Addl Cases Labor.docx

G.R. No. 173863 September 15, 2010 CHEVRON PHILIPPINES, INC. (Formerly CALTEX PHILIPPINES, INC.),Petitioner, vs. BASES CONVERSION DEVELOPMENT AUTHORITY and CLARK DEVELOPMENT CORPORATION, Respondents Facts: On June 28, 2002, the Board of Directors of respondent Clark Development Corporation (CDC) issued and approved Policy Guidelines on the Movement of Petroleum Fuel to and from the Clark Special Economic Zone. In one of its provisions, it levied royalty fees to suppliers delivering Coastal fuel from outside sources for Php0.50 per liter for those delivering fuel to CSEZ locators not sanctioned by CDC and Php1.00 per litter for those bringing-in petroleum fuel from outside sources. The policy guidelines were implemented effective July 27, 2002. The petitioner Chevron Philippines Inc (formerly Caltex Philippines Inc) who is a fuel supplier to Nanox Philippines, a locator inside the CSEZ, received a Statement of Account from CDC billing them to pay the royalty fees amounting to Php115,000 for its fuel sales from Coastal depot to Nanox Philippines from August 1 to September 21, 2002. Petitioner, contending that nothing in the law authorizes CDC to impose royalty fees based on a per unit measurement of any commodity sold within the special economic zone, protested against the CDC and Bases Conversion Development Authority (BCDA). They alleged that the royalty fees imposed had no reasonable relation to the probably expenses of regulation and that the imposition on a per unit measurement of fuel sales was for a revenue generating purpose, thus, akin to a “tax”. BCDA denied the protest. The Office of the President dismissed the appeal as well for lack of merit. Upon appeal, CA dismissed the case. CA held that in imposing the royalty fees, CDC was exercising its right to regulate the flow of fuel into CSEZ under the vested exclusive right to distribute fuel within CSEZ pursuant to its Joint Venture Agreement (JVA) with Subic Bay Metropolitan Authority (SBMA) and Coastal Subic Bay Terminal, Inc. (CSBTI) dated April 11, 1996. The appellate court also found that royalty fees were assessed on fuel delivered, not on the sale, by petitioner and that the basis of such imposition was petitioner’s delivery receipts to Nanox Philippines. The fact that revenue is incidentally also obtained does not make the imposition a tax as long as the primary purpose of such imposition is regulation. When elevated in SC, petitioner argued that: 1) CDC has no power to impose fees on sale of fuel inside CSEZ on the basis of income generating functions and its right

to market and distribute goods inside the CSEZ as this would amount to tax which they have no power to impose, and that the imposed fee is not regulatory in nature but rather a revenue generating measure; 2) even if the fees are regulatory in nature, it is unreasonable and are grossly in excess of regulation costs. Respondents contended that the purpose of royalty fees is to regulate the flow of fuel to and from the CSEZ and revenue (if any) is just an incidental product. They viewed it as a valid exercise of police power since it is aimed at promoting the general welfare of public; that being the CSEZ administrator, they are responsible for the safe distribution of fuel products inside the CSEZ. Issue: Whether the act of CDC in imposing royalty fees can be considered as valid exercise of the police power. Held: Yes. SC held that CDC was within the limits of the police power of the State when it imposed royalty fees. In distinguishing tax and regulation as a form of police power, the determining factor is the purpose of the implemented measure. If the purpose is primarily to raise revenue, then it will be deemed a tax even though the measure results in some form of regulation. On the other hand, if the purpose is primarily to regulate, then it is deemed a regulation and an exercise of the police power of the state, even though incidentally, revenue is generated. In this case, SC held that the subject royalty fee was imposed for regulatory purposes and not for generation of income or profits. The Policy Guidelines was issued to ensure the safety, security, and good condition of the petroleum fuel industry within the CSEZ. The questioned royalty fees form part of the regulatory framework to ensure “free flow or movement” of petroleum fuel to and from the CSEZ. The fact that respondents have the exclusive right to distribute and market petroleum products within CSEZ pursuant to its JVA with SBMA and CSBTI does not diminish the regulatory purpose of the royalty fee for fuel products supplied by petitioner to its client at the CSEZ. However, it was erroneous for petitioner to argue that such exclusive right of respondent CDC to market and distribute fuel inside CSEZ is the sole basis of the royalty fees imposed under the Policy Guidelines. Being the administrator of CSEZ, the responsibility of ensuring the safe, efficient and orderly distribution of fuel products within the Zone falls on CDC. Addressing specific concerns demanded by the nature of goods or products involved is encompassed in the range of services which respondent CDC is expected to provide under Sec. 2 of E.O. No. 80, in pursuance of its general power of supervision and control over the movement of all supplies and equipment into the CSEZ.

There can be no doubt that the oil industry is greatly imbued with public interest as it vitally affects the general welfare. Fuel is a highly combustible product which, if left unchecked, poses a serious threat to life and property. Also, the reasonable relation between the royalty fees imposed on a “per liter” basis and the regulation sought to be attained is that the higher the volume of fuel entering CSEZ, the greater the extent and frequency of supervision and inspection required to ensure safety, security, and order within the Zone. Respondents submit that the increased administrative costs were triggered by security risks that have recently emerged, such as terrorist strikes. The need for regulation is more evident in the light of 9/11 tragedy considering that what is being moved from one location to another are highly combustible fuel products that could cause loss of lives and damage to properties. As to the issue of reasonableness of the amount of the fees, SC held that no evidence was adduced by the petitioner to show that the fees imposed are unreasonable. Administrative issuances have the force and effect of law. They benefit from the same presumption of validity and constitutionality enjoyed by statutes. These two precepts place a heavy burden upon any party assailing governmental regulations. Petitioner’s plain allegations are simply not enough to overcome the presumption of validity and reasonableness of the subject imposition. WHEREFORE, the petition is DENIED for lack of merit and the Decision of the Court of Appeals dated November 30, 2005 in CA-G.R. SP No. 87117 is hereby AFFIRMED

MANILA MEMORIAL PARK CEMETERY, INC. v. Lluz et al. G.R. No. 208451 February 03, 2016 CARPIO, J.: Facts: Petitioner Manila Memorial Park Cemetery, Inc. (Manila Memorial) entered into a Contract of Services with respondent Ward Trading and Services (Ward Trading). The Contract of Services provided that Ward Trading, as an independent contractor, will render interment and exhumation services and other related work to Manila Memorial in order to supplement operations at Manila Memorial Park, Paranaque City.

Among those assigned by Ward Trading to perform services at the Manila Memorial Park were respondents Ezard Lluz, Norman Corral, Erwm Fugaban, Valdimar Balisi, Emilio Fabon, John Mark Aplicador, Michael Curioso, Junlin Espares, and Gavino Farinas (respondents). Respondents alleged that soon after the management declined their request for regularization and to be recognized as legitimate members of the existing labor union,the latter dismissed them. Hence, this case for illegal dismissal. By way of defense, Manila Memorial argued that there was no employer-employee relationship between the company and respondents. Instead, It argued that respondents were the employees of Ward Trading. Issue: Whether or not an employer-employee relationship exists between Manila Memorial and respondents for the latter to be entitled to their claim for wages and other benefits. Ruling: Contracting arrangements for the performance of specific jobs or services under the law and its implementing rules are allowed. However, contracting must be made to a legitimate and independent job contractor since labor rules expressly prohibit labor-only contracting. Labor-only contracting exists when the contractor or subcontractor merely recruits, supplies or places workers to perform a job, work or service for a principal and any of the following elements are present: 1) The contractor or subcontractor does not have substantial capital or investment which relates to the job, work or service to be performed and the employees recruited, supplied or placed by such contractor or subcontractor are performing activities which are directly related to the main business of the principal; or 2) The contractor does not exercise the right to control the performance of the work of the contractual employee. In the present case, The Contract of Services proved the existence of labor-only conrtacting between Manila Memorial and Ward Trading. The Contract of Services provided that Ward Trading, as an independent contractor, will render interment and exhumation services and other related work to Manila Memoria.However,a closer reading of the Contract of Services reveals that Ward Trading does not have substantial capital or investment in the form of tools, equipment, machinery, work premises and other materials since it is Manila Memorial which owns the equipment used in the performance of work needed for interment and exhumation services. Furthermore, although Ward shall be in charge of the supervision over individual respondents, the exercise of its supervisory function is

heavily dependent upon the needs of petitioner Memorial Park. The contract further provides that petitioner has the option to take over the functions of Ward's personnel if it finds any part or aspect of the work or service provided to be unsatisfactory Manila Memorial failed to adduce evidence to prove that Ward Trading had any substantial capital, investment or assets to perform the work contracted for. Thus, the presumption that Ward Trading is a labor-only contractor stands. Consequently, Manila Memorial is deemed the employer of respondents.

Diamond Farms, Inc. v. SPFL et al. G.R. Nos. 173254-55 & 173263 January 13, 2016 JARDELEZA, J.: Facts: DFI owns an 800-hectare banana plantation ("original plantation") in Alejal, Carmen, Davao. Pursuant to Republic Act No. 6657 or the Comprehensive Agrarian Reform Law of 1988 ("CARL"), commercial farms shall be subject to compulsory acquisition and distribution, thus the original plantation was covered by the law. DFI offered to give up its rights and interest over the original plantation in favor of the government by way of a Voluntary Offer to Sell. The DAR accepted DFI's offer to sell the original plantation. Out of the total 800 hectares, the DAR only approved the disposition of 689.88 hectares. The awarded plantation was turned over to qualified agrarian reform beneficiaries ("ARBs") under the CARL. These ARBs are the same farmers who were working in the original plantation. They subsequently organized themselves into a multipurpose cooperative named "DARBMUPCO," which is one of the respondents in this case. DARBMUPCO entered into a Banana Production and Purchase Agreement ("BPPA") with DFI. Under the BPPA, DARBMUPCO and its members as owners of the awarded plantation, agreed to grow and cultivate only high grade quality exportable bananas to be sold exclusively to DPI. The BPPA is effective for 10 years.18 Hampered by lack of manpower to undertake the agricultural operation under the BPPA, DFI engaged the services of the respondent-contractors, who in turn recruited the respondent-workers to assist DARBMUPCO in meeting its production obligations under the BPPA, Southern Philippines Federation of Labor ("SPFL")—a legitimate labor organization with a local chapter in the awarded plantation filed a petition for

certification election in the Office of the Med-Arbiter on behalf of some 400 workers (the respondent-workers in this petition) "jointly employed by DFI and DARBMUPCO" working in the awarded plantation. In another case, SPFL, together with more than 300 workers, filed a case for underpayment of wages, nonpayment of 13th month pay and service incentive leave pay and attorney's fees against DFI, DARBMUPCO and the respondentcontractors before the National Labor Relations Commission ("NLRC"). DARBMUPCO and DFI denied that they are the employers of the respondentworkers. They claimed, instead, that the respondent-workers are the employees of the respondent-contractors. Issue: Who among DFI,DARBMUPCO and the respondent-contractors is the employer of the respondent-workers? Ruling: Petition is denied. Furthermore, the decision of the Court of Appeals declaring DFI to be the employer of respondent-workers is affirmed. This case involves job contracting, a labor arrangement expressly allowed by law. Contracting or subcontracting is an arrangement whereby a principal (or employer) agrees to put out or farm out with a contractor or subcontractor the performance or completion of a specific job, work or service within a definite or predetermined period, regardless of whether such job, work or service is to be performed or completed within or outside the premises of the principal. The Omnibus Rules Implementing the Labor Code distinguishes between permissible job contracting (or independent contractorship) and labor-only contracting. Job contracting is permissible under the Code if the following conditions are met: (1) The contractor carries on an independent business and undertakes the contract work on his own account under his own responsibility according to his own manner and method, free from the control and direction of his employer or principal in all matters connected with the performance of the work except as to the results thereof; and (2) The contractor has substantial capital or investment in the form of tools, equipment, machineries, work premises, and other materials which are necessary in the conduct of his business.

In contrast, job contracting shall be deemed as labor-only contracting, an arrangement prohibited by law, if a person who undertakes to supply workers to an employer: (1) Does not have substantial capital or investment in the form of tools, equipment, machineries, work premises and other materials; and (2) The workers recruited and placed by such person are performing activities which are directly related to the principal business or operations of the employer in which workers are habitually employed. Based on the conditions for permissible job contracting, we rule that respondentcontractors are labor only contractors.

DFI cannot argue that DARBMUPCO is the principal of the respondent-contractors because it (DARBMUPCO) owns the awarded plantation where respondentcontractors and respondent-workers were working. That DARBMUPCO owns the awarded plantation where the respondent-contractors and respondent-workers were working is immaterial.DFI, as the principal, hired the respondent-contractors and the latter, in turn, engaged the services of the respondent-workers. Clearly, DFI is the true employer of the respondent-workers; respondentcontractors are only agents of DFI. Under Article 106 of the Labor Code, DFI shall be solidarily liable with the respondent-contractors for the rightful claims of the respondent-workers, to the same manner and extent, as if the latter are directly employed by DFI.

There is no evidence showing that respondent-contractors are independent contractors. The respondent-contractors, DFI, and DARBMUPCO did not offer any proof that respondent-contractors were not engaged in labor-only contracting.

G.R. No. 202091

Herein respondents, Voltaire Lopez, Jr., et al., were commissioned and contracted by petitioner, Diamond Farms, Inc. (DFI) to recruit farm workers, who are the complaining [respondent-workers] (as represented by Southern Philippines Federation of Labor (SPFL) in this appeal by certiorari).

SUMIFRU (PHILIPPINES) CORP. (surviving entity of a merger with Fresh Banana Agricultural Corporation and other corporations), Petitioner vs. NAGKAHIUSANG MAMUMUO SA SUYAPA FARM1 (NAMASUFA-NAFLU-KMU), Respondent

Farm tools, implements and equipment necessary to performance of such farm activities were supplied by petitioner DFI. Herein respondents Voltaire Lopez, Jr. et. al. had no adequate capital to acquire or purchase such tools, implements, equipment, etc. Herein respondents Voltaire Lopez, Jr., et. al. as well as rcspondents-SPFL, et. al. were being directly supervised, controlled and managed by petitioner DFI farm managers and supervisors, specifically on work assignments and performance targets. A finding that a contractor is a labor-only contractor is equivalent to a declaration that there is an employer-employee relationship between the principal, and the workers of the labor-only contractor; the labor-only contractor is deemed only as the agent of the principal. Thus, in this case, respondent-contractors are the laboronly contractors and either DFI or DARBMUPCO is their principal. We hold that DFI is the principal. The records show that it is DFI which hired the individual [respondent-contractors] who in turn hired their own men to work in the 689.88 hectares land of DARBMUPCO as well as in the managed area of the plantation.

Facts On March 14, 2008, the private respondent NAMASUF A-NAFLU-KMU, , filed a Petition for Certification Election before the Department of Labor and Employment, Regional Office No. XI in Davao City. NAMASUFA sought to represent all rank-and-file employees, numbering around one hundred forty, of packing plant 90 (PP 90) of Fresh Banana Agricultural Corporation (FBAC). NAMASUF A claimed that there was no existing union in the aforementioned establishment. FBAC filed an Opposition to the Petition stating that there is no employeremployee relationship between it and the workers involved. It alleged that members are actually employees of A2Y Contracting Services (A2Y), an independent contractor, as evidenced by the payroll records. NAMASUFA contended that they were former workers of Stanfilco before FBAC took over and were then required to join the Compostela Banana Packing Plant Workers' Cooperative (CBPPWC) before they were hired and allowed to work at the Packing Plant of FBAC. It further alleged that the members of NAMASUF A were working at PP 90 long before A2Y came.

DOLE Med-Arbiter – Granted petition for certification election

Ruling

The "four-fold test" will show that respondent FBAC is the employer of petitioner's members. The elements to determine the existence of an employment relationship are:

YES. The Med-Arbiter found, based on documents submitted by the parties, that Sumifru gave instructions to the workers on how to go about their work, what time they were supposed to report for work, required monitoring sheets as they went about their jobs, and provided the materials used in the packing plant.

(a) the selection and engagement of the employee; (staff of respondent FBAC advised those who are interested to be hired in the Packing Plant to become members first of CBPPWC) (b) the payment of wages (payment by a2y merely an administrative arrangement); (c) the power of dismissal (FBAC is the authority that imposes disciplinary measures against erring workers) ; and (d) the employer's power to control the employee's conduct (FBAC gives instructions to the workers on how to go about their work is sufficient indication that it exercises control over their movements) Labor Sec Appeal - DISMISSED In this case, Sumifru's control over the subject employees is evident. The fact that the subject workers are required by Sumifru to fill up monitoring sheets as they go about their jobs and the imposition of disciplinary actions for non-compliance with the "No Helmet - No Entry and No ID - No Entry" policies prove that it is indeed Sumifru, and not A2Y Contracting Services, that exercises control over the conduct of the subject workers. CA Pet Cert - DISMISSED DOLE Secretary did not commit grave abuse of discretion. The records are replete with evidence which would show that SUMIFRU has control over the concerned workers, to wit: "Standardized Packing Plant Breaktime"; Material Requisition for PP 90; "no helmet, no entry", "no ID, no entry policy", attendance Sheets for Gas and seminarrs Issue WON ER-EE RELATION EXISTS

In affirming the Med-Arbiter, the DOLE Secretary found that the element of control was present because Sumifru required monitoring sheets and imposed disciplinary actions for non-compliance with "No Helmet - No Entry" "No ID - No Entry" policies. In turn, the CA, even went further and itself reviewed the records - to arrive, as it did arrive, at the same conclusion. The Court cannot re-calibrate the factual bases of the Med-Arbiter, DOLE Secretary, and the CA, contrary to the provisions of Rule 45, especially where, as here, the Petition fails to show any whimsicality or capriciousness in the exercise of judgment of the Med-Arbiter or the DOLE Secretary in finding the existence of an employer-employee relationship. WESLEYAN UNIVERSITY-PHILIPPINES vs. GUILLERMO T. MAGLAYA, SR. G.R. No. 212774 January 23, 2017

“For this Court's resolution is a petition for review on certiorari filed by petitioner Wesleyan University-Philippines (WUP) assailing the Resolution1 dated January 20, 2014 of the Court of Appeals (CA) which denied its petition for certiorari.” FACTS: WUP is a non-stock, non-profit, non-sectarian educational corporation duly organized and existing under the Philippine laws. Respondent Atty. Guillermo T. Maglaya, Sr. was appointed as a corporate member and was elected as a member of the Board of Trustees, both for a period of five (5) years. He was elected as President of the University for a five-year term. He was re-elected as a trustee. In a Memorandum, the incumbent Bishops of the United Methodist Church apprised all the corporate members of the expiration of their tenns on December 31, 2008, unless renewed by the former. The said members, including Maglaya, sought the renewal of their membership in the WUP's Board, and signified their willingness to serve the corporation.

Dr. Dominador Cabasal, Chairman of the Board, informed the Bishops of the cessation of corporate terms of some of the members and/or trustees since the by-laws provided that the vacancy shall only be filled by the Bishops upon the recommendation of the Board. Maglaya learned that the Bishops created an Ad Hoc Committee to plan the efficient and orderly turnover of the administration of the WUP in view of the alleged "gentleman's agreement", and that the Bishops have appointed the incoming corporate members and trustees. He clarified that there was no agreement and any discussion of the turnover because the corporate members still have valid and existing corporate terms. In this case, the Bishops, through a formal notice to all the officers, deans, staff, and employees of WUP, introduced the new corporate members, trustees, and officers. In the said notice, it was indicated that the new Board met, organized, and elected the new set of officers. Manuel Palomo, the new Chairman of the Board, informed Maglaya of the termination of his services and authority as the President of the University. Thereafter, Maglaya and other fonner members of the Board filed a Complaint for Injunction and Damages before the Regional Trial Court of Cabanatuan City.The RTC dismissed the case declaring the same as a nuisance or harassment suit prohibited under Section l(b), Rule 1 of the Interim Rules for Intra-Corporate Controversies. The RTC observed that it is clear from the by-laws of WUP that insofar as membership in the corporation is concerned, which can only be given by the College of Bishops of the United Methodist Church, it is a precondition to a seat in the WUP Board. Consequently, the expiration of the terms of the plaintiffs, including Maglaya, as corporate members carried with it their termination as members of the Board. Moreover, their continued stay in their office beyond their terms was only in hold-over capacities, which ceased when the Bishops appointed new members of the corporation and the Board. The CA affirmed the decision of the RTC, and dismissed the petition for certiorari filed by the plaintiffs for being the improper remedy. Thereafter, Maglaya filed the present illegal dismissal case against WUP, Palomo, Bishop Lito C. Tangonan and Bishop Leo A. Soriano. He claimed that he was unceremoniously dismissed in a wanton, reckless, oppressive and malevolent manner. The Labor Arbiter ruled in favor of WUP. The LA held that the action between employers and employees where the employer-employee relationship is merely incidental is within the exclusive and original jurisdiction of the regular courts.

The National Labor Relations Commission reversed and set aside the Decision of the LA ruling that the illegal dismissal case falls within the jurisdiction of the labor tribunals. Since the reasons for his termination cited by WUP were not among the just causes provided under Article 282 (now Article 297) of the Labor Code, Maglaya was illegally dismissed. Thereafter, the NLRC denied the motion for reconsideration filed by WUP and the CA dismissed the petition for certiorari filed by WUP. The CA noted that the decision and resolution of the NLRC became final and executor. ISSUE: The Court of Appeals committed an error of law when it summarily dismissed the special civil action for certiorari raising lack of jurisdiction of the NLRC filed by [WUP] where it was very clear that the NLRC had no jurisdiction over the case involving a corporate officer and where the nature of the controversy is an intracorporate dispute. RULING: The Court find the instant petition impressed with merit. WUP alleges that while the NLRC decision became final and executory, it did not mean that the said decision had become immutable and unalterable as the CA ruled. WUP maintains that the remedy of the aggrieved party against a final and executory decision of the NLRC is the filing of the petition for certiorari under Rule 65 of the Rules of Court. As such, it was able to meet the conditions set forth in filing the said remedy before the CA.

"Corporate officers" in the context of Presidential Decree No. 902- A are those officers of the corporation who are given that character by the Corporation Code or by the corporation's by-laws. There are three specific officers whom a corporation must have under Section 25 of the Corporation Code. These are the president, secretary and the treasurer. The number of officers is not limited to these three. A corporation may have such other officers as may be provided for by its by-laws like, but not limited to, the vice-president, cashier, auditor or general manager. The number of corporate officers is thus limited by law and by the corporation's by-laws. Since this Court is now reversing the challenged decision of the CA and affirming the decision of the LA in dismissing the case for want of jurisdiction, Maglaya is not entitled to collect the amount of ₱2,505,208.75 awarded from the time the

NLRC decision became final and executory up to the time the CA dismissed WUP's petition for certiorari. In sum, this Court finds that the NLRC erred in assuming jurisdiction over, and thereafter in failing to dismiss, Maglaya's complaint for illegal dismissal against WUP, since the subject matter of the instant case is an intra-corporate controversy which the NLRC has no jurisdiction.

ordered ODSI and NPI to pay each of the respondents and entitled to separation pay and to nominal damages. The respondents moved for a partial reconsideration arguing since it was ODSI that closed down operations and not the NPI, therefore NPI should reinstate them. However, the NLRC denied the motion. Moreover, the NPI was dissatisfied hence filed a petition for certiorari before the Court of Appeals (CA) which the CA affirmed the NLRC ruling. ISSUE:

NESTLE PHILIPPINES INC., Petitioner VS. BENNY A. PUEDAN, et. al., Respondent G.R. No. 220617 January 30, 2017 FACTS: On July 6, 2012, the respondents filed a complaint against the petitioner for illegal dismissal and demanding for separation pay, nominal damages and attorney’s fees. The respondents alleged that Ocho de Setiembre Inc. (ODSI) and Nestle Philippines Inc. (NPI) hired them to sell various products of NPI in the assigned covered area. After sometime, the respondents demanded that they be considered regular employees of NPI but they were directed to sign contracts of employment with ODSI instead. However, the respondents refused to comply with such directives resulting from their dismissal from their position. The contention of the respondents is that ODSI is a labor-only contractor and, thus, they should be deemed regular employees of NPI and there was no just or authorized cause for their dismissal. The ODSI averred that it is a company engaged in the business of buying, selling, distributing, and marketing of goods and commodities of every kind and it enters into all kinds of contracts for the acquisition thereof. According to ODSI the respondents were hired as its employees to execute the Distributorship Agreement with the NPI. Unfortunately, the business relationship between the NPI and ODSI turned sour and eventually NPI downsized its marketing and promotional support from ODSI and termination of the Distributorship Agreement. Meanwhile, ODSI argues with the respondents that they were not dismissed but merely on floating status. However, the NPI did not file any position paper or appear in the scheduled conferences. The Labor Arbiter concluded that all the impleaded respondents therein (i.e. including NPI) should be held liable for the payment of nominal damages plus attorney’s fees. The aggrieved respondents appealed to National Labor Relation Commission (NLRC) and the NLRC reversed and set aside the Labor Arbiter ruling. The NLRC

Whether or not Nestle Philippines Inc. (NPI) and Ocho de Setiembre Inc. (ODSI) are deemed jointly and severely liable for the respondent’s monetary claims. HELD: No. The Distributorship Agreement between the Nestle Philippines inc. (NPI) and Ocho de Setiembre Inc. (ODSI) is not that of a principal and a contractor, but that of a seller and a buyer/re-seller. Based on the stipulated in the Distributorship Agreement NPI agreed to sell its products to ODSI at discounted prices. According to NPI the goods it manufactures are distributed to the market through various distributor including ODSI, that in turn, re-sell the same to the designated outlets through its own employees as the respondents. Therefore, the reselling activities allegedly performed by the respondents properly pertain to ODSI only. In effect, ODSI was not a labor-only contractor of NPI hence the NPI cannot be deemed the true employer of the respondents. Therefore, NPI cannot be held jointly and severely liable to ODSI’s monetary obligation towards the respondents.

Valenzuela vs. Alexandra Mining and Oil Ventures, Inc. G.R. No. 222419, October 5, 2016 Facts: Valenzuela sued for non-payment of backwages, overtime pay, separation pay, moral and exemplary damages and attorney's fees against Alexandra Mining and Oil Ventures, Inc. (AMO VI) and its owner and president, Cesar E. Detera (Cesar). Valenzuela was hired as a company driver of AMOVI. He did not just worked for the company but also drove for the members of the Detera family. After five years and five months of service, he was told that he can no longer continue to work as there were no forthcoming funds to pay for his salary. Respondents however

insisted that Valenzuela was the family driver of Cesar and not employee of AMOVI. LA Ruling: The Labor Arbiter (LA) rendered a Decision9 holding that Valenzuela had been illegally dismissed. The LA dismissed Cesar's claim that Valenzuela was a family driver and not an employee of AMOVI, as the evidence on record proved otherwise. She likewise pointed out that the respondents failed to present any evidence to support their claim that Valenzuela abandoned his employment. Unyielding, the respondents interposed an appeal to the National Labor Relations Commission (NLRC) and reiterated their claim that Valenzuela was the family driver of the Deteras and not an employee. NLRC Ruling: The NLRC rendered a Decision affirming the ruling of the LA. The NLRC held that respondents failed to present evidence to dispute [Valenzuela's] allegations. Such allegation is unsupported. On the other hand, the Valenzuela was able to present identification card and payslips. The respondents filed a Motion for Reconsideration of the foregoing decision, but the NLRC denied the same. Undeterred, the respondents filed a petition for certiorari with the CA imputing grave abuse of discretion on the part of the NLRC for holding that there was an employer-employee relationship between AMOVI and Valenzuela. CA Ruling: The CA partly granted the petition and modified the same by deleting the award of backwages. The CA held that since there was no clear evidence that Valenzuela was dismissed by the respondents and, on the other hand, there was an equal lack of proof of abandonment of work on the part of Valenzuela. It held further that following the ruling of the Court in Exodus International Construction Corporation, et al vs. Biscocho, et al., the remedy was to reinstate Valenzuela without backwages. Valenzuela filed a Motion for Partial Reconsideration, but the same was denied. Valenzuela filed the petition before the SC questioning the Decision and Resolution of the CA. He contends that the fact of his dismissal was clearly established and this entitles him to the payment of both separation pay and full backwages.

RULING

In its decision, the CA ruled that while it was established that Valenzuela was an employee of AMOVI there was no proof that the company or its president dismissed him from service. It likewise affirmed that Valenzuela did not abandon his employment as the respondents failed to establish acts showing his intention to leave employment. Thus, it applied the ruling in Exodus where it was held that when there is no evidence of the fact of dismissal on the part of the employer and, at the same time, no proof of abandonment on the part of the employee, the proper relief is reinstatement without backwages. This has no application where there was evidence of dismissal as when Cesar admits having impliedly dismissed a driver by invoking Art. 150 of the Labor Code in justifying the act. This case was unanimously held by the LA, NLRC, and the CA that the employer was AMOVI. There being an admission of dismissal, the SC examined whether there was observance of the substantive and procedural due process. The SC found violations in both. Thus, Valenzuela was entitled to backwages under Art. 279 of the Labor Code. However, in view of the strained relations between the parties, the Court did not award reinstatement and in lieu thereof, granted payment of separation pay of one month for every year of service from the time of illegal termination up to the finality of the decision.