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1. Insular Life v. NLRC (Nov. 15, 1989)
FACTS:
Insular Life (company) and Basiao entered into a contract by which Basiao was authorized to solicit for insurance in accordance with
the rules of the company. He would also receive compensation, in the form of commissions. The contract also contained the relations
of the parties, duties of the agent and the acts prohibited to him including the modes of termination. After 4 years, the parties
entered into another contract – an Agency Manager’s Contact – and to implement this end of it, Basiao organized an agency while
concurrently fulfilling his commitment under the first contract. The company terminated the Agency Manager’s Contract. Basiao sued
the company in a civil action. Thus, the company terminated Basiao’s engagement under the first contract and stopped payment
of his commissions.
ISSUE:
W/N Basiao had become the company’s employee by virtue of the contract, thereby placing his claim for unpaid commissions
HELD:
No. Rules and regulations governing the conduct of the business are provided for in the Insurance Code. These rules merely serve as
guidelines towards the achievement of the mutually desired result without dictating the means or methods to be employed in
attaining it. Its aim is only to promote the result, thereby creating no employer-employee relationship. It is usual and expected for
an insurance company to promulgate a set of rules to guide its commission agents in selling its policies which prescribe the
qualifications of persons who may be insured. None of these really invades the agent’s contractual prerogative to adopt his own
selling methods or to sell insurance at his own time and convenience, hence cannot justifiable be said to establish an employer-
employee relationship between Basiao and the company. The respondents limit themselves to pointing out that Basiao’s contract
with the company bound him observe and conform to such rules.
No showing that such rules were in fact promulgated which effectivelycontrolled or restricted his choice of methods of selling
insurance. Therefore, Basiao was not an employee of the petitioner, but a commission agent, an independent contract whose claim
for unpaid commissions should have been litigated in an ordinary civil action. Wherefore, the complain of Basiao is dismissed.
G.R. No. 84484 November 15, 1989
INSULAR LIFE ASSURANCE CO., LTD., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and MELECIO BASIAO,
respondents.
NARVASA, J.:
On July 2, 1968, Insular Life Assurance Co., Ltd. (hereinafter simply called the Company) and Melecio T. Basiao entered into a
contract 1
by which:
1. Basiao was "authorized to solicit within the Philippines applications for insurance policies and annuities in
accordance with the existing rules and regulations" of the Company;
2. he would receive "compensation, in the form of commissions ... as provided in the Schedule of Commissions" of
the contract to "constitute a part of the consideration of ... (said) agreement;" and
3. the "rules in ... (the Company's) Rate Book and its Agent's Manual, as well as all its circulars ... and those which
may from time to time be promulgated by it, ..." were made part of said contract.
The contract also contained, among others, provisions governing the relations of the parties, the duties of the Agent, the acts
prohibited to him, and the modes of termination of the agreement, viz.:
RELATION WITH THE COMPANY. The Agent shall be free to exercise his own judgment as to time, place and means
of soliciting insurance. Nothing herein contained shall therefore be construed to create the relationship of employee
and employer between the Agent and the Company. However, the Agent shall observe and conform to all rules and
regulations which the Company may from time to time prescribe.
ILLEGAL AND UNETHICAL PRACTICES. The Agent is prohibited from giving, directly or indirectly, rebates in any
form, or from making any misrepresentation or over-selling, and, in general, from doing or committing acts
prohibited in the Agent's Manual and in circulars of the Office of the Insurance Commissioner.
TERMINATION. The Company may terminate the contract at will, without any previous notice to the Agent, for or
on account of ... (explicitly specified causes). ...
Either party may terminate this contract by giving to the other notice in writing to that effect. It shall become ipso
facto cancelled if the Insurance Commissioner should revoke a Certificate of Authority previously issued or should
the Agent fail to renew his existing Certificate of Authority upon its expiration. The Agent shall not have any right

2. to any commission on renewal of premiums that may be paid after the termination of this agreement for any cause
whatsoever, except when the termination is due to disability or death in line of service. As to commission
corresponding to any balance of the first year's premiums remaining unpaid at the termination of this agreement,
the Agent shall be entitled to it if the balance of the first year premium is paid, less actual cost of collection, unless
the termination is due to a violation of this contract, involving criminal liability or breach of trust.
ASSIGNMENT. No Assignment of the Agency herein created or of commissions or other compensations shall be
valid without the prior consent in writing of the Company. ...
Some four years later, in April 1972, the parties entered into another contract — an Agency Manager's Contract — and to implement
his end of it Basiao organized an agency or office to which he gave the name M. Basiao and Associates, while concurrently fulfilling
his commitments under the first contract with the Company. 2
In May, 1979, the Company terminated the Agency Manager's Contract. After vainly seeking a reconsideration, Basiao sued the
Company in a civil action and this, he was later to claim, prompted the latter to terminate also his engagement under the first
contract and to stop payment of his commissions starting April 1, 1980. 3
Basiao thereafter filed with the then Ministry of Labor a complaint 4
against the Company and its president. Without contesting the
termination of the first contract, the complaint sought to recover commissions allegedly unpaid thereunder, plus attorney's fees. The
respondents disputed the Ministry's jurisdiction over Basiao's claim, asserting that he was not the Company's employee, but an
independent contractor and that the Company had no obligation to him for unpaid commissions under the terms and conditions of his
contract. 5
The Labor Arbiter to whom the case was assigned found for Basiao. He ruled that the underwriting agreement had established an
employer-employee relationship between him and the Company, and this conferred jurisdiction on the Ministry of Labor to adjudicate
his claim. Said official's decision directed payment of his unpaid commissions "... equivalent to the balance of the first year's
premium remaining unpaid, at the time of his termination, of all the insurance policies solicited by ... (him) in favor of the
respondent company ..." plus 10% attorney's fees. 6
This decision was, on appeal by the Company, affirmed by the National Labor Relations Commission. 7
Hence, the present petition
for certiorari and prohibition.
The chief issue here is one of jurisdiction: whether, as Basiao asserts, he had become the Company's employee by virtue of the
contract invoked by him, thereby placing his claim for unpaid commissions within the original and exclusive jurisdiction of the Labor
Arbiter under the provisions of Section 217 of the Labor Code, 8
or, contrarily, as the Company would have it, that under said
contract Basiao's status was that of an independent contractor whose claim was thus cognizable, not by the Labor Arbiter in a labor
case, but by the regular courts in an ordinary civil action.
The Company's thesis, that no employer-employee relation in the legal and generally accepted sense existed between it and Basiao,
is drawn from the terms of the contract they had entered into, which, either expressly or by necessary implication, made Basiao the
master of his own time and selling methods, left to his judgment the time, place and means of soliciting insurance, set no
accomplishment quotas and compensated him on the basis of results obtained. He was not bound to observe any schedule of
working hours or report to any regular station; he could seek and work on his prospects anywhere and at anytime he chose to, and
was free to adopt the selling methods he deemed most effective.
Without denying that the above were indeed the expressed implicit conditions of Basiao's contract with the Company, the
respondents contend that they do not constitute the decisive determinant of the nature of his engagement, invoking precedents to
the effect that the critical feature distinguishing the status of an employee from that of an independent contractor is control, that is,
whether or not the party who engages the services of another has the power to control the latter's conduct in rendering such
services. Pursuing the argument, the respondents draw attention to the provisions of Basiao's contract obliging him to "... observe
and conform to all rules and regulations which the Company may from time to time prescribe ...," as well as to the fact that the
Company prescribed the qualifications of applicants for insurance, processed their applications and determined the amounts of
insurance cover to be issued as indicative of the control, which made Basiao, in legal contemplation, an employee of the Company. 9
It is true that the "control test" expressed in the following pronouncement of the Court in the 1956 case of Viana vs. Alejo Al-
Lagadan 10
... In determining the existence of employer-employee relationship, the following elements are generally
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 — although the latter is the most important
element (35 Am. Jur. 445). ...
has been followed and applied in later cases, some fairly recent. 11
Indeed, it is without question a valid test of the character of a
contract or agreement to render service. It should, however, be obvious that not every form of control that the hiring party reserves
to himself over the conduct of the party hired in relation to the services rendered may be accorded the effect of establishing an
employer-employee relationship between them in the legal or technical sense of the term. A line must be drawn somewhere, if the
recognized distinction between an employee and an individual contractor is not to vanish altogether. Realistically, it would be a rare

3. contract of service that gives untrammelled freedom to the party hired and eschews any intervention whatsoever in his performance
of the engagement.
Logically, the line should be drawn between rules that merely serve as guidelines towards the achievement of the mutually desired
result without dictating the means or methods to be employed in attaining it, and those that control or fix the methodology and bind
or restrict the party hired to the use of such means. The first, which aim only to promote the result, create no employer-employee
relationship unlike the second, which address both the result and the means used to achieve it. The distinction acquires particular
relevance in the case of an enterprise affected with public interest, as is the business of insurance, and is on that account subject to
regulation by the State with respect, not only to the relations between insurer and insured but also to the internal affairs of the
insurance company. 12
Rules and regulations governing the conduct of the business are provided for in the Insurance Code and
enforced by the Insurance Commissioner. It is, therefore, usual and expected for an insurance company to promulgate a set of rules
to guide its commission agents in selling its policies that they may not run afoul of the law and what it requires or prohibits. Of such
a character are the rules which prescribe the qualifications of persons who may be insured, subject insurance applications to
processing and approval by the Company, and also reserve to the Company the determination of the premiums to be paid and the
schedules of payment. None of these really invades the agent's contractual prerogative to adopt his own selling methods or to sell
insurance at his own time and convenience, hence cannot justifiably be said to establish an employer-employee relationship between
him and the company.
There is no dearth of authority holding persons similarly placed as respondent Basiao to be independent contractors, instead of
employees of the parties for whom they worked. In Mafinco Trading Corporation vs. Ople,13
the Court ruled that a person engaged to
sell soft drinks for another, using a truck supplied by the latter, but with the right to employ his own workers, sell according to his
own methods subject only to prearranged routes, observing no working hours fixed by the other party and obliged to secure his own
licenses and defray his own selling expenses, all in consideration of a peddler's discount given by the other party for at least 250
cases of soft drinks sold daily, was not an employee but an independent contractor.
In Investment Planning Corporation of the Philippines us. Social Security System 14
a case almost on all fours with the present one,
this Court held that there was no employer-employee relationship between a commission agent and an investment company, but
that the former was an independent contractor where said agent and others similarly placed were: (a) paid compensation in the form
of commissions based on percentages of their sales, any balance of commissions earned being payable to their legal representatives
in the event of death or registration; (b) required to put up performance bonds; (c) subject to a set of rules and regulations
governing the performance of their duties under the agreement with the company and termination of their services for certain
causes; (d) not required to report for work at any time, nor to devote their time exclusively to working for the company nor to
submit a record of their activities, and who, finally, shouldered their own selling and transportation expenses.
More recently, in Sara vs. NLRC, 15
it was held that one who had been engaged by a rice miller to buy and sell rice and palay without
compensation except a certain percentage of what he was able to buy or sell, did work at his own pleasure without any supervision
or control on the part of his principal and relied on his own resources in the performance of his work, was a plain commission agent,
an independent contractor and not an employee.
The respondents limit themselves to pointing out that Basiao's contract with the Company bound him to observe and conform to
such rules and regulations as the latter might from time to time prescribe. No showing has been made that any such rules or
regulations were in fact promulgated, much less that any rules existed or were issued which effectively controlled or restricted his
choice of methods — or the methods themselves — of selling insurance. Absent such showing, the Court will not speculate that any
exceptions or qualifications were imposed on the express provision of the contract leaving Basiao "... free to exercise his own
judgment as to the time, place and means of soliciting insurance."
The Labor Arbiter's decision makes reference to Basiao's claim of having been connected with the Company for twenty-five years.
Whatever this is meant to imply, the obvious reply would be that what is germane here is Basiao's status under the contract of July
2, 1968, not the length of his relationship with the Company.
The Court, therefore, rules that under the contract invoked by him, Basiao was not an employee of the petitioner, but a commission
agent, an independent contractor whose claim for unpaid commissions should have been litigated in an ordinary civil action. The
Labor Arbiter erred in taking cognizance of, and adjudicating, said claim, being without jurisdiction to do so, as did the respondent
NLRC in affirming the Arbiter's decision. This conclusion renders it unnecessary and premature to consider Basiao's claim for
commissions on its merits.
WHEREFORE, the appealed Resolution of the National Labor Relations Commission is set aside, and that complaint of private
respondent Melecio T. Basiao in RAB Case No. VI-0010-83 is dismissed. No pronouncement as to costs.
SO ORDERED.
Cruz, Gancayco, Griño-Aquino, and Medialdea, JJ., concur.

4. PT&T vs. NLRC
272 SCRA 596
FACTS:
PT&T (Philippine Telegraph & Telephone Company) initially hired Grace de Guzman specifically as “Supernumerary Project Worker”,
for a fixed period from November 21, 1990 until April 20, 1991 as reliever for C.F. Tenorio who went on maternity leave. She was
again invited for employment as replacement of Erlina F. Dizon who went on leave on 2 periods, from June 10, 1991 to July 1, 1991
and July 19, 1991 to August 8, 1991.
On September 2, 1991, de Guzman was again asked to join PT&T as a probationary employee where probationary period will cover
150 days. She indicated in the portion of the job application form under civil status that she was single although she had contracted
marriage a few months earlier. When petitioner learned later about the marriage, its branch supervisor, Delia M. Oficial, sent de
Guzman a memorandum requiring her to explain the discrepancy. Included in the memorandum, was a reminder about the
company’s policy of not accepting married women for employment. She was dismissed from the company effective January 29,
1992. Labor Arbiter handed down decision on November 23, 1993 declaring that petitioner illegally dismissed De Guzman, who had
already gained the status of a regular employee. Furthermore, it was apparent that she had been discriminated on account of her
having contracted marriage in violation of company policies.
ISSUE: Whether the alleged concealment of civil status can be grounds to terminate the services of an employee.
HELD:
Article 136 of the Labor Code, one of the protective laws for women, explicitly prohibits discrimination merely by reason of marriage
of a female employee. It is recognized that company is free to regulate manpower and employment from hiring to firing, according
to their discretion and best business judgment, except in those cases of unlawful discrimination or those provided by law.
PT&T’s policy of not accepting or disqualifying from work any woman worker who contracts marriage is afoul of the right against
discrimination provided to all women workers by our labor laws and by our Constitution. The record discloses clearly that de
Guzman’s ties with PT&T were dissolved principally because of the company’s policy that married women are not qualified for
employment in the company, and not merely because of her supposed acts of dishonesty.
The government abhors any stipulation or policy in the nature adopted by PT&T. As stated in the labor code:
“ART. 136. Stipulation against marriage. — It shall be unlawful for an employer to require as a condition of employment or
continuation of employment that a woman shall not get married, or to stipulate expressly or tacitly that upon getting married, a
woman employee shall be deemed resigned or separated, or to actually dismiss, discharge, discriminate or otherwise prejudice a
woman employee merely by reason of marriage.”
The policy of PT&T is in derogation of the provisions stated in Art.136 of the Labor Code on the right of a woman to be free from any
kind of stipulation against marriage in connection with her employment and it likewise is contrary to good morals and public policy,
depriving a woman of her freedom to choose her status, a privilege that is inherent in an individual as an intangible and inalienable
right. The kind of policy followed by PT&T strikes at the very essence, ideals and purpose of marriage as an inviolable social
institution and ultimately, family as the foundation of the nation. Such policy must be prohibited in all its indirect, disguised or
dissembled forms as discriminatory conduct derogatory of the laws of the land not only for order but also imperatively required.
G.R. No. 118978 May 23, 1997
PHILIPPINE TELEGRAPH AND TELEPHONE COMPANY, * petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION and GRACE DE GUZMAN, respondents.
REGALADO, J.:
Seeking relief through the extraordinary writ of certiorari, petitioner Philippine Telegraph and Telephone Company (hereafter, PT & T)
invokes the alleged concealment of civil status and defalcation of company funds as grounds to terminate the services of an
employee. That employee, herein private respondent Grace de Guzman, contrarily argues that what really motivated PT & T to
terminate her services was her having contracted marriage during her employment, which is prohibited by petitioner in its company
policies. She thus claims that she was discriminated against in gross violation of law, such a proscription by an employer being
outlawed by Article 136 of the Labor Code.
Grace de Guzman was initially hired by petitioner as a reliever, specifically as a "Supernumerary Project Worker," for a fixed period
from November 21, 1990 until April 20, 1991 vice one C.F. Tenorio who went on maternity leave.1
Under the Reliever Agreement
which she signed with petitioner company, her employment was to be immediately terminated upon expiration of the agreed period.
Thereafter, from June 10, 1991 to July 1, 1991, and from July 19, 1991 to August 8, 1991, private respondent's services as reliever
were again engaged by petitioner, this time in replacement of one Erlinda F. Dizon who went on leave during both periods. 2
After
August 8, 1991, and pursuant to their Reliever Agreement, her services were terminated.
On September 2, 1991, private respondent was once more asked to join petitioner company as a probationary employee, the
probationary period to cover 150 days. In the job application form that was furnished her to be filled up for the purpose, she

5. indicated in the portion for civil status therein that she was single although she had contracted marriage a few months earlier, that
is, on May 26, 1991. 3
It now appears that private respondent had made the same representation in the two successive reliever agreements which she
signed on June 10, 1991 and July 8, 1991. When petitioner supposedly learned about the same later, its branch supervisor in Baguio
City, Delia M. Oficial, sent to private respondent a memorandum dated January 15, 1992 requiring her to explain the discrepancy. In
that memorandum, she was reminded about the company's policy of not accepting married women for employment. 4
In her reply letter dated January 17, 1992, private respondent stated that she was not aware of PT&T's policy regarding married
women at the time, and that all along she had not deliberately hidden her true civil status. 5
Petitioner nonetheless remained
unconvinced by her explanations. Private respondent was dismissed from the company effective January 29, 1992, 6
which she
readily contested by initiating a complaint for illegal dismissal, coupled with a claim for non-payment of cost of living allowances
(COLA), before the Regional Arbitration Branch of the National Labor Relations Commission in Baguio City.
At the preliminary conference conducted in connection therewith, private respondent volunteered the information, and this was
incorporated in the stipulation of facts between the parties, that she had failed to remit the amount of P2,380.75 of her collections.
She then executed a promissory note for that amount in favor of petitioner 7
. All of these took place in a formal proceeding and with
the agreement of the parties and/or their counsel.
On November 23, 1993, Labor Arbiter Irenarco R. Rimando handed down a decision declaring that private respondent, who had
already gained the status of a regular employee, was illegally dismissed by petitioner. Her reinstatement, plus payment of the
corresponding back wages and COLA, was correspondingly ordered, the labor arbiter being of the firmly expressed view that the
ground relied upon by petitioner in dismissing private respondent was clearly insufficient, and that it was apparent that she had been
discriminated against on account of her having contracted marriage in violation of company rules.
On appeal to the National Labor Relations Commission (NLRC), said public respondent upheld the labor arbiter and, in its decision
dated April 29, 1994, it ruled that private respondent had indeed been the subject of an unjust and unlawful discrimination by her
employer, PT & T. However, the decision of the labor arbiter was modified with the qualification that Grace de Guzman deserved to
be suspended for three months in view of the dishonest nature of her acts which should not be condoned. In all other respects, the
NLRC affirmed the decision of the labor arbiter, including the order for the reinstatement of private respondent in her employment
with PT & T.
The subsequent motion for reconsideration filed by petitioner was rebuffed by respondent NLRC in its resolution of November 9,
1994, hence this special civil action assailing the aforestated decisions of the labor arbiter and respondent NLRC, as well as the
denial resolution of the latter.
1. Decreed in the Bible itself is the universal norm that women should be regarded with love and respect but, through the ages, men
have responded to that injunction with indifference, on the hubristic conceit that women constitute the inferior sex. Nowhere has that
prejudice against womankind been so pervasive as in the field of labor, especially on the matter of equal employment opportunities
and standards. In the Philippine setting, women have traditionally been considered as falling within the vulnerable groups or types of
workers who must be safeguarded with preventive and remedial social legislation against discriminatory and exploitative practices in
hiring, training, benefits, promotion and retention.
The Constitution, cognizant of the disparity in rights between men and women in almost all phases of social and political life,
provides a gamut of protective provisions. To cite a few of the primordial ones, Section 14, Article II 8
on the Declaration of Principles
and State Policies, expressly recognizes the role of women in nation-building and commands the State to ensure, at all times, the
fundamental equality before the law of women and men. Corollary thereto, Section 3 of Article XIII 9
(the progenitor whereof dates
back to both the 1935 and 1973 Constitution) pointedly requires the State to afford full protection to labor and to promote full
employment and equality of employment opportunities for all, including an assurance of entitlement to tenurial security of all
workers. Similarly, Section 14 of Article XIII 10
mandates that the State shall protect working women through provisions for
opportunities that would enable them to reach their full potential.
2. Corrective labor and social laws on gender inequality have emerged with more frequency in the years since the Labor Code was
enacted on May 1, 1974 as Presidential Decree No. 442, largely due to our country's commitment as a signatory to the United
Nations Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW). 11
Principal among these laws are Republic Act No. 6727 12
which explicitly prohibits discrimination against women with respect to
terms and conditions of employment, promotion, and training opportunities; Republic Act No. 695513
which bans the "mail-order-
bride" practice for a fee and the export of female labor to countries that cannot guarantee protection to the rights of women
workers; Republic Act No. 7192 14
also known as the "Women in Development and Nation Building Act," which affords women equal
opportunities with men to act and to enter into contracts, and for appointment, admission, training, graduation, and commissioning
in all military or similar schools of the Armed Forces of the Philippines and the Philippine National Police; Republic Act No.
7322 15
increasing the maternity benefits granted to women in the private sector; Republic Act No. 7877 16
which outlaws and
punishes sexual harassment in the workplace and in the education and training environment; and Republic Act No. 8042, 17
or the
"Migrant Workers and Overseas Filipinos Act of 1995," which prescribes as a matter of policy, inter alia, the deployment of migrant
workers, with emphasis on women, only in countries where their rights are secure. Likewise, it would not be amiss to point out that
in the Family Code, 18
women's rights in the field of civil law have been greatly enhanced and expanded.

6. In the Labor Code, provisions governing the rights of women workers are found in Articles 130 to 138 thereof. Article 130 involves
the right against particular kinds of night work while Article 132 ensures the right of women to be provided with facilities and
standards which the Secretary of Labor may establish to ensure their health and safety. For purposes of labor and social legislation,
a woman working in a nightclub, cocktail lounge, massage clinic, bar or other similar establishments shall be considered as an
employee under Article 138. Article 135, on the other hand, recognizes a woman's right against discrimination with respect to terms
and conditions of employment on account simply of sex. Finally, and this brings us to the issue at hand, Article 136 explicitly
prohibits discrimination merely by reason of the marriage of a female employee.
3. Acknowledged as paramount in the due process scheme is the constitutional guarantee of protection to labor and security of
tenure. Thus, an employer is required, as a condition sine qua non prior to severance of the employment ties of an individual under
his employ, to convincingly establish, through substantial evidence, the existence of a valid and just cause in dispensing with the
services of such employee, one's labor being regarded as constitutionally protected property.
On the other hand, it is recognized that regulation of manpower by the company falls within the so-called management prerogatives,
which prescriptions encompass the matter of hiring, supervision of workers, work assignments, working methods and assignments,
as well as regulations on the transfer of employees, lay-off of workers, and the discipline, dismissal, and recall of employees. 19
As
put in a case, an employer is free to regulate, according to his discretion and best business judgment, all aspects of employment,
"from hiring to firing," except in cases of unlawful discrimination or those which may be provided by law. 20
In the case at bar, petitioner's policy of not accepting or considering as disqualified from work any woman worker who contracts
marriage runs afoul of the test of, and the right against, discrimination, afforded all women workers by our labor laws and by no less
than the Constitution. Contrary to petitioner's assertion that it dismissed private respondent from employment on account of her
dishonesty, the record discloses clearly that her ties with the company were dissolved principally because of the company's policy
that married women are not qualified for employment in PT & T, and not merely because of her supposed acts of dishonesty.
That it was so can easily be seen from the memorandum sent to private respondent by Delia M. Oficial, the branch supervisor of the
company, with the reminder, in the words of the latter, that "you're fully aware that the company is not accepting married women
employee (sic), as it was verbally instructed to you." 21
Again, in the termination notice sent to her by the same branch supervisor,
private respondent was made to understand that her severance from the service was not only by reason of her concealment of her
married status but, over and on top of that, was her violation of the company's policy against marriage ("and even told you that
married women employees are not applicable [sic] or accepted in our company.") 22
Parenthetically, this seems to be the curious
reason why it was made to appear in the initiatory pleadings that petitioner was represented in this case only by its said supervisor
and not by its highest ranking officers who would otherwise be solidarily liable with the corporation. 23
Verily, private respondent's act of concealing the true nature of her status from PT & T could not be properly characterized as willful
or in bad faith as she was moved to act the way she did mainly because she wanted to retain a permanent job in a stable company.
In other words, she was practically forced by that very same illegal company policy into misrepresenting her civil status for fear of
being disqualified from work. While loss of confidence is a just cause for termination of employment, it should not be simulated. 24
It
must rest on an actual breach of duty committed by the employee and not on the employer's caprices. 25
Furthermore, it should
never be used as a subterfuge for causes which are improper, illegal, or unjustified. 26
In the present controversy, petitioner's expostulations that it dismissed private respondent, not because the latter got married but
because she concealed that fact, does have a hollow ring. Her concealment, so it is claimed, bespeaks dishonesty hence the
consequent loss of confidence in her which justified her dismissal.
Petitioner would asseverate, therefore, that while it has nothing against marriage, it nonetheless takes umbrage over the
concealment of that fact. This improbable reasoning, with interstitial distinctions, perturbs the Court since private respondent may
well be minded to claim that the imputation of dishonesty should be the other way around.
Petitioner would have the Court believe that although private respondent defied its policy against its female employees contracting
marriage, what could be an act of insubordination was inconsequential. What it submits as unforgivable is her concealment of that
marriage yet, at the same time, declaring that marriage as a trivial matter to which it supposedly has no objection. In other words,
PT & T says it gives its blessings to its female employees contracting marriage, despite the maternity leaves and other benefits it
would consequently respond for and which obviously it would have wanted to avoid. If that employee confesses such fact of
marriage, there will be no sanction; but if such employee conceals the same instead of proceeding to the confessional, she will be
dismissed. This line of reasoning does not impress us as reflecting its true management policy or that we are being regaled with
responsible advocacy.
This Court should be spared the ennui of strained reasoning and the tedium of propositions which confuse through less than candid
arguments. Indeed, petitioner glosses over the fact that it was its unlawful policy against married women, both on the aspects of
qualification and retention, which compelled private respondent to conceal her supervenient marriage. It was, however, that very
policy alone which was the cause of private respondent's secretive conduct now complained of. It is then apropos to recall the
familiar saying that he who is the cause of the cause is the cause of the evil caused.
Finally, petitioner's collateral insistence on the admission of private respondent that she supposedly misappropriated company funds,
as an additional ground to dismiss her from employment, is somewhat insincere and self-serving. Concededly, private respondent
admitted in the course of the proceedings that she failed to remit some of her collections, but that is an altogether different story.
The fact is that she was dismissed solely because of her concealment of her marital status, and not on the basis of that supposed
defalcation of company funds. That the labor arbiter would thus consider petitioner's submissions on this supposed dishonesty as a

7. mere afterthought, just to bolster its case for dismissal, is a perceptive conclusion born of experience in labor cases. For, there was
no showing that private respondent deliberately misappropriated the amount or whether her failure to remit the same was through
negligence and, if so, whether the negligence was in nature simple or grave. In fact, it was merely agreed that private respondent
execute a promissory note to refund the same, which she did, and the matter was deemed settled as a peripheral issue in the labor
case.
Private respondent, it must be observed, had gained regular status at the time of her dismissal. When she was served her walking
papers on January 29, 1992, she was about to complete the probationary period of 150 days as she was contracted as a
probationary employee on September 2, 1991. That her dismissal would be effected just when her probationary period was winding
down clearly raises the plausible conclusion that it was done in order to prevent her from earning security of tenure. 27
On the other
hand, her earlier stints with the company as reliever were undoubtedly those of a regular employee, even if the same were for fixed
periods, as she performed activities which were essential or necessary in the usual trade and business of PT & T. 28
The primary
standard of determining regular employment is the reasonable connection between the activity performed by the employee in
relation to the business or trade of the employer. 29
As an employee who had therefore gained regular status, and as she had been dismissed without just cause, she is entitled to
reinstatement without loss of seniority rights and other privileges and to full back wages, inclusive of allowances and other benefits
or their monetary equivalent. 30
However, as she had undeniably committed an act of dishonesty in concealing her status, albeit
under the compulsion of an unlawful imposition of petitioner, the three-month suspension imposed by respondent NLRC must be
upheld to obviate the impression or inference that such act should be condoned. It would be unfair to the employer if she were to
return to its fold without any sanction whatsoever for her act which was not totally justified. Thus, her entitlement to back wages,
which shall be computed from the time her compensation was withheld up to the time of her actual reinstatement, shall be reduced
by deducting therefrom the amount corresponding to her three months suspension.
4. The government, to repeat, abhors any stipulation or policy in the nature of that adopted by petitioner PT & T. The Labor Code
state, in no uncertain terms, as follows:
Art. 136. Stipulation against marriage. — It shall be unlawful for an employer to require as a condition of
employment or continuation of employment that a woman shall not get married, or to stipulate expressly or tacitly
that upon getting married, a woman employee shall be deemed resigned or separated, or to actually dismiss,
discharge, discriminate or otherwise prejudice a woman employee merely by reason of marriage.
This provision had a studied history for its origin can be traced to Section 8 of Presidential Decree No. 148, 31
better known as the
"Women and
Child Labor Law," which amended paragraph (c), Section 12 of Republic Act No. 679, 32
entitled "An Act to Regulate the Employment
of Women and Children, to Provide Penalties for Violations Thereof, and for Other Purposes." The forerunner to Republic Act No. 679,
on the other hand, was Act No. 3071 which became law on March 16, 1923 and which regulated the employment of women and
children in shops, factories, industrial, agricultural, and mercantile establishments and other places of labor in the then Philippine
Islands.
It would be worthwhile to reflect upon and adopt here the rationalization in Zialcita, et al. vs. Philippine Air Lines, 33
a decision that
emanated from the Office of the President. There, a policy of Philippine Air Lines requiring that prospective flight attendants must be
single and that they will be automatically separated from the service once they marry was declared void, it being violative of the
clear mandate in Article 136 of the Labor Code with regard to discrimination against married women. Thus:
Of first impression is the incompatibility of the respondent's policy or regulation with the codal provision of law.
Respondent is resolute in its contention that Article 136 of the Labor Code applies only to women employed in
ordinary occupations and that the prohibition against marriage of women engaged in extraordinary occupations,
like flight attendants, is fair and reasonable, considering the pecularities of their chosen profession.
We cannot subscribe to the line of reasoning pursued by respondent. All along, it knew that the controverted policy
has already met its doom as early as March 13, 1973 when Presidential Decree No. 148, otherwise known as the
Women and Child Labor Law, was promulgated. But for the timidity of those affected or their labor unions in
challenging the validity of the policy, the same was able to obtain a momentary reprieve. A close look at Section 8
of said decree, which amended paragraph (c) of Section 12 of Republic Act No. 679, reveals that it is exactly the
same provision reproduced verbatim in Article 136 of the Labor Code, which was promulgated on May 1, 1974 to
take effect six (6) months later, or on November 1, 1974.
It cannot be gainsaid that, with the reiteration of the same provision in the new Labor Code, all policies and acts
against it are deemed illegal and therefore abrogated. True, Article 132 enjoins the Secretary of Labor to establish
standards that will ensure the safety and health of women employees and in appropriate cases shall by regulation
require employers to determine appropriate minimum standards for termination in special occupations, such as
those of flight attendants, but that is precisely the factor that militates against the policy of respondent. The
standards have not yet been established as set forth in the first paragraph, nor has the Secretary of Labor issued
any regulation affecting flight attendants.
It is logical to presume that, in the absence of said standards or regulations which are as yet to be established, the
policy of respondent against marriage is patently illegal. This finds support in Section 9 of the New Constitution,
which provides:

8. Sec. 9. The State shall afford protection to labor, promote full employment and equality in employment, ensure
equal work opportunities regardless of sex, race, or creed, and regulate the relations between workers and
employees. The State shall assure the rights of workers to self-organization, collective bargaining, security of
tenure, and just and humane conditions of work . . . .
Moreover, we cannot agree to the respondent's proposition that termination from employment of flight attendants
on account of marriage is a fair and reasonable standard designed for their own health, safety, protection and
welfare, as no basis has been laid therefor. Actually, respondent claims that its concern is not so much against the
continued employment of the flight attendant merely by reason of marriage as observed by the Secretary of Labor,
but rather on the consequence of marriage-pregnancy. Respondent discussed at length in the instant appeal the
supposed ill effects of pregnancy on flight attendants in the course of their employment. We feel that this needs no
further discussion as it had been adequately explained by the Secretary of Labor in his decision of May 2, 1976.
In a vain attempt to give meaning to its position, respondent went as far as invoking the provisions of Articles 52
and 216 of the New Civil Code on the preservation of marriage as an inviolable social institution and the family as a
basic social institution, respectively, as bases for its policy of non-marriage. In both instances, respondent
predicates absence of a flight attendant from her home for long periods of time as contributory to an unhappy
married life. This is pure conjecture not based on actual conditions, considering that, in this modern world,
sophisticated technology has narrowed the distance from one place to another. Moreover, respondent overlooked
the fact that married flight attendants can program their lives to adapt to prevailing circumstances and events.
Article 136 is not intended to apply only to women employed in ordinary occupations, or it should have
categorically expressed so. The sweeping intendment of the law, be it on special or ordinary occupations, is
reflected in the whole text and supported by Article 135 that speaks of non-discrimination on the employment of
women.
The judgment of the Court of Appeals in Gualberto, et al. vs. Marinduque Mining & Industrial Corporation 34
considered as void a
policy of the same nature. In said case, respondent, in dismissing from the service the complainant, invoked a policy of the firm to
consider female employees in the project it was undertaking as separated the moment they get married due to lack of facilities for
married women. Respondent further claimed that complainant was employed in the project with an oral understanding that her
services would be terminated when she gets married. Branding the policy of the employer as an example of "discriminatory
chauvinism" tantamount to denying equal employment opportunities to women simply on account of their sex, the appellate court
struck down said employer policy as unlawful in view of its repugnance to the Civil Code, Presidential Decree No. 148 and the
Constitution.
Under American jurisprudence, job requirements which establish employer preference or conditions relating to the marital status of
an employee are categorized as a "sex-plus" discrimination where it is imposed on one sex and not on the other. Further, the same
should be evenly applied and must not inflict adverse effects on a racial or sexual group which is protected by federal job
discrimination laws. Employment rules that forbid or restrict the employment of married women, but do not apply to married men,
have been held to violate Title VII of the United States Civil Rights Act of 1964, the main federal statute prohibiting job
discrimination against employees and applicants on the basis of, among other things, sex. 35
Further, it is not relevant that the rule is not directed against all women but just against married women. And, where the employer
discriminates against married women, but not against married men, the variable is sex and the discrimination is unlawful. 36
Upon
the other hand, a requirement that a woman employee must remain unmarried could be justified as a "bona fide occupational
qualification," or BFOQ, where the particular requirements of the job would justify the same, but not on the ground of a general
principle, such as the desirability of spreading work in the workplace. A requirement of that nature would be valid provided it reflects
an inherent quality reasonably necessary for satisfactory job performance. Thus, in one case, a no-marriage rule applicable to both
male and female flight attendants, was regarded as unlawful since the restriction was not related to the job performance of the flight
attendants. 37
5. Petitioner's policy is not only in derogation of the provisions of Article 136 of the Labor Code on the right of a woman to be free
from any kind of stipulation against marriage in connection with her employment, but it likewise assaults good morals and public
policy, tending as it does to deprive a woman of the freedom to choose her status, a privilege that by all accounts inheres in the
individual as an intangible and inalienable right. 38
Hence, while it is true that the parties to a contract may establish any
agreements, terms, and conditions that they may deem convenient, the same should not be contrary to law, morals, good customs,
public order, or public policy. 39
Carried to its logical consequences, it may even be said that petitioner's policy against legitimate
marital bonds would encourage illicit or common-law relations and subvert the sacrament of marriage.
Parenthetically, the Civil Code provisions on the contract of labor state that the relations between the parties, that is, of capital and
labor, are not merely contractual, impressed as they are with so much public interest that the same should yield to the common
good. 40
It goes on to intone that neither capital nor labor should visit acts of oppression against the other, nor impair the interest or
convenience of the public. 41
In the final reckoning, the danger of just such a policy against marriage followed by petitioner PT & T is
that it strikes at the very essence, ideals and purpose of marriage as an inviolable social institution and, ultimately, of the family as
the foundation of the nation. 42
That it must be effectively interdicted here in all its indirect, disguised or dissembled forms as
discriminatory conduct derogatory of the laws of the land is not only in order but imperatively required.
ON THE FOREGOING PREMISES, the petition of Philippine Telegraph and Telephone Company is hereby DISMISSED for lack of merit,
with double costs against petitioner.

9. [G.R. No. 118892. March 11, 1998]
FILIPINAS BROADCASTING NETWORK, INC., petitioner vs. NATIONAL LABOR RELATIONS COMMISION and SIMEON
MAPA JR., respondents.
D E C I S I O N
PANGANIBAN, J.:
As a rule, factual findings of the NLRC are binding on his Court. However, when the findings of the NLRC and the labor arbiter
are contradictory, this Court may review questions of facts. Where the evidence clearly shows the absence of an employer-employee
relationship, a claim for unpaid wages, thirteenth month pay, holiday and rest pay and other employment benefits must necessarily
fail.
The Case
Before us is a petition for certiorari assailing the April 29, 1994 Decision of the National Labor Relations Commission,[1]
in Case
No. 05-08-00348-92, entitled “Simeon M. Mapa Jr., v. DZRC Radio Station.” The dispositive portion of the challenged Decision reads:
“WHEREFORE, premises considered, the appealed decision is set aside, and a new judgment is entered, declaring that complainant is
an employee of the respondent and is entitled to his claims for the payment of his services from March 11, 1990 to January 16,
1992.”[2]
Petitioner also impugns the November 9, 1994 Resolution[3]
f the NLRC denying the motion for reconsideration.
The October 13, 1993 decision of the labor arbiter,[4]
which the NLRC reversed and set aside, disposed as follows:
“This Arbitration Branch, based on the facts and circumstances established by the parties in this case is inclined to believe that
complaint Simeon M. Mapa, Jr., had not been an employee of the respondent DZRC Radio Station before February 16, 1992.[5]
He
was but a volunteer reporter when accommodated to air his report on the respondent radio station as his application for employment
with the respondent radio station as his application for employment with the respondent as fieled reporter had not been accepted yet
or approved before February, 1992. There was no employer-employee relations that existed between the complainant and the
respondent since March 11, 1990 until February 16, 1992. The complainant is not entitled to his claim for any salaries, premium pay
for holiday and rest day, holiday pay and the 13th
month pay against the respondent DZRC Radio Station/Salvo Fortuno.
WHEREFORE, in the light of the foregoing premises, judgment is hereby rendered dismissing the complaint in his case for lack of
merit.”[6]
The Facts
Version of Private Respondent
Petitioner and private respondent submitted different versions of the facts. The facts as viewed by private respondent are as
follows:[7]
“The complainant (herein private respondent) began to work for the respondent as a radio reporter starting March 11, 1990. On May
14, 1990, upon being informed by then respondent’s Station Manager, Mr. Plaridel Brocales, that complainant’s employment with
respondent is being blocked by Ms. Brenda Bayona of DZGB, complainant’s previous employer, the said complainant took a leave of
absence. In the first week of June, 1990, the respondent thru Mr. Antonio Llarena, then an employee of the respondent, asked the
complainant to return to work even as he was assured that his salaries will be paid to him already. Thus, the complainant continued
to work for the respondent since then. On September 5, 1991, again the complainant took a leave of absence because of his
desperation over the failure of respondent to make good its promise of payment of salaries. He was reinstated on January 16, 1992
and resigned on February 27, 1992 when he decided to run for an elective office in the town of Daraga, albay. Unfortunately, the
respondent paid salary to the complainant only for the period from January 16, 1992 up to February 27, 1992. Respondent did not
pay the complainant for all the services rendered by the latter from March 11, 1990 up to January 16, 1992.”
As may be glened from its memorandum,[8]
petitioner’s version of the facts is as follows:
“1. On or before April 1990, Mapa was dismissed from his employment with PBN-DZGB Legaspi. At the time, Mapa filed a case for
illegal dismissal against PBN-DZGB Legaspi docketed as RAV V. Case No. 05-04-00120-90 entitled ‘Simeon Mapa, Jr. v. People’s
Broadcasting Network-DZGB Legaspi, Jorge Bayona and Arturo Osia’.
2. On or about May 1990, Mapa sought employment from DZRC as a radio reporter. However, DZRC required of private respondent
the submission of a clearance from his former employer. Otherwise, his apllication would not be acted upon;

10. 3.On May 14, 1990, Mapa was informed by DZRC's then station manager, Mr. Plaridel ‘Larry’ Brocales, that his application for
employment was ‘being blocked by Ms. Brenda Bayona of DZGB, Mapa’s former employer.’ This fact is supported by Mapa’s position
paper before the Honorable Labor Arbiter xxx;
4. Taking pity on Mapa and pending the issuance of the clearance from PBN-DZGB Legaspi, Mr. Larry Brocales granted the request
of Mapa to be accomodated only as a volunteer reporter of DZRC on a part-time basis. As a volunteer reporter, Mapa was not to be
paid wages as an employee of DZRC but he was permitted to find sponsors whose business establishments will be advertised every
time he goes on the air. Most importantly, Mapa’s only work consisted of occasional newsbits or on-the spot reporting of consisted of
occasional newsbits or on-the spot reporting of incidents or newsworthy occurances, which was very seldom.
5. Mapa’s friends who were also in the same situation as he was, declared in an affidavit dated June 10, 1993 that:
“WE, ALLAN ALMARIO and ELMER ANONUEVO, of legal age, single, with postal address at Washington Drive, Legaspi City, under
oath, depose and state:
1. We personally know Simeon “Jun” Mapa, a former volunteer reporter at DZRC just like us;
2. As volunteer reporters we know that we will not receive any salary or allowance from DZRC because our work was purely
voluntary;
3. As incentive for us, the management of DZRC allowed us to get our own sponsors whose business establishment we
mention[ed] every after field report was made by us;
4. The management did not require or oblige us to render a report. We were on our own. We ma[d]e or render[ed] a report as
we [saw]fit;
5. During our stint as volunteer reporters we had several sponsors each who paid us P300.00 per month (each).”
xxx xxx xxx
6. Having no radio gadgets to begin with, DZRC loaned Mapa the necessary equipment such as handheld radios and reporting
gadgets. Mapa was to do occasional reporting only, i.e., a few minutes each day at an irregular time period at Mapa’s own
convinience. Mapa advertised his sponsors and pocketed the payment of these sponsors for his advertising services. In addition,
DZRC had no control over the manner by [sic] which he was to make his reports. Nor were the said reports subject to editing by
DZRC;
7. In an Affidavit dated June 10, 1993 executed by one of Mapa’s sponsors, the same reads as follows:
‘I, CARLITO V. BAYLON, of legal age, married, resident of Dona Maria Subdivision, Daraga, Albay, under oath, despose and state:
1. I am a lawyer by profession. At the same time, I am owner of ‘Kusina ni Manoy’ a restaurant situated in Daraga, Albay;
2. I personally know Simeon ‘Jun’ Mapa. Sometime in May, 1990 he went to make and asked if I could be one of his sponsors
because he was accomodated by DZRC as volunteer reporter. He explained to me that, he will not be receiving any salary from
DZRC[;] hence, he was soliciting any support;
3. Taking pity on him, I agreed to be one of his sponsors. The condition was, I will have to pay him P300.00/month. In exchange
thereto, he will have to mention the name of the name of my restaurant every time he renders a report on the air;
4. My sponsorship lasted for about (5) months after which I discontinued it when I rarely heard Jun Mapa in DZRC program.’
xxx xxx xxx
8. On November 7, 1990, in his testimony against his former employer, Mapa declared under oath. To wit:
“ATTY. LOBRIGO:
‘On paragraph 14 of the same affidavit it states and I quote: 13. Having been left with an empty stomach, I was compelled to apply
for employment with another radio station. On March 11, 1990, I applied for employment with DZRC. Unfortunately, my application
would not yet be acted [upon] favorably because of the malicious and oppressive imputations to me by my former employer.’
My question is what is now the status of your employment with DZRC?
WITNESS:

11. I am at present on a volunteer status because my former employer at DZGB did not give me clearance and I am required to submit
that clearance to DZRC.” (Underlining supplied).”
See p. 2 of Position Paper of DZRC before the Labor Arbiter and pp. 4-5 of the Transcript of Stenographer Notes dated November 7,
1990, attached and marked as Annex “F” and Annex “F-1”, Petition for Certiorari;
9. It cannot be overstressed that Mapa’s application for employment could not have been acted upon because of the lack of the pre-
requisite clearance.
10. Lacking in sponsors, Mapa soon failed to provide petitioner with newsbits, finding it unprofitable to continue since he had no
available sources of funding. Sometime in September 1991, Mapa quit his part-time endeavor with DZRC, as attested to by the
Office of Supervisor/Traffic Manager Ignacio Casi in an Affidavit dated June 10, 1992, to wit:
‘1. I am the Office Supervisor/Traffic Manager of DZRC-AM;
2. Sometime in May, 1990 Simeon “Jun” Mapa went to my office inside our radio station. He asked me if he could be
accomodated as Radio Reporter of DZRC, as he was dismissed from DZGB. I referred him to Larry Brocales, our
Station Manager then;
3. Larry Brocales told Jun Mapa that he cannot be accomodated because he has no clearance from DZGB. Jun Mapa,
almost teary eyed, pleaded to Larry Brocales that he be accomodated as volunteer reporter, that is, he will not receive
any salary but that he intimated that he be allowed to look for sponsors whose business establishment, for a fee, will
have to be mentioned after every report is made. Larry Brocales took pity on Jun Mapa and accomodated him;
4. Jun Mapa, just like the other volunteer reporters, was not obliged to render field reports, at a particular time and in a
particular program. They render report as they wish or see fit;
5. The management (DZRC) does not collect anything from the sponsors of Jun Mapa. They (sponsors) pay directly to
him;
6. Being the Office Supervisor, I know for a fact that Jun Mapa seldom renders report on the air. He has no assigned
program either. He was on and off the air, so to speak;
7. Finally, some time in September, 1991, Jun Mapa told me that he is quitting already because his sponsors were no
longer paying him of his monthly contract with them.” (Underscoring supplied)(See Annex “G”, Petition for Certiorari);
11. Subsequently, Mapa sent a letter dated October 7, 1991 to Ms. Diana C. Gozum, General Manager of petitioner FBN. In
the said letter, Mapa wrote and admitted that:
‘I am [sic] Mr. Simeon Mapa, Jr. respectfully request your good office to reconsider my previous application submitted last March
1990 as a reporter of DZRC AM.
May I inform you that since the submission of such application I worked until September 6, 1991 for free services [sic]. Hoping that
I’ll be given the chance to be recognized as a regular reporter.
With this, I respectfully wish to follow up my application for recognition.
May I also inform you that the case I have with my previous job with the other company has commenced.
Attached herewith is my resume.
I am once again submitting myself for an interview with your office at a time convenient to you.
Thank you.’
(See Annex “H”, Petition for Certiorari);
12. Reacting to the letter mentioned in the immediately preceding paragraph, DZRC favorably acted upn the application of
Mapa and accepted him as a radio reporter on January 16, 1992;
13. On February 27, 1992, Mapa resigned as a radio reporter in order to run for an elective office in the May 1992 elections
and was paid all his salaries and benefits for the period of his employment commencing from January 16, 1992 until February 27,
1992;
14. Having no work to do and no employment in sight, Mapa filed a complaint against FBN-DZRC on August 1992, claiming the
payment of salaries, premium pay, holiday pay as well as 13th
month pay for the period 28 February 1990 until January 16, 1992;”

12. On October 13, 1993, Labor Arbiter Emeterio Ranola dismissed the complaint for lack of merit, finding that no employer-
employee relationship existed between Mapa and DZRC during the period March 11, 1990 to February 16, 1992.[9]
Findings of the NLRC
In holding that there was an employer-employee relationship, the NLRC set aside the labor arbiter’s findings:
“In his appeal, complainant insists that there was an employer-employee relationship between him and the respondent. In support
of his contention, he cites the payroll for February 16 to 29, 1992, the ID card issued to him as employee and regular reporter by the
respondent: [sic] the program schedules of DZRC showing the regular program of the station indicating his name: [sic] the affidavit
of Antonio Llarena, program supervisor of DZRCM, stating that he [was] a regular reporter underhis supervision and the list of
reporting gadgets issued to regular reporter.
The existence of employer employee relationship is determined by the following elements, namely: 1) selection and engagement of
the employee; 2) the payment of wages; 3) the power of dismissal; and 4) the power to control employee’s conduct although the
latter is the most important element. (Rosario Brothers, Inc. vs. Ople, 131 SCRA 72)
Considering the totality of the evidence adduced by the parties, we are of the opinion that the complainant is a regular reporter of
the respondent. Firstly, the work of the complainant is being supervised by the program supervisor of the respondent; secondly, the
complainant uses the reporting gadgets of the respondent. Thirdly, he has no reporting gadgets of his own; Fourthly, the program
schedule is prepared by the respondent; and Lastly, he was paid salary for the period for the period from February 16 to 29, 1992
and covered under the Social Security System. There is no showing in the record that his work from February 16, 1992 was different
from his work before the said period.”[10]
The NLRC subsequently denied petitioner’s motion for reconsideration[11]
on November 9, 1994.[12]
Hence this petition.[13]
Issue
Petitioner alleges that Public Respondent NLRC committed grave abuse of discretion as follows:[14]
“I
xxx in declaring Mapa as an employee of petitioner before January 16, 1992. The test of an employer-employee relationship was
erroneously applied to the facts of this case.
II
xxx in disregarding significant facts which clearly and convincingly show that the private respondent was not an employee of the
petitioner before 16 January 1992.”
In the main, the issue in this case is whether private respondent was an employee of petitioner for the period March 11, 1990
to January 15, 1992.
The Court’s Ruling
The petition is meritorious.
Main Issue:
Private Respondent Was Not an Employee During the Period in Controversy
As a rule, the NLRC’s findings are accorded great respect, even finality, by this Court. This rule, however, is not without
qualification. This Court held in Jimenez v. NLRC:[15]
The review of labor cases elevated to us on certiorari is confined to questions of jurisdiction or grave abuse of discretion.[16]
As a
rule, this Court does not review supposed errors in the decision of the NLRC which raise factual issues, because factual finding of
agencies exercising quasi-judicial functions are accorded not only respect but even finality, aside from the consideration that the

13. Court is essentially not a trier of facts. However, in the case at bar, a review of the records thereof with an assessment of the facts is
necessary since the factual findings of the NLRC and the labor arbiter are at odds with each other.[17]
In the present case, a review of the factual findings of the public respondent is in order, for said findings differ from those of
the labor arbiter.[18]
Worse the facts alleged by the private respondent and relied upon by the public respondent do not prove an
employer-employee relationship.[19]
In this light, we will review – and overrule – the findings of the NLRC.
The following are generally considered in the determination of the existence of an employer-employee relationship: (1) the
manner of selection and engagement, (2) the payment of wages, (3) the presence or absence of the power of dismissal, and (4) the
presence or absence of the power of control; of these four, the last one is the most important.[20]
Engagement and Payment of Wages
Let us consider the circumstances of the private respondent’s engagement in DZRC before January 16, 1992. Petitioner did not
act on his application for employment as a radio reporter because private respondent admittedly failed to present a clearance from
his former employer. Nevertheless, private respondent “volunteered” his services, knowing that he would not be paid wages, and
that he had to rely on financial sponsorships of business establishments that would be advertised in his reports. In other words,
private respondent willingly acted as a volunteer reporter, fully cognizant that he was not an employee and that he would not receive
any compensation directly from the petitioner, but only from his own advertising sponsors.
The nature of private respondent’s engagement is evident from the affidavit of Allan Almario and Elmer Anonuevo who served
under identical circumstances. The two affirmed the following:
“1. We personally know Simeon “Jun” Mapa, a volunteer reporter at DZRC just like us;
2. As a volunteer reporters we know [sic] that we will not receive any salary or allowance from DZRC because our work was purely
voluntary;
3. As incentive for us, the management of DZRC allowed us to get our own sponsors whose business establishments we mention
every after [sic] field report was made by us;
xxx xxx xxx
4. During our stint as volunteer reporters we had several sponsors each who paid us P300.00 per month.”[21]
The above statement is corroborated by Carlito Baylon, one of private respondent’s advertising sponsors. In his affidavit dated
June 10, 1993, he averred:
“2. I personally know Simeon “Jun” Mapa.
Sometime in May, 1990, he went to me and asked if I could be one of his sponsors because he was accomodated by DZRC as
volunteer reporter. He explained to me that, he will not be receiving any salary from DZRC[,] hence, he was soliciting my support;
3. Taking pity on him, I agreed to be one of his sponsors. The condition was, I will have to pay him P300.00/month. In exchange
thereto, he will have to mention the name of my restaurant everytime he renders a report on the air;
4. My sponsorship lasted for about five (5) months after which I discontinued it when I rarely heard Jun Mapa in DZRC program.”[22]
Indeed, private respondent himself admitted tat he worked under the said circumstances. The bio-data sheet signed by Mapa
himself, in which he acknowledged that he was not an employee, states in part:
“Work experiences:
DWGW …. Reporter/Newscaster 1970-1980
DZGB …. Reporter 1983-1990
DZRC …. Reporter 1990-1991
for free not recognized due to no appointment.”[23]
(Underscoring supplied.)
In his letter dated October 7, 1991, which he sent to the general manager of Filipinas Broadcasting Network (owner of DZRC),
Mapa again acknowledged in the following words that he was not an employee:

14. “I am [sic] Mr. Simeon Mapa, Jr. respectfully request your good office to reconsider my previous application submitted last March
1990 as a reporter of DZRC AM.
May I inform you that since the submission of such application I worked until September 6, 1991 for free of services [sic]. Hoping
that I’ll be given the chance to be recognized as a regular reporter.
With this, I respectfully wish to follow up my application for recognition.” (Italics supplied.)
There is no indication that these two circumstances were made under duress. Indeed, private respondent himself did not
dispute their voluntariness or veracity. It is clear that he rendered services knowing that he was not an employee. Aware that he
would not be paid wages, he described himself as a “volunteer reporter” who was, as evident from his letter, hoping for “the chance
to be recognized as a regular reporter.” In fact, petitioner acted favorably on this letter and accepted his application as an employee
effective on January 16, 1992.
Power of Dismissal
Likewise, the evidence on record shows that petitioner did not exercise the power to dismiss private respondent during the
period in question. in September 1991, Private Respondent Mapa ceased acting as a volunteer reporter, not because he was fired ,
but because he stopped sending his reports. Ignacio Casi, Office Supervisor of DZRC, declared in his affidavit that Mapa told him that
“he [was] quitting already because his sponsors were no longer paying him of [sic] his monthly contract with them.” Mapa did not
controvert this statement. In fact, his aforesaid letter of October 17, 1991 expressed his hope of being “given the chance to be
recognized as a regular reporter.” Private respondent’s attitude in said letter is inconsistent with the notion that he had been
dismissed.
Mapa Was Not Subject to Control of Petitioner
The most crucial test – the control test – demonstrates all too clearly the absence of an employee-employee relationship. No
one at the DZRC had the power to regulate or control private respondents’ activities or inputs. Unlike the regular reporters, he was
not subject to any supervision by petitioner or its officials. Regular reporters “are required by the petitioner to adhere to a program
schedule which delineates the time when they are to render their reports, as well as the topic to be reported upon. The substance of
their reports are [sic] oftentimes screened by the station prior to [their] actual airing. In contrast, volunteer reporters are never
given such a program schedule but are merely advised to inform the station of the reports they would make from time to time.”[24]
Indeed, DZRC, the petitioner’s radio station , exercised no editorial rights over his reports. He had no fixed day or time for
making his reports; in fact, he was not required to report anything at all. Whether he would air anything depended entirely on him
and his convenience.
The absence of petitioner’s control over private respondent is manifest from the sworn statement of the traffic manager of
petitioner, Ignacio Casi, who deposed in part:
“xxx xxx xxx
4. Jun Mapa, just like the other volunteer reporters, was not obliged to render field reports, at a particular time and in a particular
program. They render report as they wish or see fit;
5. The management (DZRC) does not collect anything from the sponsors of Jun Mapa. They (sponsors) pay directly to him;
6. Being the Office Supervisor, I know for a fact that Jun Mapa seldom renders report on the air. He has no assigned program either.
He was on and off the air, so to speak;
7. Finally, some time in September, 1991, Jun Mapa told me that he is quitting already because his sponsors were no longer paying
him of his monthly contract with them.”
In Encyclopedia Britannica (Philippines) Inc., v. NLRC,[25]
we reiterated that there could be no employer-employee relationship
where “the element of control is absent; where a person who works for another does so more or less at his own pleasure and is not
subject to definite hours or conditions of work[;] and in turn is compensated according to the result of his efforts and not the amount
thereof, we should not find that the relationship of employer-employee exists.” In the present case, private respondent worked at his
“own pleasure and [was] not subject to definite hours or conditions of work.”
“Evidence” Found by NLRC Not Applicable

15. In its two-page[26]
holding that there was an employer-employee relationship, the NLRC relied on the following:
(1) the payroll for February 16 to 29, 1992,
(2) the ID card issued to him as employee and regular reporter by the respondent,
(3) the program schedules of DZRC showing the regular program of the station indicating his name:
(4) the affidavit of Antonio Llarena, program supervisor of DZRC, stating that he [was] under his supervision, and
(5) the list of reporting gadgets issued to a regular reporter.
Other than the items enumerated above, no other document was considered by the NLRC. In other words, its conclusion was
based solely on these alleged pieces of evidence. It clearly committed grave abuse of discretion in its factual findings, because all the
above documents relate to the period January 16, 1992 to February 28, 1992 and not to the period March 11, 1990 to January 15,
1992 which are inclusive dates in controversy.
The payroll[27]
from February 16, 1992 to February 27, 1992 does not demonstrate that private respondent was an employee
prior to said period. Lest it be forgotten, the question in this case pertains to the status of private respondent from March 11, 1990
to January 15, 1992. The said payroll may prove that private respondent was an employee during said days in February 1992, but
not for the period which is the subject of the present controversy.
Furthermore, neither the identification cards nor the SSS number printed at the back thereof indicate the date of issuance.
Likewise, the SSS number does not show that he was a member during the period in controversy; much less, that he became so by
reason of his employment with petitioner.
Similarly inapplicable is the program schedule[28]
which allegedly showed the regular program of the station and indicated the
name of private respondent as an employee. The document is a mere photocopy of a typewritten schedule. There is absolutely no
indicium of its authenticity. Moreover, it is undated; hence, it does not indicate whether such schedule pertained to the period in
disupte, that is, March 11, 1990 to January 15, 1992. Worse, the heading thereof was entitled “Radio DZRC Programming Proposal.
[italics supplied]” A proposal is “put forth merely for consideration and acceptance.”[29]
It cannot, by itself, prove that such program
was implemented and that private respondent acted as an employee of petitioner.
Neither does the list of returned gadgets support the conclusion of the NLRC. It must be stressed that such gadgets were
essential to enable the private respondent to access the specific radio frequency and fcailities of the radio station. Being exclusive
properties of the radio station, such gadgets could not have been purchased, as they were not commercially available. In any event,
the list of returned gadgets was dated February 27, 1997 -- again, a date not in controversy. Such document, by itself, does not
prove that private respondent was an employee from March 20, 1990 to January 15, 1992.
The affidavit of Antonio Llarena[30]
, an employee of DZRC, stating that the private respondent was under his supervision, is
vague, even misleading; it declaring merely that Llarena was “in charge” of said respondent. Such language could not be construed
to mean that he exercised supervision and control over private respondent.
Indubitably, the NLRC based its findings of employer-employee relationship from the circumstances attendant when private
respondent was already a regular employee. Uncontroverted is the statement that the private respondent was a regular employee
from January 16, 1992 to February 28, 1992, for which period he received all employee benefits. But such period, it must be
stressed again, is not covered by private respondent’s complaint.
In sum, the evidence, which Public Respondent NLRC relies upon, does not justify the reversal of the labor arbiter’s ruling
which, in turn, we find amply supported by the records. Clearly, private respondent was not an employee during the period in
question.
WHEREFORE, the petition is hereby GRANTED and the assailed Decision and Resolution are hereby SET ASIDE. The Order of the
Labor Arbiter dated October 13, 1993 dismissing the case for lack of merit is hereby REINSTATED. No costs.
SO ORDERED.
Davide,Jr., (Chairman), Bellosillo, Vitug, and Quisumbing, JJ., concur.
SECOND DIVISION
[G.R. No. 127864. December 22, 1999]

16. TRADERS ROYAL BANK, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and ROGELIO
ESPAÑOLA, respondent.
D E C I S I O N
BELLOSILLO, J.:
Whether an employer-employee relationship exists between petitioner Traders Royal Bank and private respondent Rogelio
Española - this is the issue on which hinges the fate of private respondent who after twenty (20) years of service found himself
"jobless" and deprived of his only means of livelihood.
On 27 June 1974 Agro-Commercial Security Services Agency Inc. (AGRO) assigned Rogelio Española to work as a janitor at the
Iloilo Branch of petitioner Traders Royal Bank (TRB). This assignment was covered by Mission Order No. 29 dated 26 June 1974
which was duly issued by the Administrative Officer of AGRO, Alberto G. Espinosa.[1]
Sometime in 1982 Española was informed that
he would be absorbed by a new agency, Royal Protective and Janitorial Services Inc. (ROYAL), and that he would perform the same
functions.[2]
However, since ROYAL was also managed and owned by the same people who previously handled AGRO, it did not give
him separation pay or any other benefits. ROYAL also appointed Alberto G. Espinosa, AGRO’s former Administrative Officer, as its
General Manager.[3]
On 15 July 1988 TRB and ROYAL executed a new service agreement whereby ROYAL would continue supplying janitorial
services TRB for one year, beginning 23 March 1988.[4]
The contract also stated that if there was no notice to terminate at the end of
the one (1) year period it would remain in force on a monthly basis.
When the service agreement expired on 23 March 1989 TRB did not issue a termination notice. Instead, it continued to avail of
ROYAL’s services on a monthly basis as stated in the contract. It was only on 4 February 1994 that TRB sent a letter to ROYAL
apprising the latter of its desire to terminate the service agreement effective 16 March 1994.[5]
In turn, ROYAL sent a notice to
private respondent Española informing him that due to TRB's decision to end their contract his services were no longer needed.
[6]
After being dismissed ROYAL declined to give him any further assignment since his job was allegedly coterminus with its contract
with TRB.
On 24 March 1994 Española filed a case against ROYAL, TRB and Alberto Espinosa for illegal dismissal, illegal deduction,
underpayment of wages, non-payment of overtime pay, premium pay for rest day, service incentive leave pay, 13th month pay and
night shift differentials with a prayer for reinstatement and back wages. He also claimed moral and exemplary damages as well as
attorney’s fees.[7]
On 20 December 1995 the Labor Arbiter ruled in favor of TRB holding that Española had no cause of action against it as there
was no employer-employee relationship between them. The Labor Arbiter further ruled that Española was ROYAL’s employee but he
was not entitled to any monetary award since he did not prove his claims of underpayment and illegal deductions against ROYAL.[8]
On appeal public respondent National Labor Relations Commission (NLRC) reversed the decision of the Labor Arbiter and ruled
that Española was not an employee of ROYAL but of TRB. NLRC then ordered TRB to reinstate him and to pay him the total amount
of P110,829.78 broken down as follows: P81,265.90 for back wages, P736.92 for ERA, P15,698.08 for salary differentials, P3,143.45
for 13th month pay and P10,075.00 for attorney’s fees.[9]
After its motion for reconsideration was denied TRB filed this special civil action for certiorari contending that the NLRC gravely
abused its discretion in reversing the Labor Arbiter’s decision and declaring Española to be its employee.[10]
Who was Española’s real employer? If Española was ROYAL’s employee then he would have no recourse against TRB since his
dismissal was caused by the legitimate termination of a service contract. But if he was really TRB’s employee then he would be
entitled to reinstatement and full back wages as he was illegally dismissed.
To prove that Española was not its employee TRB cites Mission Order No. 29 signed by AGRO Administrative Officer Alberto G.
Espinosa. The order stated that Rogelio Española would be assigned as janitor to TRB’s Iloilo Branch. It also provided that his
employment would be from 26 January 1974 until revoked.[11]
TRB argues that this proves that AGRO was Española’s employer from
1974 to 1982. And when he agreed to be absorbed by ROYAL he became its employee from 1982 to 1994. Hence, he was never
employed by TRB. To bolster its contention TRB refers to the provisions of its service agreement with ROYAL, dated 15 July 1988,
which state that:
2. That the janitor and/or janitress assigned to the PARTY OF THE FIRST PART (petitioner) shall in no way be considered as
employees of the PARTY OF THE FIRST PART and the PARTY OF THE SECOND PART (ROYAL) shall be responsible for the conduct
and performance of its duties;
6. For and in consideration of the services to be rendered by he PARTY OF THE SECOND PART to the PARTY OF THE FIRST PART, the
latter shall pay to the PARTY OF THE SECOND PART (under this agreement) the amount of TWO THOUSAND TWO HUNDRED FIFTY
SEVEN & 32/100 ONLY (2,257.32), Philippine Currency, per month per janitress, the same payable in two (2) installments on the
15th
and last day of every month.
TRB asserts that aside from the agreement itself which reveals that it was ROYAL which provided the janitors’ salary, par. 2
thereof also states that the janitors were its own employees. Thus, Española’s dismissal was the result of a valid termination of its
service agreement with ROYAL.

17. We are not convinced. This Court has ruled that the existence of employer-employee relationship cannot be proved by merely
showing the agreement of the parties.[12]
It is a question of fact which should be supported by substantial evidence.[13]
And in
determining the existence of such relationship the elements usually considered are: (a) the selection of the employee; (b) the
payment of wages; (c) the power of dismissal; and, (d) the power to control the employee’s conduct, with the "control test"
generally assuming primacy in the overall consideration.[14]
Who then had control over Española's conduct? Was it ROYAL or TRB? Between the two, we believe it was TRB. Española
claimed in his position paper that -
Complainant, as previously stated, was required to work as a janitor and as a driver. Moreover, he was required to do his cleaning
chores at night in order not to disturb the transaction of business at the bank during office hours. Thus, every night from Sunday to
Thursday he was required to clean the bank premises of respondent TRB. From Monday to Friday he was required to drive TRB’s
armored car and pick up the children of respondent TRB’s manager, Mrs. Erlinda Ocampo, then drive them to Angelicum School in
Jaro, Iloilo City. Thereafter, he was required to stay in the bank premises until 5:00 P.M., except for lunch break, run errands and
discharge other tasks and chores assigned to him by respondent TRB’s employees. After 5:00 P.M. complainant was required to
drive the above named officers of respondent TRB home. He usually got back to the bank between 6:00 P.M. to 7:00 P.M. Upon his
arrival he would start cleaning the bank and, since the premises was big, it usually took about 2 hours or up to 9:00 P.M. to finish
his cleaning. Because he had to work late and start working early and since his residence was in Sta. Barbara, Iloilo, where there
was no public transportation at night, he had to sleep in the bank. His day-to-day work was monitored and supervised by
respondent TRB.[15]
The above allegations contained in the position paper of Española were never refuted. TRB could have easily presented
affidavits, written explanations or any other pleadings to defend itself and disprove Española’s claims.[16]
However, the only evidence
it ever presented was its service agreement with ROYAL. From the time TRB submitted its position paper to the Labor Arbiter up to
the time it submitted its memorandum to the Supreme Court, not once did it deny that it designated Española as its driver. On the
other hand, Española constantly reiterated in his pleadings that TRB supervised and controlled his work as its janitor-driver. The fact
that Española’s allegations were never controverted at any stage of the proceedings affirms that such averments were true.
[17]
Furthermore, Rule 9, Sec. 11, of the Rules of Court, which supplements the NLRC rules, also provides that an allegation which is
not specifically denied is deemed admitted.[18]
Besides, even if this Court relied on the service agreement, as espoused by TRB, it can still be seen that TRB was the one which
controlled and supervised Española. Paragraph 3 of the contract states -
3. That the PARTY OF THE FIRST PART shall have the direct control and supervision over their janitor’s and janitress’ conduct
and performance in consonance with the preceding paragraph, with minimum interference by the PARTY OF THE SECOND PART,
provided however, that discipline and administration of these janitors and janitresses shall conform with the standards and policies
of the PARTY OF THE FIRST PART x x x x
TRB should, under the foregoing, be obviously deemed as Española's employer.
Petitioner cites Filipino Synthetic Fiber Corp. (FILSYN) v. NLRC[19]
in an effort to persuade this Court that the doctrine therein
should be applied in the instant case. We do not agree. In FILSYN, the employees worked exclusively as janitors and were never
required by FILSYN to perform any other task. Furthermore, there was no proof that FILSYN controlled the manner they
worked. Hence, in that case, the Court ruled that the employer of the janitors was the De Lima Corporation, the janitorial agency,
and not FILSYN. In the present case, however, Española not only worked as a janitor but he was also TRB's driver. Since 1974 he
was required to drive TRB’s armored car, bring and fetch the children of the bank’s manager to and from school, drive for its officers,
and perform various errands assigned to him by TRB employees.
Furthermore, FILSYN presented substantial evidence that the janitorial agency was an independent contractor. It presented De
Lima's Articles of Incorporation and proof of its capitalization amounting to almost P2,000,000. This was not done by TRB. Instead,
it relied heavily on the aforementioned service agreement covering the period from 1988 to 1994. TRB did not even prove
sufficiently that it was not Española’s employer from 1974 to 1987.
As a matter of fact, it was ROYAL which submitted documents to establish that it was an independent contractor. However, it
alleged that it never knew that TRB utilized Española as its driver and compelled him to do other chores.[20]
ROYAL further claimed
that it was TRB which had control and supervision over Española.[21]
Again, TRB never refuted this statement. Neither did it prove
that ROYAL was the one which effectively controlled and supervised the manner Española worked.
The NLRC therefore did not abuse its discretion in ruling that Española was not the employee of ROYAL. On the contrary, it was
the Labor Arbiter who came up with the erroneous conclusion. He disregarded the uncontroverted allegations of Española and
hastily concluded that since ROYAL was an independent contractor, it was Española’s direct employer. While it may be that ROYAL
could very well be an independent contractor - although it did not establish this fact with competent evidence to qualify it as such -
and that Española’s name appeared in its payroll,[22]
nevertheless, whatever role ROYAL had in this case, it was certainly not as the
employer of Española. For the fact remains that it was TRB which had control and supervision over Española’s work. Consequently,
it should be considered as his employer.
Since Española was illegally dismissed he is entitled to reinstatement with full back wages.[23]
The NLRC erred in ruling that he
was only entitled to back wages from 16 March 1994 to 30 September 1996. An illegally dismissed employee is entitled to back
wages from the time he was dismissed to the time of his actual reinstatement.[24]
However, the NLRC’s ruling with regard to the
salary differentials and 13th month pay differentials must be sustained.
WHEREFORE, the petition is DISMISSED. The assailed Decision of public respondent National Labor Relations Commission
reversing that of the Labor Arbiter and ordering petitioner Traders Royal Bank to reinstate private respondent Rogelio Espanola and
to pay him salary differentials of P15,698.00, 13th month pay differentials of P3,143.45 and attorney's fees of P10,075.43 is

18. AFFIRMED, but with the modification that petitioner should pay private respondent full back wages from 16 March 1994 up to his
actual reinstatement. Costs against petitioner.
[G.R. No. 142293. February 27, 2003]
VICENTE SY, TRINIDAD PAULINO, 6B’S TRUCKING CORPORATION, and SBT[1]
TRUCKING CORPORATION,petitioners, vs.
HON. COURT OF APPEALS and JAIME SAHOT, respondents.
D E C I S I O N
QUISUMBING, J.:
This petition for review seeks the reversal of the decision[2]
of the Court of Appeals dated February 29, 2000, in CA-G.R. SP No.
52671, affirming with modification the decision[3]
of the National Labor Relations Commission promulgated on June 20, 1996 in NLRC
NCR CA No. 010526-96. Petitioners also pray for the reinstatement of the decision[4]
of the Labor Arbiter in NLRC NCR Case No. 00-
09-06717-94.
Culled from the records are the following facts of this case:
Sometime in 1958, private respondent Jaime Sahot[5]
started working as a truck helper for petitioners’ family-owned trucking
business named Vicente Sy Trucking. In 1965, he became a truck driver of the same family business, renamed T. Paulino Trucking
Service, later 6B’s Trucking Corporation in 1985, and thereafter known as SBT Trucking Corporation since 1994. Throughout all
these changes in names and for 36 years, private respondent continuously served the trucking business of petitioners.
In April 1994, Sahot was already 59 years old. He had been incurring absences as he was suffering from various
ailments. Particularly causing him pain was his left thigh, which greatly affected the performance of his task as a driver. He inquired
about his medical and retirement benefits with the Social Security System (SSS) on April 25, 1994, but discovered that his premium
payments had not been remitted by his employer.
Sahot had filed a week-long leave sometime in May 1994. On May 27th
, he was medically examined and treated for EOR,
presleyopia, hypertensive retinopathy G II (Annexes “G-5” and “G-3”, pp. 48, 104, respectively),[6]
HPM, UTI, Osteoarthritis (Annex
“G-4”, p. 105),[7]
and heart enlargement (Annex G, p. 107).[8]
On said grounds, Belen Paulino of the SBT Trucking Service
management told him to file a formal request for extension of his leave. At the end of his week-long absence, Sahot applied for
extension of his leave for the whole month of June, 1994. It was at this time when petitioners allegedly threatened to terminate his
employment should he refuse to go back to work.
At this point, Sahot found himself in a dilemma. He was facing dismissal if he refused to work, But he could not retire on
pension because petitioners never paid his correct SSS premiums. The fact remained he could no longer work as his left thigh hurt
abominably. Petitioners ended his dilemma. They carried out their threat and dismissed him from work, effective June 30, 1994. He
ended up sick, jobless and penniless.
On September 13, 1994, Sahot filed with the NLRC NCR Arbitration Branch, a complaint for illegal dismissal, docketed as NLRC
NCR Case No. 00-09-06717-94. He prayed for the recovery of separation pay and attorneys fees against Vicente Sy and Trinidad
Paulino-Sy, Belen Paulino, Vicente Sy Trucking, T. Paulino Trucking Service, 6B’s Trucking and SBT Trucking, herein petitioners.
For their part, petitioners admitted they had a trucking business in the 1950s but denied employing helpers and drivers. They
contend that private respondent was not illegally dismissed as a driver because he was in fact petitioner’s industrial partner. They
add that it was not until the year 1994, when SBT Trucking Corporation was established, and only then did respondent Sahot
become an employee of the company, with a monthly salary that reached P4,160.00 at the time of his separation.
Petitioners further claimed that sometime prior to June 1, 1994, Sahot went on leave and was not able to report for work for
almost seven days. On June 1, 1994, Sahot asked permission to extend his leave of absence until June 30, 1994. It appeared that
from the expiration of his leave, private respondent never reported back to work nor did he file an extension of his leave. Instead,
he filed the complaint for illegal dismissal against the trucking company and its owners.
Petitioners add that due to Sahot’s refusal to work after the expiration of his authorized leave of absence, he should be deemed
to have voluntarily resigned from his work. They contended that Sahot had all the time to extend his leave or at least inform
petitioners of his health condition. Lastly, they cited NLRC Case No. RE-4997-76, entitled “Manuelito Jimenez et al. vs. T. Paulino
Trucking Service,” as a defense in view of the alleged similarity in the factual milieu and issues of said case to that of Sahot’s, hence
they are in pari material and Sahot’s complaint ought also to be dismissed.
The NLRC NCR Arbitration Branch, through Labor Arbiter Ariel Cadiente Santos, ruled that there was no illegal dismissal in
Sahot’s case. Private respondent had failed to report to work. Moreover, said the Labor Arbiter, petitioners and private respondent
were industrial partners before January 1994. The Labor Arbiter concluded by ordering petitioners to pay “financial assistance” of
P15,000 to Sahot for having served the company as a regular employee since January 1994 only.
On appeal, the National Labor Relations Commission modified the judgment of the Labor Arbiter. It declared that private
respondent was an employee, not an industrial partner, since the start. Private respondent Sahot did not abandon his job but his
employment was terminated on account of his illness, pursuant to Article 284[9]
of the Labor Code. Accordingly, the NLRC ordered
petitioners to pay private respondent separation pay in the amount of P60,320.00, at the rate of P2,080.00 per year for 29 years of
service.
Petitioners assailed the decision of the NLRC before the Court of Appeals. In its decision dated February 29, 2000, the appellate
court affirmed with modification the judgment of the NLRC. It held that private respondent was indeed an employee of petitioners
since 1958. It also increased the amount of separation pay awarded to private respondent to P74,880, computed at the rate of
P2,080 per year for 36 years of service from 1958 to 1994. It decreed: