PEDRO CHAVEZ V NLRC JAN 17,2005 GR 146530

FACTS:
The respondent company, Supreme Packaging, Inc., is in the business of manufacturing
cartons and other packaging materials for export and distribution. It engaged the services of the
petitioner, Pedro Chavez, as truck driver. As such, the petitioner was tasked to deliver the
respondent company’s products from its factory in Mariveles, Bataan, to its various customers,
mostly in Metro Manila. The respondent company furnished the petitioner with a truck. The
deliveries were made in accordance with the routing slips issued by respondent company
indicating the order, time and urgency of delivery.
Sometime in 1992, the petitioner expressed to respondent company’s plant manager, his desire
to avail himself of the benefits that the regular employees were receiving such as overtime pay,
nightshift differential pay, and 13th month pay, among others.
On February 20, 1995, the petitioner filed a complaint for regularization. Before the case could
be heard, respondent company terminated the services of the petitioner. Consequently, on May
25, 1995, the petitioner filed an amended complaint against the respondents for illegal
dismissal, unfair labor practice and non-payment of overtime pay, nightshift differential pay, 13th
month pay, among others.
The respondents denied the existence of an employer-employee relationship between the
company and Chavez. They averred that Chavez was an independent contractor and not an
employee.
ISSUE: Whether or not there is an employer-employee relationship between Chavez and
Supreme Packaging.
HELD:
YES. The elements to determine the existence of an employment relationship are: (1) the
selection and engagement of the employee; (2) the payment of wages; (3) the power of
dismissal; and (4) the employer’s power to control the employee’s conduct.The most important
element is the employer’s control of the employee’s conduct, not only as to the result of the
work to be done, but also as to the means and methods to accomplish it.All the four elements
are present in this case.
Wages are defined as "remuneration or earnings, however designated, capable of being
expressed in terms of money, whether fixed or ascertained on a time, task, piece or commission
basis, or other method of calculating the same, which is payable by an employer to an
employee under a written or unwritten contract of employment for work done or to be done, or
for service rendered or to be rendered."That the petitioner was paid on a per trip basis is not
significant. This is merely a method of computing compensation and not a basis for determining
the existence or absence of employer-employee relationship. One may be paid on the basis of
results or time expended on the work, and may or may not acquire an employment status,
depending on whether the elements of an employer-employee relationship are present or not.
Moreover, under the Rules Implementing the Labor Code, every employer is required to pay his
employees by means of payroll.The payroll should show, among other things, the employee’s
rate of pay, deductions made, and the amount actually paid to the employee. Interestingly, the
respondents did not present the payroll to support their claim that the petitioner was not their
employee, raising speculations whether this omission proves that its presentation would be
adverse to their case.
Compared to an employee, an independent contractor is one who carries on a distinct and
independent business and undertakes to perform the job, work, or service on its own account
and under its own responsibility according to its own manner and method, free from the control
and direction of the principal in all matters connected with the performance of the work except
as to the results thereof.Hence, while an independent contractor enjoys independence and
freedom from the control and supervision of his principal, an employee is subject to the
employer’s power to control the means and methods by which the employee’s work is to be
performed and accomplished.
Although the respondents denied that they exercised control over the manner and methods by
which the petitioner accomplished his work, a careful review of the records shows that the latter
performed his work as truck driver under the respondents’ supervision and control.
MAYON HOTEL & RESTAURANT V ADANA MAY 16,2005 GR 157634
FACTS:
Petitioner Mayon Hotel & Restaurant hired 16 employees who are all respondents in this case.
Due to the expiration and non-renewal of the lease contract for the rented space occupied by
the said hotel and restaurant the hotel operations of the business were suspended on March 31,
1997.The operation of the restaurant was continued in its new location while waiting for the
construction of a new Mayon Hotel & Restaurant. Only nine (9) of the sixteen (16) employees
continued working in the Mayon Restaurant at its new site.
On various dates of April and May 1997, the 16 employees filed complaints for underpayment of
wages and other money claims against the petitioner. Wenefredo Loveres, Luis Guades, Amado
Macandog, Jose Atractivo, Paterno Llarena, Gregorio Nicerio and Santos Branola also filed a
complaint for illegal dismissal.
ISSUE: Whether or not the respondents are entitled to their money claims due to underpayment
of wages, and nonpayment of holiday pay, rest day premium, service incentive leave pay, cost
of living allowance, overtime pay, and night shift differential pay.
HELD:
YES. Respondents have set out with particularity in their complaint, position paper, affidavits
and other documents the labor standard benefits they are entitled to, and which they alleged
that petitioners have failed to pay them. It was therefore petitioners' burden to prove that they
have paid these money claims. One who pleads payment has the burden of proving it.
Petitioners next claim that the cost of the food and snacks provided to respondents as facilities
should have been included in reckoning the payment of respondents' wages. They state that
although on the surface respondents appeared to receive minimal wages, petitioners had
granted respondents other benefits which are considered part and parcel of their wages and are
allowed under existing laws.They claim that these benefits make up for whatever inadequacies
there may be in compensation.
The cost of meals and snacks purportedly provided to respondents cannot be deducted as part
of respondents' minimum wage. such facilities could not be deducted without compliance with
certain legal requirements. As stated in Mabeza v. NLRC, the employer simply cannot deduct
the value from the employee's wages without satisfying the following: (a) proof that such
facilities are customarily furnished by the trade; (b) the provision of deductible facilities is
voluntarily accepted in writing by the employee; and (c) the facilities are charged at fair and
reasonable value. The records are clear that petitioners failed to comply with these
requirements.
We also do not agree with petitioners that the five (5) percent of the gross income of the
establishment can be considered as part of the respondents' wages. While complainants, who
were employed in the hotel, receive[d] various amounts as profit share, the same cannot be
considered as part of their wages in determining their claims for violation of labor standard
benefits. Petitioners failed to submit evidence that the amounts received by [respondents] as
profit share are to be considered part of their wages and had been agreed by them prior to their
employment.
As for petitioners repeated invocation of serious business losses, suffice to say that this is not a
defense to payment of labor standard benefits. The employer cannot exempt himself from
liability to pay minimum wages because of poor financial condition of the company. The
payment of minimum wages is not dependent on the employer's ability to pay.
AKLAN ELECTRIC COOPERATIVE INCORPORATED (AKELCO) V NLRC, RETISO AND
165 OTHERS. JAN 25, 2000 GR 121439
FACTS:
These are consolidated cases/claims for non-payment of salaries and wages, 13th month pay,
ECOLA and other fringe benefits as rice, medical and clothing allowances, submitted by
complainant Rodolfo M. Retiso and 165 others against respondents Aklan Electric Cooperative,
Inc. (AKELCO).
Complainants alleged that prior to the temporary transfer of the office of AKELCO from Lezo
Aklan to Kalibo, Aklan, complainants were continuously performing their task and were duly paid
of their salaries at their main office located at Lezo, Aklan.
That on January 22, 1992, by way of resolution of the Board of Directors of AKELCO allowed
the temporary transfer holding of office at Amon Theater, Kalibo, Aklan per information by their
Project Supervisor that their head office is closed and that it is dangerous to hold office thereat;
Nevertheless, majority of the employees including herein complainants continued to report for
work at Lezo Aklan and were paid of their salaries.
That complainants who were then reporting at the Lezo office from January 1992 up to May
1992 were duly paid of their salaries, while in the meantime some of the employees continued
to remain and work at Kalibo, Aklan;
That from June 1992 up to March 18, 1993, complainants who continuously reported for work at
Lezo, Aklan in compliance with the aforementioned resolution were not paid their salaries;
AKELCO alleged that the complainants voluntarily abandoned their respective work/job
assignments, without any justifiable reason and without notifying the management of the Aklan
Electric Cooperative, Inc. (AKELCO), hence the cooperative suffered damages and systems
loss; and That the complainants herein defied the lawful orders and other issuances by the
General Manager and the Board of Directors of the AKELCO. These complainants were
requested to report to work at the Kalibo office . . . but despite these lawful orders of the
General Manager, the complainants did not follow and wilfully and maliciously defied said orders
and issuance of the General Manager; that the Board of Directors passed a Resolution resisting
and denying the claims of these complainants, . . . under the principle of "no work no pay" which
is legally justified;
ISSUE: Whether or not the private respondents are covered by the “no work, no pay” principle
and are thus not entitled to the claim for unpaid wages from June 16, 1992 to March 18, 1993.
HELD:
YES. We do not agree with the finding that private respondents had rendered services from
June 16, 1992 to March 18, 1993 so as to entitle them to payment of wages. Petitioner was able
to show that private respondents did not render services during the stated period. Petitioner's
evidences show that on January 22, 1992, petitioner's Board of Directors passed a resolution
temporarily transferring the Office from Lezo, Aklan to Amon Theater, Kalibo, Aklan upon the
recommendation of the project supervisor, on the ground that the office at Lezo was dangerous
and unsafe. Such transfer was approved by then NEA Administrator. Such transfer was done in
the exercise of a management prerogative and in the absence of contrary evidence is not
unjustified. With the transfer of petitioner's business office from its former office, Lezo, to Kalibo,
Aklan, its equipments, records and facilities were also removed from Lezo and brought to the
Kalibo office where petitioner's official business was being conducted; thus private respondents'
allegations that they continued to report for work at Lezo to support their claim for wages has no
basis.
Their excuse is that the transfer to Kalibo was illegal but we agree with the Labor Arbiter that it
was not for private respondents to declare the management's act of temporarily transferring the
AKELCO office to Kalibo as an illegal act. There is no allegation nor proof that the transfer was
made in bad faith or with malice.
The age-old rule governing the relation between labor and capital, or management and
employee of a "fair day's wage for a fair day's labor" remains as the basic factor in determining
employees' wages. If there is no work performed by the employee there can be no wage or pay
unless, of course, the laborer was able, willing and ready to work but was illegally locked out,
suspended or dismissed,or otherwise illegally prevented from working,a situation which we find
is not present in the instant case. It would neither be fair nor just to allow private respondents to
recover something they have not earned and could not have earned because they did not
render services at the Kalibo office during the stated period