AMERICAN POWER CONVERSION CORP v LIM Thereafter, Kong arrived in the country and met with Lim.

ong arrived in the country and met with Lim. He informed Lim of
January 11, 2018, Del Castillo a supposed company restructuring which rendered his position as Regional
Facts: Manager redundant.
Jayson Yu Lim was hired to serve as the Country Manager of American Power Lim’s counsel proceeded to DOLE to verify if the petitioners gave the requisite
Conversion Philippine Sales Office, which was not registered with the SEC but notice of termination. DOLE confirmed that there was no record on file of a
acted as a liaison office for American Power Conversion Corp. (APCC), an notice of termination filed by any of the petitioners.
American corporation. APCC is engaged in designing, developing, Lim was paid severance pay, but in a written demand, he sought
manufacturing, and marketing of power protection and management solutions reinstatement, the payment of backwages and allowances/benefits, and
for computer, communication, and electronic applications. damages for his claimed malicious and illegal termination. APCC’s counsel
The only SEC-registered Corporation then was American Power Conversion refused to accede.
Phils., Inc (APCPI). LA: LA decided in favor of Lim
Since American Power Conversion Philippine Sales Office was unregistered but NLRC: NLRC ruled in favor of the petitioners.
doing business in the country, Lim was included in the list of employees and CA: CA ruled in favor of Lim.
payroll of APCPI. He was also instructed to create a petty cash fund using his Issue: Whether Lim’s dismissal by reason of redundancy was valid
own personal bank account to answer for the daily operations of the Sales Ruling:
Office. No.
American Power Conversion Phils. B.V. (APCP-BV) was established in the APCC conducted business here as an unregistered and unregulated enterprise;
country and it acquired APCPI and continued the latter’s business. consequently, it did not pay truces despite doing business here and earning
Lim was eventually promoted as Regional Manager for APC North ASEAN, a income as a result. APCP BV was not engaged in sales, as it is licensed to
division of APC ASEAN. One David Shao was appointed as Regional Manager engage only in the manufacture of computer-related products - yet, it holds
for South ASEAN. respondent in its payroll. Meanwhile, Lim took orders from and came under
Truong, the Country General Manager at the time of Lim’s appointment was the supervision and control of APCS and Kong from Singapore. This
eventually replaced by petitioner George Kong. Management and manner of conducting business by petitioners is illegal.
During their stint with Kong, Lim and Shao discovered irregularities committed Being illegal, this should have been early on remedied by petitioners, including
by Kong. They reported the irregularities to Leanne Cunnold, General Manager Plumer, Kong, and Hendy, who are presumed to know, by the very nature of
for APC-South and Kong’s immediate superior. Cunnold took up the matter their positions and business, how legitimate business is supposed to be
with petitioner Alicia Hendy, the Human Resource Director for APCP BV. Lim conducted in this country, that is, by registering the business to allow
and Shao also took the matter directly to David Plumer, VP for Asia Pacific of regulation and taxation by the authorities. Yet they did not.
APC Japan, who advised them to discuss the matter directly with Kong. When Lim joined APCC, he was merely in his early twenties, as admitted by
Kong sent emails to Lim and the other six members of the sales and marketing Truong in his email message announcing respondent's appointment as
team indicating his displeasure and that he took the matter quite personally. Regional Manager for APC North ASEAN. He cannot be faulted for acceding to
Kong and Hendy then met with Shao where the latter was asked to resign. APCC's condition at the outset that he use his personal bank account for
When he refused, he was right then and there terminated from employment APCC's operations in the meantime; during the incipient phase of his
with immediate effect. The letter of termination did not specify any reason employment, he must have been operating wider the impression that since
why he was being fired from work. APCC's sales and marketing operations were new in the country, it needed
time to formalize its operations and secure a license to do business here. And
with this hope, he innocently went about doing his work.
There is this unique situation where Lim was hired directly by APCC of the
USA., but was being paid his remuneration by a separate entity-APCP BV of the
Philippines and is supervised and controlled by APCS from Singapore and APC
Japan - all in furtherance of APCC's objective of doing business here unfettered
by government regulation.
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 employee's conduct. These
elements or indicators comprise the so-called 'four-fold' test of employment
relationship.
It would seem that all of the petitioners are for all practical purposes Lim's
employers. This bizarre labor relation was made possible and necessary only
by the petitioners' common objective: to enable APCC to skirt the law. For all
legal purposes, APCC is Lim's employer. The SC ruled the subject redundancy
scheme a sham, the same being an integral part of petitioners' illegitimate
scheme to defraud the public - including Lim - and the State. It is null and void
for being contrary to law and public policy.
From a labor standpoint, they are al guilty of violating the Labor Code as a
result of their concerted acts of fraud and misrepresentation upon Lim, using
him and placing him in a precarious position without risk to themselves, and
thus deliberately disregarding their fundamental obligation to afford
protection to labor and insure the safety of their employees. For this gross
violation of the fundamental policy of the Labor Code, petitioners must be
held liable to pay backwages, damages, and attorney's fees.