University of the Philippines College of Law

AYA, E

Topic Non-Union Membership or Withdrawal from Membership as a condition of

Employment ("yellow-dog contract" or "iron-clad contract") - 259 (248) (b)
Case No. G.R. No. L-21696 / February 25, 1967
Case Name Visayan Stevedore (Vistranco) v. CIR
Ponente CONCEPCION, C.J.

RELEVANT FACTS

United Workers and Farmers Association (UWFA) is a labor organization which supplies workers to Visayan
Stevedoring Transportation Co. (Company). UWFA filed a complaint against for unfair labor practice against the
Company after the latter refused to engage the services of Venancio Dano-og, Buenaventura Agarcio and 137
other persons, allegedly because of their union activities. The Company argued that it had never had an employer-
employee relationship with the Complainants, the latter’s services having allegedly been engaged by the UWFA,
and that, in any event, whatever contractual relation there may have been between the Company and the
Complainants had ceased at the end of each milling season.

ISSUE AND RATIO DECIDENDI

Issue Ratio
W/N there is an employer- There was no independent contract between UWFA and the Company.
employee relationship Complainants merely reported for work at the beginning of each milling
between the Complainants season, and their services were invariably availed of by the Company, although
and UWFA – YES. an officer of the UWFA determined the laborers who would work at a given
time, following a rotation system arranged therefor.

In the performance of their duties, Complainants worked under the direction

and control of the officers of the Company, who paid the corresponding
compensation directly to said Complainants, who, in turn, acknowledged
receipt in payrolls of the company. Laborers working under these conditions
are employees of the Company in the same manner as watchmen or security
guards furnished by watchmen or security agencies, inasmuch as the agencies
and/or labor organizations involved therein merely performed the role of a
representative or agent of the employer in the recruitment of men needed for
the operation of the latter’s business.

At the conclusion of each milling season, it is settled that the workers are
considered merely on leave of absence, without pay, and their employer-
employee relationship merely deemed suspended.

W/N the Company The workers not admitted to work were precisely those belonging to the
committed unfair labor UWFA. Xaudaro, the Company branch manager, had told them point
practice – YES. blank that severance of their connection with the UWFA was the remedy,
if they wanted to continue working with the Company.

RULING
 University of the Philippines College of Law
AYA, E

WHEREFORE, the order and resolution appealed from are hereby affirmed, with costs against petitioners
herein. It is so ordered.