David Versus Macasio

David versus Macasio
Facts:
1. Macasio filed before the Labor Arbiter a complaint against petitioner Ariel L.
David, doing business under the name and style Yiels Hog Dealer, for
nonpayment of overtime pay, holiday pay, and 13th month pay.
2. He also claimed payment for moral and exemplary damages and attorneys
fees; and for payment of service incentive leave (SIL).
3. Macasio alleged before the Labor Arbiter that he had been working as a
butcher for David since January 6, 1995.
4. Macasio claimed that David exercised effective control and supervision over
his work, pointing out that David:
(1) set the work day, reporting time and hogs to be chopped, as well as
the manner by which he was to perform his work;
(2) daily paid his salary of P700.00, which was increased from P600.00 in
2007, P500.00 in 2006 and P400.00 in 2005; and
(3) approved and disapproved his leaves.
5. Macasio added that David owned the hogs delivered for chopping, as well as
the work tools and implements; David also rented the workplace.
6. Macasio further claimed that David employs about twenty-five (25) butchers
and delivery drivers.
7. David claimed that he started his hog dealer business in 2005, and that he
only has ten employees.
8. He alleged that he hired Macasio as a butcher or chopper on pakyaw or
task basis who is, therefore, not entitled to overtime pay, holiday pay and
13th month pay.
9. David pointed out that Macasio:
(1) usually starts his work at 10:00 p.m. and ends at 2:00 a.m. of the
following day or earlier, depending on the volume of the delivered hogs;
(2) received the fixed amount of P700.00 per engagement, regardless of the
actual number of hours that he spent chopping the delivered hogs; and
(3) was not engaged to report for work and, accordingly, did not receive any
fee when no hogs were delivered.
10.Macasio disputed Davids allegations.
11.He argued that, first, David did not start his business only in 2005. He pointed
to the Certificate of Employment that David issued in his favor which placed
the date of his employment, albeit erroneously, in January 2000.
12.Second, he reported for work every day which the payroll or time record
could have easily proved had David submitted them in evidence.
13.David claimed that he issued the Certificate of Employment, upon Macasios
request, only for overseas employment purposes.
14.The Labor Arbiter dismissed Macasios complaint for lack of merit. The Labor
Arbiter gave credence to Davids claim that he engaged Macasio on pakyaw
or task basis.
15.The LA concluded that since Macasio was engaged on pakyaw or task basis,
he is not entitled to overtime, holiday, SIL and 13 th month pay.
16.The NLRC affirmed the Labor arbiters ruling.
17.The CA partly granted Macasios certiorari petition and reversed the NLRCs
ruling for having been rendered with grave abuse of discretion.
18.While the CA agreed with the LA and the NLRC that Macasio was a task basis
employee, it nevertheless found Macasio entitled to his monetary claims.
19.The CA explained that as a task basis employee, Macasio is excluded from
the coverage of holiday, SIL and 13th month pay only if he is likewise a field
personnel.
20.As defined by the Labor Code, a field personnel is one who performs the
work away from the office or place of work, and whose regular work hours
cannot be determined with reasonable certainty.
21.In Macasios case, the elements that characterize a field personnel are
evidently lacking as he had been working as a butcher at Davids Yiels Hog
Dealer business in Sta. Mesa, Manila under Davids supervision and control,
and for a fixed working schedule that starts at 10:00 p.m.
22.Accordingly, the CA awarded Macasios claim for holiday, SIL and 13th month
pay for three years, with 10% attorneys fees on the total monetary award.
23.Hence, David filed the present petition.
Issue
The issue revolves around the proper application and interpretation of the labor law
provisions on holiday, SIL and 13th month pay to a worker engaged on pakyaw or
task basis.
Held:
1. David confuses engagement on pakyaw or task basis with the lack of
employment relationship. Impliedly, David asserts that their pakyawan or
task basis arrangement negates the existence of employment relationship.
2. The Supreme Court reject this assertion of the petitioner.
3. Engagement on pakyaw or task basis does not characterize the relationship
that may exist between the parties, i.e., whether one of employment or
independent contractorship.
4. To determine the existence of an employer-employee relationship, four
elements generally need to be considered, namely:
(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 employees conduct.
5. These elements or indicators comprise the so-called four-fold test of
employment relationship.
6. Macasios relationship with David satisfies this test.

7. A distinguishing characteristic of pakyaw or task basis engagement, as
opposed to straight-hour wage payment, is the non-consideration of the time
spent in working.
8. The payment of an employee on task or pakyaw basis alone is insufficient to
exclude one from the coverage of Service Incentive Leave (SIL) and holiday
pay.
9. In determining whether workers engaged on pakyaw or task basis is
entitled to holiday and Service Incentive Leave (SIL) pay, the presence (or
absence) of employer supervision as regards the workers time and
performance is the key.
10.The Supreme Court agree with the CA that Macasio does not fall under the
definition of field personnel.
11.The CAs finding in this regard is supported by the established facts of this
case:
first, Macasio regularly performed his duties at Davids principal place of
business;
second, his actual hours of work could be determined with reasonable
certainty; and
third, David supervised his time and performance of duties.
12.Since Macasio cannot be considered a field personnel, then he is not
exempted from the grant of holiday, SIL pay even as he was engaged on
pakyaw or task basis.
13.With respect to the payment of 13th month pay however, the Supreme Court
find that the CA legally erred in finding that the NLRC gravely abused its
discretion in denying this benefit to Macasio.
14.The governing law on 13th month pay is PD 8 5 1. As with holiday and SIL
pay, 13th month pay benefits generally cover all employees; an employee
must be one of those expressly enumerated to be exempted.
15.Section 3 of the Rules and Regulations Implementing P.D. 851 enumerates the
exemptions from the coverage of 13th month pay benefits. Under said law,
employers of those who are paid on task basis, and those who are paid a
fixed amount for performing a specific work, irrespective of the time
consumed in the performance thereof are exempted.
16.Note that unlike the IRR of the Labor Code on holiday and SIL pay, Section
3(e) of the Rules and Regulations Implementing PD 851 exempts employees
paid on task basis without any reference to field personnel. This could
only mean that insofar as payment of the 13th month pay is concerned, the
law did not intend to qualify the exemption from its coverage with the
requirement that the task worker be a field personnel at the same time.
~END

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David versus Macasio

6. Macasios relationship with David satisfies this test.

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