10. Coca-Cola Bottlers (Phils.), Inc. v. Dr. Dean Climaco G.R. No.

146881; February 5, 2007 Facts: Respondent is a medical doctor who was hired by petitioner Coca-Cola Bottlers Phils., Inc. by virtue of a Retainer Agreement. The Retainer Agreement was renewed annually. The last one expired on December 31, 1993. However, despite the non-renewal of the said agreement, respondent continued to perform his functions as company doctor to Coca-Cola until he received a letter from petitioner company concluding their retainership agreement effective 30 days from receipt thereof. Respondent inquired from the management of petitioner company whether it was agreeable to recognize him as a regular employee. The management refused to do so. With this, respondent filed a complaint seeking recognition as a regular employee of the company and prayed for the payment of all benefits of a regular employee, including 13th Month pay, Cost of Living Allowance, Holiday Pay, Service Incentive Leave Pay and Christmas bonus. Subsequently, respondent received a letter from the company concluding their retainership agreement. Issues: 1. Whether or not there exists an employer-employee relationship between the parties. 2. Whether the termination of respondents employment is illegal. Ruling: The Court agrees with the Labor Arbiter and NLRC that this case shows no employeremployee relationship existing between the parties. Petitioner company lacked the power of control over the performance by respondent of his duties. The Comprehensive Medical Plan which contains the respondents objectives, duties and obligations only laid down the guidelines to ensure that the desired end result was achieved but did not control the means and methods which respondent preformed his assigned tasks. The schedule of work and the requirement to be on call for emergency cases do not amount to such control but are necessary incidents to the retainership agreement. Considering that there is no employer-employee relationship exists between the parties, the termination of the Retainership Agreement does not constitute illegal dismissal of respondent. 11. Consolidated Broadcasting System vs. Oberio G.R. No. 168424, June 8, 2007 Facts: DYWB-Bombo Radyo, a radio station owned and operated by petitioner, employed respondents as drama talents. They worked daily for six days in a week and were required to record their drama production in advance. Some of them were employed since 1974, while the latest one was hired 1997. Their drama programs were aired in Bacolod City and in the sister stations of DYWB in the VisMin areas. Petitioner reduced the number of its drama productions, but was opposed by respondents. After the negotiations failed, the latter sought the intervention of DOLE. An inspection of DWYB revealed that petitioner is guilty of violation of labor standard laws. Petitioner contended that respondents are not its employees and refused to submit the payroll and DTRs. Vexed by the respondents complaint, petitioner allegedly intimidated respondents by suspending them for minor lapses and delaying the payment of their salaries. Eventually, respondents were barred by petitioner from reporting for work; thus, the former claimed constructive dismissal. On appeal to the NLRC, respondents raised the issue of ER-EE relationship and submitted the following to prove the existence of such relationship: time cards, identification cards, payroll, a show cause order of the station manager to respondent Oberio and memoranda either noted or issued by said manager. Petitioner, on the other hand, did not present any documentary evidence in its behalf and merely denied the allegations of respondents. It claimed that the radio station pays for the drama

recorded by piece and that it has no control over the conduct of respondents. NLRC rendered a decision holding that respondents were regular employees of petitioner who were illegally dismissed by the latter. Issues: 1) Whether respondents were employees of petitioner; and 2) Whether their dismissal was illegal. Ruling: Petitioner failed to controvert with substantial evidence the allegation of respondents that the former hired them. If petitioner did not hire them and if it was the director alone who chose the talents, petitioner could have easily shown a contract to such effect. However, petitioner merely relied on its contention that respondents were piece rate contractors paid by results. Under Policy Instruction No. 40 (P.I. #40), petitioner is obliged to execute the necessary contract specifying the nature of the work to be performed, rates of pay, and the programs in which they will work. Moreover, project or contractual employees are required to be apprised of the project they will undertake under a written contract. This was not complied with by the petitioner. In ABS-CBN v. Marquez, the failure of the employer to produce the contract mandated by P.I. #40) is indicative that the so-called talents or project workers are in reality, regular employees -Program employees are those whose skills, talents or services are engaged by the station for a particular or specific program or undertaking and who are not required to observe normal working hours such that on some days they work for less than eight (8) hours and on other days beyond the normal work hours observed by station employees and are allowed to enter into employment contracts with other persons, stations, advertising agencies or sponsoring companies. The engagement of program employees, including those hired by advertising or sponsoring companies, shall be under a written contract specifying, among other things, the nature of the work to be performed, rates of pay, and the programs in which they will work. The contract shall be duly registered by the station with the Broadcast Media Council within 3 days from its consummation. It is basic that project or contractual employees are appraised of the project they will work under a written contract, specifying the nature of work to be performed and the rates of pay and the program in which they will work. No written contract was ever presented when petitioner is in the best of position to present these documents. Since none was presented to show that no written contract was accomplished, thus belying petitioners defense. There was no showing of compliance with the required reports to be filed, as provided either under the very Policy Instruction, or under the Omnibus Implementing Rules of the Labor Code for project employees. This bolsters respondents contention that they were indeed petitioners regular employees since their employment was not only for a particular program. Moreover, the engagement of respondents from 2 to 25 years and the fact that their drama programs were aired not only in Bacolod City but also in the sister stations of DYWB in the Visayas and Mindanao areas, undoubtedly show that their work is necessary and indispensable to the usual business or trade of petitioner. The test to determine whether employment is regular or not is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. Also, if the employee has been performing the job for at least one year, even if the performance is not continuous or merely intermittent, the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity, if not indispensability of that activity to the business. Thus, even assuming that respondents were initially hired as project/contractual employees, the engagement of their services for 2 to 25 years justify their classification as regular employees. As to the payment of wages, it was petitioner who paid the same as shown by the payroll bearing the name of petitioner company in the heading with the respective salaries of respondents opposite their names. Anent the power of control, dismissal, and imposition of disciplinary measures, the same were duly proven by the: (1) memorandum noted by petitioners station manager, calling the attention of the Drama Department to the late submission of scripts by writers and the tardiness and

absences of directors and talents, as well as the imposable fines for future infractions; (2) the memorandum of the station manager directing respondent Oberio to explain why no disciplinary action should be taken against him for punching the time card of a certain Mrs. Fe Oberio; and (3) the station managers memorandum suspending respondent Oberio for six days for the said infraction. These, taken together show the existence of an ER-EE relationship. Respondents were illegally dismissed. Petitioner merely contended that it was respondents who ceased to report to work, and never presented any substantial evidence to support said allegation. Petitioner failed to discharge its burden, hence, respondents were correctly declared to have been illegally dismissed. Furthermore, if doubts exist between the evidence presented by the employer and the employee, the scales of justice must be tilted in favor of the latter the employer must affirmatively show rationally adequate evidence that the dismissal was for a justifiable cause. It is a time-honored rule that in controversies between a laborer and his master, doubts reasonably arising from the evidence should be resolved in the formers favor. The policy is to extend the doctrine to a greater number of employees who can avail of the benefits under the law, which is in consonance with the avowed policy of the State to give maximum aid and protection of labor. 12. Dumpit-Murillo v. CA G.R. No. 164652, June 8, 2007 Facts: Associated Broadcasting Company (ABC) hired Thelma Dumpit-Murillo under a talent contract as a newscaster and co-anchor for Balitang-Balita, an early evening news program. The contract was for a period of three months. After four years of repeated renewals, petitioners talent contract expired. Two weeks after the expiration of the last contract, petitioner sent a letter to Mr. Jose Javier, Vice President for News and Public Affairs of ABC, informing the latter that she was still interested in renewing her contract subject to a salary increase. Thereafter, petitioner stopped reporting for work. She sent a demand letter to ABC, demanding reinstatement, payment of unpaid wages and full backwages, payment of 13th month pay, vacation/sick/service incentive leaves and other monetary benefits due to a regular employee. ABC replied that a check covering petitioners talent fees had been processed and prepared, but that the other claims of petitioner had no basis in fact or in law. The Labor Arbiter dismissed the complaint for illegal constructive dismissal. NLRC reversed. Issue: Whether or not Murillo is an employee of Associated Broadcasting Company. Ruling: Thelma Dumpit-Murillo was a regular employee under contemplation of law. The practice of having fixed-term contracts in the industry does not automatically make all talent contracts valid and compliant with labor law. The assertion that a talent contract exists does not necessarily prevent a regular employment status. Further, the Sonza case is not applicable. In Sonza, the television station did not exercise control over the means and methods of the performance of Sonzas work. In the case at bar, ABC had control over the performance of petitioners work. Noteworthy too, is the comparatively low P28,000 monthly pay of petitioner vis the P300,000 a month salary of Sonza, that all the more bolsters the conclusion that petitioner was not in the same situation as Sonza. The duties of petitioner as enumerated in her employment contract indicate that ABC had control over the work of petitioner. Aside from control, ABC also dictated the work assignments and payment of petitioners wages. ABC also had power to dismiss her. All these being present, clearly, there existed an employment relationship between petitioner and ABC. Concerning regular employment, the requisites for regularity of employment have been met in the instant case. Petitioners work was necessary or desirable in the usual business or trade of the employer which includes, as a pre-condition for its enfranchisement, its participation in the

governments news and public information dissemination. In addition, her work was continuous for a period of four years. This repeated engagement under contract of hire is indicative of the necessity and desirability of the petitioners work in private respondent ABCs business. As a regular employee, petitioner is entitled to security of tenure and can be dismissed only for just cause and after due compliance with procedural due process. Since private respondents did not observe due process in constructively dismissing the petitioner, there was an illegal dismissal. G.R. No. 162813: FAR EAST AGRICULTURAL SUPPLY, INC. and/or ALEXANDER UY vs JIMMY LEBATIQUE and THE HONORABLE COURT OF APPEALS 12 February 2007 l Labor Standards Abandonment Service Incentive Leave Field Personnel In March 1996, Lebatique was hired as a driver by FAR EAST AGRICULTURAL SUPPLY, INC. with a daily wage of P223.50. His job as a driver includes the delivery of animal feeds to the clients of the company. He must report either in the morning or in the afternoon to make the deliveries. On January 24, 2000, Lebatique was suspended by Manuel Uy (brother of FEASIs General Manager Alexander Uy) for allegedly using the company vehicle illegally. On the same day, Lebatique filed a complaint for nonpayment of overtime pay against Alexander Uy. Uy summoned Lebatique and asked why he was claiming overtime pay. Lebatique said since he started working with the company he has never been paid OT pay. Uy consulted with his brother. On January 29, 2000, Uy told Lebatique to look for another job. Lebatique then filed an Illegal Dismissal case against the company. The Labor Arbiter ruled in favor of Lebatique. Uy was ordered to reinstate Lebatique and at the same time to pay Lebatique his 13th month pay, back wages (time when case was pending), service incentive leave pay and OT pay all amounting to P196,659.72. Uy argued that Lebatique was not dismissed and that he was merely suspended; that he abandoned his job; and that Lebatique was a field personnel not entitled to overtime pay and service incentive leave. ISSUE: Whether or not Lebatique is a field personnel. HELD: No. Lebatique is a regular employee. Uy illegally dismissed Lebatique when he told him to look for another job. Judging at the sequence of event, Lebatique earned the ire of Uy when he filed a complaint for nonpayment of OT pay on the day Lebatique was suspended by Manuel Uy. Such is not a valid reason for dismissing Lebatique. Uy cannot therefore claim that he merely suspended Lebatique. Further, Lebatique did not abandon his job. His filing of this case is proof enough that he had no intention to abandon his job. To constitute abandonment as a just cause for dismissal, there must be: (a) absence without justifiable reason; and (b) a clear intention, as manifested by some overt act, to sever the employer-employee relationship. None of the above was proven by Uy. Also, Lebatique is not a field personnel as defined above for the following reasons:

(1) company drivers, including Lebatique, are directed to deliver the goods at a specified time and place; (2) they are not given the discretion to solicit, select and contact prospective clients; and (3) Far East issued a directive that company drivers should stay at the clients premises during truckban hours which is from 5:00 to 9:00 a.m. and 5:00 to 9:00 p.m. As a regular employee, Lebatique is entitled to service incentive leave and OT pay. The Supreme Court affirmed the Labor Arbiters decision but remanded the case for properly computing Lebatiques OT pay taking in to consideration the companys time keeping records. Field Personnel Defined Field personnel are those who regularly perform their duties away from the principal place of business of the employer and whose actual hours of work in the field cannot be determined with reasonable certainty. PNOC-EDC v. NLRC Facts: Danilo Mercado, an employee of the Philippine National Oil Company - Energy Development Corporation, was dismissed on the grounds of serious acts of dishonesty and violation of company rules and regulations allegedly committed as follows: 1. Withdrew P1680.00 from company funds, appropriated P680.00 for personal use and paid the nipa supplier P1000.00. 2. Withdrew P28.66 as payment for the fabrication of rubber stamp but appropriated the P8.66 for personal use. 3. Absence without leave and without proper turn-over thus disrupting and delaying company work activities. 4. Vacation leave without prior leave. Mercado filed a complaint against PNOC-EDC before the NLRC Regional Arbitration Branch. After considerations of position papers presented by both parties, the labor arbiter ruled in favor of Mercado. Issues: 1. Whether or not matters of employment of PNOC-EDC is within the jurisdiction of the labor arbiter and the NLRC. 2. Whether or not the labor arbiter and the NLRC are justified in ordering the reinstatement of the private respondent, payment of his savings, 13th month pay, and payment of damages as well as attorneys fees. Held: The High Court affirmed the resolution of the respondent NLRC with modification: reducing moral damages to P10000 and exemplary damages to P5000. 1. The test whether a government-owned or controlled corporation is subject to Civil Service Law is the manner of its creation. Those created by special charter are subject to its provision while those created under General Corporation Law are not within its coverage. The PNOC-EDC, having been incorporated under General Corporation Law, is subject to the provisions of the Labor Law.

2. PNOC-EDCs accusations are not supported by evidence. Loss of trust or breach of confidence is a valid ground for dismissing an employee, but such loss or breach must have some basis. LAKAS SA INDUSTRIYA NG KAPATIRANG HALIGI NG ALYANSA - PINAGBUKLOD NG MANGGAGAWANG PROMO NG BURLINGAME vs. BURLINGAME CORPORATION G. R. No. 162833, June 15, 2007 FACTS: Petitioner in this case sought to represent all rank-and-file promo employees of respondent. It alleged that said group of employees is not represented by a Union. So, they filed a petition for certification election before the Department of Labor and Employment. Respondent, however, opposed said petition on the ground that there exists no employer-employee relation between the parties. Respondent here further claimed that the employees sought to be represented by petitioner are not their employees but the employees of F. Garil Manpower Services, a duly licensed local employment agency. ISSUE: Whether or not there is employer-employee relationship between respondent and the employees sought to be represented by petitioner RULING: In deciding the instant petition, the Supreme Court stressed the "four-fold test" in determining the existence of employer-employee relationship. The elements to determine the existence of an employment relationship are: 1. the selection and engagement of the employee 2. the payment of wages 3. the power of dismissal and 4. the employer's power to control the employee's conduct The most important element is the last element. That is, the employer controls the conduct of an employee not only as to the result of the work to be done, but also as to the means and methods to accomplish it. It bears stressing that the facts of the case clearly indicate the existence of employeremployee relationship. The involvement of F. Garil, the employment agency, is limited only to the recruitment aspect. Furthermore, despite of the presence of an stipulation agreed into by the employment agency and herein respondent to the extent that the rank-and-file employees are considered as the employees of the former, the Supreme Court held that said contractual stipulation cannot override factual circumstances firmly establishing the legal existence of an employer-employee relationship.

Gregorio V. Tongko vs. The Manufacturers Life Insurance Co. (Phils.), Inc., G.R. No. 167622, June 29, 2010. The cited decision is the Courts ruling on a Motion for Reconsideration filed by the Manulife. FACTS OF THE CASE: The case arose from a complaint for illegal dismissal with various claims filed by Tongko against Manulife. Tongko alleged that he was an employee of the company since the latter exercised control over him. Of course, Manulife claims otherwise insisting that he was an agent. The Labor Arbiter dismissed the case not finding any employer-employee relationship. This was reversed by the NLRC. On appeal to the CA, the latter ruled in favor of Manulife finding no employeremployee relationship. Hence, Tongko appealed to the Supreme Court.

What the Supreme Court said: THE SUPREME COURTS ORIGINAL DECISION Central to the resolution of the Supreme Court in the appeal was the disquisition on the existence of employer-employee relationship. The significance of this finding is that if it is found that no such relationship exists, the labor courts have no jurisdiction over this case. The employer-employee relationship is established by the four-fold test, as follows: (a) the selection and engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employers power to control the employees conduct. The Supreme Court held that if the specific rules and regulations that are enforced against insurance agents or managers are such that would directly affect the means and methods by which such agents or managers would achieve the objectives set by the insurance company, they are employees of the insurance company. Applying said standard, the Court held that Tongko was an employee of Manulife since the latter had the power of control over the former. The Court accorded much weight on the various codes of conduct that Tongko had to observe pursuant to the agency agreement. It held: Thus, with the company regulations and requirements alone, the fact that Tongko was an employee of Manulife may already be established. Certainly, these requirements controlled the means and methods by which Tongko was to achieve the companys goals. More importantly, Manulifes evidence establishes the fact that Tongko was tasked to perform administrative duties that establishes his employment with Manulife. In short, the Supreme Court ruled in favor of Tongko which prompted Manulife to file its Motion for Reconsideration. THE MOTION FOR RECONSIDERATION In disposing of this Motion for Reconsideration, the Supreme Court placed heavy significance on the application of the Civil Code and Insurance provisions on agency. The original Agreement of Tongko with the company dictates that he is an insurance agent. No other documentary evidence was found to support subsequent stipulations as to their relationship that would negate the agency, and not employment, relationship on the original agreement. It was found by the Court that Tongko declared himself as business or self-employed person in his income tax return. In a sense, an independent contractor. This bolsters the content of the Agreement

mentioned above that he was an insurance agent in the context of the Insurance Code and the Civil Code. To the Court, this aspect of the evidence was not considered in its original decision, which had they been given importance, would have changed the decision as it is an admission against interest on the part of Tongko. Another principle that surfaced here is the concept of estoppel. Tongkos previous admissions in several years of tax returns as an independent agent, as against his belated claim that he was all along an employee, are too diametrically opposed to be simply dismissed or ignored. As to the value of the Code of Conduct relied upon by Tongko in claiming that he is an employee, the Court posits: What, to Tongko, serve as evidence of labor law control are the codes of conduct that Manulife imposes on its agents in the sale of insurance. The mere presentation of codes or of rules and regulations, however, is not per se indicative of labor law control as the law and jurisprudence teach us. As already recited above, the Insurance Code imposes obligations on both the insurance company and its agents in the performance of their respective obligations under the Code, particularly on licenses and their renewals, on the representations to be made to potential customers, the collection of premiums, on the delivery of insurance policies, on the matter of compensation, and on measures to ensure ethical business practice in the industry. Element of control in principal-agent relationship does not make the agent an employee of the principal. The general law on agency, on the other hand, expressly allows the principal an element of control over the agent in a manner consistent with an agency relationship. In this sense, these control measures cannot be read as indicative of labor law control. Foremost among these are the directives that the principal may impose on the agent to achieve the assigned tasks, to the extent that they do not involve the means and manner of undertaking these tasks. The law likewise obligates the agent to render an account; in this sense, the principal may impose on the agent specific instructions on how an account shall be made, particularly on the matter of expenses and reimbursements. To these extents, control can be imposed through rules and regulations without intruding into the labor law concept of control for purposes of employment. The Court further held that a commitment to abide by the rules and regulations of an insurance company does not ipso facto make the insurance agent an employee. Neither do guidelines somehow restrictive of the insurance agents conduct necessarily indicate control as this term is defined in jurisprudence. Guidelines indicative of labor law control, should not merely relate to the mutually desirable result intended by the contractual relationship; they must have the nature of dictating the means or methods to be employed in attaining the result, or of fixing the methodology and of binding or restricting the party hired to the use of these means. In fact, results-wise, the principal can impose production quotas and can determine how many agents, with specific territories, ought to be employed to achieve the companys objectives. These are management policy decisions that the labor law element of control cannot reach. Thus, as will be shown more fully , Manulifes codes of conduct, all of which do not intrude into the insurance agents means and manner of conducting their sales and only control them as to the desired results and Insurance Code norms, cannot be used as basis for a

finding that the labor law concept of control existed between Manulife and Tongko. Thus, the Court did not see the existence of such relationship and reversed its earlier ruling which granted Tongko millions in backwages and damages, among others. G.R. No. 155207: WILHELMINA S. OROZCO vs THE FIFTH DIVISION OF THE HONORABLE COURT OF APPEALS, PHILIPPINE DAILY INQUIRER, AND LETICIA JIMENEZ MAGSANOC 29 April 2005 / Labor Standards Employee-employer Relationship in a Publication Bond Requirement When Employer Appeals in a Labor Case Orozco was hired as a writer by the Philippine Daily Inquirer in 1990. She was the columnist of Feminist Reflections under the Lifestyle section of the publication. She writes on a weekly basis and on a per article basis (P250-300/article). In 1991, Magsanoc as the editor-in-chief sought to improve the Lifestyle section of the paper. She said there were too many Lifestyle writers and that it was time to reduce the number of writers. Orozcos column was eventually dropped. Orozco filed for a case for Illegal Dismissal against PDI and Magsanoc. Orozco won in the Labor Arbiter. The LA ruled that there exists an employer-employee relationship between PDI and Orozco hence Orozco is entitled to receive backwages, reinstatement, and 13th month pay. PDI appealed to the National Labor Relations Commission. The NLRC denied the appeal because of the failure of PDI to post a surety bond as required by Article 223 of the Labor Code. The Court of Appeals reversed the NLRC. ISSUE: Whether or not there exists an employer-employee relationship between PDI and Orozco. Whether or not PDIs appeal will prosper. HELD: Under Article 223 of the Labor Code: ART. 223. Appeal. Decisions, awards or orders of the Labor Arbiter are final and executory unless appealed to the Commission by any or both parties within ten (10) calendar days from receipt of such decisions, awards, or orders. In case of a judgment involving a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the Commission in the amount equivalent to the monetary award in the judgment appealed from. The requirement that the employer post a cash or surety bond to perfect its/his appeal is apparently intended to assure the workers that if they prevail in the case, they will receive the money judgment in their favor upon the dismissal of the employers appeal. It was intended to discourage employers from using an appeal to delay, or even evade, their obligation to satisfy their employees just and lawful claims. But in this case, this principle is relaxed by the Supreme Court considering the fact that the Labor Arbiter, in ruling that the Orozco is entitled to backwages, did not provide any computation.

The case is then remanded to the Labor Arbiter for the computation. This necessarily pended the resolution of the other issue of whether or not there exists an employer-employee relationship between PDI and Orozco.