Jose Y. Sonza V.

ABS-CBN Broadcasting Corporation

G.R. No. 138051, 10 June 2004, First Division, (Carpio, J.)

Individuals with special skills, expertise or talent enjoy the freedom to offer their services as independent
contractors.
The right to life and livelihood guarantees this freedom to contract as independent contractors. The right
of labor to security of tenure cannot operate to deprive an individual, possessed with special skills,
expertise and talent, of his right to contract as an independent contractor.

In May 1994, respondent ABS-CBN signed an “Agreement” with the Mel and Jay Management and
Development Corporation (MJMDC”) represented by Jose Y. Sonza and Carmela Tiangco. Referred to in
the Agreement as “AGENT,” MJMDC agreed to provide SONZA’s services exclusively to ABS-CBN as
talent for radio and television.

On 1 April 1996, SONZA wrote a letter to ABS-CBN’s President, Eugenio Lopez III, saying that he
irrevocably resigns in view of recent events concerning his programs and career. The acts of the station
are violative of the Agreement and said letter will serve as notice of rescission of said contract. The letter
also contained the waiver and renunciation for recovery of the remaining amount stipulated but reserves
the right to seek recovery of the other benefits under said Agreement.

On 30 April 1996, SONZA filed a complaint against ABS-CBN before the DOLE-NCR Q.C.. SONZA
complained for none payment of his salaries, separation pay, service incentive leave pay, 13th month pay,
signing bonus, travel allowance and amounts due under the Employees Stock Option Plan)”ESOP”).
ABS-CBN filed a Motion to Dismiss on the ground that no employee-employer relationship existed
between the parties.

The Labor Arbirter denied the motion to dismiss by respondents but later dismissed the complaint
for lack of jurisdiction. SONZA appealed to the NLRC but it affirmed the Labor Arbiter’s decision.
SONZA filed a motion for reconsideration, which the NLRC also denied. The Court of Appeals affirmed
the Decision. Hence, this petition.

ISSUE:

Whether or not there exist an employer-employee relationship between Sonza and ABS-CBN

HELD:

There is no employer-employee relationship between Sonza and ABS-CBN. Petition denied.

Judgment decision affirmed.

Independent contractors often present themselves to possess unique skills, expertise or talent to
distinguish them from ordinary employees. The specific selection and hiring of SONZA, because of his
unique skills, talent and celebrity status not possessed by ordinary employees, is a circumstance
indicative, but not conclusive, of an independent contractual relationship. In any event, the method of
selecting and engaging SONZA does not conclusively determine his status. The Court must consider all
the circumstances of the relationship, with the control test being the most important element.
The payment of talent fees directly to SONZA and not to MJMDC does not negate the status of SONZA
as an independent contractor. The parties expressly agreed on such mode of payment. Under the
Agreement, MJMDC is the AGENT of SONZA, to whom MJMDC would have to turn over any talent fee
accruing under the Agreement. Applying the control test, SONZA is not an employee but an independent
contractor. SONZA’s contention that ABS-CBN exercised control over the means and methods of his
work is misplaced. To perform his work, SONZA only needed his skills and talent. How SONZA delivered
his lines, appeared on television, and sounded on radio were outside ABS-CBN’s control. The clear
implication is that 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’s right not to broadcast SONZA’s show, burdened as it was by the obligation to continue
paying in full SONZA’s talent fees, did not amount to control over the means and methods of the
performance of SONZA’s work. This proves that ABS-CBN’s control was limited only to the result of
SONZA’s work, whether to broadcast the final product or not. In either case, ABS-CBN must still pay
SONZA’s talent fees in full until the expiry of the Agreement.

The equipment, crew and airtime are not the “tools and instrumentalities” SONZA needed to perform his
job. What SONZA principally needed were his talent or skills and the costumes necessary for his
appearance. A radio broadcast specialist who works under minimal supervision is an independent
contractor. SONZA’s work as television and radio program host required special skills and talent, which
SONZA admittedly possesses. The records do not show that ABS-CBN exercised any supervision and
control over how SONZA utilized his skills and talent in his shows.

The Agreement stipulates that SONZA shall abide with the rules and standards of performance “covering
talents” of ABS-CBN. The Agreement does not require SONZA to comply with the rules and standards of
performance prescribed for employees of ABS-CBN. The code of conduct imposed on SONZA under the
Agreement refers to The KBP code applies to broadcasters, not to employees of radio and television
stations. Broadcasters are not necessarily employees of radio and television stations. Clearly, the rules
and standards of performance referred to in the Agreement are those applicable to talents and not to
employees of ABS-CBN.

SONZA failed to show that “Television and Radio Code of the Kapisanan ng mga Broadcaster sa
Pilipinas (KPB),” which has been adopted by the COMPANY (ABS-CBN) as its Code of Ethics, controlled
his performance. The general rules are merely guidelines towards the achievement of the mutually
desired result, which are top-rating television and radio programs that comply with standards of the
industry.

Being an exclusive talent does not by itself mean that SONZA is an employee of ABS-CBN. Even an
independent contractor can validly provide his services exclusively to the hiring party. In the broadcast
industry, exclusivity is not necessarily the same as control. The hiring of exclusive talents is a widespread
and accepted practice in the entertainment industry. This practice is not designed to control the means
and methods of work of the talent, but simply to protect the investment of the broadcast station. The huge
talent fees partially compensates for exclusivity, as in the present case.

Individuals with special skills, expertise or talent enjoy the freedom to offer their services as independent
contractors. The right to life and livelihood guarantees this freedom to contract as independent
contractors. The right of labor to security of tenure cannot operate to deprive an individual, possessed
with special skills, expertise and talent, of his right to contract as an independent contractor. An individual
like an artist or talent has a right to render his services without any one controlling the means and
methods by which he performs his art or craft. If radio and television program hosts can render their
services only as employees, the station owners and managers can dictate to the radio and television
hosts what they say in their shows. This is not conducive to freedom of the press.
SONZA’s claims are all based on the May 1994 Agreement and stock option plan, and not on the Labor
Code. Clearly, the present case does not call for an application of the Labor Code provisions but an
interpretation and implementation of the May 1994 Agreement. In effect, SONZA’s cause of action is for
breach of contract which is intrinsically a civil dispute cognizable by the regular courts.

Javier vs Fly ace

PETITIONER Bitoy Javier alleged that he was an employee of respondent Fly Ace Corp., performing
various tasks at its warehouse such as cleaning and arranging the canned items before their delivery to
certain locations, except in instances when he would be ordered to accompany the company’s delivery
vehicles as pahinante. To support his claim, Javier adduced no other evidence except an affidavit
executed by one Bengie Valenzuela, who only attested that he would frequently see Javier at the
workplace where he was also hired as stevedore. Does Javier’s evidence suffice to establish employer-
employee relationship between Fly Ace and him?

Ruling: No.

Expectedly, opposing parties would stand poles apart and proffer allegations as different as chalk and
cheese. It is, therefore, incumbent upon the Court to determine whether the party on whom the burden to
prove lies was able to hurdle the same. “No particular form of evidence is required to prove the existence
of such employer-employee relationship. Any competent and relevant evidence to prove the relationship
may be admitted. Hence, while no particular form of evidence is required, a finding that such relationship
exists must still rest on some substantial evidence. Moreover, the substantiality of the evidence depends
on its quantitative as well as its qualitative aspects.” Although substantial evidence is not a function of
quantity but rather of quality, the x x x circumstances of the instant case demand that something more
should have been proffered. Had there been other proofs of employment, such as x x x inclusion in
petitioner’s payroll, or a clear exercise of control, the Court would have affirmed the finding of employer-
employee relationship.”

In sum, the rule of thumb remains: the onus probandi falls on petitioner to establish or substantiate such
claim by the requisite quantum of evidence. “Whoever claims entitlement to the benefits provided by law
should establish his or her right thereto x x x.”

In this case, the labor arbiter and the Court of Appeals (CA) both concluded that Javier failed to establish
his employment with Fly Ace. All that Javier presented were his self-serving statements purportedly
showing his activities as an employee of Fly Ace. He failed to pass the substantiality requirement to
support his claim. Hence, the Court sees no reason to depart from the findings of the CA.

While Javier remains firm in his position that as an employed stevedore of Fly Ace, he was made to work
in the company premises during weekdays arranging and cleaning grocery items for delivery to clients, no
other proof was submitted. The lone affidavit executed by one Bengie Valenzuela was unsuccessful in
strengthening Javier’s cause. All Valenzuela attested to was that he would frequently see Javier at the
workplace where the latter was also hired as stevedore. Tthe Court cannot ignore the inescapable
conclusion that Javier’s mere presence at the workplace falls short in proving employment therein. The
affidavit could have bolstered Javier’s claim of being tasked to clean grocery items when there were no
scheduled delivery trips, but no information was offered simply because the witness had no personal
knowledge of Javier’s employment status. The Court cannot accept Javier’s statements, hook, line and
sinker. (Bitoy Javier vs. Fly Ace Corp./Flordelyn Castillo, G.R. No. 192558, Feb. 15, 2012).

Dumpit-Murillo vs. CA
[GR. No. 164652. June 8, 2007]

Facts:
Murillo was hired under a talent contract, as a newscaster and co-anchor for ABC’s early evening news
program. The contract was for a period of three months. It was renewed fifteen times within four years.
Upon the expiration of her last talent contract, she informed ABC of her desire to renew.
Not having received a reply, she considered the company’s inaction as constructive dismissal of her
services.

Held:
Murillo was not a fixed term employee.
An employer-employee relationship was created when the private respondents started to merely renew
the contracts repeatedly fifteen times or for four consecutive years. Petitioner was a regular employee.
The practice of having fixed-term contracts in the industry does not automatically make all talent contracts
valid and compliant with labor law.

In the case at bar, it does not appear that the employer and employee dealt with each other on equal
terms. Being one of the numerous newscasters/broadcasters of ABC and desiring to keep her job as a
broadcasting practitioner, petitioner was left with no choice but to affix her signature of conformity on each
renewal of her contract as already prepared by private respondents; otherwise, private respondents
would have simply refused to renew her contract. Patently, the petitioner occupied a position of weakness
vis-à-vis the employer. Moreover, private respondents’ practice of repeatedly extending petitioner’s 3-
month contract for four years is a circumvention of the acquisition of regular status. Hence, there was no
valid fixed-term employment between petitioner and private respondents.

Sonza case is not applicable [i.e. absence of employer-employee relationship between a talent and the
media entity which engaged the talent’s services on a per talent contract basis]

In Sonza, the television station did not instruct Sonza how to perform his job. How Sonza delivered his
lines, appeared on television, and sounded on radio were outside the television station’s control.
In the case at bar, ABC had control over the performance of petitioner’s 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 petitioner’s
wages. ABC also had power to dismiss her.

Murillo was a regular employee

The assertion that a talent contract exists does not necessarily prevent a regular employment status.
Petitioner’s 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 government’s 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
petitioner’s work in private respondent ABC’s business.

Bernarte vs pba
In the case of Bernarte v. PBA, G.R. No. 192084, September 14, 2011, a referee whose contract was not
renewed following its expiration accused the PBA of illegal dismissal. He won before the Labor Arbiter
and the NLRC which both held that he was an employee who was illegally dismissed and, therefore,
entitled to backwages, damages and attorney’s fees. The Court of Appeals, however, reversed the
decision prompting the referee to elevate the case to the Supreme Court where he contended that he is
an employee since the PBA exercised control over the performance of his work. More particularly, he
cited the following stipulations in the contract to show evidence of control: (1) the PBA classifies or rates
the referee; (2) the PBA requires the referee to attend all basketball games at least one hour before the
start of the first game of each day; (3) the PBA assigns the referee to officiate ballgames, two hours per
game; and (4) the only deduction from the fees received by the referee is the withholding tax.
Finding for the PBA, the Supreme Court stated that the element of control is missing in this case, making
the referee an independent contractor and not an employee of PBA. According to the Tribunal, the
aforementioned stipulations hardly demonstrate control over the means and methods by which Mr.
Bernarte performs his work as a referee officiating a PBA basketball game. The contractual stipulations
do not pertain to, much less dictate, how and when he will blow the whistle and make calls. On the
contrary, they merely serve as rules of conduct or guidelines in order to maintain the integrity of the
professional basketball league. As correctly observed by the Court of Appeals, “how could a skilled
referee perform his job without blowing a whistle and making calls? x x x [H]ow can the PBA control the
performance of work of a referee without controlling his acts of blowing the whistle and making calls?”
In ruling for the PBA, the Supreme Court further called attention to other circumstances that point to
petitioner’s being an independent contractor:
“We agree with respondents that once in the playing court, the referees exercise their own independent
judgment, based on the rules of the game, as to when and how a call or decision is to be made. The
referees decide whether an infraction was committed, and the PBA cannot overrule them once the
decision is made on the playing court. The referees are the only, absolute, and final authority on the
playing court. Respondents or any of the PBA officers cannot and do not determine which calls to make
or not to make and cannot control the referee when he blows the whistle because such authority
exclusively belongs to the referees. The very nature of petitioner’s job of officiating a professional
basketball game undoubtedly calls for freedom of control by respondents.”

GRN 119268 FEBRUARY 23, 2000

JARDIN VS NLRC
QUISUMBING, J.:

FACTS:
Petitioners were drivers of Goodman Taxi and were collected average of PhP400 as boundary plus
30pesos for car wash. They do not agree with the car wash fee and planned to form a union. Upon
learning of their plan, private respondent refused to let petitioners drive their taxicab for few days.
Petitioners filed illegal dismissal and illegal collection of wash fee. Labor Arbiter dismissed the complaint
while NLRC reversed the decision ratiocinating that as employees, their dismissal must be for just cause
and after due process.

ISSUE:
Whether or not an employer-employee relationship exists.

RULING:
Complainants are taxi drivers on boundary system but in determining if employer-employee relationship
exists, the four-fold test is applied: power of selection; payment of wages; power of dismissal, and; power
to control the employees. Petitioners are undoubtedly employees of the respondent because taxi drivers
perform activities which are necessary or desirable in the usual business or trade of the employer. Thus
an employee illegally dismissed shall be entitled to reinstatement without loss of seniority rights and other
privileges and to his full backwages, inclusive of allowances an to his other benefits or their monetary
equivalent computed from the time his compensation was withheld from him up to the time of his actual
reinstatement.

Orozco vs ca

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. Orozco’s
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 13 th 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 PDI’s 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 employer’s 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.

Coca Cola Bottlers Inc. v. Climaco February 5, 2007 G.R. No. 146881 514 SCRA 164

Facts:
Respondent Dr. Dean N. Climaco is a medical doctor who was hired by petitioner Coca-Cola
Bottlers Phils., Inc (Coca-Cola), by virtue of a Retainer Agreement. The Retainer Agreement, which
began on January 1, 1988, was renewed annually. The last one expired December 31, 1993. Despite the
non-renewal of the Retainer 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. It is noted that as early as September 1992, petitioner was already making inquiries regarding
his status with petitioner company. Petitioner company, however, did not take any action. 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.
Respondent filed a Complaint before the NLRC seeking recognition as a regular employee of
petitioner company and prayed for the payment of all benefits of a regular employee. While the complaint
was pending before the Labor Arbiter, respondent received a letter from petitioner company concluding
their retainership agreement effective 30 days from receipt thereof. This prompted respondent to file a
complaint for illegal dismissal against petitioner company. The Labor Arbiter and NLRC declared that
there is no employer-employee relationship existed between the parties. However, the Court of Appeals
declared that respondent should be classified as a regular employee having rendered 6 years of service
as plant physician by virtue of several renewed retainer agreements.

Issue: WON there exist an employer-employee relationship between the parties

Ruling:
The court, in determining the existence of an employer-employee relationship, has invariably
adhered to the four-fold test: (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.
The Court agrees with the finding of the Labor Arbiter and the NLRC that the circumstances of
this case show that no employer-employee relationship exist between the parties, they correctly found
that petitioner company lacked the power of control over the performance by respondent of his duties.
The Labor Arbiter reasoned that the Comprehensive Medical Plan, which contains the
respondent’s objectives, duties and obligations, does not tell respondent “how to conduct his physical
examination, how to immunize, or how to diagnose and treat his patients, employees of company, in
each case.”
In effect, the Labor Arbiter held that petitioner company, through the Comprehensive Medical
Plan, provided guidelines merely to ensure that the end result was achieved, but did not control the
means and methods by which respondent performed his assigned tasks.
The NLRC affirmed the findings of the Labor Arbiter and stated that it is precisely because the
company lacks the power of control that the contract provides that respondent shall be directly
responsible to the employee concerned and their dependents for any injury, harm or damage caused
through professional negligence, incompetence or other valid causes of action.
 In addition, the Court finds that 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. The Court agrees that there is nothing wrong with the employment of respondent as a
retained physician of petitioner company and upholds the validity of the Retainership Agreement which
clearly stated that no employe-employee relationship existed between the parties. Considering that there
is no employer-employee relationship between the parties, the termination of the Retainership Agreement
, which is accordance with the provisions of the Agreement, does not constitute illegal dismissal of
respondent.

Autobus vs bautista

Antonio Bautista was employed by Auto Bus Transport Systems, Inc. in May 1995. He was assigned to
the Isabela-Manila route and he was paid by commission (7% of gross income per travel for twice a
month).
In January 2000, while he was driving his bus he bumped another bus owned by Auto Bus. He claimed
that he accidentally bumped the bus as he was so tired and that he has not slept for more than 24 hours
because Auto Bus required him to return to Isabela immediately after arriving at Manila. Damages were
computed and 30% or P75,551.50 of it was being charged to Bautista. Bautista refused payment.
Auto Bus terminated Bautista after due hearing as part of Auto Bus’ management prerogative. Bautista
sued Auto Bus for Illegal Dismissal. The Labor Arbiter Monroe Tabingan dismissed Bautista’s petition but
ruled that Bautista is entitled to P78,117.87 13 th month pay payments and P13,788.05 for his unpaid
service incentive leave pay.
The case was appealed before the National Labor Relations Commission. NLRC modified the LA’s ruling.
It deleted the award for 13th Month pay. The court of Appeals affirmed the NLRC.
Auto Bus averred that Bautista is a commissioned employee and if that is not reason enough that
Bautista is also a field personnel hence he is not entitled to a service incentive leave. They invoke:
Art. 95. RIGHT TO SERVICE INCENTIVE LEAVE
(a) Every employee who has rendered at least one year of service shall be entitled to a yearly service
incentive leave of five days with pay.
Book III, Rule V: SERVICE INCENTIVE LEAVE
SECTION 1. Coverage. ‘ This rule shall apply to all employees except:
(d) Field personnel and other employees whose performance is unsupervised by the employer including
those who are engaged on task or contract basis, purely commission basis, or those who are paid in a
fixed amount for performing work irrespective of the time consumed in the performance thereof; . . .

ISSUE: Whether or not Bautista is entitled to Service Incentive Leave. If he is, Whether or not the three
(3)-year prescriptive period provided under Article 291 of the Labor Code, as amended, is applicable to
respondent’s claim of service incentive leave pay.

HELD: Yes, Bautista is entitled to Service Incentive Leave. The Supreme Court emphasized that it does
not mean that just because an employee is paid on commission basis he is already barred to receive
service incentive leave pay.
The question actually boils down to whether or not Bautista is a field employee.
According to Article 82 of the Labor Code, ‘field personnel shall refer to non-agricultural employees who
regularly perform their duties away from the principal place of business or branch office of the employer
and whose actual hours of work in the field cannot be determined with reasonable certainty.
As a general rule, field personnel are those whose performance of their job/service is not supervised by
the employer or his representative, the workplace being away from the principal office and whose hours
and days of work cannot be determined with reasonable certainty; hence, they are paid specific amount
for rendering specific service or performing specific work. If required to be at specific places at specific
times, employees including drivers cannot be said to be field personnel despite the fact that they are
performing work away from the principal office of the employee.
Certainly, Bautista is not a field employee. He has a specific route to traverse as a bus driver and that is a
specific place that he needs to be at work. There are inspectors hired by Auto Bus to constantly check
him. There are inspectors in bus stops who inspects the passengers, the punched tickets, and the driver.
Therefore he is definitely supervised though he is away from the Auto Bus main office.
On the other hand, the 3 year prescriptive period ran but Bautista was able to file his suit in time before
the prescriptive period expired. It was only upon his filing of a complaint for illegal dismissal, one month
from the time of his dismissal, that Bautista demanded from his former employer commutation of his
accumulated leave credits. His cause of action to claim the payment of his accumulated service incentive
leave thus accrued from the time when his employer dismissed him and failed to pay his accumulated
leave credits.
Therefore, the prescriptive period with respect to his claim for service incentive leave pay only
commenced from the time the employer failed to compensate his accumulated service incentive leave
pay at the time of his dismissal. Since Bautista had filed his money claim after only one month from the
time of his dismissal, necessarily, his money claim was filed within the prescriptive period provided for by
Article 291 of the Labor Code.
Definition of Service Incentive Leave
Service incentive leave is a right which accrues to every employee who has served within 12 months,
whether continuous or broken reckoned from the date the employee started working, including authorized
absences and paid regular holidays unless the working days in the establishment as a matter of practice
or policy, or that provided in the employment contracts, is less than 12 months, in which case said period
shall be considered as one year. It is also commutable to its money equivalent if not used or exhausted at
the end of the year. In other words, an employee who has served for one year is entitled to it. He may use
it as leave days or he may collect its monetary value.

Tenazas v. R. Villegas Taxi, G,R, No. 192998, April 2, 2014

There is no hard and fast rule designed to establish the aforesaid elements. Any competent and relevant
evidence to prove the relationship may be admitted. Identification cards, cash vouchers, social security
registration, appointment letters or employment contracts, payrolls, organization charts, and personnel
lists, serve as evidence of employee status. In this case, however, Francisco failed to present any proof
substantial enough to establish his relationship with the respondents. He failed to ';_present documentary
evidence like attendance logbook, payroll, SSS record or any personnel file that could somehow depict
his status as an employee. Anent his claim that he was not issued with employment records, he could
have, at least, produced his social security records which state his contributions, name and address of his
employer, as his co-petitioner Tenazas did. He could have also presented testimonial evidence showing
the respondents' exercise of control over the means and methods by which he undertakes his work. This
is imperative in light of the respondents' denial of his employment and the claim of another taxi operator,
Emmanuel Villegas (Emmanuel), that he was his employer. Specifically, in his Affidavit,36 Emmanuel
alleged that Francisco was employed as a spare driver in his taxi garage from January 2006 to December
2006, a fact that the latter failed to deny or question in any of the pleadings attached to the records of this
case. The utter lack of evidence is fatal to Francisco's case especially in cases like his present
predicament when the law has been very lenient in not requiring any particular form of evidence or
manner of proving the presence of employer-employee relationship.

In Opulencia Ice Plant and Storage v. NLRC, this Court emphasized, No particular form of evidence is
required to prove the existence of an employer-employee relationship. Any competent and relevant
evidence to prove the relationship may be admitted. For, if only documentary evidence would be required
to show that relationship, no scheming employer would ever be brought before the bar of justice, as no
employer would wish to come out with any trace of the illegality he has authored considering that it should
take much weightier proof to invalidate a written instrument. Here, Francisco simply relied on his
allegation that he was an employee of the company without any other evidence supporting his claim.

Unfortunately for him, a mere allegation in the position paper is not tantamount to evidence. Bereft of any
evidence, the CA correctly ruled that Francisco could not be considered an employee of the respondents.

Francisco v. NLRC August 31, 2006 G.R NO. 170087 500 SCRA 690

Facts:
Petitioner was hired by Kasei Corporation during its incorporation stage. She was designated
as Accountant and Corporate Secretary and was assigned to handle all the accounting needs of the
company, however she was not entrusted with the corporate documents; neither did she attend any board
meeting nor required to do so. She never prepared any legal document and never represented the
company as its Corporate Secretary, but she was prevailed upon to sign documentation for the company.
She was also designated as Liason Officer to secure business permits, construction permits and other
licenses for the initial operation of the company.
In 1996, petitioner was designated Acting Manager, she was assigned to handle recruitment of
all employees and perform management administration functions. For 5 years, petitioner performed the
duties of Acting Manager.
In January 2001, petitioner was replaced by Liza R. Fuentes as Manager and the petitioner was
assured that she would still be connected with Kasei Corporation as Technical Assistant to Seiji Kamura
and in charge of all BIR matters. Petitioner did not receive her salary from the company and was informed
that she is no longer connected with the company. Petitioner filed an action for constructive dismissal
before the labor arbiter.
Private respondents averred that petitioner is not an employee of Kasei Corporation. They
alleged that as technical consultant, petitioner performed her work at her own discretion without control
and supervision of Kasei Corporation. She had no daily time record and she came to the office any time
she wanted. The company never interfered with her work except that from time to time, the management
would ask her opinion on matters relating to her profession. The petitioner did not go through the usual
procedure of selection of employees and her designation as technical consultant depended solely upon
the will of management. As such, her consultancy may be terminated any time considering that her
services were only temporary in nature and dependent on the needs of the corporation.
Issue: Won there was an employer-employee relationship between the parties.

Ruling:
In certain cases the control test is not sufficient to give a complete picture of the relationship
between the parties, owing to the complexity of such a relationship where several positions have been
held by the worker. There are instances when, aside from the employer’s power to control the employee
with respect to the means and methods by which the work is to be accomplished, economic realities of
the employment relations help provide a comprehensive analysis of the true classification of the
individual, whether as employee, independent contractor, corporate officer or some other capacity.
The better approach would therefore be to adopt a two-tiered test involving: 1) putative
employer’s power to control the employee with respect to the means and methods by which the work is to
be accomplished; and 2) the underlying economic realities of the activity or relationship. This two-tiered
test would provide us with a framework of analysis, which would take into consideration the totality of
circumstances surrounding the true nature of the relationship between the parties. This is especially
appropriate in this case where there is no written agreement or terms of reference to base the relationship
on; and due to the complexity of the relationship based on the various positions and responsibilities given
to the worker over the period of the latter’s employment.

The determination of the relationship between employer and employee depends upon the
circumstances of the whole economic activity, such as:
1) the extent to which the services performed are an integral part of the employer’s business;
2) the extent of the worker’s investment in equipment and facilities;
3) the nature and degree of control exercised by the employer;
4) the worker’s opportunity for profit or loss;
5) the amount of initiative, skill, judgment or foresight required for the success of the claimed
independent enterprise;
6) the permanency and duration of the relationship between the worker and the employer; and
7) the degree of dependency of the worker upon the employer of his continued employment in that
line of business.

The proper standard of economic dependence is whether the worker is dependent on the
alleged employer for his continued employment in that line of business. Based on the foregoing, there can
be no other conclusion that petitioner is an employee of respondent Kasei Corporations. She was
selected and engaged by the company for compensation, and is economically dependent upon
respondent for her continued employment in that line of business. Her main job function involved
accounting and tax services rendered to respondent corporation on a regular basis over an indefinite
period of engagement. Respondent corporation hired and engaged petitioner for compensation, with the
power to dismiss her for cause. More importantly, respondent corporation had the power to control
petitioner with the means and methods by which the work is to be accomplished.