LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

Parties

& Business of the Duty of the Is

Case no.

company

worker

there Final disposition

employeremployee

relationship?
1.
Insular Insurance
To
solicit None employer- None
of
the
rules
and
Life
company with within
the employee
regulations provided for in the
Assurance
business
to Philippines
relationship. In Insurance Code can justifiably
vs.

NLRC, solicit

G.R. 84484

within applications

determining

the Philippines for insurance the existence of

applications for policies
insurance
policies
annuities.

and employer-

annuities,
and however

relationship,
four the following

years

later, elements are

parties generally

entered

into considered,

another
contract
(Agency
Manager's
Contract)

said

to

establish

an

employer-employee
relationship.

employee

Some
the

be

Rules and regulations governing

the conduct of the business are
provided for in the Insurance
Code

and

enforced

by

the

Insurance Commissioner. It is

namely: (1) the usual and

selection and insurance

expected
company

for

an
to

engagement of promulgate a set of rules to guide

the employee; its commission agents in selling
(2)
1

the its policies that they may not run

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

wherein

payment

Basiao

wages; (3) the requires or prohibits. But none of

organized his power

own
or

of afoul of the law and what it

of these really invades the agent's

agency dismissal; and contractual prerogative to adopt

office, (4) the power to his own selling methods or to sell

while

control

concurrently

employees'

fulfilling

the insurance at his own time and

his conduct

commitment

although

s under the latter

is

convenience,

hence

cannot

justifiably be said to establish an

the employer-employee

relationship

the between him and the company.

first contract most important

with

the element.

Company.

Length of stay in Insurance

Company does not determine
employment

relationship

What is germane is Basiao's

status under the contract of July
2, 1968, not the length of his
relationship with the Company to
justify employment relationship.
Basiao was not an employee but
2

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

a

commission

independent

agent,

contractor

an
whose

claim for unpaid commissions

should have been litigated in an
2.

Insular Insurance

Life

company

Assurance

business

vs.

NLRC, solicit

ordinary civil action.

Entered into Yes, employer- It is axiomatic that the existence
with n

agency employee

of

to contract with relationship

within Pantaleon de exist

G.R. 119930 the Philippines los

Reyes case.

in

an

employer-employee

relationship cannot be negated by

this expressly repudiating it in the

management

contract

applications for authorizing

providing

therein

insurance

"employee"

is

policies
annuities.

him To solicit
and within

the

an

that

and
the

independent

contractor when the terms of the

Philippines

agreement

applications

otherwise. For, the employment

for insurance

status of a person is defined and

policies

prescribed by law and not by

and

annuities.

clearly

show

what the parties say it should

be. 7 In determining the status of
the management contract, the
"four-fold test" on employment
3

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

earlier

mentioned

has

to

be

applied.
Exclusivity of service, control of
assignments
agents

and

removal

under

of

private

respondent's unit, collection of

premiums,

furnishing

of

company facilities and materials

as well as capital described as
Unit Development Fund are but
hallmarks of the management
system in which herein private
respondent

worked.

This

obtaining, there is no escaping

the

conclusion

respondent

that

Pantaleon

private
de

los

Reyes was an employee of herein

petitioner.
3. Jardin vs. Domestic

Used to drive Yes, employer- The

4

relationship

between

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

NLRC
119268

GR. corporation

the

taxi

of employee

operators and drivers under the

engaged in the the

relationship

operation

exist

of respondents

Goodman Taxi.

in

boundary

system

this employer-employee

is
and

that

of

not

of

on a 24 hour case.

lessor-lessee as argued by the

work

NLRC.

schedule

explained that in the lease of

under

the

chattels,

boundary
system

The

court

the

already

lessor

loses

complete control over the chattel

and

leased although the lessee cannot

they

would

be reckless in the use thereof,

earn

an

average
400

otherwise

of

he

would

be

responsible for the damages to

day.

the

lessor.

In

the

case

of

Nevertheless,

operators and drivers, the former

the

exercise supervision and control

respondent

over the latter. The management

admittedly

of the business is in the owners

regularly

hand. The owner as holder of the

deducts from

certificate of public convenience

the

must see to it that the drivers

petitioners

follow the route prescribed by the

5

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

daily
earnings

franchising authority. The fact

30

that the drivers do not received

pesos for the

fixed salary but get only that

washing

excess of the boundary is not

the

of
taxi

sufficient

units.

to

withdraw

the

relationship between that of the

employer-employee. This is based
in the four fold test provided to
determine the relationship, to
wit:

(1)

the

selection

and

engagement of the employee; (2)

the payment of wages; (3) the
power of dismissal; and (4) the
power to control the employee's
conduct, or the so-called "control
test." Of these four, the last one
is the most important. The socalled" control test" is commonly
regarded as the most crucial and

determinative

indicator

of

the

presence

absence

of

an

or

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

employer-employee
Since

the

already

relationship.

relationship
determined

was
the

termination of employment was

illegal for it did not comply with
the

notice

and

hearing

prior

termination and further there

was

no

just

cause

for

such

termination. In the issue of the

washing fee, the court held that
it was a valid deduction. It is
incumbent upon the driver to
restore the unit he has driven to
the same clean condition when
4.

Manila Manila

Golf vs. IAC and

GR.
64948

Golf Caddies
Country Manila

NO. Club,

Golf employer-

the facts logically point to the

of There

a and Country employee

domestic

Club-

corporation

PTCCEA

doing

is

he took it out.
no The Court does not agree that

relationship.

employer-employee

relationship.

In the very nature of things,

caddies must submit to some

golf

supervision
7

of

their

conduct

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

business
Golf

for Caddies

while enjoying the privilege of

members claims

and
players.

pursuing their occupation within

Golf availment

of

the premises and grounds of

of

whatever club they do work in.

Social

They work for the club to which

benefits
the

Security Act

they

attach

sufferance

themselves

but,

on

the

on
other

hand, also without having to

observe any working hours, free
to leave anytime they please, to
stay away for as long they like.
These

considerations

frontally

with

the

clash

concept

of

employment. It can happen that

a

caddy

who

has

rendered

services to a player on one day

may still find sufficient time to
work

elsewhere.

Under

such

circumstances, the caddy may

leave the premises and to go to
such other place of work that he
8

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

wishes. These are things beyond
5.

AFP Insurance

Mutual

business

Private

the control of the petitioner.

No employment The
significant
factor

respondent

relationship

Benefit

VS.

was hired by had

NLRC

GR.

the

102199

herein existed

petitioner as between
Sales Agent

parties.

in

determining the relationship of

ever the parties is the presence or

absence of supervisory authority
the to control the method and the
details of performance of the
service being rendered, and the
degree to which the principal
may intervene to exercise such
control. The presence of such
power of control is indicative of
an

employment

while

absence

indicative

of

relationship,
thereof

is

independent

contractorship. In other words,

the

test

existence

to
of

determine

the

independent

contractorship is whether one

claiming to be an independent
9

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

contractor has contracted to do
the work according to his own
methods

and

without

being

subject to the control of the

employer except only as to the
result

of

exactly

the
the

relationship

work. Such
nature

between

of

is
the

petitioner

and private respondent.

The "control" which the above
factors indicate did not sum up
to the power to control private
respondent's

conduct

in

and

mode of soliciting insurance. On

the contrary, they clearly indicate
that

the

juridical

element

of

control had been absent in this

situation. Thus, the Court is
constrained
employment
10

to

rule

that

relationship

no
had

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

ever existed between the parties.

6.

Jose Radio

Sonza

vs. Television

ABS-CBN
GR.
138051

and SONZAs

NO.

Broadcasting.

There

services

is

employer-

no Applying the control test, SONZA

is

not

an

employee

but

an

exclusively to employee

independent

ABS-CBN as relationship.

greater

talent

for

control the hirer exercises, the

radio

and

more likely the worker is deemed

television.

the

contractor. The
supervision

and

an employee. The converse holds

true as well the less control the
hirer exercises, the more likely
the

worker

is

considered

an

independent contractor.
ABS-CBN did not exercise control
over the means and methods of
performance of SONZAs work. It
did not assign any other work to
SONZA. To perform his work,
SONZA only needed his skills
11

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

and talent. SONZA had a free
hand on what to say or discuss
in his shows provided he did not
attack ABS-CBN or its interests.
ABS-CBN was not involved in the
actual

performance

that

produced the finished product of

SONZAs work. It did not instruct
SONZA how to perform his job.
ABS-CBN merely reserved the
right

to

modify

the

program

format and airtime schedule. Its

sole concern was the quality of
the shows and their standing in
7. Besa vs. Doing business Petitioners
Trajano GR. under
NO. 72409

the are

There

is

shoe employer

the ratings.
no The shoe shiner is distinct from a
piece worker because while the

name and style shiners paid employee

latter

of

accomplished,

BESA'S on

a relationship

is

paid
he

for
does

work
not,

CUSTOMBUILT commission

however, contribute anything to

SHOES

the capital of the employer other

basis
12

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

than

his

service.

It

is

the

employer of the piece worker who

pays his wages, while the shoe
shiner in this instance is paid
directly by his customer. The
piece worker is paid for work
accomplished without regard or
concern to the profit as derived
by his employer, but in the case
of the shoe shiners, the proceeds
derived from the trade are always
divided share and share alike
with respondent BESA.
The most important condition to
be considered is the exercise of
control and supervision over the
employees, per our conversation,
the

persons

concerned

under

your query are the shoe shiners

and
13

based

on

the

decision

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

rendered

by

Associate

Judge

Emiliano Tabigne of the defunct

Court

of

Industrial

these

shoe

Relations,

shiners

are

not

employees of the company, but

are partners instead. This is due
to

the

fact

that

the

owner/manager does not exercise

control and supervision over the
shoe shiners. That the shiners
have their own customers from
whom they charge the fee and
divide the proceeds equally with
the owner, which make the owner
categorized them as on purely
commission basis. The attendant
circumstances clearly show that
there is no employer-employee
relationship existing, and such
the owner/manager is not by law,
under obligation to extend to
14

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

those

on

purely

commission

basis the benefit of Wage Order

No. 2. However, the law does not
preclude the employer in giving
such benefit to all its employees
including those which may not be
covered by the mandate of the
law.
8. Francisco Corporation
vs.

NLRC

GR.
170087

NO.

Francisco

There

is

an The

determination

of

was hired by existing

relationship

Kasei

employer

and employee depends upon the

Corporation

employee

circumstances

as

relationship

economic activity, such as: (1) the

of

which

employer

the
the

whole

Accountant

extent

and

performed are an integral part of

Corporate

the employers business; (2) the

Secretary

extent of the workers investment

and

to

between

the

services

was

in equipment and facilities; (3)

assigned

to

the nature and degree of control

handle

all

exercised by the employer; (4) the

15

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

the

workers opportunity for profit

accounting

and loss; (5) the amount of

needs of the

initiative,

company.

foresight required for the success

She was also

of

designated

enterprise; (6) the permanency

as

and duration of the relationship

Liaison

the

skill,
claimed

or

independent

Officer to the

between

City

employer; and (7) the degree of

of

Makati.

the

judgment

worker

and

the

dependency of the worker upon

the employer for his continued

Years

later,

she

employment

was

in

that

line

of

business.

designated
Acting

In this case, Francisco is an

Manager

employee of Kasei Corporation

because she was under the direct
control and supervision of Seiji
Kamura,

the

corporations

Technical

Consultant.

She

reported for work regularly and

16

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

served in various capacities with
substantially
functions,

the

that

same

is,

job

rendering

accounting and tax services to

the

company

functions

and

performing

necessary

and

desirable for the proper operation

of

the

corporation.

The

corporation hired and engaged

Francisco for compensation, with
the power to dismiss her for
cause.

More

importantly,

the

corporation had the power to

control Francisco with the means
and methods by which the work
is

is to be accomplished.
no Evidence point to the fact that he

as employer-

is not an employee of Marling

9. Restituto Rice Mill

Palomado

There

Palomado

hired

VS.

NLRC

truck driver

GR.

NO.

employee

Rice

relationship

precondition of illegal dismissal is

96520

Mill.An

the prior
17

indispensable

existence

of

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

an employer-employee
relationship; in this case, since it
was established that there was
no

such

relationship

between

petitioner and private respondent

Tan, therefore, the allegation of
illegal dismissal does not

have

any leg to stand on. The claims

for back wages, separation pay
and other benefits must likewise
10.

Airline

Philippine

Business

Synergy

Synergy

fail
In this case, the work performed

(as Services

Services

Corp by the respondents were directly

Air Line vs. owner)

Corp

Ligan

contractor)

GR.

NO. 146408

entered

(as is a labor only related to the main business

contractor.

into Employer-

of PAL. Also, the equipment used

as

station

loaders

such

as

an

employee

trailers and conveyors were all

Agreement

relationship

owned by PAL.PAL and Synergy

where

the exist.

also failed to substantiate their

latter

claim

undertook to

substantial
18

that

the
capital,

latter

had

and

only

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

provide

after

loading,

rendered did it try to prove such

unloading,

fact.

delivery and

respondents worked

other related

alongside PALs regula

services.

r employees who performed the

It

the

CA

It

decision

was

found

was
that

was

same work.PAL tried to disprove

expressly

the its right to control; however,

stated

that

the

Court

found

that

the

Synergy was

Agreement

an

stipulated

independent

shall comply with the owners

contractor

rules,

and that no

and directives.

employer-

PAL in fact

employee

admitted that it fixes the work

relationship

schedule of respondents. Also,

would

PALs managers and supervisors

exist

between

its

19

contractor
procedures,

respondents

work assignments

and PAL.

the

regulations,

approved

employees

that

weekly

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

and were referred to as station
Ligan

et

laborer

al

attendants

of

of cargo operation and airfreight

Synergy

services

of

PAL.

Services

having performed tasks which

Corp.

are

usually

Respondents

necessary

desirable

and

in

air transportation

the

business

of

PAL, they should be deemed its

regular employees and Synergy
as a labor-only contractor. The
Court

ordered

respondents
employees,
benefits

PAL

to

as
pay

due,

accept
regular

wages
plus

and
salary

differentials. Case remanded to

LA for determination of monetary
liabilities.
11.

Almeda a

domestic Asahi

vs. Asahi GR corporation

entered

Employerinto employee
20

An

important

element

of

legitimate job contracting is that

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

.
177785

NO. engaged in the a

business

service relationship

of contract

the contractor has substantial

on exist

capital

or

investment,

which

5,

respondent failed to prove. There

with

is a dearth of evidence to prove

glass

March

manufacturing

2002

San

that SSASI possessed substantial

Sebastian

capital

Allied

respondent

Services, Inc.

relations with it more than a

(SSASI)

decade before 2003. The court

whereby

the

or

investment
began

when

contractual

did not find a single financial

latter

statement or record to attest to

undertook to

the

provide

the

financial capacity of SSASI to

former

with

venture into and sustain its own

economic

status

Randy

business

Almeda,

petitioner.

Edwin

Furthermore,

Audencial,

unconvinced

Nolie

argument that petitioners were

Ramirez and

performing jobs that were not

Ernesto

directly r
21

independent

and

the
by

Court

from
is

respondents

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

Calicagan as

elated

glass cutters,

to

and

business. Respondent is engaged

petitioner

in glass manufacturing. One of

Reynaldo

the petitioners serve as a quality

Calicagan as

controller, while the rest were

Quality

glass

Controller, all

indispensability

assigned

services

to

respondents

main

line

cutters.
was

of

of

The
petitioners

fortified

by

the

work for

length and

respondent

continuity of their performance,

Asahi.

lasting for periods ranging from

three to 11 years
The court has already declared
that petitioners employment as
quality

controllers

and

glass

cutters are directly related to

the usual business or trade of

22

respondent

as

manufacturer.

Petitioners

glass
have

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

worked for respondent for not
less than three years and as
much

as

continued

11

years,

employment

demonstrates

its

their
clearly

continuing

necessity and indispensability to

the

business

raising

their

regular

status.

of respondent,
employment
Thus,

to

having

gained regular status, petitioners

were entitled to security of tenure
and could only be dismissed on
just or authorized causes and
after they had been accorded due
process. The sole reason given for
the dismissal of petitioners by
SSASI was the termination of its
service contract with respondent.
But since SSASI was a labor-only
contractor, and petitioners were
to be deemed the employees of
23

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

respondent, then the said reason
would not
constitute a just or authorized
cause for petitioners dismissal
12.

domestic Hired

Southeast

corporation

internationa

engaged in the machine

l Rattan vs. business

sizing
of operator

as Employer-

To ascertain the existence of an

employee

employer-employee

relationship

jurisprudence

exist

adhered to the four-fold test, to

wit:

NO. 186621

engagement of the employee; (2)

exporting

furniture

to

the

invariably

Coming GR. manufacturing

and

(1)

has

relationship

selection

and

the payment of wages; (3) the

various

power of dismissal; and (4) the

countries

power to control the employees

conduct, or the so-called "control
test." In resolving the issue of
whether such relationship exists
in

given

case,

evidence

that

relevant

evidence

substantial
amount

of

which

reasonable mind might accept as

24

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

adequate to justify a conclusion
is

sufficient.

Although

no

particular form of evidence is

required to prove the existence of
the

relationship,

and

any

competent and relevant evidence

to prove the relationship may be
admitted,

relationship

finding

that

exists

the
must

nonetheless rest on substantial

evidence.
13.

Pioneer PIL

Concrete

is

corporation

a PIL

VS. duly organized to

Todaro

GR. and

does not

principally

engaged in the services

which

may

reference

is consented to
engage

relationship exists between the

exist parties and no issue is involved

the in this case

Australia former

and

that where no employer-employee

an relationship

existing agreement

under the laws wherein

of

this Court has consistently held

Todaro came employee

Phil.

NO. 154830

and Employer-

other

to

labor

be

resolved

the

Labor

statutes

or

by

Code,
any

the

collective bargaining agreement,

of

it is the Regional Trial Court that

25

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

ready-mix
concrete

the latter as

has jurisdiction. In the present

and a consultant

concrete

for

aggregates

three

two

case,

to

no

relationship

employer-employee
exists

between

petitioners and respondent. In

business; PPHI months, after

fact, in his complaint, private

is the company which,

he

respondent is not seeking any

established by would

be

relief under the Labor Code, but

PIL to own and employed as

seeks payment of damages on

hold the stocks the manager

account

of its operating of

breach of their obligation under

PIL's

of petitioners' alleged

company in the ready-mix

their agreement to employ him. It

Philippines;

is settled that an action for

PCPI

is

company

concrete
the operations

breach of contractual obligation

should

is intrinsically a civil dispute. In

the

established by company

the alternative, respondent seeks

PIL

to decide

undertake

its invest in the

business

to

redress

on

the

basis

of

the

provisions of Articles 19 and 21

of Philippines

of the Civil Code. Hence, it is

ready-mix

clear that the present action is

concrete,

within the realm of civil law, and

concrete

jurisdiction over it belongs to the

26

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

aggregates and

regular courts.

quarrying
operations

in

the Philippines
14. De leon Liquor

Moises

vs.

Leon

GR.
70705

NLRC industries
NO.

De Employerwas employee

An

employment

regular

when

is
the

deemed
activities

employed by relationship

performed by the employee are

La

Tondea exist

usually necessary or desirable in

on

the usual business or trade of

Inc.
December

the

employer

11, 1981, at
the

1. An employment is deemed

Maintenance

regular

Section of its

performed by the employee are

Engineering

usually necessary or desirable in

Department

the usual business or trade of

in

the

Tondo,

Manila.

when

the activities

employer.

His

work

2. Not considered regular are the

consisted

so-called

mainly

of

"project

employment"

the completion or termination of

27

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

painting

which

company

determinable

at

building and

employment,

such

equipment,

employed in connection with a

and

other

particular

odd

jobs

and seasonal employment which

to

by its nature is only desirable for

relating

is

or

the

time
as

construction

of

those
project

He was paid

However, any employee who has

on

rendered at least one year of

daily

period

less

maintenance.
a

limited

more

of

time.

basis

service, whether continuous or

through

intermittent, is deemed regular

petty

cash

with respect to the activity he

vouchers.

performed

and

while

activity

actually

such
exists.

3. In the case at bar, during De

Leons period of employment, the
records reveal that the tasks
assigned to him included not
only
28

painting

of

company

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

buildings, equipment and tools
but

also

cleaning

machines,

even

and

oiling

operating

drilling machine, and other odd

jobs assigned to him when he
had no painting job. A regular
employee

of

the

company,

Emiliano Tanque Jr., attested in

his affidavit that De Leon worked
with him as a maintenance man
when

there

was

no

painting

job. The

painting

and

maintenance

work

him

given

manifest a treatment consistent

with a maintenance man and not
just a painter, for if his job was
truly only to paint a building
there would have been no basis
for

giving

him

other

work

assignments In between painting

activities.
29

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

4. De Leon performed his work of

painting

and

maintenance

activities for more than one year,

until early January, 1983 when
he demanded to be regularized
and was subsequently dismissed.
Certainly, by this fact alone he is
entitled by law to be considered a
regular

employee.

And

considering further that weeks

after his dismissal, De Leon was
rehired by the company through
a labor agency and was returned
to his post in the Maintenance
Section and made to perform the
same activities that he used to
do, it cannot be denied that as
activities as a regular painter and
maintenance

30

man

still

exist.

LABOR STANDARDS (EMPLOYER- EMPLOYEE RELATIONSHIP)

5. Whether a certain employment
is regular or casual is not the will
and word of the employer, to
which the desperate worker often
accedes, much less the procedure
of hiring the employee or the
manner of paying his salary. It is
the nature

of

performed in
particular

the

activities

relation

to

business

trade considering
circumstances,

the
or
all

and

in

some

cases the length of time of its

performance and its continued
existence.

31