Makati Haberdashery, Inc. vs. National Labor Relations Commission, G.R. Nos.

83380-81, November 15,1989Facts:

Individual complainants have been working for Makati Haberdashery, Inc. as tailors, seamsters, sewers,
basters and plantsadoras. They were paid on a piece-rate basis except the two who were paid on a monthly basis.
In addition to their piece-rate, they were given a daily allowance of three (P3.00) pesos provided they report for
work before 9:30 a.m. everyday. They were required to work from or before 9:30 a.m. up to 6:00 or 7:00 p.m. from
Monday to Saturday and during peak periods even on Sundays and holidays.
The Sandigan ng Manggagawang Pilipino filed a complaint for underpayment of the basic wage,
underpayment of living allowance, non-payment of overtime work, non-payment of holiday pay, and other money
claims.
The labor arbiter rendered judgement in favor of complainants which the NLRC affirmed.
Petitioner [employer] urged that the NLRC erred in concluding that an employer-employee relationship
existed between petitioner and the workers.
Issue:

Whether or not piece-rate workers are employees

Ruling:
The facts at bar indubitably reveal that the most important requisite of control is present. When a customer
enters into a contract with the haberdashery or its proprietor, the latter directs an employee who may be a tailor,
pattern maker, sewer or plantsadora to take the customers measurement and to sew the pants, coat or shirt as
specified by the customer. Supervision is actively manifested in all these acts the manner and quality of cutting,
sewing and ironing.
Petitioner has reserved the right to control its employees not only as to the result but also the means and
methods by which the same are to be accomplished. Unlike independent contractors who generally rely on their own
resources, the equipment, tools, accessories and paraphernalia used by the workers are supplied and owned by the
Haberdashery. The workers are totally dependent on the employer in all theses aspects.
Caurdanetaan Piece Workers Union vs. Undersecretary Bienvenido E. Laguesma and Corfarm Grains, Inc., G.R.
No. 113542, February 24, 1998
Facts:
The complainants worked as cargador at the warehouse and ricemills of private respondent Corfarm at
Umingan, Pangasinan since 1982. As cargadores, they loaded, unloaded and piled sacks of palay from the
warehouse to the cargo trucks and those brought by cargo trucks for delivery to different places. They were paid by
Corfarm on a piece-rate basis. When Corfarm denied them some benefits, they formed their union. Corfarm replaced
them with non-members of the union.
Respondent Corfamr denies that ut had the power to control over the complainants, rationalizing that they
were street-hired workers engaged from time to time to do loading and unloading work; there was no
superintendent-in-charge to give orders; and there were no gate passes issued, nor tools, equipment and
paraphernalia issued by Corfarm for loading/unloading. It attributes error to the solicitors generals reliance on
Article 280 [now 294] of the Labor Code. Citing Brent School, Inc. vs. Zamora (181 SCRA 702, February 5, 1990),
it asserts that a literal application of such article will result in absurdity, where petitioners members will be
regular employees not only of respondents but also of several other rice mills, where they allegedly also render
service. Finally, Corfarm submits that the OSGs position is negated by the fact petitioners members contracted for
loading and unloading services with respondent company when such work was available when they felt lik it x x x.
Issue:
Ruling:

Whether street-hired cargadores be considered as regular employees

The Court considers cargadores as regular employee. It is undeniable that petitioners members worked as
cargadores for private respondent. They loaded, unloaded and pile sacks of palay from the warehouses to the cargo
trucks and from the cargo trucks to the buyers. This work is directly related, necessary and vital to the operations of
Corfarm. Moreover, Corfarm did not even allege, much less prove, that petitioners members have substantial
capital or investment in the form of tools, equipment, machineries, and work premises among others. Furthermore,
said respondent did no contradict petitioners allegation that it paid wages directly to these workers without the
intervention of any third-party independent contractor. It also wielded the power of dismissal over petitioners; in
fact, its exercise of this power. Clearly, the workers are not independent contractors.

Ruga et. al vs. NLRC ,GR No. 72654-61, January 22, 1990
Facts:
Petitioners were the fishermen-crew members of 7/B Sandyman II, one of several fishing vessels owned
and operated by private respondent De Guzman Fishing Enterprises which is primarily engaged in the fishing
business with port and office at Camaligan, Camarines Sur. Petitioners rendered service aboard said fishing vessel in
various capacities, as follows: Alipio Ruga and Jose Parma patron/pilot; Eladio Calderon, chief engineer; Laurente
Bautu, second engineer; Jaime Barbin, master fisherman; Nicanor Francisco, second fisherman; Philip Cervantes
and Eleuterio Barbin, fishermen.
For services rendered in the conduct of private respondent's regular business of "trawl" fishing, petitioners
were paid on percentage commission basis in cash by one Mrs. Pilar de Guzman, cashier of private respondent. As
agreed upon, they received thirteen percent (13%) of the proceeds of the sale of the fish-catch if the total proceeds
exceeded the cost of crude oil consumed during the fishing trip, otherwise, they received ten percent (10%) of the
total proceeds of the sale. The patron/pilot, chief engineer and master fisherman received a minimum income of
P350.00 per week while the assistant engineer, second fisherman, and fisherman-winchman received a minimum
income of P260.00 per week.
On September 11, 1983 upon arrival at the fishing port, petitioners were told by Jorge de Guzman,
president of private respondent, to proceed to the police station at Camaligan, Camarines Sur, for investigation on
the report that they sold some of their fish-catch at midsea to the prejudice of private respondent. Petitioners denied
the charge claiming that the same was a countermove to their having formed a labor union and becoming members
of Defender of Industrial Agricultural Labor Organizations and General Workers Union (DIALOGWU) on
September 3, 1983.
During the investigation, no witnesses were presented to prove the charge against petitioners, and no
criminal charges were formally filed against them.
Notwithstanding, private respondent refused to allow petitioners to return to the fishing vessel to resume
their work on the same day, September 11, 1983.
On September 22, 1983, petitioners individually filed their complaints for illegal dismissal and nonpayment of 13th month pay, emergency cost of living allowance and service incentive pay, with the then Ministry
(now Department) of Labor and Employment, Regional Arbitration Branch No. V, Legaspi City, Albay. They
uniformly contended that they were arbitrarily dismissed without being given ample time to look for a new job.
Issue:
Whether or not the fishermen-crew members of the trawl fishing vessel 7/B Sandyman II are employees of its
owner-operator, De Guzman Fishing Enterprises.

Ruling:
Disputing the finding of public respondent that a "joint fishing venture" exists between private respondent
and petitioners, petitioners claim that public respondent exceeded its jurisdiction and/or abused its discretion when it
added facts not contained in the records when it stated that the pilot-crew members do not receive compensation
from the boat-owners except their share in the catch produced by their own efforts; that public respondent ignored
the evidence of petitioners that private respondent controlled the fishing operations; that public respondent did not
take into account established jurisprudence that the relationship between the fishing boat operators and their crew is
one of direct employer and employee.
We have consistently ruled that in determining the existence of an employer-employee relationship, the
elements that are generally considered are the following (a) the selection and engagement of the employee; (b) the
payment of wages; (c) the power of dismissal; and (d) the employer's power to control the employee with respect to
the means and methods by which the work is to be accomplished. 8 The employment relation arises from contract of
hire, express or implied. 9 In the absence of hiring, no actual employer-employee relation could exist.
From the four (4) elements mentioned, we have generally relied on the so-called right-of-control test where
the person for whom the services are performed reserves a right to control not only the end to be achieved but also
the means to be used in reaching such end. The test calls merely for the existence of the right to control the manner
of doing the work, not the actual exercise of the right.
The petition is GRANTED. The questioned resolution of the National Labor Relations Commission dated
May 30,1985 is hereby REVERSED and SET ASIDE. Private respondent is ordered to reinstate petitioners to their
former positions or any equivalent positions with 3-year backwages and other monetary benefits under the law. No
pronouncement as to costs.