LIRIO v GENOVIA

F: Genovia was hired as studio manager by Lirio, owner of Celkor, to manage and
operate Celkor and to promote and sell the recording studio's services to music
enthusiasts and other prospective clients. He received a monthly salary of P7k p
lus an additional commission of P100/hr in recording/editing work. He worked fro
m 9-6 on M-F and supposedly half-day Saturdays, but this was not really the case
. Everyone rendered overtime work, but a daily time record was not kept supposed
ly to avoid overtime pay.
Days after he started working, petitioner approached him and told him about his
album project for his child. Respondent would compose and arrange songs; he woul
d be compensated separately from his regular work. He was never paid for that--
petitioner would at first stress that the respondent was a nobody in the music i
ndustry, and would only be entitled to 20% of net profit. Worse, the salaries he
would receive would be deducted from the net share. Respondent disagreed, but h
e ended up being terminated, leading to an illegal dismissal complaint.
Args: Regular employee entitled to security of tenure; Evidenced by payroll and
petty cash vouchers
Resp: Mainly stressed that arrangement was for an informal partnership under Art
. 1767. No e-er as petitioner had no control over time and manner composed/arran
ged the songs. [but he did say that he trained the resp]
LA: E-er existed
NLRC: Reversed (failed to prove employment with substantial evidence)
CA: Reinstated LA
I: Whether or not an employee-employer relationship exists.
H/R: YES.
- ELements: selection and engagement, payment of wages, power of dismissal, powe
r to control. Emphasis is control over conduct as to result, means, and methods.
Any relevant evidence may be admitted.
- Based on evidence presented: it appears that respondent was hired as an employ
ee with monthly wages. The power to dismiss was shown by the verbal dismissal.
- Control: Petitioner stated in his position paper that he would train responden
t on how to use the studio equipment-- he had power to check on the progress and
work, and see to it that the results would be satisfactory.
- Partnership: No written agreement [partnership not presumed]. Negated by wages
in the payroll.
- Termination: Illegal due to failure to meet notice requirement; not valid reas
on
--
SEMBLANTE v CA
F: Semblante and Pilar were the masiador (calls and takes bets; distributes winn
ings after deducting their commission) and sentenciador (overseas the cockfights
themselves), respectively, of a cockpit owned by respondent spouses Loot. Their
work conditions are as follows:
SEMBLANTE: 2k/wk, TWSaSu exc. monthly derbies and cockfights held on spe
cial holidays, 1 pm-12 mn, with ID
PILAR: 3.5k/wk, same conditions
One day (2003), they were denied entry and were informed of the termination of t
heir services, prompting them to file a complaint for illegal dismissal.
ANSWER: Independent contractors. IDs were only to differentiate them from the ge
neral public.
LA: Illegal dismissal. E-er.
NLRC: Reversed. No e-er. No part in selection; no separate individual contract.
CA: Affirmed NLRC. Independent contractors.
I: Whether or not an employee-meployer relationship exists between the parties.
H/R: NO. Circumstances show independent contractor relationship.
- Using the 4-fold test, it was held they were not employees:
- No part in selection and management; they came and went to the different cockp
its
- Compensation paid from arriba (can deduct already without mentioning it to the
respondents)
- Free from direction and control of respondents; no tools provided
Can never be illegal dismissal if independent contractors in spite of a procedur
al infirmity in the appeal bond.
--
OROZCO v CA
F: Mar 1990: PDI engaged the servies of petitioner to write a weekly column for
its Lifestyle section. She submitted articles every week, except when she stayed
in NYC when she still sent articles through mail. She was paid on a per-article
basis.
2 years after she began her column, the petitioner's column appeared for the las
t time. She claims that PDI just wanted to stop publishing her column; PDI claim
s that they had to terminate the column because they had to cut down on the numb
er of columnists, and she had to be taken out because her articles were of low q
uality. This led to the filing of an illegal dismissal complaint.
LA: Employee. There was control. (Key elements: prerogative to reject articles,
had to adapt to the editorial taste of the editor, nature of 'feminist reflectio
n', number of articles per period)
NLRC: Affirmed. Same reasoning as LA.
CA: Reversed. Key elements: Admission that Orozco was not an employee; no employ
ment contract; space allocation and length is not control envisioned by the SC g
uidelines; had to select topics merely because of the nature of the lifestyle se
ction; only result controlled. No e-er.
I: Whether or not Orozco was an employee of PDI.
H/R: NO. Independent contractor.
- Args: had to base articles on objectives of lifestyle section, had to observe
deadlines, limits in space, feedback from readers.
- Court: Not all of the forms of control would establish an employee-employer re
lationship. The line should be drawn between rules that merely serve as guidelin
es (which do not dictate the means or methods to be employed in attaining the re
sult), and those that fix the methodology and restrict the party hired to the us
e such means. FIRST: no e-er; SECOND: e-er.
- Test: Whether the rules set by the employer are meant not just the results of
the work but also the means and method to be used in order to achieve such resul
ts.
- Court: The factors enumerated are inherent conditions in running a newspaper.
Other than those, PDI did not place any restraints on her creativity-- she was f
ree to write as she wishes. Any perceived constraints were her fault (e.g. Femin
ist Reflections).
Rejection should not be equated with control, as she wrote on a per commission b
asis; it only makes sense that the person who commissions another to do a piece
of work be allowed to reject the work if it fails to meet certain standards. Rej
ection only refers to the end-result.
Contrast: beats and regular reportes.
Effect: No e-er.
- Alternate: economic reality test :: an analysis of the economic realities prev
ailing within the activity or between the parties, considering the totality of c
ircumstances surrounding the true nature of the relationship between the parties
. Often used in the absence of a contract.
- Here: Is the worker economically dependent on the employer?
- Not quite. Petitioner is primarily a woman's rights advocate in variou
s organizations, and writes for other publications.
Effect: Still no e-er.
- As independent contractor: one who carries on a distinct and independent busin
ess and undertakes to perform the job, work, or service on one's own account and
under one's own responsibility according to one's own manner and method, free f
rom the control and direction of the principal in all matters conneceted with th
e performance of the work except as to the results thereof.
- Similar to Sonza v ABS-CBN.
- All PDI had was the right to shorten articles based on the newspaper's
capacity [a reality in the newspaper business]. Petitioner had all t he tools i
n herself.
--
JAVIER v FLY-ACE CO.
F: Javier was supposedly an employee of Fly Ace since 2007 [for 1 year], where h
e did several tasks at the warehouse or accompanied the company's delivery vehic
les as pahinante. He worked M-Sat, 7-5pm; without an ID or payslips. One day, he
reported for work but was no longer allowed to enter the company premises-- his
'superior' terminated him (supposedly because of a courtship problem). This lea
d to a complaint for illega dismissal. Support: Affidavit from Bergie Valenzuela
[was a stevedore]
Answer: Was an extra helper on a pakyaw basis; often relied on when its normally
contracted hauler was not available. At one point, they no longer needed Javier
's services-- at any rate, he was not their employee. Basis: receipts [pakyaw].
LA: No e-er. Failed to show evidence that led to him being an employee of Fly Ac
e. Was not required in regular course of business (normal: sales of groceries);
there was a regular hauler for hauling, he was just contacted when they were una
vailable.
NLRC: Reversed LA. LA should not have been considered a contractor simply becaus
e he failed to present proof. The pakyaw agreement did not preclude the existenc
e of e-er. There was a reasonable connection between his being a pahinante with
the usual business of the employer. Cannot be an IC because he could not exercis
e his own judgment in the delivery of company products.
CA: Reinstated LA. In proving e-er, the employee must show evidence to prove he
is an employee. Lack of ID, salary vouchers, etc. would have gravitated to e-er.
Work was not necessary and desierable-- there was a regular hauling service. Al
so had work outside of the company premises.
I: Whether or not Javier is an employee of FlyAce.
Args: Bare allegations and self-serving affidavits of other employees do not by
themselves substantiate claim that Javier was not an employee. Being on pakywaw
basis did not preclude regular employment at any rate. Work was related, necessa
ry, and desirable. (Case cited: Chavez v NLRC)
Ans: No substantial evidence to prove e-er. Was merely a loiterer that assisted
the company driver. From that point, Javier made the decisions. Again stressed l
ack of e-er (no evidence to show e-er, not treated like regular employee, no con
trol).
- Though Sec. 10, Rules VII of the New Rules of Procedure of the NLRC allows a r
elaxation of the rules of procedure and evidence in labor cases, it does not mea
n a complete dispensation of proof. Evidence is still required in order to prove
one's claim-- the court may just be a little more liberal in how the evidence i
s interpreted, but there remains the fact that evidence is essential.
- No particular form of evidence is required to prove the existence of e-er. Any
competent and relevant evidence may do-- but still, evidence is required.
- There was no evidence showing employment with SunAce except self-serving state
ments. Not even the Valenzuela affidavit was material as all he said was that Ja
vier was there at the workplace. Mere presence was not enough.
- As for the four elements: there was no proof that showed any of the elements.
- Pakyaw payment: may still be considered as regular employment, provided the el
ements of an e-er are present.
--
SARONA v NLRC/ROYALE
F: The petitioner was originally hired by SCEPTRE as a ecurity guard since 1976.
He was asked by Karen Tan, SCEPTER's OPERATION MANAGER, to submit as a resignat
ion letter as the same was required for applying at ROYALE [SCEPTRE was closing,
and there was a move to have its former employees transfer to ROYALE]. He fille
d up ROYALE's employment application form, which was handed to him by ROYALE's G
M, Cesar Tan.
After weeks of being in floating stats, ROYALE's Sec. Officer, Martin Gono, assi
gned the petitioner at Highlight Metal Craft. He still used SCEPTER's patches an
d agency cloths. Later, he was assigned to Wide Wide World Express, where he beg
an using the new ROYALE insignia.
However, the petitioner was informed that his assignment at WWWE had been withdr
awn due to Royale being replaced by another agency, but he later learned that th
is was not true-- other security guards from Royale remained at their posts. Aft
er another stint at Highlight, petitioner was later told by Martin that the GM o
f Sceptre stopped giving assignments for him, leading to a complaint for illegal
dismissal.
LA: Illegaly dismissed. However, separation pay only based on tenure with ROYALE
. Did not consider any connection between Royale and Sceptre-- no evidence that
they share same stockholders and incorporators, and that Sceptre has complete co
ntrol over ROYALE. [in spite of fact that ROYALE maintained SCEPTRE's offices, o
fficers, staff, etc.]; no proof that SCEPTRE's owner was an incorporator in ROYA
LE.
NLRC: Affirmed LA, though computed sep pay from 3 months and decreased backwages
. Only the piercing doctrine issue was appealed.
CA: Maintained NLRC. Stock ownership was pointed out as a key aspect in piercing
veil of corporate fiction.
Key Arg:
- ROYALE as alter ego/business conduit to circumvent labor laws
- ownership is by grandchildren of the owner of SCEPTER
- properties, officers, and staff are maintained by ROYALE
Ans: Denial; Lack of evidence to show connection
I: Whether or not the veil of corporate fiction should be pierced so that petiti
oner's backwages could be computed from his stint in SCEPTRE.
H/R: YES.
- Though a corporation is its own juridical entity, it is possible for the law t
o pierce this juridical entity and go to the person hidden within. It may be pie
rced when it becomes a shield for fraud, illegality or inequity committed agains
t third persons.
- How determined: obtaining facts appropriately pleaded or proved.
- When used: if corporate veil... defeats public convenience by evading obligtio
ns, justify wrongs/crimes/frauds, or hides the business conduit of a person.
- Court: ROYALE is a mere continuation of SCEPTRE adn fraudulent objectives are
behind incorporation.
- Aida, the grandchild, handled the affairs of both companies. She took over ear
ly on even when ROYALE was not yet existing. In ROYALE, she had a hand in its ma
nagmeent and supervision of employees; in fact, it was Aida who stopped giving a
ssignments to the petitioner.
- The way the petitioner ended up in ROYALE shows the fraudulent intent. He resi
gned from SCEPTRE because he thought it was necessary for contiued employment. H
owever, this actually lead to termination and an allegation of a shorter term. T
here seems to be an intent to evade an obligation here-- the obligation to consi
der continuous service.
- As sole prop: It doesn't matter. The corporate veil doctrine is meant to attac
k the use of alter egos of juridical entites in general.
- More importantly: R&S share properties, officers, and employees. (e.g. Karen w
as SCEPTRE's Operation Manager and ROYALE's incorporator; use of SCEPTRE's insig
nia even when under ROYALE)
- Effect: No change in employees. Separation pay from SCEPTRE tenure.