Cosmopolitan

vs.
Maalat and NLRC
G.R. No. 84484 November 15, 1989
By Richard Troy A. Colmenares
USA College of Law
Start: 6/25/14 11:28:00 PM
Finish: 6/26/14 12:37:31 AM
Nature of the Case
A petition for certiorari seeking to annul the decision of NLRC that there exists employer-employee relationship between the parties.

Facts
Maalat was engaged sometime in 1962 as a supervisor selling funeral services and was paid by petitioner Cosmo on commission basis for
the amounts he has collected and remitted. Maalat was dismissed on 15 January 1987 for violation of certain conditions despite him being
forewarned. He thereafter filed a complaint of illegal dismissal seeking for payment of his commissions which was granted by the labor
arbiter, ordering petitioner to pay separation pay, commission, interests and attorneys fees totaling to P 205,571.52. On appeal before the
NLRC, the labor arbiters decision was modified declaring the dismissal of Maalat as valid and remanding the case to the Regional Arbitration
in consideration of his monetary claims in accordance with NLRCs decision over the case, which has ordered petitioner to pay Maalat
separation pay equivalent to one-half (1/2%) month average income for every year of service by way of equitable relief and in the interest
of social and compassionate justice. Petioners motion for reconsideration was fatal. Thus, this petition.

Issue(s)
(1). Is there employer-employee (E2e) relationship between the parties?
(2). Is there equitable basis for the separation pay?

Held
(1). Yes.

Pertinent to determining E2e relationship is the right of control test. Under this test, an employer-employee relationship exists
where the person for whom the services are performed reserves the right to control not only the end to be achieved, but also the
manner and means to be used in reaching that end.

The petitioners argument that Maalats work is approximated to that of an independent contractor is bereft of merit for the facts, as
aptly considered by NLRC, disclose that: (1) petitioner failed to overcome NLRCs factual finding that E2e relationship existed; (2)
that it had prohibitive rules which subject Maalat to control despite petitioners allegation that these rules had no direct bearing on
the means and methods ordinarily required of a supervisor; (3) petitioner failed to show proof that indeed a mere contract of agency
existed; that in fact Maalat needs to be on the job most of the time as people die at all times of the day or night; and (4) Maalat was
covered as an employee under the SSS. All of which satisfy the control test.

Maalat, paid on commission basis, does not belie his status was not an employee.

(2). No.

The Court cannot disturb the findings of NLRC that Maalat was indeed dishonest in the discharge of his duties. Additionally, Maalat
did not appeal NLRCs decision that he was validly dismissed, thereby impliedly accepting the validity of his dismissal. Thus, the
court takes exception on the award of separation pay.

A grant for separation pay to employee who has been validly dismissed for dishonesty finds no legal basis. As held in PLDT vs.
NLRC:
[S]eparation pay shall be allowed as a measure of social justice only in those instances where the employee is validly
dismissed for causes other than serious misconduct or those reflecting on his moral character. Where the reason for the
valid dismissal is, for example, habitual intoxication or an offense involving moral turpitude, like theft or illicit sexual
relations with a fellow worker, the employer may not be required to give the dismissed employee separation pay, or
financial assistance, or whatever other name it is called, on the ground of social justice.

A contrary rule would, as the petitioner correctly argues, have the effect of rewarding rather than punishing the erring
employee for his offense. xxx

The policy of social justice is not intended to countenance wrongdoing simply because it is committed by the
underprivileged. At best it may mitigate the penalty but it certainly will not condone the offense. Compassion for the poor is
an imperative of every humane society but only when the recipient is not a rascal claiming an undeserved privilege xxx

The further proceedings conducted by the labor arbiter computing the separation pay and unpaid commission of Maalat is hereby
modified, ordering petitioner to pay only the unpaid commissions of Maalat and 2% interest for interest attorneys fees.




Cosmopolitan
vs.
Maalat and NLRC
G.R. No. 84484 November 15, 1989
By Richard Troy A. Colmenares
USA College of Law
Start: 6/25/14 11:28:00 PM
Finish: 6/26/14 12:37:31 AM