CASES Digest 1st Set

8/18/2019 CASES Digest 1st Set

1/19

CASES

LVN vs Phil Musicians Guild

Facts:

- Review on certiorari – Certifying the Phil Musicians Guild (FF! as the sole and e"clusive #argaining

agency of all $usicians wor%ing with said co$&anies' (LVN )a$&aguita Pictures and Pre$iere

Productions!- Guild – duly registered legiti$ate la#or organi*ation'- LVN and )a$&aguita (Co$&any! – cor&orations duly organi*ed under the Phil laws engage in the $a%ing

of $otion &ictures and in the &rocessing and distri#ution thereof'- +$&loys $usicians &ur&ose of $a%ing $usic recordings for title $usic #ac%ground $usic $usical

nu$#ers finale $usic and other incidental $usic'

- Prayed #e declared as sole and e"clusive #argaining agency for all $usicians- Co$&any , &etition for certification cannot #e entertained when the e"istence of e$&loyer,e$&loyee

relationshi& #etween the &arties is contested'- -he $usical nu$#ers in the filing of the co$&anies are furnished #y inde&endent contractors'

.ssue

- /N the $usicians are e$&loyees of the said co$&anies 0 /N there is +R,++ Relationshi& #etween the

Musicians and the Co$&anies'

1eld:

- 2es' -he wor% of the $usical director and $usicians is a functional and integral &art of the enter&rise

&erfor$ed at the sa$e studio su#stantially under the direction and control of the co$&any' -o deter$inewhether a &erson who &erfor$s wor% for another is the latter3s e$&loyee or an inde&endent contractor the

National La#or Relations relies on 3the right to control3 test' 4nder this test an e$&loyer,e$&loyee

relationshi& e"ist where the &erson for who$ the services are &erfor$ed reserves the right to control not

only the end to #e achieved #ut also the $anner and $eans to #e used in reaching the end'

Notwithstanding that the e$&loyees are called inde&endent contractors3 the 5oard will hold the$ to #e

e$&loyees under the 6ct where the e"tent of the e$&loyer3s control over the$ indicates that the relationshi&

is in reality one of e$&loy$ent'- -he right of control of the fil$ co$&any over the $usicians is shown (7! #y calling the $usicians through

3call sli&s3 in 3the na$e of the co$&any8 (9! #y arranging schedules in its studio for recording sessions8 (! #y

furnishing trans&ortation and $eals to $usicians8 and(;! #y su&ervising and directing in detail through the

$otion &icture director the &erfor$ance of the $usicians #efore the ca$era in order to suit the $usic they

are &laying to the &icture which is #eing flashed on the screen'-

-he s why it>s not one of the &etitioners in the case! fil$

co$&anies su$$on the $usicians to wor% through the $usical directors' -he fil$ co$&anies through the

$usical directors fi" the date the ti$e and the &lace of wor%' -he fil$ co$&anies not the $usical directors

&rovide the trans&ortation to and fro$ the studio' -he fil$ co$&anies furnish $eal at dinner ti$e' .t is well

settled that ?an e$&loyer,e$&loyee relationshi& e"ists ' ' 'where the &erson for who$ the services are

&erfor$ed reserves a right to control not only the end to #e achieved #ut also the $eans to #e used in

reaching such end ' ' ' '?


2/19

Legend 1otel vs 1ernani )' Realuyo

Facts:

- 6 case for illegal dis$issal and for other la#or standards #enefits was filed #y Realuyo (6@6 Aoey R' Roa! a

&ianist e$&loyed to &erfor$ in the restaurant against Legend'- Realuyo – wor%ed as &ianist8 rate ;BB,DB0night8 &erfor$s at ,7B&$ E" a wee%'- 1otel – no +R,++ relationshi&8 talent engaged to &erfor$ $usic8 hrs0day 9" a wee%8 econo$ic crisis $gt

dis&ense of his services'- La#or 6r#iter and NLRC – no +R,++ #ecause Realuyo was receiving s $anager reuired hi$ at certain ti$es to &erfor$ only -agalog songs or $usicor to wear #arong -agalog to confor$ to the Fili&iniana $otif8 and

d' 1e was su#Hected to the rules on e$&loyees> re&resentation chec% and chits a &rivilege granted

to other e$&loyees'

Jy @he 5eng vs .N-+RN6-./N6L L65/R and M6R.N+ 4N./N /F -1+ P1.L.PP.N+) +- 6L'


3/19

Facts:

- 6 charge of unfair la#or &ractice was filed against Jy @eh 5eng a &ro&rietor of a #as%et factory #y

dis$issing )olano and -udla for their union activities' Jy @eh 5eng contended that he did not %now -udla

and )olano was not his e$&loyee #ecause the latter ca$e to the esta#lish$ent only when there was wor%

which he did on &a%iaw #asis'- )olano was not his e$&loyee for the following reasons:

(7! )olano never stayed long enough at Jy3s esta#lish$ent8(9! )olano had to leave as soon as he was through with the(! order given hi$ #y Jy8(;! hen there were no orders needing his services there was nothing for hi$ to do8(D! hen orders ca$e to the sho& that his regular wor%ers could not fill it was then that Jy went to

his address in Caloocan and fetched hi$ for these orders8 and(E! )olano3s wor% with Jy3s esta#lish$ent was not continuous'

.ssue:

- /N -udla and )olano are e$&loyees of Jy

1eld:

-2es' +vidence showed that the wor% of )olano and -udla was continuous e"ce&t in the event of illness

although their services were co$&ensated on &iece #asis' -he control test calls for the e"istence of the right

to control the $anner of doing the wor% not the actual e"ercise of the right considering that Jy @eh 5eng is

engaged in the $anufacture of #as%ets %nown as s

s&ecifications such as the si*e and uality of the s are contractual e$&loyees8 assu$ing they are e$&loyees their e$&loy$ent are coter$inous with

each unloading and loading Ho#8 Pet are not under o#ligation to hire PR>s e"clusively8 no ter$ination #ut

$erely re,hiring'- NLRC – there is +R,++ relationshi&'

.ssue:


4/19

- /N there is +R,++ relationshi& #etween PR>s and RAL'

1eld:

- 2es' -he continuity of e$&loy$ent is not the deter$ining factor #ut rather whether the wor% of the la#orer is

&art of the regular #usiness or occu&ation of the e$&loyee'- 6lthough it $ay #e that &rivate res&ondents alternated their e$&loy$ent on different vessels when they

were not assigned to &etitioners3 #oats that did not affect their e$&loyee status' -he evidence also

esta#lishes that &etitioners had a fleet of fishing vessels with a#out ED shi& ca&tains and as &rivate

res&ondents contended when they finished with one vessel they were instructed to wait for the ne"t'- .ndustrial,Co$$ercial,6gricultural or%ers /rgani*ation vs' C.R , ?that during the te$&orary layoff the

la#orers are considered free to see% other e$&loy$ent is natural since the la#orers are not #eing &aid yet

$ust find $eans of su&&ort? and such te$&orary cessation of o&erations ?should not $ean starvation for

e$&loyees and their fa$ilies'?- .ndeed considering the length of ti$e that &rivate res&ondents have wor%ed for &etitioner since 7IK

there is Hustification to conclude that they were engaged to &erfor$ activities usually necessary or desira#le

in the usual #usiness or trade of &etitioners and are therefore regular e$&loyees such that they are

entitled to the #enefits awarded'

P1.L.PP.N+ )/C.+-2 F/R -1+ PR+V+N-./N /F CR4+L-2 -/ 6N.M6L) vs C/6

Facts:

- -he &etitioner was incor&orated as a Huridical entity over one hundred years ago #y virtue of 6ct No' 79KD

enacted on Aanuary 7I 7IBD #y the Phili&&ine Co$$ission' -he &etitioner at the ti$e it was created was

co$&osed of ani$al aficionados and ani$al &ro&agandists' -he o#Hects of the &etitioner as stated in

)ection 9 of its charter shall #e to enforce laws relating to cruelty inflicted u&on ani$als or the &rotection of

ani$als in the Phili&&ine .slands and generally to do and &erfor$ all things which $ay tend in any way to

alleviate the suffering of ani$als and &ro$ote their welfare'- 6t the ti$e of the enact$ent of 6ct No' 79KD the original Cor&oration Law 6ct No' 7;DI was not yet in

e"istence'- )ec' ; – &ower to a&&oint agents and $a%e arrest8 )ec' D – /ne,half of all the fines i$&osed and collected

through the efforts of said society' ()u#seuently recalled #y C6 7;K in 7IE!- Jec 7 9BB C/6 audit tea$ went to the office of Pet to conduct an audit survey'- Pet – C/6 has no Hurisdiction over the$ #ecause they are a &rivate entity'

o Aan 7IBD had no Cor&oration Code nor )+C

o +/ E stri&&ed the$ of any govern$ental functions

o Nowhere in their charter is it indicated that they are a &u#lic cor&oration'

o -heir ++>s are covered with the )))

o No Gov>t a&&ointee or re& sits on their #oard

- C/6 , Pet was a govern$ent entity that was su#Hect to the audit Hurisdiction of res&ondent C/6'o Pet is a 5ody Politic created #y virtue of a legislation0s&ecial charter

o Pet e"ercises sovereign &owers – enforce the laws – govern$ent instru$entality

o Jes&ite the &assage of the Cor&oration Code the law creating the &etitioner had not #een

a#olished nor had it #een re,incor&orated under any general cor&oration law'

o R6 K;KD designates the &etitioner as a $e$#er of its Co$$ittee on 6ni$al elfare which isattached to the Je&art$ent of 6griculture'

.ssue:

- /N Pet is a govern$ent instru$entality

1eld:


5/19

- No' )ince the under&innings of the charter test had #een introduced #y the 7ID Constitution and not earlier

it follows that the test cannot a&&ly to the &etitioner which was incor&orated #y virtue of 6ct No' 79KD

enacted on Aanuary 7I 7IBD' )ettled is the rule that laws in general have no retroactive effect unless the

contrary is &rovided'- 6ll statutes are to #e construed as having only a &ros&ective o&eration unless the &ur&ose and intention of

the legislature to give the$ a retros&ective effect is e"&ressly declared or is necessarily i$&lied fro$ the

language used' .n case of dou#t the dou#t $ust #e resolved against the retros&ective effect'

- -here are a few e"ce&tions' )tatutes can #e given retroactive effect in the following cases: (7! when the law

itself so e"&ressly &rovides8 (9! in case of re$edial statutes8 (! in case of curative statutes8 (;! in case of

laws inter&reting others8 and (D! in case of laws creating new rights' None of the e"ce&tions is &resent in the

instant case'- )+C' D' 6ny cor&oration or sociedad anoni$a for$ed organi*ed and e"isting under the laws of the

Phili&&ine .slands and lawfully transacting #usiness in the Phili&&ine .slands on the date of the &assage of

this 6ct shall #e su#Hect to the &rovisions hereof so far as such &rovisions $ay #e a&&lica#le and shall #e

entitled at its o&tioneither to continue #usiness as such cor&oration or to refor$ and organi*e under and #y

virtue of the &rovisions of this 6ct transferring all cor&orate interests to the new cor&oration which if a stoc%

cor&oration is authori*ed to issue its shares of stoc% at &ar to the stoc%holders or $e$#ers of the old

cor&oration according to their interests'- .n a legal regi$e where the charter test doctrine cannot #e a&&lied the $ere fact that a cor&oration has

#een created #y virtue of a s&ecial law does not necessarily ualify it as a &u#lic cor&oration'

--he a$end$ents introduced #y C'6' No' 7;K $ade it clear that the &etitioner was a &rivate cor&oration and

not an agency of the govern$ent' -his was evident in +"ecutive /rder No' E issued #y then President of

the Phili&&ines Manuel L' ue*on declaring that the revocation of the &owers of the &etitioner to a&&oint

agents with &owers of arrest ?corrected a serious defect? in one of the laws e"isting in the statute #oo%s'- a reading of &etitioner>s charter shows that it is not su#Hect to control or su&ervision #y any agency of the

)tate unli%e govern$ent,owned and ,controlled cor&orations' No govern$ent re&resentative sits on the

#oard of trustees of the &etitioner' Li%e all &rivate cor&orations the successors of its $e$#ers are

deter$ined voluntarily and solely #y the &etitioner in accordance with its #y,laws'- -he fact that a certain Huridical entity is i$&ressed with &u#lic interest does not #y that circu$stance alone

$a%e the entity a &u#lic cor&oration inas$uch as a cor&oration $ay #e &rivate although its charter contains

&rovisions of a &u#lic character incor&orated solely for the &u#lic good' .t $ust #e stressed that a uasi,

&u#lic cor&oration is a s&ecies of &rivate cor&orations #ut the ualifying factor is the ty&e of service the

for$er renders to the &u#lic: if it &erfor$s a &u#lic service then it #eco$es a uasi,&u#lic cor&oration'

Feati 4niversity vs 5autista

Facts:- Aanuary 7; 7IE: the President of Feati 4niversity Faculty Clu# (P6FL4! wrote a letter to Mrs' Victoria L'

6raneta President of Feati 4niversity infor$ing her that it registered as a la#or union'- Aanuary 99 7IE: P6FL4 sent a letter with 9E de$ands in relation to their e$&loy$ent and reuesting an

answer within 7B days fro$ recei&t thereof'- 6raneta answered the letters reuesting that she #e given at least B days to study thoroughly the different

&hases of the de$ands' Meanwhile counsel for Feati wrote a letter to the President of P6FL4 de$anding

&roof of its $aHority status and designation as a #argaining re&resentative- Fe#ruary 7 7IE: the President of P6FL4 reHected the e"tension of ti$e and filed a notice of stri%e with the

5ureau of La#or due to Feati>s refusal to #argain collectively'- Conciliation Jivision of the 5ureau of La#or $ade efforts to conciliate the$ #ut failed'

-Fe#ruary 7K 7IE: P6FL4 declared a stri%e and esta#lished &ic%et lines in the &re$ises of Feati resulting in

the disru&tion of classes in the 4niversity'- March 97 7IE: the President of the Phili&&ines certified to the Court of .ndustrial Relations (C.R! the

dis&ute #etween Feati and P6FL4 &ursuant to the &rovisions of )ection 7B of Re&u#lic 6ct No' KD'- cases were filed with the C.R

- ;7,.P6 – P6FL4>s &etition to declare in conte$&t of court since Feati refused to acce&t the$ #ac% to wor% in

violation of the return,to,wor% order of March B 7IE and has e$&loyed &rofessors and0or instructors to

ta%e their &laces


6/19

- 77K,MC – P6FL4>s &etition for certification election &raying that it #e certified as the sole and e"clusive

#argaining re&resentative- Later withdrawn since the Case ;7,.P6 had already #een certified #y the President to the C.R and has

a#sor#ed the issues herein- V,B – P6FL4>s co$&laint for indirect conte$&t of court filed against the ad$inistrative officials of the Feati

reiterating Case ;7,.P6- May 7B 7IE: Feati filed #efore the )C a &etition for certiorari and &rohi#ition with writ of &reli$inary

inHunction which was issued u&on the Feati3s filing a #ond of PDBBBB (increased fro$ P7BBB! ordering C.R

Audge Aose )' 5autista to desist and refrain fro$ further &roceeding- March 9 7IE: /n the strength of the &residential certification Audge 5autista set the case for hearing- Feati thru counsel filed a $otion to dis$iss the case u&on the ground that the C.R has no Hurisdiction over

the case #ecause:o -he .ndustrial Peace 6ct is N/- a&&lica#le to the 4niversity it #eing an educational institution nor

to the $e$#ers of the Faculty Clu# they #eing inde&endent contractorso -he &residential certification is violative of )ection 7B of the .ndustrial Peace 6ct as the 4niversity

is not an industrial esta#lish$ent and there was no industrial dis&ute which could #e certified to the

C.R- Audge 5autista denied the $otion to dis$iss and ordered the stri%ers to return i$$ediately to wor% and the

4niversity to ta%e the$ #ac% under the last ter$s and conditions e"isting #efore the dis&ute arose- ithout the $otion for reconsideration having #een acted u&on #y the C.R en #anc Audge 5autista set the

case for hearing on the $erits for May K 7IE #ut was cancelled u&on Feati>s &etition for certiorari allegingthat Audge Aose )' 5autista acted without or in e"cess of Hurisdiction or with grave a#use of discretion in

ta%ing cogni*ance of and in issuing the uestioned orders in C.R Cases Nos' ;7,.P6 77K,MC and V,B- Feati clai$s that it is not an e$&loyer within the conte$&lation of R'6' KD #ecause it is not an industrial

esta#lish$ent- Feati also clai$s that it is only a lessee of the services of its &rofessors and0or instructors &ursuant to a

contract of services entered into #etween the$ #ecause the 4niversity does not e"ercise control over their

wor%'.suue:

- /N Feati can #e considered an e$&loyer and P6FL4 as an e$&loyee to #e covered #y R'6' KD and

have right to unioni*e'1eld:

- 2+)' &etition for certiorari and &rohi#ition with &reli$inary inHunction in Case G'R' No' L,979K is dis$issed'

o )ection 9(c! of R'6' KD:

-he ter$ e$&loyer include any &erson acting in the interest of an e$&loyer directly or

indirectly #ut shall not include any la#or organi*ation (otherwise than when acting as an

e$&loyer! or any one acting in the ca&acity or agent of such la#or organi*ation'

• Congress did not intend to give a co$&lete definition of ?e$&loyer? #ut rather

that such definition should #e co$&le$entary to what is co$$only understood

as e$&loyer'

• 6ct itself s&ecifically enu$erated those who are not included in the ter$

?e$&loyer? and educational institutions are not included8 hence they can #e

included in the ter$ ?e$&loyer?' 1owever those educational institutions that are

not o&erated for &rofit are not within the &urview of Re&u#lic 6ct No' KD'o Feati reali*es &rofits and &arts of such earning is distri#uted as

dividends to &rivate stoc%holders or individuals'

• .t e$#races not only those who are usually and ordinarily considered e$&loyees

#ut also those who have ceased as e$&loyees as a conseuence of a la#or

dis&ute'- +$&loyee $ust #e one who is engaged in the service of another8 who &erfor$s services for another8 who

wor%s for salary or wages- ?wor%ers? li$ited to those &erfor$ing &hysical la#or

o e$#race stenogra&hers and #oo%%ee&ers

o -eachers are not included

- Feati controls the wor% of the $e$#ers of its facultyo &rescri#es the courses or su#Hects that &rofessors teach and when and where to teach


7/19

o &rofessors3 wor% is characteri*ed #y regularity and continuity for a fi"ed duration

o &rofessors are co$&ensated for their services #y wages and salaries rather than #y &rofits

o &rofessors and0or instructors cannot su#stitute others to do their wor% without the consent of the

universityo &rofessors can #e laid off if their wor% is found not satisfactory

- Moreover even if university &rofessors are considered inde&endent contractors still they would #e covered

#y Re&' 6ct No' KD

-&rofessors instructors or teachers of &rivate educational institutions who teach to earn a living are entitled to

the &rotection of our la#or laws and one such law is Re&u#lic 6ct No' KD'- -he ter$ ?la#or dis&ute? includes any controversy concerning ter$s tenure or conditions of e$&loy$ent or

concerning the association or re&resentation of &ersons in negotiating fi"ing $aintaining changing or

see%ing to arrange ter$s or conditions of e$&loy$ent regardless of whether the dis&utants stand in

&ro"i$ate relation of e$&loyer and e$&loyees'- -o certify a la#or dis&ute to the C.R is the &rerogative of the President under the law (5ecause the stri%e

declared #y the $e$#ers of the $inority union threatens a $aHor industry of 7KBBB students which affects

the national interest! and this Court will not interfere in $uch less curtail the e"ercise of that &rerogative'

-he Hurisdiction of the C.R in a certified case is e"clusive' -he &arties involved in the case $ay a&&eal to

the )u&re$e Court fro$ the order or orders thus issued #y the C.R'- )ection 7B of Re&u#lic 6ct No' KD e$&owers the Court of .ndustrial Relations to issue an order ?fi"ing the

ter$s of e$&loy$ent'? -his clause is #road enough to authori*e the Court to order the stri%ers to return to

wor% and the e$&loyer to read$it the$- -he return,to,wor% order cannot #e considered as an i$&air$ent of the contract entered into with the

re&lace$ents' 5esides la#or contracts $ust yield to the co$$on good and such contracts are su#Hect to

the s&ecial laws on la#or unions collective #argaining stri%es and si$ilar su#Hects'

6))/C.6-+J L65/R 4N./N vs Audge 5orro$eo

Facts:- 6L4 is a duly registered la#or organi*ation' 6$ong the $e$#ers thereof are e$&loyees of )u&erior Gas

and +ui&$ent Co$&any of Ce#u .nc ()4G+C/!- )4G+C/ a do$estic cor&oration with offices at Auan Luna )treet Ce#u City and a factory &lant in

5asa% Mandaue &rovince of Ce#u'- /n Aanuary 7 7IED 6L4 and )4G+C/ entered into a collective #argaining contract effective u& to Aanuary

7 7IEE' -here was an ongoing negotiations for renewal of contract late in Fe#ruary 7IEE'

-79 )4G+C/ $e$#ers resigned fro$ 6L4' -hereu&on negotiations sto&&ed' 6L4 reuested that 79

e$&loyees not #e allowed to re&ort to wor% )4G+C/ reHected the reuest due to irre&ara#le inHury and that

the contract la&sed' )4G+C/ stated that the 79 e$&loyees should reHoin 6L4 to resu$e the negotiations'

6L4 wrote to )4G+C/ of #argaining in #ad faith' 6L4 struc% and &ic%eted in the )4G+C/ &lant in

Mandaue'- )4G+C/ filed a case against 6L4 with CF. Ce#u to restrain the sa$e fro$ &ic%eting in the said &lant and

offices elsewhere in the Phili&&ines' CF. Ce#u issued a &reli$inary inHunction &rayed for #y )4G+C/'- 6L4 filed charges of 4LP against )4G+C/ with C.R8 filed a $otion for reconsideration on the issuance of

the inHunction' CF. denied the $otion8 filed a &etition for certiorari and &rohi#ition against Audge Go$e* and

5orro$eo and )4G+C/ &rayed that CF. of Ce#u has no Hurisdiction over the case'- )C annulled the &reli$inary inHunction issued #y CF. Ce#u and directed to dis$iss the case' -he writ of

inHunction sought #y 6L4 was granted May 7E 7IEE'- 6L4 resu$ed &ic%eting and #egan to &ic%et at the house of )4G+C/3s General Manager Mr' Mrs' Lua

and Ce#u 1o$e store'- Mr' Lua filed a co$&laint with CF. Ce#u to restrain 6L4 fro$ &ic%eting the store and residence and recover

da$ages'- Audge 5orro$eo issued an order reuiring 6L4 to show cause order why the writ should not #e issued'- 6L4 filed a $otion to dis$iss assailed the Hurisdiction of CF. Ce#u to hear the case on the ground that it has

grown out fro$ a la#or dis&ute'- -he Hudge denied the $otion to dis$iss and to reconsider his order and dissolve the writ of inHunction of

Aune B 7IEE'- 6L4 co$$enced the &resent action for certiorari and &rohi#ition with &reli$inary inHunction to annul the writs

dated Aune B and Auly 99 7IEE and to restrain the lower court fro$ hearing the case'


8/19

.ssue:- /N the stri%e conducted at the Ce#u ho$e involves a la#or dis&ute'

1eld:- 2es' )ection D (a! of Re&u#lic 6ct No' KDK vests in the Court of .ndustrial Relations e"clusive Hurisdiction

over the &revention of any unfair la#or &ractice' Moreover for an issue ?concerning ter$s tenure or

conditions of e$&loy$ent or concerning the association or re&resentation of &ersons in negotiating fi"ing$aintaining changing or see%ing to arrange ter$s or conditions of e$&loy$ent? to &arta%e of the nature of

a ?la#or dis&ute? it is not necessary that ?the dis&utants stand in the &ro"i$ate relation of e$&loyer and

e$&loyee'?- to a&&ly the &rovisions of )ec' I of Re&u#lic 6ct No' KD governing the conditions under which ?any

restraining order? or ?te$&orary or &er$anent inHunction? $ay issue in any ?case involving or growing out of

a la#or dis&ute? it is not indis&ensa#le that the &ersons involved in the case #e ?e$&loyees of the sa$e

e$&loyer? although this is the usual case' )ec' I li%ewise governs cases involving &ersons:o 7! ?who are engaged in the sa$e industry trade craft or occu&ation?8 or

o 9! ?who ''' have direct or indirect interests therein? or

o ! ?who are $e$#ers of the sa$e or an affiliated organi*ation of e$&loyers or e$&loyees?8 or

o ;! ?when the case involves any conflicting or co$&eting interests in a ?la#or dis&ute? (as

herein#efore defined! or ?&ersons &artici&ating or interested? therein (as hereinafter defined!?'-

Further$ore ?a &erson or association shall #e held to #e a &erson &artici&ating or interested in a la#ordis&ute if relief is sought against hi$ or it? and ?he or it is engaged in the sa$e industry trade craft or

occu&ation in which such dis&ute occurs or has a direct or indirect interest therein or is a $e$#er officer

or agent of any association co$&osed in whole or in &art of e$&loyees or e$&loyers engaged in such

industry trade craft or occu&ation'?- Now then there is no dis&ute regarding the e"istence of a la#or dis&ute #etween the 6L4 and )4G+C/,

Ce#u8 that )4G+C/3s general $anager Mrs' Lua is the wife of the owner and $anager of Ce#u 1o$e

6ntonio Lua8 and that Ce#u 1o$e is engaged in the $ar%eting of )4G+C/ &roducts' .t is li%ewise clear

that as $anaging $e$#er of the conHugal &artnershi& #etween hi$ and his wife Mr' Lua has an interest in

the $anage$ent #y Mrs' Lua of the #usiness of )4G+C/ and in the success or failure of her controversy

with the 6L4 considering that the result thereof $ay affect the condition of said conHugal &artnershi&'

)i$ilarly as a distri#utor of )4G+C/ &roducts the Ce#u 1o$e has at least an indirect interest in the la#or

dis&ute #etween )4G+C/ and the 6L4 and in Case No' R,I997' .n other words res&ondents herein have

an indirect interest in said la#or dis&ute for which reason we find that )ection I of Re&u#lic 6ct No' KDsuarely a&&lies to Case No' R,I;7;'

- Goldfinger v' Feintuch , ithin the li$its of &eaceful &ic%eting however &ic%eting $ay #e carried on not only

against the $anufacturer #ut against a non,union &roduct sold #y one in unity of interest with the

$anufacturer who is in the sa$e #usiness for &rofit'- 6$erican 5ra%e )hoe Co' v' Jistrict Lodge I of .nternational 6ssociation of Machinists , here cor&orate

e$&loyer had se&arate &lants in Missouri and Pennsylvania and la#or dis&ute e"isted atMissouri &lant #ut

not at the Pennsylvania &lant &eaceful &ic%eting at Pennsylvania &lant #y $e$#ers of union re&resenting

e$&loyees at Missouri &lant was not an unfair la#or &ractice as defined #y La#or Manage$ent Relations

6ct''''=- 6$erican Auris&rudence , .t see$s now generally agreed that a state cannot either #y its co$$on law or #y

statute &rohi#it the &eaceful &ic%eting of a &lace of #usiness solely on the ground that the &ic%eting is carried

on #y &ersons not e$&loyed therein'

Reynaldo 5autista vs 1on' 6$ado C' .nciong

Facts:- 5autista was e$&loyed #y 6L4 as 3/rgani*er3 in 7I9 with a starting salary of P9DB'BB a $onth' 6s such he

&aid his $onthly ))) contri#utions with the res&ondent as his e$&loyer' /n March 7D 7II 1e was left in

the office of 6L4 while his other co,organi*ers were in Cainta Ri*al attending a certification election at

Chrysler Phili&&ines as he was not the organi*er assigned in said co$&any' /n March 7E 7II he went on

sic% leave for ten (7B! days' 1is ))) sic%ness #enefit a&&lication for$ signed #y 6L43s &hysician was given

to 6L4 for su#$ission to the )))' /n March 7E 7II co$&lainant re&orted #ac% for wor% u&on e"&iration


9/19

of his leave #ut was infor$ed #y 6L43s 6rea Vice,President for Lu*on of his ter$ination effective March 7D

7II' 1ence this co$&laint filed on March 9K 7II' /n 6&ril 7K 7II however 6L4 filed a clearance

a&&lication to ter$inate co$&lainant3s services effective March 7E 7II on the ground of a#andon$ent of

wor%'- Ministry of La#or – 5autista was $erely acco$$odated #y the res&ondent union after he was dis$issed #y

his for$er e$&loyer so$eti$e in 7I9 and that his $e$#ershi& coverage with the ))) which shows that

6L4 is the one &aying the e$&loyer3s share in the &re$iu$s is not conclusive &roof that 6L4 is the 5autista

e$&loyer #ecause such &ay$ents were &erfor$ed #y the res&ondent as a favor for all those who were

&erfor$ing full ti$e union activities with it to entitle the$ to ))) #enefits'

.ssue:- /N .nciong is an e$&loyee of 6L4

1eld:- 2es' -he $ere fact that the res&ondent is a la#or union does not $ean that it cannot #e considered an

e$&loyer of the &ersons who wor% for it' Much less should it #e e"e$&ted fro$ the very la#or laws which it

es&ouses as la#or organi*ation'- .n deter$ining the e"istence of an e$&loyer,e$&loyee relationshi& the ele$ents that are generally

considered are the following :o (a! the selection and engage$ent of the e$&loyee8

o

(#! the &ay$ent of wages8o (c! the &ower of dis$issal8 and

o (d! the e$&loyer3s &ower to control the e$&loyee with res&ect to the $eans and $ethods #y which

the wor% is to #e acco$&lished' .t is the so,called 3control test3 that is the $ost i$&ortant ele$ent- Petitioner was an e$&loyee of the res&ondent union as reflected in the latter3s individual &ayroll sheets and

shown #y the &etitioner3s $e$#ershi& with the )ocial )ecurity )yste$ ()))! and the res&ondent union3s

share of re$ittances in the &etitioner3s favor' +ven $ore significant is the res&ondent union3s act of filing a

clearance a&&lication with the M/L to ter$inate the &etitioner3s services' 5autista was selected and hired #y

the 4nion' 1e was &aid wages #y the 4nion' 6L4 had the &ower to dis$iss hi$ as indeed it dis$issed hi$'

6nd definitely the 4nion tightly controlled the wor% of 5autista as one of its organi*ers'

Cor&oral et al' vs NLRC

Facts:

-Five $ale &etitioners na$ely /sias .' Cor&oral )r' Pedro -olentino Manuel Ca&aras +l&idio Laca& and)i$&licio Pedelos wor%ed as #ar#ers while the two fe$ale &etitioners -eresita Flores and Patricia Nas

wor%ed as $anicurists in New Loo% 5ar#er )ho& located at ED7 P' Paterno )treet uia&o Manila owned #y

&rivate res&ondent Lao +nteng Co' .nc'' Petitioner Nas alleged that she also wor%ed as watcher and

$ar%eter of &rivate res&ondent'- Pet – New Loo% 5ar#ersho& was originally a single &ro&rietorshi& then the children of the owner organi*ed

a cor&oration w0c was registered with the )+C' -hey were allowed to wor% for the co$&any' -hen -rinidad

/ng infor$ed the$ that the #uilding was sold and their services were no longer needed'- PR – Pet were Hoint venturers and were receiving DBO co$$ission of the a$ount charge fro$ costu$ers –

no +R,++8 serious #usiness loss8 had no control over &etitioners who were free to co$e and go as they

wished8 all ))) contri#ution was $ade #y Pet'- L6 and NLRC – no +R,++ relationshi&8 Co$$on &ractice in #ar#ersho& industry that #ar#ers scissors and

ra*ors and s&lit their earnings8 5ar#ers are characteri*ed as inde&endent contractor'

.ssue:- /N there is +R,++ relationshi& #etween Pet and PR

1eld:- 2es' -he La#or 6r#iter3s findings that the &arties were engaged in a Hoint venture is unsu&&orted #y any

docu$entary evidence' .t should #e noted that aside fro$ the self,serving affidavit of -rinidad Lao /ng

there were no other evidentiary docu$ents nor written &artnershi& agree$ents &resented' e have ruled

that even the sharing of &roceeds for every Ho# of &etitioners in the #ar#er sho& does not $ean they were

not e$&loyees of the res&ondent co$&any'


10/19

- 6n inde&endent contractor is one who underta%es ?Ho# contracting? i'e' a &erson who (a! carries on an

inde&endent #usiness and underta%es the contract wor% on his own account under his own res&onsi#ility

according to his own $anner and $ethod free fro$ the control and direction of his e$&loyer or &rinci&al in

all $atters connected with the &erfor$ance of the wor% e"ce&t as to the results thereof and (#! has

su#stantial ca&ital or invest$ent in the for$ of tools eui&$ent $achineries wor% &re$ises and other

$aterials which are necessary in the conduct of the #usiness'- Petitioners are not ?inde&endent contractors?' -hey did not carry on an inde&endent #usiness' Neither did

they underta%e cutting hair and $anicuring nails on their own as their res&onsi#ility and in their own

$anner and $ethod' -he services of the &etitioners were engaged #y the res&ondent co$&any to attend to

the needs of its custo$ers in its #ar#er sho&' More i$&ortantly the &etitioners individually or collectively did

not have a su#stantial ca&ital or invest$ent in the for$ of tools eui&$ent wor% &re$ises and other

$aterials which are necessary in the conduct of the #usiness of the res&ondent co$&any'- +R,++ relationshi& , Records of the case show that the late Vicente Lao engaged the services of the

&etitioners to wor% as #ar#ers and $anicurists in the New Loo% 5ar#er )ho& then a single &ro&rietorshi&

owned #y hi$8 that in Aanuary 7IK9 his children organi*ed a cor&oration which they registered with the

)ecurities and +"change Co$$ission as Lao +nteng Co$&any .nc'8 that u&on its incor&oration it too% over

the assets eui&$ent and &ro&erties of the New Loo% 5ar#er )ho& and continued the #usiness8 that the

res&ondent co$&any retained the services of all the &etitioners and continuously &aid their wages' Clearly

all three ele$ents e"ist in &etitioners3 and &rivate res&ondent3s wor%ing arrange$ents'- Control , Private res&ondent clai$s it had no control over &etitioners' -he &ower to control refers to the

e"istence of the &ower and not necessarily to the actual e"ercise thereof nor is it essential for the e$&loyer

to actually su&ervise the &erfor$ance of duties of the e$&loyee' .t is enough that the e$&loyer has the right

to wield that &ower' 6s to the ?control test? the following facts indu#ita#ly reveal that res&ondent co$&any

wielded control over the wor% &erfor$ance of &etitioners in that: (7! they wor%ed in the #ar#er sho& owned

and o&erated #y the res&ondents8 (9! they were reuired to re&ort daily and o#serve definite hours of wor%8

(! they were not free to acce&t other e$&loy$ent elsewhere #ut devoted their full ti$e wor%ing in the New

Loo% 5ar#er )ho& for all the fifteen (7D! years they have wor%ed until 6&ril 7D 7IID8 (;! that so$e have

wor%ed with res&ondents as early as in the 7IEB3s8 (D! that &etitioner Patricia Nas was instructed #y the

res&ondents to watch the other si" (E! &etitioners in their daily tas%' Certainly res&ondent co$&any was

clothed with the &ower to dis$iss any or all of the$ for Hust and valid cause' Petitioners were unargua#ly

&erfor$ing wor% necessary and desira#le in the #usiness of the res&ondent co$&any'

10) G.R. No. 192084 September 14, 2011

JOSE MEL BERNARTE, Petitionervs'P!L!PP!NE BAS"ETBALL ASSOC!AT!ON #PBA), JOSE EMMAN$EL M. EALA, %&' PERR(MART!NE,Res&ondents'

*%+t-

Co$&lainants (Aose Mel 5ernarte and Renato Guevarra! aver that they were invited to Hoin the P56 as referees'Juring the leadershi& of Co$$issioner +$ilio 5ernardino they were $ade to sign contracts on a year,to,year #asis'Juring the ter$ of Co$$issioner +ala however changes were $ade on the ter$s of their e$&loy$ent' -heyreceived a letter fro$ the /ffice of the Co$$issioner advising the$ that their contract would not #e renewed citingtheir unsatisfactory &erfor$ance on and off the court'

Res&ondents aver on the other hand that co$&lainants entered into two contracts of retainer with the P56 in theyear 9BB' -hat co$&lainants were not illegally dis$issed #ecause they were not e$&loyees of the P56' -heir res&ective contracts of retainer were si$&ly not renewed' P56 had the &rerogative of whether or not to renew their contracts which they %new were fi"ed'

!e- hether &etitioner is an e$&loyee of res&ondents'

e/'- NO.


11/19

-o deter$ine the e"istence of an e$&loyer,e$&loyee relationshi& case law has consistently a&&lied the four,foldtest to wit: (a! the selection and engage$ent of the e$&loyee8 (#! the &ay$ent of wages8 (c! the &ower of dis$issal8and (d! the e$&loyer>s &ower to control the e$&loyee on the $eans and $ethods #y which the wor% is acco$&lished'-he so,called ?+o&tro/ tet? is the $ost i$&ortant indicator of the &resence or a#sence of an e$&loyer,e$&loyeerelationshi&'

.n this case P56 ad$its re&eatedly engaging &etitioner>s services as shown in the retainer contracts' P56 &ays

&etitioner a retainer fee e"clusive of &er die$ or allowances as sti&ulated in the retainer contract' P56 can ter$inatethe retainer contract for &etitioner>s violation of its ter$s and conditions'

1owever res&ondents argue that the all,i$&ortant ele$ent of control is lac%ing in this case $a%ing &etitioner aninde&endent contractor and not an e$&loyee of res&ondents'

Petitioner contends otherwise' Petitioner asserts that he is an e$&loyee of res&ondents since the latter e"ercisecontrol over the &erfor$ance of his wor%' Petitioner cites the following:

(7! res&ondents classify or rate a referee8

(9! res&ondents reuire referees to attend all #as%et#all ga$es organi*ed or authori*ed #y the P56 at least one hour #efore the start of the first ga$e of each day8

(! res&ondents assign &etitioner to officiate #allga$es or to act as alternate referee or su#stitute8 (;! referee agrees

to o#serve and co$&ly with all the reuire$ents of the P56 governing the conduct of the referees whether on or off the court8

(D! referee agrees (a! to %ee& hi$self in good &hysical $ental and e$otional condition during the life of the contract8(#! to give always his #est effort and service and loyalty to the P56 and not to officiate as referee in any #as%et#allga$e outside of the P56 without written &rior consent of the Co$$issioner8 (c! always to conduct hi$self on and off the court according to the highest standards of honesty or $orality8 and

(E! i$&osition of various sanctions for violation of the ter$s and conditions of the contract'

-he )C however held that the foregoing sti&ulations hardly de$onstrate control over the $eans and $ethods #ywhich &etitioner &erfor$s his wor% as a referee officiating a P56 #as%et#all ga$e' -he contractual sti&ulations do not&ertain to $uch less dictate how and when &etitioner will #low the whistle and $a%e calls' /n the contrary they$erely serve as rules of conduct or guidelines in order to $aintain the integrity of the &rofessional #as%et#all league'

e agree with res&ondents that once in the &laying court the referees e"ercise their own inde&endent Hudg$ent#ased on the rules of the ga$e as to when and how a call or decision is to #e $ade' -he very nature of &etitioner>s

Ho# of officiating a &rofessional #as%et#all ga$e undou#tedly calls for freedo$ of control #y res&ondents'

Moreover the following circu$stances indicate that &etitioner is an inde&endent contractor:

(7! the referees are reuired to re&ort for wor% only when P56 ga$es are scheduled which is three ti$es a wee%s&read over an average of only 7BD &laying days a year and they officiate ga$es at an average of two hours &er ga$e8 and

(9! the only deductions fro$ the fees received #y the referees are withholding ta"es'

.n other words unli%e regular e$&loyees who ordinarily re&ort for wor% eight hours &er day for five days a wee%&etitioner is reuired to re&ort for wor% only when P56 ga$es are scheduled or three ti$es a wee% at two hours &er ga$e'

.n addition there are no deductions for contri#utions to the )ocial )ecurity )yste$ Philhealth or Pag,.#ig which arethe usual deductions fro$ e$&loyees> salaries' -hese undis&uted circu$stances #uttress the fact that &etitioner is aninde&endent contractor and not an e$&loyee of res&ondents'

.n addition the fact that P56 re&eatedly hired &etitioner does not #y itself &rove that &etitioner is an e$&loyee of thefor$er' For a hired &arty to #e considered an e$&loyee the hiring &arty $ust have control over the $eans and$ethods #y which the hired &arty is to &erfor$ his wor% which is a#sent in this case' -he continuous rehiring #y P56of &etitioner si$&ly signifies the renewal of the contract #etween P56 and &etitioner and highlights the satisfactoryservices rendered #y &etitioner warranting such contract renewal' Conversely if P56 decides to discontinue&etitioner>s services at the end of the ter$ fi"ed in the contract whether for unsatisfactory services or violation of the


12/19

ter$s and conditions of the contract or for whatever other reason the sa$e $erely results in the non,renewal of thecontract as in the &resent case' -he non,renewal of the contract #etween the &arties does not constitute illegaldis$issal of &etitioner #y res&ondents'

11) G.R. No. 1821 O+tober 2, 2009

RA$L G. LOCS!N %&' E!E B. TOMA$!N, Petitionersvs'P!L!PP!NE LONG !STANCE TELEPONE COMPAN(, Res&ondent'

*%+t-

Res&ondent Phili&&ine Long Jistance -ele&hone Co$&any (PLJ-! and the )ecurity and )afety Cor&oration of thePhili&&ines ())CP! entered into a )ecurity )ervices 6gree$ent (6gree$ent! where#y ))CP would &rovide ar$edsecurity guards to PLJ- to #e assigned to its various offices'

Pursuant to such agree$ent &etitioners Raul Locsin and +ddie -o$auin a$ong other security guards were &ostedat a PLJ- office'

/n 6ugust B 9BB7 res&ondent issued a Letter ter$inating the 6gree$ent effective /cto#er 7 9BB7'

Jes&ite the ter$ination of the 6gree$ent however &etitioners continued to secure the &re$ises of their assignedoffice' -hey were allegedly directed to re$ain at their &ost #y re&resentatives of res&ondent' .n su&&ort of their contention &etitioners &rovided the co&ies of &etitioner Locsin>s &ay sli&s for the &eriod of Aanuary to )e&te$#er 9BB9'D

-hen on )e&te$#er B 9BB9 &etitioners> services were ter$inated'

-hus &etitioners filed a co$&laint #efore the La#or 6r#iter for illegal dis$issal and recovery of $oney clai$s such asoverti$e &ay holiday &ay &re$iu$ &ay for holiday and rest day service incentive leave &ay +$ergency Cost of Living 6llowance and $oral and e"e$&lary da$ages against PLJ-'

!e- hether or not co$&lainants e"tended services to the res&ondent for one (7! year fro$ /cto#er 7 9BB7 u&to )e&te$#er B 9BB9 without a renewed contract constitutes an e$&loyer,e$&loyee relationshi& #etweenres&ondent and the co$&lainants'

e/'- (ES.

6n +$&loyer,+$&loyee Relationshi& +"isted 5etween the Parties'

.t is #eyond cavil that there was no e$&loyer,e$&loyee relationshi& #etween the &arties fro$ the ti$e of &etitioners>first assign$ent to res&ondent #y ))CP in 7IKK until the alleged ter$ination of the 6gree$ent #etween res&ondentand ))CP' .t #ears &ointing out that &etitioners were a$ong those declared to #e e$&loyees of their res&ectivesecurity agencies and not of PLJ-'

-he only issue in this case is whether &etitioners #eca$e e$&loyees of res&ondent after the 6gree$ent #etween))CP and res&ondent was ter$inated'

-his $ust #e answered in the affir$ative'

Nota#ly res&ondent does not deny the fact that &etitioners re$ained in the &re$ises of their offices even after the 6gree$ent was ter$inated' 6nd it is this fact that $ust #e e"&lained'

-he fact re$ains that &etitioners re$ained at their &ost after the ter$ination of the 6gree$ent' Nota#ly in itsCo$$ent dated March 7B 9BBIK res&ondent never denied that &etitioners re$ained at their &ost until )e&te$#er B 9BB9' hile res&ondent denies the alleged circu$stances stated #y &etitioners that they were told to re$ain attheir &ost #y res&ondent>s )ecurity Je&art$ent and that they were infor$ed #y ))CP /&erations /fficer +duardoAuliano that their salaries would #e coursed through ))CP as &er arrange$ent with PLJ- it does not state why theywere not $ade to vacate their &osts' Res&ondent said that it did not %now why &etitioners re$ained at their &osts'

http://www.lawphil.net/judjuris/juri2009/oct2009/gr_185251_2009.html#fnt3http://www.lawphil.net/judjuris/juri2009/oct2009/gr_185251_2009.html#fnt3http://www.lawphil.net/judjuris/juri2009/oct2009/gr_185251_2009.html#fnt3http://www.lawphil.net/judjuris/juri2009/oct2009/gr_185251_2009.html#fnt5http://www.lawphil.net/judjuris/juri2009/oct2009/gr_185251_2009.html#fnt5http://www.lawphil.net/judjuris/juri2009/oct2009/gr_185251_2009.html#fnt8http://www.lawphil.net/judjuris/juri2009/oct2009/gr_185251_2009.html#fnt5http://www.lawphil.net/judjuris/juri2009/oct2009/gr_185251_2009.html#fnt8http://www.lawphil.net/judjuris/juri2009/oct2009/gr_185251_2009.html#fnt3


13/19

.n the ordinary course of things res&onsi#le #usiness owners or $anagers would not allow security guards of anagency with who$ the owners or $anagers have severed ties with to continue to stay within the #usiness> &re$ises'-his is #ecause u&on the ter$ination of the owners> or $anagers> agree$ent with the security agency the agency>sunderta%ing of lia#ility for any da$age that the security guard would cause has already #een ter$inated' -hus in theevent of an accident or otherwise da$age caused #y such security guards it would #e the #usiness owners and0or $anagers who would #e lia#le and not the agency' -he #usiness owners or $anagers would therefore #e o&eningthe$selves u& to lia#ility for acts of security guards over who$ the owners or $anagers allegedly have no control'

.t would see$ that ))CP was &aying &etitioners> salaries while securing res&ondent>s &re$ises des&ite theter$ination of their 6gree$ent' /#viously it would only #e res&ondent that would #enefit fro$ such a situation' 6nd itis seriously dou#tful that a security agency that was esta#lished for &rofit would allow its security guards to secureres&ondent>s &re$ises when the 6gree$ent was already ter$inated'

Clearly such a situation $a%es no sense and the denials &roffered #y res&ondent do not shed any light to thesituation' .t is #ut reasona#le to conclude that with the #ehest and &resu$a#ly directive of res&ondent &etitionerscontinued with their services' +vidently such are indicia of control that res&ondent e"ercised over &etitioners'

)uch &ower of control has #een e"&lained as the ?right to control not only the end to #e achieved #ut also the $eansto #e used in reaching such end'? ith the conclusion that res&ondent directed &etitioners to re$ain at their &ostsand continue with their duties it is clear that res&ondent e"ercised the &ower of control over the$8 thus the e"istenceof an e$&loyer,e$&loyee relationshi&'

.n the deter$ination of whether an e$&loyer,e$&loyee relationshi& e"ists #etween two &arties this Court a&&lies thefour,fold test to deter$ine the e"istence of the ele$ents of such relationshi&'

(a! the selection and engage$ent of the e$&loyee8

(#! the &ay$ent of wages8

(c! the &ower of dis$issal8 and

(d! the e$&loyer>s &ower to control the e$&loyee>s conduct' .t is the so,called ?control test? which constitutes the$ost i$&ortant inde" of the e"istence of the e$&loyer,e$&loyee relationshi& that is whether the e$&loyer controls or has reserved the right to control the e$&loyee not only as to the result of the wor% to #e done #ut also as to the$eans and $ethods #y which the sa$e is to #e acco$&lished'

+vidently res&ondent having the &ower of control over &etitioners $ust #e considered as &etitioners> e$&loyer––fro$

the ter$ination of the 6gree$ent onwards––as this was the only ti$e that any evidence of control was e"hi#ited #yres&ondent over &etitioners'

12) G.R. No. 139 No5ember 26, 2011

CESAR C. L!R!O, 'o7& b7&e &'er te &%me %&' t:/e o; CEL"OR A SON!CM!


14/19

wor% fro$ Monday to Friday fro$ I:BB a'$' to E &'$' /n )aturdays he was reuired to wor% half,day only #ut $ost

of the ti$e he still rendered eight hours of wor% or $ore' 6ll the e$&loyees of &etitioner including res&ondent

rendered overti$e wor% al$ost everyday #ut &etitioner never %e&t a daily ti$e record to avoid &aying the e$&loyees

overti$e &ay'

Res&ondent stated that a few days after he started wor%ing as a studio $anager &etitioner a&&roached hi$ and told

hi$ a#out his &roHect to &roduce an al#u$ for his daughter Celine Mei Lirio and &ro$ised that he (Lirio! would draft acontract to assure res&ondent of his co$&ensation for such services' -he Ho# was done then res&ondent re$inded

&etitioner a#out the contract on his co$&ensation #ut &etitioner told res&ondent that since he was &ractically a

no#ody and had &roven nothing yet in the $usic industry res&ondent did not deserve a high co$&ensation and

infor$ed res&ondent that he was entitled only to 9BO of the net &rofit and not of the gross sales of the al#u$ and

that the salaries he received and would continue to receive as studio $anager of Cel%or would #e deducted fro$ the

said 9BO net &rofit share' Res&ondent o#Hected and insisted that he #e &ro&erly co$&ensated' /n March 7; 9BB9

&etitioner ver#ally ter$inated res&ondent>s services and he was instructed not to re&ort for wor%'

Res&ondent asserts that he was illegally dis$issed as he was ter$inated without any valid grounds'

.n defense &etitioner stated that res&ondent was not hired as studio $anager co$&oser technician or as an

e$&loyee in any other ca&acity of Cel%or' Res&ondent could not have #een hired as a studio $anager since the

recording studio has no &ersonnel e"ce&t &etitioner'

.n the facts a#out the &roduction of an al#u$ Petitioner asserted that his relationshi& with res&ondent is one of an

infor$al &artnershi& under 6rticle 7ED of the New Civil Code since they agreed to contri#ute $oney &ro&erty or

industry to a co$$on fund with the intention of dividing the &rofits a$ong the$selves' Petitioner had no control over

the ti$e and $anner #y which res&ondent co$&osed or arranged the songs e"ce&t on the result thereof'

Res&ondent re&orted to the recording studio #etween 7B:BB a'$' and 79:BB noon' 1ence &etitioner contended that

no e$&loyer,e$&loyee relationshi& e"isted #etween hi$ and the res&ondent and there was no illegal dis$issal to

s&ea% of'

!e- hether there e"ists an e$&loyer,e$&loyee relationshi& #etween the &arties'

e/'- (ES.

Petitioner>s argu$ent lac%s $erit'

.n this case co$&lainant3s evidence is su#stantial enough to &rove the e$&loy$ent relationshi& that on 6ugust 7;

9BB7 he was hired as 3)tudio $anager3 #y res&ondent Lirio to $anage and o&erate the recording studio and to

&ro$ote and sell its services to $usic enthusiasts and clients &roven #y his recei&t for this &ur&ose fro$ said

res&ondent a fi"ed $onthly co$&ensation of PBBB'BB with co$$ission of P7BB'BB &er hour when serving as

recording technician shown #y the &ayroll fro$ Auly 7 9BB7,March 7D 9BB9' -he said evidence &oints to

co$&lainant3s hiring as e$&loyee so that the case co$es within the &urview of our Hurisdiction on la#or dis&utes

#etween an e$&loyer and an e$&loyee'

Respondent Lirio's so-called existence of a partnership agreement was not substantiated and his assertionthereto, in the face of complainant's evidence, constitute but a self-serving assertion, without probative

value, a mere invention to justify the illegal dismissal.

.ndeed we find credi#le that what caused co$&lainant3s dis$issal on March 7; 9BB9 was due to his refusal to

res&ondent3s Lirio3s insistences on $erely giving hi$ 9BO #ased on net &rofit on sale of the al#u$ which he

co$&osed and arranged during his free ti$e and $oreover that salaries which he received would #e deducted

therefro$ which o#viously soured the relations fro$ the &oint of view of res&ondent Lirio'

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15/19

-o esta#lished that an e$&loyer,e$&loyee relationshi& e"isted #etween &etitioner and res&ondent the following

ele$ents $ust #e &resent:

(a! the selection and engage$ent of the e$&loyee8

(#! the &ay$ent of wages8

(c! the &ower of dis$issal8 and

(d! the e$&loyer>s &ower to control the e$&loyee>s conduct' -he $ost i$&ortant ele$ent is the e$&loyer>s control of

the e$&loyee>s conduct not only as to the result of the wor% to #e done #ut also as to the $eans and $ethods to

acco$&lish it'

.n this case the docu$entary evidence &resented #y res&ondent to &rove that he was an e$&loyee of &etitioner are

as follows:

(a! a docu$ent deno$inated as ?&ayroll? (dated Auly 7 9BB7 to March 7D 9BB9! certified correct #y

&etitioner which showed that res&ondent received a $onthly salary of PBBB'BB (PDBB'BB every 7Dth of

the $onth and another PDBB'BB every Bth of the $onth! with the corres&onding deductions due toa#sences incurred #y res&ondent8 and

(#! co&ies of &etty cash vouchers showing the a$ounts he received and signed for in the &ayrolls'

-he said docu$ents showed that &etitioner hired res&ondent as an e$&loyee and he was &aid $onthly wages

ofPBBB'BB' Petitioner wielded the &ower to dis$iss as res&ondent stated that he was ver#ally dis$issed #y

&etitioner and res&ondent thereafter filed an action for illegal dis$issal against &etitioner'

-he &ower of control refers $erely to the e"istence of the &ower' .t is not essential for the e$&loyer to actually

su&ervise the &erfor$ance of duties of the e$&loyee as it is sufficient that the for$er has a right to wield the &ower'

Nevertheless &etitioner stated in his Position Pa&er that it was agreed that he would hel& and teach res&ondent how

to use the studio eui&$ent' .n such case &etitioner certainly had the &ower to chec% on the &rogress and wor% of

res&ondent'

6lso &etitioner failed to &rove that his relationshi& with res&ondent was one of &artnershi&' )uch clai$ was not

su&&orted #y any written agree$ent' -he Court notes that in the &ayroll dated Auly 7 9BB7 to March 7D

9BB9D there were deductions fro$ the wages of res&ondent for his a#sence fro$ wor% which negates &etitioner>s

clai$ that the wages &aid were advances for res&ondent>s wor% in the &artnershi&'

Re$e$#er: .f dou#t e"ists #etween the evidence &resented #y the e$&loyer and the e$&loyee the scales of Hustice

$ust #e tilted in favor of the latter'

JA>!ER >S. *L( ACE CORP. *eb. 1, 2012

F6C-):

/n May 9 9BBK Aavier filed a co$&laint #efore the NLRC for under&ay$ent of salaries and other la#or standard #enefits' 1e

alleged that he was an e$&loyee of Fly 6ce since )e&te$#er 9BB &erfor$ing various tas%s at the res&ondent>s warehouse such

as cleaning and arranging the canned ite$s #efore their delivery to certain locations e"ce&t in instances when he would #e

ordered to acco$&any the co$&any>s delivery vehicles as pahinante8 that he re&orted for wor% fro$ Monday to )aturday fro$

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16/19

:BB o>cloc% in the $orning to D:BB o>cloc% in the afternoon8 that during his e$&loy$ent he was not issued an identification card

and &aysli&s #y the co$&any8 that on May E 9BBK he re&orted for wor% #ut he was no longer allowed to enter the co$&any

&re$ises #y the security guard u&on the instruction of Ru#en /ng (Mr. Ong) his su&erior8D that after several $inutes of #egging to

the guard to allow hi$ to enter he saw /ng who$ he a&&roached and as%ed why he was #eing #arred fro$ entering the &re$ises8

that /ng re&lied #y saying ?Tanungin mo anak mo;? E that he then went ho$e and discussed the $atter with his fa$ily8 that he

discovered that /ng had #een courting his daughter 6nnalyn after the two $et at a fiesta cele#ration in Mala#on City8 that 6nnalyn

tried to tal% to /ng and convince hi$ to s&are her father fro$ trou#le #ut he refused to accede8 that thereafter Aavier waster$inated fro$ his e$&loy$ent without notice8 and that he was neither given the o&&ortunity to refute the cause0s of his dis$issal

fro$ wor%'

-o su&&ort his allegations Aavier &resented an affidavit of one 5engie Valen*uela who alleged that Aavier was a stevedore

or pahinante of Fly 6ce fro$ )e&te$#er 9BB to Aanuary 9BBK' -he said affidavit was su#scri#ed #efore the La#or 6r#iter (LA)'

For its &art Fly 6ce averred that it was engaged in the #usiness of i$&ortation and sales of groceries' )o$eti$e in Jece$#er

9BB Aavier was contracted #y its e$&loyee Mr' /ng as e"tra hel&er on a pakyaw #asis at an agreed rate of P BB'BB &er tri&

which was later increased to P 9D'BB in Aanuary 9BBK' Jenying that he was their e$&loyee Fly 6ce insisted that there was no

illegal dis$issal'K Fly 6ce su#$itted a co&y of its agree$ent with Mil$ar 1auling )ervices and co&ies of ac%nowledg$ent recei&ts

evidencing &ay$ent to Aavier for his contracted services #earing the words ?daily $an&ower (pakyaw/piece rate pay)? and the

latter>s signatures0initials' -he C6 li%ewise added that Aavier>s failure to &resent salary vouchers &aysli&s or other &ieces of

evidence to #olster his contention &ointed to the inesca&a#le conclusion that he was not an e$&loyee of Fly 6ce' Further it foundthat Aavier>s wor% was not necessary and desira#le to the #usiness or trade of the co$&any as it was only when there were

scheduled deliveries which a regular hauling service could not deliver that Fly 6ce would contract the services of Aavier as an

e"tra hel&er' the facts alleged #y Aavier did not &ass the ?control test'? 1e contracted wor% outside the co$&any &re$ises8 he was

not reuired to o#serve definite hours of wor%8 he was not reuired to re&ort daily8 and he was free to acce&t other wor% elsewhere

as there was no e"clusivity of his contracted service to the co$&any

.))4+: hether or not Aavier is an e$&loyee of res&ondent

R$L!NG- No' Aavier is not an e$&loyee of Fly 6ce'

6s the records #ear out the L6 and the C6 found Aavier>s clai$ of e$&loy$ent with Fly 6ce as wanting and deficient' -he Court is

constrained to agree' 6lthough )ection 7B Rule V.. of the New Rules of Procedure of the NLRC9K allows a rela"ation of the rules of

&rocedure and evidence in la#or cases this rule of li#erality does not $ean a co$&lete dis&ensation of &roof' La#or officials are

enHoined to use reasona#le $eans to ascertain the facts s&eedily and o#Hectively with little regard to technicalities or for$alities #ut

nowhere in the rules are they &rovided a license to co$&letely discount evidence or the lac% of it'

?No &articular for$ of evidence is reuired to &rove the e"istence of such e$&loyer,e$&loyee relationshi&' 6ny co$&etent and

relevant evidence to &rove the relationshi& $ay #e

ad$itted'htt&:00www'law&hil'net0HudHuris0Huri9BBI0$ay9BBI0gr7IED99BBI'ht$l , fnt7 1ence while no &articular for$ of

evidence is reuired a finding that such relationshi& e"ists $ust still rest on so$e su#stantial evidence' Moreover the

su#stantiality of the evidence de&ends on its uantitative as well as its qualitative as&ects'?B 6lthough su#stantial evidence is not a

function of uantity #ut rather of uality the " " " circu$stances of the instant case de$and that so$ething $ore should have #een

&roffered' 5y way of evidence on this &oint all that Aavier &resented were his self,serving state$ents &ur&ortedly showing his

activities as an e$&loyee of Fly 6ce'

Aavier failed to &ass the su#stantiality reuire$ent to su&&ort his clai$' 1ence the Court sees no reason to de&art fro$ the

findings of the C6' hile Aavier re$ains fir$ in his &osition that as an e$&loyed stevedore of Fly 6ce he was $ade to wor% in the

co$&any &re$ises during wee%days arranging and cleaning grocery ite$s for delivery to clients no other &roof was su#$itted to

fortify his clai$' -he lone affidavit e"ecuted #y one 5engie Valen*uela was unsuccessful in strengthening Aavier>s cause' .n said

docu$ent all Valen*uela attested to was that he would freuently see Aavier at the wor%&lace where the latter was also hired as

stevedore'; Certainly in gauging the evidence &resented #y Aavier the Court cannot ignore the inesca&a#le conclusion that his

$ere &resence at the wor%&lace falls short in &roving e$&loy$ent therein' -he su&&orting affidavit could have to an e"tent

#olstered Aavier>s clai$ of #eing tas%ed to clean grocery ite$s when there were no scheduled delivery tri&s #ut no infor$ation was

offered in this su#Hect si$&ly #ecause the witness had no &ersonal %nowledge of Aavier>s e$&loy$ent status in the co$&any'

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17/19

-he Court is of the considera#le view that on Aavier lies the #urden to &ass the well,settled tests to deter$ine the e"istence of an

e$&loyer,e$&loyee relationshi& vi : (7! the selection and engage$ent of the e$&loyee8 (9! the &ay$ent of wages8 (! the &ower

of dis$issal8 and (;! the &ower to control the e$&loyee>s conduct' /f these ele$ents the $ost i$&ortant criterion is whether the

e$&loyer controls or has reserved the right to control the e$&loyee not only as to the result of the wor% #ut also as to the $eans

and $ethods #y which the result is to #e acco$&lished'D

Aavier>s allegations did not esta#lish that his relationshi& with Fly 6ce had the attri#utes of an e$&loyer,e$&loyee relationshi& on

the #asis of the a#ove,$entioned four,fold test' orse Aavier was not a#le to refute Fly 6ce>s assertion that it had an agree$ent

with a hauling co$&any to underta%e the delivery of its goods' .t was also #affling to reali*e that Aavier did not dis&ute Fly 6ce>s

denial of his services> e"clusivity to the co$&any' .n short all that Aavier laid down were #are allegations without corro#orative

&roof'

-here was no su#stantial evidence to &rove e$&loyer,e$&loyee relationshi&' 1aving a service contract with Mil$ar 1auling

)ervices for the &ur&ose of trans&orting and delivering co$&any &roducts to custo$ers Fly 6ce contracted Aavier as an e"tra

hel&er or pahinante on a $ere ?&er tri& #asis'? Aavier who was actually a loiterer in the area only acco$&anied and assisted the

co$&any driver when Mil$ar could not deliver or when the e"igency of e"tra deliveries arises for roughly five to si" ti$es a $onth'

5efore $a%ing a delivery Fly 6ce would turn over to the driver and Aavier the delivery vehicle with its loaded co$&any &roducts'

ith the vehicle and &roducts in their custody the driver and Aavier ?would leave the co$&any &re$ises using their own $eans

$ethod #est Hudg$ent and discretion on how to deliver ti$e to deliver where and Qwhen to start and $anner of delivering the

&roducts'?9B

S( >S. CA AN SAOT *EBR$AR( 2006

F6C-):

)o$eti$e in 7IDK &rivate res&ondent Aai$e )ahotD started wor%ing as a truc% hel&er for &etitioners> fa$ily,owned truc%ing

#usiness na$ed Vicente )y -ruc%ing' .n 7IED he #eca$e a truc% driver of the sa$e fa$ily #usiness rena$ed -' Paulino -ruc%ing

)ervice later E5>s -ruc%ing Cor&oration in 7IKD and thereafter %nown as )5- -ruc%ing Cor&oration since 7II;' -hroughout all

these changes in na$es and for E years &rivate res&ondent continuously served the truc%ing #usiness of &etitioners' .n 6&ril

7II; )ahot was already DI years old' 1e had #een incurring a#sences as he was suffering fro$ various ail$ents' 1e inuired

a#out his $edical and retire$ent #enefits with the )ocial )ecurity )yste$ ()))! on 6&ril 9D 7II; #ut discovered that his &re$iu$

&ay$ents had not #een re$itted #y his e$&loyer' )ahot had filed a wee%,long leave so$eti$e in May 7II;' /n May 9th he was$edically e"a$ined and treated for +/R &resleyo&ia hy&ertensive retino&athy G .. (6nne"es ?G,D? and ?G,? &&' ;K 7B;

res&ectively!E 1PM 4-. /steoarthritis (6nne" ?G,;? &' 7BD! and heart enlarge$ent' 6t the end of his wee%,long a#sence )ahot

a&&lied for e"tension of his leave for the whole $onth of Aune 7II;' )ahot found hi$self in a dile$$a' 1e was facing dis$issal if

he refused to wor% 5ut he could not retire on &ension #ecause &etitioners never &aid his correct ))) &re$iu$s' -he fact

re$ained he could no longer wor% as his left thigh hurt a#o$ina#ly' Petitioners ended his dile$$a' -hey carried out their threat

and dis$issed hi$ fro$ wor% effective Aune B 7II;' 1e ended u& sic% Ho#less and &enniless'

/n )e&te$#er 7 7II; )ahot filed with the NLRC NCR 6r#itration 5ranch a co$&laint for illegal dis$issal doc%eted as NLRC

NCR Case No' BB,BI,BE7,I;' 1e &rayed for the recovery of se&aration &ay and attorneys fees against Vicente )y and -rinidad

Paulino,)y 5elen Paulino Vicente )y -ruc%ing -' Paulino -ruc%ing )ervice E5>s -ruc%ing and )5- -ruc%ing herein &etitioners'

For their &art &etitioners contend that &rivate res&ondent was not illegally dis$issed as a driver #ecause he was in fact &etitioner>s

industrial &artner' -hey add that it was not until the year 7II; when )5- -ruc%ing Cor&oration was esta#lished and only then did

res&ondent )ahot #eco$e an e$&loyee of the co$&any'

.))4+: /N res&ondent Aai$e )ahot is an e$&loyee of &etitioner )y

R4L.NG: (e. Repo&'e&t 7 %& emp/o:ee o; S:.

there was error co$$itted #y the La#or 6r#iter when he concluded that co$&lainant was an industrial &artner &rior to 7II;' 6

co$&utation of the age of co$&lainant shows that he was only twenty,three (9! years when he started wor%ing with res&ondent as

truc% hel&er'

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18/19

-he ele$ents to deter$ine the e"istence of an e$&loy$ent relationshi& are: (a! the selection and engage$ent of the e$&loyee8

(#! the &ay$ent of wages8 (c! the &ower of dis$issal8 and (d! the e$&loyer>s &ower to control the e$&loyee>s conduct' -he $ost

i$&ortant ele$ent is the e$&loyer>s control of the e$&loyee>s conduct not only as to the result of the wor% to #e done #ut also as

to the $eans and $ethods to acco$&lish it'7I

6s found #y the a&&ellate court &etitioners owned and o&erated a truc%ing #usiness since the 7IDBs and #y their own allegations

they deter$ined &rivate res&ondent>s wages and rest day'9B Records of the case show that &rivate res&ondent actually engaged in

wor% as an e$&loyee' Juring the entire course of his e$&loy$ent he did not have the freedo$ to deter$ine where he would go

what he would do and how he would do it' 1e $erely followed instructions of &etitioners and was content to do so as long as he

was &aid his wages' .ndeed said the C6 &rivate res&ondent had wor%ed as a truc% hel&er and driver of &etitioners not for his own

&leasure #ut under the latter>s control'

Private res&ondent for his &art denies that he was ever an industrial &artner of &etitioners' -here was no written agree$ent no

&roof that he received a share in &etitioners> &rofits nor was there anything to show he had any &artici&ation with res&ect to the

running of the #usiness'7K 6rticle 7E97 of the Civil Code states that in a contract of &artnershi& two or $ore &ersons #ind

the$selves to contri#ute $oney &ro&erty or industry to a co$$on fund with the intention of dividing the &rofits a$ong

the$selves'99 Not one of these circu$stances is &resent in this case' No written agree$ent e"ists to &rove the &artnershi&

#etween the &arties' Private res&ondent did not contri#ute $oney &ro&erty or industry for the &ur&ose of engaging in the su&&osed

#usiness' -here is no &roof that he was receiving a share in the &rofits as a $atter of course during the &eriod when the truc%ing

#usiness was under o&eration' Neither is there any &roof that he had actively &artici&ated in the $anage$ent ad$inistration and

ado&tion of &olicies of the #usiness' -hus &rivate res&ondent was not an industrial &artner #ut an e$&loyee of &etitioner'

ENC(CLOPE!A 5. NLRC %&' L7m?o+o 1993 +%e

F6C-):

Private res&ondent 5enHa$in Li$Hoco was a )ales Jivision Manager of &etitioner +ncyclo&aedia 5ritannica and was in charge of

selling &etitioner3s &roducts through so$e sales re&resentatives' 6s co$&ensation &rivate res&ondent received co$$issions fro$

the &roducts sold #y his agents' 1e was also allowed to use &etitioner3s na$e goodwill and logo' Petitioner would also #e infor$ed

a#out a&&oint$ents &ro$otions and transfers of e$&loyees in &rivate res&ondent3s district' .t was however agreed u&on that

office e"&enses would #e deducted fro$ &rivate res&ondent3s co$$issions' /n Aune 7; 7I; &rivate res&ondent Li$Hoco

resigned fro$ office to &ursue his &rivate #usiness' -hen on /cto#er B 7ID he filed a co$&laint against &etitioner

+ncyclo&aedia 5ritannica with the Je&art$ent of La#or and +$&loy$ent clai$ing for non,&ay$ent of se&aration &ay and other

#enefits and also illegal deduction fro$ his sales co$$issions'

Petitioner +ncyclo&aedia 5ritannica alleged that co$&lainant 5enHa$in Li$Hoco (Li$Hoco for #revity! was not its e$&loyee #ut an

inde&endent dealer authori*ed to &ro$ote and sell its &roducts and in return received co$$issions therefro$' 1e also had his

own se&arate office financed the #usiness e"&enses and $aintained his own wor%force' -he salaries of his secretary utility $an

and sales re&resentatives were chargea#le to his co$$issions' -hus &etitioner argued that it had no control and su&ervision over

the co$&lainant as to the $anner and $eans he conducted his #usiness o&erations' -he latter did not even re&ort to the office of

the &etitioner and did not o#serve fi"ed office hours' Conseuently there was no e$&loyer,e$&loyee relationshi&'

Li$Hoco $aintained otherwise' 1e alleged that he was hired #y the &etitioner in Auly 7IB was assigned in the sales de&art$ent

and was earning a certain a$ount as an average $onthly salary' was under the su&ervision of the &etitioner3s officials who issued

to hi$ and his other &ersonnel $e$oranda guidelines on co$&any &olicies instructions and other orders' 1e was however

dis$issed #y the &etitioner when the Laurel,Langley 6gree$ent e"&ired' 6s a result thereof Li$Hoco asserts that in accordance

with the esta#lished co$&any &ractice and the &rovisions of the collective #argaining agree$ent he was entitled to ter$ination

&ay un&aid #enefits (Christ$as #onus $idyear #onus clothing allowance vacation leave and sic% leave! and the a$ounts

illegally deducted fro$ his co$$issions which were then used for the &ay$ents of office su&&lies office s&ace and overhead

e"&enses'

.))4+: /N there is an e$&loyer e$&loyee relationshi& #etween &etitioners and res&ondent L.$Hoco'

http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt19http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt20http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt20http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt20http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt18http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt18http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt18http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt21http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt21http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt22http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt19http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt20http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt18http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt21http://www.lawphil.net/judjuris/juri2003/feb2003/gr_142293_2003.html#fnt22


19/19

R$L!NG- No. L7m?o+o 7 %& 7&'epe&'e&t +o&tr%+tor.

.n deter$ining the e"istence of an e$&loyer,e$&loyee relationshi& the following ele$ents $ust #e &resent: 7! selection and

engage$ent of the e$&loyee8 9! &ay$ent of wages8 ! &ower of dis$issal8 and ;! the &ower to control the e$&loyee3s conduct' /f

the a#ove control of e$&loyee3s conduct is co$$only regarded as the $ost crucial and deter$inative indicator of the &resence or

a#sence of an e$&loyer,e$&loyee relationshi&' 6

4nder the control test an e$&loyer,e$&loyee relationshi& e"ists where the&erson for who$ the services are &erfor$ed reserves the right to control not only the end to #e achieved #ut also the $anner and

$eans to used in reaching that end' ;

-he fact that &etitioner issued $e$oranda to &rivate res&ondents and to other division sales $anagers did not &rove that &etitioner

had actual control over the$' -he different $e$oranda were $erely guidelines on co$&any &olicies which the sales $anagers

follow and i$&ose on their res&ective agents' .t should #e noted that in &etitioner3s #usiness of selling encyclo&edias and #oo%s

the $ar%eting of these &roducts was done through dealershi& agree$ents' -he sales o&erations were &ri$arily conducted #y

inde&endent authori*ed agents who did not receive regular co$&ensations #ut only co$$issions #ased on the sales of the

&roducts' -hese inde&endent agents hired their own sales re&resentatives financed their own office e"&enses and $aintained

their own staff' -hus there was a need for the &etitioner to issue $e$oranda to &rivate res&ondent so that the latter would #e

a&&rised of the co$&any &olicies and &rocedures' Nevertheless &rivate res&ondent Li$Hoco and the other agents were free to

conduct and &ro$ote their sales o&erations' -he &eriodic re&orts to the &etitioner #y the agents were #ut necessary to u&date the

co$&any of the latter3s &erfor$ance and #usiness inco$e' 6lthough the &etitioner can fi" the &rices of the &roducts for reason ofunifor$ity and &rivate res&ondent could not alter the$ the latter nevertheless had free rein in the $eans and $ethods for

conducting the $ar%eting o&erations' 1e selected his own &ersonnel and only reason why he had to notify the &etitioner a#out

such a&&oint$ents was for &ur&ose of deducting the e$&loyees3 salaries fro$ his co$$issions. (!etitioner in their agreement had

to "e in#ormed a"out the appointment$% promotion$% and tran$#er$ o# employee$ that re$pondent Lim&oco had to take)

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