2t 2* a c2*7*e! sc21e.

o The repeated rehiring o% respondent worersand the "ontin!ing need %or their servi"es"learl) attest to the ne"essit) or desirabilit) o% their servi"es in the reg!lar "ond!"t o% theb!siness or trade o% petitioner "ompan) Theo!rt o% Appeals has %o!nd ea"h o% respondentsto have wored %or at least one )ear with

petitioner "ompan)

o 4hile this o!rt$ in Brent 'chool, Inc. vs. (a"ora$ has !pheld the legalit) o% a /ed-termemplo)ment$ it has done so$ however$ with astern admonition that where %rom the"ir"!mstan"es it is apparent that the period hasbeen imposed to pre"l!de the a"B!isition o% ten!rial se"!rit) b) the emplo)ee$ then it

sho!ld be str!" down as being "ontrar) to law$morals$ good "!stoms$ p!bli" order and p!bli"poli")

o The perni"io!s pra"ti"e o% having emplo)ees$worers and laborers$ engaged %or a /edperiod o% %ew months$ short o% the normal si-month probationar) period o% emplo)ment$ and$therea%ter$ to be hired on a da)-to-da) basis$mo"s the law The %a"t that respondentworers have agreed to be emplo)ed on s!"hbasis and to %orego the prote"tion given to themon their se"!rit) o% ten!re$ demonstrate nothingmore than the serio!s problem o% impoverishment o% so man) o% o!r people and

the res!lting !nevenness between labor and"apital A "ontra"t o% emplo)ment is impressedwith p!bli" interest The provisions o% appli"able stat!tes are deemed written into the"ontra"t$ and Ethe parties are not at libert) toins!late themselves and their relationships %romthe impa"t o% labor laws and reg!lations b)simpl) "ontra"ting with ea"h otherF

o Re Reease, (ave+ a*! )utca;e?@ 25 t0e 2+*ac21a*a*tsC D!ring the penden") o% theappeal with the A$ 3H "omplainantsindivid!all) ee"!ted vol!ntaril) a release$waiver and B!it"laim and re"eived %rom

petitioner "ompan) the amo!nt o% /%teentho!sand 7P1'$000008 pesos ea"h Theamo!nt a""ords with the disposition o% the "aseb) the vol!ntar) arbitrator The re"eipt o% theamo!nt awarded b) the vol!ntar) arbitrator$ aswell as the ee"!tion

Labor Law Rev - Parts i - V Digests

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Transcript of Labor Law Rev - Parts i - V Digests