Caurdanetaan Piece Workers Union vs. Laguesma & Corfarm Grains

G.R No. 113542, February 24, 1998

Facts:

Caurdanetaan Piece Workers Union members (petitioners) worked as cargadores for

Corfarms Grains,Inc. (private respondent). They loaded, unloaded and piled sacks of palay from the
warehouses to the cargo trucks and from the cargo trucks to the buyers. They were paid by private
respondent on a piece rate basis. When Corfarm denied some benefits to these cargadores, they
organized a union. Upon learning of its formation, Corfarm barred its members from working with
them and replaced them with non-members of the union.

Petitioner filed [a petition] for certification election before the Department of Labor and
Employment and also filed a complaint ffor
or illegal dismissal.

Corfarm denies that it had the power of control, rationalizing that petitioner's members
"were 'street-hired' workers engaged from time to time to do loading and unloading work .There
was no superintendent-in-charge to give orders and there were no gate passes issued, nor tools,
equipment and paraphernalia issued by Corfarm for loading/unloading. Furthermore they
contended that employer-employee relationship is negated by the fact that they offer and actually
perform loading and unloading work for various rice mills in Pangasinan .

Labor Arbiter Rolando D. Gambito issued his decision finding the dismissal of petitioner's
members illegal. Public Respondent Laguesma premised the dismissal of the petition for
certification election on the absence of an employer-employee relationship between petitioner's
members and private respondent 

ISSUE:

The present controversy hinges on whether or not an employer-employee relationship

between the CPWU members and Respondent Corfarm exist.

HELD.

Yes there is employer-emploee relationship. To determine the existence of an employer-

employee relation, this Court has consistently applied the "four-fold" test which has the following
elements: (1) the power to hire, (2) the payment of wages, (3) the power to dismiss, and (4) the
power to control - the last being the most important element.

Caurdanetaan Piece Workers Union members (petitioners) performed work which is

directly related, necessary and vital to the operations of Corfarm. Moreover, Corfarm did not even
allege, much less prove, that petitioner's members have "substantial capital or investment in the
form of tools, equipment, machineries, [and] work premises, among others. To be considered as
independent contractors. Furthermore, said respondent did not contradict petitioner's allegation
that it paid wages directly to these workers without the intervention of any third-party
independent contractor. It also wielded the power of dismissal over petitioners; in fact, its exercise
of this power was the progenitor of the illegal dismissal case. Clearly, the workers are not 
independent contractors. Assuming arguendo that they did work with other rice mills, this was
required by the imperative of meeting their basic needs.
 

ALEJANDRO MARAGUINOT, JR. and PAULINO ENERO vs NLRC

GRN 120969 January 22, 1998

Facts:

Petitioner Alejandro Maraguinot, Jr. maintains that he was employed by private

respondents filming crew and was was promoted to the rank of Electrician. Petitioner Paulino
Enero, on his part, claims that private respondents employed him as a member of the shooting crew
. Petitioners' tasks consisted of loading, unloading and arranging movie equipment in the shooting
area as instructed by the cameraman, returning the equipment to Viva Films' warehouse, assisting
in the "fixing" of the lighting system, and performing other tasks that the cameraman and/or
director may assign.

Petitioners sought the assistance of their supervisor, Mrs. Alejandria Cesario, to facilitate
their request that private respondents adjust their salary in accordance with the minimum wage
law. Mrs. Cesario informed petitioners that Mr. Vic del Rosario would agree to increase their salary
only if they signed a blank employment contract. As petitioners refused to sign, private respondents
forced Enero to go on leave, then refused to take him back when he reported for work. Meanwhile,
Maraguinot was again asked to sign a blank employment contract, and when he still refused, private
respondents terminated his services. Petitioners thus sued for illegal dismissal before the Labor
Arbiter.

On the other hand, private respondents claim that Viva Films (hereafter VIVA) that it is
primarily engaged in the distribution and exhibition of movies - but not in the business of making
movies; in the same vein, private respondent Vic del Rosario is merely an executive producer, i.e.,
the financier who invests a certain sum of money for the production of movies distributed and
exhibited by VIVA.

Private respondents assert that they contract persons called "producers" - also referred to
as "associate producers" to "produce" or make movies
movies for private respondents;
respondents; and contend that 
petitioners are project employees of the associate producers who, in turn, act as independent 
contractors. As such, there is no employer-employee relationship between petitioners and private
respondents.

After considering both versions of the facts, the Labor Arbiter ruled in favor of the
complainants. Respondents were ordered to reinstate complainants to their former
positions.Private respondents appealed to the NLRC . The NLRC, in reversing the Labor Arbiter,
then concluded that these circumstances, taken together, indicated that complainants (herein
petitioners) were "project employees."

Issue:

The determination of whether an employer-employee relationship existed between

petitioners and private respondents or any one of
o f private respondents.

Held:

All the circumstances indicate an employment relationship between petitioners and VIVA
alone, thus the inevitable conclusion is that petitioners are employees only of VIVA. In respect to

the respondent’s
contracting out of allegation that the
labor is allowed petitioners
only in case of are
job project employees,
contracting. it isata bar,
In the case settled
the rule that 
associate
 

producers cannot be considered as job contractors but only agents because they are not engaged in
the business of making motion pictures. The movie making equipment are supplied to the
producers and owned by VIVA. In addition, the associate producers cannot be considered as labor
only contractors as they did not supply, recruit nor hire workers.

It may not be ignored, however, that private respondents expressly admitted that 
petitioners were part of a work pool; 31 and, while petitioners were initially hired possibly as
project employees, they had attained the status of regular employees in view of VIVA's conduct.

A project employee or a member of a work pool may acquire the status of a regular
employee when the following concur:

1) There is a continuous re
rehiring
hiring of project employees
employees even after cessation
cessation of a project; 32 and

2) The tasks per

performed
formed by the
the alleged "project employee" are vital,
vital, necessary and indispensable to
the usual business or trade of the employer. 33
 

Makati Haberdashery, Inc. vs. NLRC

G.R. Nos. 83380-81, November 15, 1989

Facts:

Private respondents, have been working for Makati Haberdashery, Inc. as tailors,
seamstress, sewers, basters (manlililip) and "plantsadoras". They are paid on a piece-rate basis
except two workers who are paid on a monthly basis. In addition to their piece-rate, they are given
a daily allowance of three (P 3.00) pesos provided they report for work before 9:30 a.m. everyday.

Private respondents are required to work from or before 9:30 a.m. up to 6:00 or 7:00 p.m.
from Monday to Saturday and during peak periods even on Sundays and holidays.

The Sandigan ng Manggagawang Pilipino, a labor organization of the respondent workers,

filed a complaint(a) underpayment of the basic wage; (b) underpayment of living allowance; (c)
non-payment of overtime work and other money claims.

The Labor Arbiter decided in favor of the complainants which was further affirmed by the
NLRC. Petitioners filed the petition contending that public respondents were erroneous in
concluding that an employer-employee relationship exist be between
tween Haberdashery and the priva
private
te
respondents.

Issue: 

WHETHER OR NOT AN EMPLOYER-EMPLOYEE RELATIONSHIP EXISTS BETWEEN PETITIONER

HABERDASHERY AND RESPONDENTS WORKERS. 

Held:

The facts indubitably reveal that the most important requisite of control is present. As
gleaned from the operations of petitioner, when a customer enters into a contract with the
haberdashery or its proprietor, the latter directs an employee who may be a tailor, pattern maker,
sewer or "plantsadora" to take the customer's measurements, and to sew the pants, coat or shirt as
specified by the customer. Supervision is actively manifested in all these aspects — the manner and
quality of cutting, sewing and ironing.

Furthermore, the presence of control is immediately evident in a memorandum issued by

Assistant Manager which requires workers comply with the following directives:

1.  To follow instructions only from specific persons;

2.  Before accepting the job orders tailors must check the materials, job orders, due dates and 
other things to maximize the efficiency of production;
3.  All job orders must be finished one day before the due date.
4.  Alteration-Before accepting alteration person attending on customers must ask first or
must advise the tailors regarding the due dates.
5.  Any tailor violating the memorandum will be subject to disciplinary action.

It is evident that petitioner has reserved the right to control its employees not only as to the
result but also the means and methods by which the same are to be accomplished. That private
 

respondents are regular employees is further proven by the fact that they have to report for work 
regularly from 9:30 a.m. to 6:00 or 7:00 p.m. and are paid an additional allowance of P 3.00 daily if 
they report for work before 9:30 a.m. and which is forfeited when they arrive at or after 9:30 a.m. 11

Since private respondents are regular employees, necessarily the argument that they are
independent contractors must fail. As established, private respondents did not exercise
independence in their own methods, but on the contrary were subject to the control of petitioners
from the beginning of their tasks to their completion. Unlike independent contractors who
generally rely on their own resources, the equipment, tools, accessories, and paraphernalia used by
private respondents are supplied and owned by petitioners. Private respondents are totally
dependent on petitioners in all these aspects.

Villamaria vs. CA
G.R. No. 165881,2006

Facts:

Petitioner Oscar Villamaria, Jr. was the owner of Villamaria Motors, a sole proprietorship
engaged in assembling passenger jeepneys with a public utility franchise. By 1995, Villamaria stopped
assembling jeepneys and retained only nine, four of which he operated by employing drivers on a
"boundary basis." One of those drivers was respondent Bustamante who drove the jeepney with Plate
No. PVU-660. Bustamante remitted P450.00 a day to Villamaria as boundary and kept the residue of his
daily earnings as compensation for driving the vehicle. In August 1997, Villamaria verbally agreed to sell
the jeepney to Bustamante under the "boundary-hulog scheme," where Bustamante would remit to
Villarama P550.00 a day for a period of four years; Bustamante would then become the owner of the
vehicle and continue to drive the same under Villamaria’s franchise. It was also agreed that Bustamante
would make a downpayment
downpayment of P10,000.00.

Villamaria executed a contract entitled "Kasunduan ng Bilihan ng Sasakyan sa Pamamagitan

ng Boundary-Hulog"
Boundary-Hulog"5The parties agreed that if Bustamante failed to pay the boundary-hulog for
three days, Villamaria Motors would hold on to the vehicle until Bustamante paid his arrears,
including a penalty of P50.00 a day; in case Bustamante failed to remit the daily boundary-hulog for
a period of one week, the Kasunduan would cease to have legal effect and Bustamante would have
to return the vehicle to Villamaria Motors. Under the Kasunduan, Bustamante was prohibited from
driving the vehicle without prior authority from Villamaria Motors

Bustamante and other drivers who also had the same arrangement with Villamaria Motors
failed to pay their respective boundary-hulog. This prompted Villamaria to serve a "Paalala,"
"Paalala,"6 
reminding them that under the Kasunduan, failure to pay the daily boundary-hulog for one week,
would mean their respective jeepneys would be returned to him without any complaints. Villamaria
took back the jeepney driven by Bustamante and barred the latter from driving the vehicle.

Bustamante filed a Complaint 

Complaint 7  for Illegal Dismissal against Villamaria and his wife Teresita.
spouses Villamaria argued that Bustamante was not illegally dismissed since the Kasunduan
executed on August 7, 1997 transformed the employer-employee relationship into that of vendor-
vendee. the Labor Arbiter rendered judgment 
judgment 17 17  in favor of the spouses Villamaria. Bustamante

appealed the decision to the NLRC. The NLRC rendered judgmenjudgment 

t 20
20  dismissing the appeal for lack of 

merit. Bustamante elevated the matter to the CA via Petition for Certiorari. the CA reversed and set 
aside the NLRC decision.
 

ISSUE: Whether or not the boundary-hulog scheme negated the presence of employer-
employee relationship.

Held: No. The Court agreed with the ruling of the CA that, under the boundary-hulog scheme
incorporated in the Kasunduan, a dual juridical relationship was created between petitioner and
respondent: that of employer-employee and vendor-vendee. The Kasunduan did not extinguish the
employer-employee relationship of the parties extant before the execution of said deed. The
boundary system is a scheme by an owner/operator engaged in transporting passengers as a
common carrier to primarily govern the compensation of the driver, that is, the latter’s daily
earnings are remitted to the owner/operator less the excess of the boundary which represents the
driver’s compensation. Under this system, the owner/operator exercises control and supervision
over the driver. It is unlike in lease of chattels where the lessor loses complete control over the
chattel leased but the lessee is still ultimately responsible for the consequences of its use. The
management of the business is still in the hands of the owner/operator, who, being the holder of 
the certificate of public convenience, must see to it that the driver follows the route prescribed by
the franchising and regulatory authority, and the rules promulgated with regard to the business
operations. The fact that the driver does not receive fixed wages but only the excess of the
"boundary" given to the owner/operator is not sufficient to change the relationship between them.
Indubitably, the driver performs activities which are usually necessary or desirable in the usual
46
business or trade and
between petitioner of the owner/operator
owner/operator.
respondent . The juridical
was not negated relationship
by the foregoing of employer-employee
stipulation in the Kasunduan,
considering that petitioner retained control of respondent’s conduct as dri ver of the vehicle.