G.R. No.

L-8967
May 31, 1956
ANASTACIO VIAÑA, Petitioner, vs. ALEJO AL-LAGADAN and FILOMENA PIGA,
Respondents.

Facts:

Petitioner Anastacio Viaña owned the fishing sailboat “Magkapatid”, which, in the night of
September 3, 1948, sunk in the waters between the province of Bataan and the island of
Corregidor, as a consequence of a collision with the USS “TINGLES”, a vessel of the U.S. Navy.
Inasmuch as Alejandro Al-Lagadan, a member of the crew of the “Magkapatid”, disappeared
with the craft, his parents, Respondent Alejo Al-Lagadan and Filomena Piga, filed the
corresponding claim for compensation under Act No. 3428.

Viaña has brought the matter to us, for review by certiorari, upon the ground that this case does
not fall within the purview of Act No. 3428, because the gross income of his business for the
year 1947 was allegedly less than P10,000, and because Alejandro Al-Lagadan was, at the time
of his death, his (Petitioner’s) industrial partner, not his employee.

Issue: Whether or not there exist employer-employee relationship

Ruling:

In the opinion of the Referee, as well as of Commissioner, the mere fact that Alejandro’s share in
the understanding “could be reckoned in terms of money”, sufficed to characterize him as an
employee of Viaña. We do not share this view. Neither can we accept, however, Petitioner’s
theory to the effect that the deceased was his partner, not an employee, simply because he (the
deceased) shared in the profits, not in the losses.

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; (4) the power to control the employees’ conduct
— although the latter is the most important element (35 Am. Jur. 445). Assuming that the share
received by the deceased could partake of the nature of wages — on which we need not, and do
not, express our view — and that the second element, therefore, exists in the case at bar, the
record does not contain any specific data regarding the third and fourth elements.
G.R. No. L-12582 January 28, 1961
LVN PICTURES, INC., petitioner-appellant,
vs.
PHILIPPINE MUSICIANS Guild (FFW) and COURT OF INDUSTRIAL RELATIONS,
respondents-appellees.

Facts:

The Philippine Musicians Guild (FFW), hereafter referred to as the Guild, averred that it is a
duly registered legitimate labor organization; that LVN Pictures, Inc., Sampaguita Pictures, Inc.,
and Premiere Productions, Inc. are corporations, duly organized under the Philippine laws,
engaged in the making of motion pictures and in the processing and distribution thereof; that said
companies employ musicians for the purpose of making music recordings for title music,
background music, musical numbers, finale music and other incidental music, without which a
motion picture is incomplete; that ninety-five (95%) percent of all the musicians playing for the
musical recordings of said companies are members of the Guild; and that the same has no
knowledge of the existence of any other legitimate labor organization representing musicians in
said companies.

Issue: The real issue in these cases, is whether or not the musicians in question are employees of
the film companies.

Ruling:
-
We are thus called upon to apply R.A. Act 875. which is substantially the same as and patterned
after the Wagner Act substantially the same as Act and the Taft-Hartley Law of the United States.

In the case of National Labor Relations Board vs. Hearts Publication, 322 U.S. 111, the United
States Supreme Court said the Wagner Act was designed to avert the 'substantial obstruction to
the free flow of commerce which results from strikes and other forms of industrial unrest by
eliminating the causes of the unrest. Strikes and industrial unrest result from the refusal of
employers' to bargain collectively and the inability of workers to bargain successfully for
improvement in their working conditions. Hence, the purposes of the Act are to encourage
collective bargaining and to remedy the workers' inability to bargaining power, by protecting the
exercise of full freedom of association and designation of representatives of their own choosing,
for the purpose of negotiating the terms and conditions of their employment.'

In other words, the scope of the term 'employee' must be understood with reference to the
purposes of the Act and the facts involved in the economic relationship. Where all the conditions
of relation require protection, protection ought to be given .The statutory definition of the word
'employee' is of wide scope. As used in the Act, the term embraces 'any employee' that is all
employees in the conventional as well in the legal sense expect those excluded by express
provision. (Connor Lumber Co., 11 NLRB 776.).
The work of the musical director and musicians is a functional and integral part of the enterprise
performed at the same studio substantially under the direction and control of the company.

In other words, to determine whether a person who performs work for another is the latter's
employee or an independent contractor, the National Labor Relations relies on 'the right to
control' test. Under this test an employer-employee relationship exist where the person for whom
the services are performed reserves the right to control not only the end to be achieved, but also
the manner and means to be used in reaching the end. (United Insurance Company, 108, NLRB
No. 115.).

'Notwithstanding that the employees are called independent contractors', the Board will hold
them to be employees under the Act where the extent of the employer's control over them
indicates that the relationship is in reality one of employment. (John Hancock Insurance Co.,
2375-D, 1940, Teller, Labor Dispute Collective Bargaining, Vol.).

The right of control of the film company over the musicians is shown (1) by calling the
musicians through 'call slips' in 'the name of the company; (2) by arranging schedules in its
studio for recording sessions; (3) by furnishing transportation and meals to musicians; and (4) by
supervising and directing in detail, through the motion picture director, the performance of the
musicians before the camera, in order to suit the music they are playing to the picture which is
being flashed on the screen.

Thus, in the application of Philippine statutes and pertinent decisions of the United States Courts
on the matter to the facts established in this case, we cannot but conclude that to effectuate the
policies of the Act and by virtue of the 'right of control' test, the members of the Philippine
Musicians Guild are employees of the three film companies and, therefore, entitled to right of
collective bargaining under Republic Act No. 875.
G.R. No. L-2009 April 30, 1949
SUNRIPE COCONUT PRODUCTS CO., INC petitioner,
vs.
THE COURT OF INDUSTRIAL RELATIONS and SUNSHINE COCONUT WORKERS'
UNION (CLO), respondents.

Facts:

This is an appeal from a decision of the Court of Industrial Relation holding that the parers and
"shellers" of the petitioner Sunshine Coconut Products Co., Inc., are its laborers entitled to
twelve days sick leave (one day for each month of service), notwithstanding the fact that they are
piece-workers under the pakiao system. The contention of the petitioner is that said "parer" and
"shellers" are independent contractors and do not fall within the category of employees or
laborers.

Issue: WON the said workers are employees

Ruling:

The Court of Industrial Relation has relied upon the rule laid down in the case of Philadelphia
Record Company, 69 N.L.R.B., 1232 (1946), to the effect that when a worker possesses some
attributes of an employee and others off an independent contractor which make him fall within
an intermediate area he may be classified under the category off an employee when the economic
facts of the relation make it more nearly one of employment than one of independent business
enterprise with to the ends sought to be accomplished.

Some facts expressly invoked by the Court of Industrial Relations are: That the "parers" and
"shellers" work under some degree of control or supervision of the company if not under its
absolute direction; that said " parers" and "shellers" form stable groups composed of matured
men and women who regularly work at shelling and paring nuts that for the most part they
depend on their work in the Sunripe Coconut Products Co., Inc. For their livelihood; that they are
admittedly working in the factory of said company alongside person who are indisputably
employed by said company.

The Court of Industrial Relations departed from the definition of the word "employee" or
"laborer" found in the Workmen's Compensation Law namely: " 'Laborer' is used as a synonym
off employee,' and it means every person who has entered the employment of or works under a
service or apprenticeship contract for an employer. . . ."
[G.R. No. 138051. June 10, 2004]
JOSE Y. SONZA, petitioner, vs. ABS-CBN BROADCASTING CORPORATION,
respondent.

Facts:

In May 1994, respondent ABS-CBN Broadcasting Corporation (ABS-CBN) signed an

Agreement (Agreement) with the Mel and Jay Management and Development Corporation
(MJMDC).

The Agreement listed the services SONZA would render to ABS-CBN, as follows:

a. Co-host for Mel & Jay radio program, 8:00 to 10:00 a.m., Mondays to Fridays;

b. Co-host for Mel & Jay television program, 5:30 to 7:00 p.m., Sundays.[3]

On 30 April 1996, SONZA filed a complaint against ABS-CBN before the Department of Labor
and Employment, National Capital Region in Quezon City. SONZA complained that ABS-CBN
did not pay his salaries, separation pay, service incentive leave pay, 13th month pay, signing
bonus, travel allowance and amounts due under the Employees Stock Option Plan (ESOP).

Issue: WON there exist employer-employee relationship

Ruling:

We find it erroneous to assert that MJMDC is a mere labor-only contractor of ABS-CBN such
that there exist[s] employer-employee relationship between the latter and Mr. Sonza.

SONZA maintains that all essential elements of an employer-employee relationship are present
in this case. Case law has consistently held that the elements of an employer-employee
relationship are: (a) the selection and engagement of the employee; (b) the payment of wages; (c)
the power of dismissal; and (d) the employers power to control the employee on the means and
methods by which the work is accomplished.[18] The last element, the so-called control test, is
the most important element.[19]

A. Selection and Engagement of Employee

Independent contractors often present themselves to possess unique skills, expertise or talent to
distinguish them from ordinary employees. The specific selection and hiring of SONZA, because
of his unique skills, talent and celebrity status not possessed by ordinary employees, is a
circumstance indicative, but not conclusive, of an independent contractual relationship. If
SONZA did not possess such unique skills, talent and celebrity status, ABS-CBN would not have
entered into the Agreement with SONZA but would have hired him through its personnel
department just like any other employee.

B. Payment of Wages

All the talent fees and benefits paid to SONZA were the result of negotiations that led to the
Agreement. If SONZA were ABS-CBNs employee, there would be no need for the parties to
stipulate on benefits such as SSS, Medicare, x x x and 13th month pay[20] which the law
automatically incorporates into every employer-employee contract.[21] Whatever benefits
SONZA enjoyed arose from contract and not because of an employer-employee relationship.[22]

C. Power of Dismissal

For violation of any provision of the Agreement, either party may terminate their relationship.

D. Power of Control

Since there is no local precedent on whether a radio and television program host is an employee
or an independent contractor, we refer to foreign case law in analyzing the present case. The
United States Court of Appeals, First Circuit, recently held in Alberty-Vlez v. Corporacin De
Puerto Rico Para La Difusin Pblica (WIPR)[27] that a television program host is an independent
contractor.

Applying the control test to the present case, we find that SONZA is not an employee but an
independent contractor. The control test is the most important test our courts apply in
distinguishing an employee from an independent contractor.[29] This test is based on the extent
of control the hirer exercises over a worker. The greater the supervision and control the hirer
exercises, the more likely the worker is deemed an employee. The converse holds true as well the
less control the hirer exercises, the more likely the worker is considered an independent
contractor.

ABS-CBN did not assign any other work to SONZA. To perform his work, SONZA only needed
his skills and talent. How SONZA delivered his lines, appeared on television, and sounded on
radio were outside ABS-CBNs control. SONZA did not have to render eight hours of work per
day.

Although ABS-CBN did have the option not to broadcast SONZAs show, ABS-CBN was still
obligated to pay SONZAs talent fees. Thus, even if ABS-CBN was completely dissatisfied with
the means and methods of SONZAs performance of his work, or even with the quality or product
of his work, ABS-CBN could not dismiss or even discipline SONZA. All that ABS-CBN could
do is not to broadcast SONZAs show but ABS-CBN must still pay his talent fees in full.
SONZA further contends that ABS-CBN exercised control over his work by supplying all
equipment and crew. No doubt, ABS-CBN supplied the equipment, crew and airtime needed to
broadcast the Mel & Jay programs. However, the equipment, crew and airtime are not the tools
and instrumentalities SONZA needed to perform his job. What SONZA principally needed were
his talent or skills and the costumes necessary for his appearance.

The Agreement does not require SONZA to comply with the rules and standards of performance
prescribed for employees of ABS-CBN.
G.R. No. 164156 September 26, 2006
ABS-CBN BROADCASTING CORPORATION, petitioner,
vs.
MARLYN NAZARENO, MERLOU GERZON, JENNIFER DEIPARINE, and
JOSEPHINE LERASAN, respondents.

Facts;

Petitioner ABS-CBN Broadcasting Corporation (ABS-CBN) is engaged in the broadcasting

business and owns a network of television and radio stations, whose operations revolve around
the broadcast, transmission, and relay of telecommunication signals.

Petitioner employed respondents Nazareno, Gerzon, Deiparine, and Lerasan as production

assistants (PAs) on different dates. They were assigned at the news and public affairs, for various
radio programs in the Cebu Broadcasting Station, with a monthly compensation of P4,000. They
were issued ABS-CBN employees’ identification cards and were required to work for a minimum
of eight hours a day, including Sundays and holidays.

On October 12, 2000, respondents filed a Complaint for Recognition of Regular Employment
Status, Underpayment of Overtime Pay, Holiday Pay, Premium Pay, Service Incentive Pay, Sick
Leave Pay, and 13th Month Pay with Damages against the petitioner before the NLRC

Issue: Whether or not employer-employee relationship exist

Ruling:

Yes. The question of whether respondents are regular or project employees or independent
contractors is essentially factual in nature; nonetheless, the Court is constrained to resolve it due
to its tremendous effects to the legions of production assistants working in the Philippine
broadcasting industry.

We agree with respondents’ contention that where a person has rendered at least one year of
service, regardless of the nature of the activity performed, or where the work is continuous or
intermittent, the employment is considered regular as long as the activity exists, the reason being
that a customary appointment is not indispensable before one may be formally declared as
having attained regular status. Article 280 of the Labor Code provides:

ART. 280. REGULAR AND CASUAL EMPLOYMENT.—The provisions of written agreement

to the contrary notwithstanding and regardless of the oral agreement of the parties, an
employment shall be deemed to be regular where the employee has been engaged to perform
activities which are usually necessary or desirable in the usual business or trade of the employer
except where the employment has been fixed for a specific project or undertaking the completion
or termination of which has been determined at the time of the engagement of the employee or
where the work or services to be performed is seasonal in nature and the employment is for the
duration of the season.

In Universal Robina Corporation v. Catapang, the Court reiterated the test in determining
whether one is a regular employee:

The primary standard, therefore, of determining regular employment is the reasonable

connection between the particular activity performed by the employee in relation to the usual
trade or business of the employer. The test is whether the former is usually necessary or desirable
in the usual business or trade of the employer. The connection can be determined by considering
the nature of work performed and its relation to the scheme of the particular business or trade in
its entirety. Also, if the employee has been performing the job for at least a year, even if the
performance is not continuous and merely intermittent, the law deems repeated and continuing
need for its performance as sufficient evidence of the necessity if not indispensability of that
activity to the business. Hence, the employment is considered regular, but only with respect to
such activity and while such activity exists.

It is of no moment that petitioner hired respondents as "talents." The fact that respondents
received pre-agreed "talent fees" instead of salaries, that they did not observe the required office
hours, and that they were permitted to join other productions during their free time are not
conclusive of the nature of their employment. Respondents cannot be considered "talents"
because they are not actors or actresses or radio specialists or mere clerks or utility employees.
They are regular employees who perform several different duties under the control and direction
of ABS-CBN executives and supervisors.

Thus, there are two kinds of regular employees under the law: (1) those engaged to perform
activities which are necessary or desirable in the usual business or trade of the employer; and (2)
those casual employees who have rendered at least one year of service, whether continuous or
broken, with respect to the activities in which they are employed.

The law overrides such conditions which are prejudicial to the interest of the worker whose weak
bargaining situation necessitates the succor of the State. What determines whether a certain
employment is regular or otherwise is not the will or word of the employer, to which the worker
oftentimes acquiesces, much less the procedure of hiring the employee or the manner of paying
the salary or the actual time spent at work. It is the character of the activities performed in
relation to the particular trade or business taking into account all the circumstances, and in some
cases the length of time of its performance and its continued existence.36 It is obvious that one
year after they were employed by petitioner, respondents became regular employees by operation
of law.

In this case, it is undisputed that respondents had continuously performed the same activities for
an average of five years. Their assigned tasks are necessary or desirable in the usual business or
trade of the petitioner. The persisting need for their services is sufficient evidence of the
necessity and indispensability of such services to petitioner’s business or trade.
G.R. No. 64948 September 27, 1994
MANILA GOLF & COUNTRY CLUB, INC., petitioner,
vs.
INTERMEDIATE APPELLATE COURT and FERMIN LLAMAR, respondents

Facts:

The question before the Court here is whether or not persons rendering caddying services for
members of golf clubs and their guests in said clubs' courses or premises are the employees of
such clubs and therefore within the compulsory coverage of the Social Security System (SSS).

It involves seventeen (17) persons who styled themselves "Caddies of Manila Golf and Country
Club-PTCCEA" for coverage and availment of benefits under the Social Security Act.

Issue: Existence of Employer-Employee Relationship

The Court does not agree that said facts necessarily or logically point to such a relationship, and
to the exclusion of any form of arrangements, other than of employment, that would make the
respondent's services available to the members and guest of the petitioner.

Petitioner has no means of compelling the presence of a caddy. A caddy is not required to
exercise his occupation in the premises of petitioner. He may work with any other golf club or he
may seek employment a caddy or otherwise with any entity or individual without restriction by
petitioner. .

It can happen that a caddy who has rendered services to a player on one day may still find
sufficient time to work elsewhere. Under such circumstances, he may then leave the premises of
petitioner and go to such other place of work that he wishes (sic). Or a caddy who is on call for a
particular day may deliberately absent himself if he has more profitable caddying, or another,
engagement in some other place.
SOCIAL SECURITY SYSTEM, petitioner, vs. THE COURT OF APPEALS and
CONCHITA AYALDE, respondents.

Facts:

In a petition before the Social Security Commission, Margarita Tana, widow of the late Ignacio
Tana, Sr., alleged that her husband was, before his demise, an employee of Conchita Ayalde as a
farmhand in the two (2) sugarcane plantations she owned.

For his labor, Tana allegedly received a regular salary according to the minimum wage prevailing
at the time. She further alleged that throughout the given period, social security contributions, as
well as medicare and employees compensation premiums were deducted from Tanas wages.

Issue: Existence of Employer-Employee Relationship

Ruling:

The mandatory coverage under the SSS Law (Republic Act No. 1161, as amended by PD 1202
and PD 1636) is premised on the existence of an employer-employee relationship, and Section
8(d) defines an employee as any person who performs services for an employer in which either
or both mental and physical efforts are used and who receives compensation for such services
where there is an employer-employee relationship. The essential elements of an employer-
employee relationship are: (a) the selection and engagement of the employee; (b) the payment of
wages; (c) the power of dismissal; and (d) the power of control with regard to the means and
methods by which the work is to be accomplished, with the power of control being the most
determinative factor.

In the parallel case of Opulencia Ice Plant and Storage v. NLRC, the petitioners argued that since
Manuel P. Esitas name does not appear in the payrolls of the company it necessarily means that
he was not an employee. This Court held:

We do not agree. No particular form of evidence is required to prove the existence of an

employer-employee relationship. Any competent and relevant evidence to prove the relationship
may be admitted. For, if only documentary evidence would be required to show that relationship,
no scheming employer would ever be brought before the bar of justice, as no employer would
wish to come out with any trace of the illegality he has authored considering that it should take
much weightier proof to invalidate a written instrument.

The argument is raised that Tana is an independenent contractor because he was hired and paid
wages on pakyaw basis.
A closer scrutiny of the records, however, reveals that while Ayalde herself may not have directly
imposed on Tana the manner and methods to follow in performing his tasks, she did exercise
control through her overseer.

Be that as it may, the power of control refers merely to the existence of the power. It is not
essential for the employer to actually supervise the performance of duties of the employee; it is
sufficient that the former has a right to wield the power.[24] Certainly, Ayalde, on her own or
through her overseer, wielded the power to hire or dismiss, to check on the work, be it in
progress or quality, of the laborers. As the owner/lessee of the plantations, she possessed the
power to control everyone working therein and everything taking place therein.

Jurisprudence provides other equally important considerations which support the conclusion that
Tana was not an independent contractor. First, Tana cannot be said to be engaged in a distinct
occupation or business. His carabao and plow may be useful in his livelihood, but he is not
independently engaged in the business of farming or plowing. Second, he had been working
exclusively for Ayalde for eighteen (18) years prior to his demise. Third, there is no dispute that
Ayalde was in the business of growing sugarcane in the two plantations for commercial purposes.
There is also no question that plowing or preparing the soil for planting is a major part of the
regular business of Ayalde.
G.R. No. L-59229 August 22, 1991

HIJOS DE F. ESCAÑO INC., and PIER 8 ARRASTRE AND STEVEDORING

SERVICES, INC., petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION, NATIONAL ORGANIZATION OF
WORKINGMEN (NOWM) PSSLU-TUCP and ROLANDO VILLALOBOS, respondents.

Facts:

Private respondent National Organization of Workingmen ("NOWM") PSSLU-TUCP is a labor

organization that counts among its members a majority of the laborers of petitioner Pier 8
Arrastre & Stevedoring Services, Inc. ("PIER 8 A&S") consisting, among others, of stevedores,
dockworkers, sweepers and forklift operators (hereinafter collectively referred to as "the
stevedores"). On 31 July 1978, NOWM PSSLU-TUCP and about 300 stevedores filed with the
then Ministry of Labor and Employment ("MOLE") a complaint1 for unfair labor practice ULP
and illegal dismissal against PIER 8 A&S.

The stevedores claim that since they had long been servicing Escaño vessels, i.e. from the time
Escaño was exclusively serviced by MISI until the time MISI was merged with SNSASI to form
PIER 8 A&S they should also be considered as employees of Escaño. Escaño disclaimed any
employment relationship with the stevedores.

Issue: 1. Existence of Employer-Employee Relationship 2. Guilty of ULP

The Court is unable to agree with the conclusion reached by the Labor Arbiter, particularly that
portion where the Labor Arbiter supposed stevedoring to be an indispensable part of the business
of Escaño.

Considering that a shipping company is not normally or customarily engaged in stevedoring and
arrastre activities either for itself or other vessels, it contracts with other companies offering
those services.

We turn next to the stevedores' contention that PIER 8 A&S is guilty of ULP. In this respect, the
Labor Arbiter had found that:

Now comes the issue of unfair labor practice. This Labor Arbiter believes that respondents are
guilty as charged. The unfair labor practice acts of the respondents started when they came to
know that the petitioners have organized themselves and affiliated with the NOWM Subsequent
acts of the respondents like requiring the petitioners to disaffiliate with the NOWM and affiliate
with the General Maritime Stevedores Union and later on to Independent Workers Union,
requiring them to sign applications for membership therein, they were threatened and coerced,
are all acts of unfair labor practices.

Article 248 of the Labor Code provides:

Art. 248. Unfair labor practices of employers. — It shall be unlawful for an employer to commit
any of the following unfair labor practice:

(a) To interfere with, restrain or coerce employees in the exercise of their right to self-
organization;

(b) To require as a condition of employment that a person or an employee shall not join a
labor organization or shall withdraw from one to which he belongs;

(c) To contract out services or functions being performed by union members when such will
interfere with, restrain or coerce employees in the exercise of their rights to self-organization;

(d) To initiate, dominate, assist or otherwise interfere with the formation or administration of
any labor organization, including the giving of financial or other support to it or its organizations
or supporters;

(e) To discriminate in regard to wages, hours of work, and other terms and conditions of
employment in order to encourage or discourage membership in any labor organization.
[G.R. No. 124354. December 29, 1999]

ROGELIO E. RAMOS and ERLINDA RAMOS, in their own behalf and as natural
guardians of the minors, ROMMEL RAMOS, ROY RODERICK RAMOS and RON
RAYMOND RAMOS, petitioners, vs. COURT OF APPEALS, DELOS SANTOS
MEDICAL CENTER, DR. ORLINO HOSAKA and DRA. PERFECTA GUTIERREZ,
respondents.

Facts:

In the case at bar, the Court is called upon to rule whether a surgeon, an anesthesiologist and a
hospital should be made liable for the unfortunate comatose condition of a patient scheduled for
cholecystectomy.

Plaintiff Erlinda Ramos was, until the afternoon of June 17, 1985, a 47-year old (Exh. A) robust
woman. Because the discomforts somehow interfered with her normal ways, she sought
professional advice. She was advised to undergo an operation for the removal of a stone in her
gall bladder. Dr. Hosaka decided that she should undergo a cholecystectomy operation after
examining the documents (findings from the Capitol Medical Center, FEU Hospital and
DLSMC) presented to him. At around 7:30 A.M. of June 17, 1985 and while still in her room,
she was prepared for the operation by the hospital staff. Her sister-in-law, Herminda Cruz, who
was the Dean of the College of Nursing at the Capitol Medical Center. and Dr. Perfecta
Gutierrez, the other defendant, who was to administer anesthesia. ). Dr. Gutierrez thereafter
informed Herminda Cruz about the prospect of a delay in the arrival of Dr. Hosaka. At about
12:15 P.M., Herminda Cruz, who was inside the operating room with the patient, heard
somebody say that Dr. Hosaka is already here. She then saw people inside the operating room
moving, doing this and that. She thereafter heard Dr. Gutierrez say, ang hirap ma-intubate nito,
mali yata ang pagkakapasok. O lumalaki ang tiyan (id., p. 17). Because of the remarks of Dra.
Gutierrez, she focused her attention on what Dr. Gutierrez was doing. She thereafter noticed
bluish discoloration of the nailbeds of the left hand of the hapless Erlinda even as Dr. Hosaka
approached her. She then heard Dr. Hosaka issue an order for someone to call Dr. Calderon,
another anesthesiologist (id., p. 19). After Dr. Calderon arrived at the operating room, she saw
this anesthesiologist trying to intubate the patient. The patients nailbed became bluish and the
patient was placed in a trendelenburg position - a position where the head of the patient is placed
in a position lower than her feet which is an indication that there is a decrease of blood supply to
the patients brain. At almost 3:00 P.M. of that fateful day, she saw the patient taken to the
Intensive Care Unit (ICU). Erlinda Ramos stayed at the ICU for a month. About four months
thereafter or on November 15, 1985, the patient was released from the hospital.

We now discuss the responsibility of the hospital in this particular incident. The unique practice
(among private hospitals) of filling up specialist staff with attending and visiting consultants,[74]
who are allegedly not hospital employees, presents problems in apportioning responsibility for
negligence in medical malpractice cases. However, the difficulty is only more apparent than real.
In the first place, hospitals exercise significant control in the hiring and firing of consultants and
in the conduct of their work within the hospital premises. Doctors who apply for consultant slots,
visiting or attending, are required to submit proof of completion of residency, their educational
qualifications; generally, evidence of accreditation by the appropriate board (diplomate),
evidence of fellowship in most cases, and references.
In other words, private hospitals, hire, fire and exercise real control over their attending and
visiting consultant staff. While consultants are not, technically employees, a point which
respondent hospital asserts in denying all responsibility for the patients condition, the control
exercised, the hiring, and the right to terminate consultants all fulfill the important hallmarks of
an employer-employee relationship, with the exception of the payment of wages. In assessing
whether such a relationship in fact exists, the control test is determining. Accordingly, on the
basis of the foregoing, we rule that for the purpose of allocating responsibility in medical
negligence cases, an employer-employee relationship in effect exists between hospitals and their
attending and visiting physicians. This being the case, the question now arises as to whether or
not respondent hospital is solidarily liable with respondent doctors for petitioners condition.[76]

The basis for holding an employer solidarily responsible for the negligence of its employee is
found in Article 2180 of the Civil Code which considers a person accountable not only for his
own acts but also for those of others based on the formers responsibility under a relationship of
patria potestas.
In the instant case, respondent hospital, apart from a general denial of its responsibility over
respondent physicians, failed to adduce evidence showing that it exercised the diligence of a
good father of a family in the hiring and supervision of the latter. It failed to adduce evidence
with regard to the degree of supervision which it exercised over its physicians. In neglecting to
offer such proof, or proof of a similar nature, respondent hospital thereby failed to discharge its
burden under the last paragraph of Article 2180. Having failed to do this, respondent hospital is
consequently solidarily responsible with its physicians for Erlindas condition.
[G.R. No. 116236. October 2, 1996]

VICTORIAS MILLING CO., INC., petitioner, vs. NATIONAL LABOR RELATIONS

COMMISSION and NATIONAL FEDERATION OF SUGAR WORKERS-FOOD AND
GENERAL TRADES (NFSW-FGT), respondents.

Facts:

In September 1989, private respondent National Federation of Sugar Workers-Food and General
Trades (NFSW-FGT), on behalf of all workers of farm owners,[1] instituted a suit against
petitioner Victorias Milling Co., Inc., a sugar central in Victorias, Negros Oriental, planter
Hacienda Estrella II/Ferraris and all other haciendas within petitioners milling district before
Regional Arbitration Branch No. VI, National Labor Relations Commission (NLRC),
Department of Labor and Employment.[2] Pursuant to Republic Act No. 809,[3] private
respondent sought to recover the share of the workers in the increased deliveries enjoyed by the
planter of unrefined sugar and by-products produced in petitioners refinery from 1952 to crop
year 1983-1984.

Issue: The question now is whether an employer-employee relationship exist between petitioner
sugar central and private respondent farm workers.

Ruling:

The answer is in the negative.

As early as 1981 in the case of Federation of Free Farmers v. Court of Appeals,[9] this Court had
ruled that a sugar central does not have any privity of any kind with the sugar farm workers, to
wit:

x x x From the very beginning of the sugar industry, the centrals have never had any privity of
any kind with the plantation laborers, since they had their own laborers to take care of. In other
words, both the centrals and the planters have always been the one dealing with their respective
laborers regarding the terms and conditions of their employment, particularly as to wages. x x x.

Clearly, there is no privity between the sugar centrals and the sugar farm workers. The workers
are not employees of the sugar central but of the planter.[12] And R.A. 809 expressly recognizes
the planter, not the central, as the employer of the farm workers by imposing on it the duty of
paying its respective workers their share of the proceeds from the milled sugar.
G.R. No. 75112 August 17, 1992

FILAMER CHRISTIAN INSTITUTE, petitioner,

vs.
HON. INTERMEDIATE APPELLATE COURT, HON. ENRIQUE P. SUPLICO, in his
capacity as Judge of the Regional Trial Court, Branch XIV, Roxas City and
POTENCIANO KAPUNAN, SR., respondents.

Facts:-

The Court ruled that the petitioner is not liable for the injuries caused by Funtecha on the
grounds that the latter was not an authorized driver for whose acts the petitioner shall be directly
and primarily answerable, and that Funtecha was merely a working scholar who, under Section
14, Rule X, Book III of the Rules and Regulations Implementing the Labor Code is not
considered an employee of the petitioner.

It is undisputed that Funtecha was a working student, being a part-time janitor and a scholar of
petitioner Filamer. He was, in relation to the school, an employee even if he was assigned to
clean the school premises for only two (2) hours in the morning of each school day.

Having a student driver's license, Funtecha requested the driver, Allan Masa, and was allowed, to
take over the vehicle while the latter was on his way home one late afternoon. It is significant to
note that the place where Allan lives is also the house of his father, the school president, Agustin
Masa. Moreover, it is also the house where Funtecha was allowed free board while he was a
student of Filamer Christian Institute.

Allan Masa turned over the vehicle to Funtecha only after driving down a road, negotiating a
sharp dangerous curb, and viewing that the road was clear. (TSN, April 4, 1983, pp. 78-79)
According to Allan's testimony, a fast moving truck with glaring lights nearly hit them so that
they had to swerve to the right to avoid a collision. Upon swerving, they heard a sound as if
something had bumped against the vehicle, but they did not stop to check. Actually, the Pinoy
jeep swerved towards the pedestrian, Potenciano Kapunan who was walking in his lane in the
direction against vehicular traffic, and hit him.

Ruling:

Driving the vehicle to and from the house of the school president where both Allan and Funtecha
reside is an act in furtherance of the interest of the petitioner-school. Allan's job demands that he
drive home the school jeep so he can use it to fetch students in the morning of the next school
day.

It is indubitable under the circumstances that the school president had knowledge that the jeep
was routinely driven home for the said purpose.
The clause "within the scope of their assigned tasks" for purposes of raising the presumption of
liability of an employer, includes any act done by an employee, in furtherance of the interests of
the employer or for the account of the employer at the time of the infliction of the injury or
damage.

Funtecha is an employee of petitioner Filamer. He need not have an official appointment for a
driver's position in order that the petitioner may be held responsible for his grossly negligent act,
it being sufficient that the act of driving at the time of the incident was for the benefit of the
petitioner. Hence, the fact that Funtecha was not the school driver or was not acting within the
scope of his janitorial duties does not relieve the petitioner of the burden of rebutting the
presumption juris tantum that there was negligence on its part either in the selection of a servant
or employee, or in the supervision over him. The petitioner has failed to show proof of its having
exercised the required diligence of a good father of a family over its employees Funtecha and
Allan.

An employer is expected to impose upon its employees the necessary discipline called for in the
performance of any act indispensable to the business and beneficial to their employer.

In the present case, the petitioner has not shown that it has set forth such rules and guidelines as
would prohibit any one of its employees from taking control over its vehicles if one is not the
official driver or prohibiting the driver and son of the Filamer president from authorizing another
employee to drive the school vehicle. Furthermore, the petitioner has failed to prove that it had
imposed sanctions or warned its employees against the use of its vehicles by persons other than
the driver.
G.R. No. L-72654-61 January 22, 1990

ALIPIO R. RUGA, JOSE PARMA, ELADIO CALDERON, LAURENTE BAUTU, JAIME

BARBIN, NICANOR FRANCISCO, PHILIP CERVANTES and ELEUTERIO BARBIN,
petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION and DE GUZMAN FISHING
ENTERPRISES and/or ARSENIO DE GUZMAN, respondents.

Facts:

The issue to be resolved in the instant case is whether or not the fishermen-crew members of the
trawl fishing vessel 7/B Sandyman II are employees of its owner-operator, De Guzman Fishing
Enterprises, and if so, whether or not they were illegally dismissed from their employment.

Records show that the petitioners were the fishermen-crew members of 7/B Sandyman II, one of
several fishing vessels owned and operated by private respondent De Guzman Fishing
Enterprises which is primarily engaged in the fishing business with port and office at Camaligan,
Camarines Sur.

For services rendered in the conduct of private respondent's regular business of "trawl" fishing,
petitioners were paid on percentage commission basis in cash by one Mrs. Pilar de Guzman,
cashier of private respondent. As agreed upon, they received thirteen percent (13%) of the
proceeds of the sale of the fish-catch if the total proceeds exceeded the cost of crude oil
consumed during the fishing trip, otherwise, they received ten percent (10%) of the total
proceeds of the sale. The patron/pilot, chief engineer and master fisherman received a minimum
income of P350.00 per week while the assistant engineer, second fisherman, and fisherman-
winchman received a minimum income of P260.00 per week. 1

On September 11, 1983 upon arrival at the fishing port, petitioners were told by Jorge de
Guzman, president of private respondent, to proceed to the police station at Camaligan,
Camarines Sur, for investigation on the report that they sold some of their fish-catch at midsea to
the prejudice of private respondent. Petitioners denied the charge claiming that the same was a
countermove to their having formed a labor union and becoming members of Defender of
Industrial Agricultural Labor Organizations and General Workers Union (DIALOGWU) on
September 3, 1983.

On September 22, 1983, petitioners individually filed their complaints for illegal dismissal and
non-payment of 13th month pay, emergency cost of living allowance and service incentive pay.
Petitioners assail the ruling of the public respondent NLRC that what exists between private
respondent and petitioners is a joint venture arrangement and not an employer-employee
relationship.

Ruling:

We have consistently ruled that in determining the existence of an employer-employee

relationship, the elements that are generally considered are the following (a) the selection and
engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the
employer's power to control the employee with respect to the means and methods by which the
work is to be accomplished. 8 The employment relation arises from contract of hire, express or
implied. 9 In the absence of hiring, no actual employer-employee relation could exist.

From the four (4) elements mentioned, We have generally relied on the so-called right-of-control
test 10 where the person for whom the services are performed reserves a right to control not only
the end to be achieved but also the means to be used in reaching such end. The test calls merely
for the existence of the right to control the manner of doing the work, not the actual exercise of
the right.

Herein petitioners, were directly hired by private respondent, through its general manager,
Arsenio de Guzman, and its operations manager, Conrado de Guzman and have been under the
employ of private respondent for a period of 8-15 years in various capacities,

While tenure or length of employment is not considered as the test of employment, nevertheless
the hiring of petitioners to perform work which is necessary or desirable in the usual business or
trade of private respondent for a period of 8-15 years since 1968 qualify them as regular
employees within the meaning of Article 281 of the Labor Code as they were indeed engaged to
perform activities usually necessary or desirable in the usual fishing business or occupation of
private respondent.

Aside from performing activities usually necessary and desirable in the business of private
respondent, it must be noted that petitioners received compensation on a percentage commission
based on the gross sale of the fish-catch i.e. 13% of the proceeds of the sale if the total proceeds
exceeded the cost of the crude oil consumed during the fishing trip, otherwise only 10% of the
proceeds of the sale. Such compensation falls within the scope and meaning of the term "wage"
as defined under Article 97(f) of the Labor Code, thus:

(f) "Wage" paid to any employee shall mean the remuneration or earnings, however
designated, capable of being expressed in terms of money, whether fixed or ascertained on a
time, task, piece or commission basis, or other method of calculating the same, which is payable
by an employer to an employee under a written or unwritten contract of employment for work
done or to be done, or for services rendered or to be rendered, and included the fair and
reasonable value, as determined by the Secretary of Labor, of board, lodging, or other facilities
customarily furnished by the employer to the employee. . . .

Even on the assumption that petitioners indeed sold the fish-catch at midsea the act of private
respondent virtually resulting in their dismissal evidently contradicts private respondent's theory
of "joint fishing venture" between the parties herein. A joint venture, including partnership,
presupposes generally a parity of standing between the joint co-venturers or partners, in which
each party has an equal proprietary interest in the capital or property contributed and where each
party exercises equal lights in the conduct of the business.

-In Negre vs. WCC 135 SCRA 653 (1985), we held that fishermen crew members who were
recruited by one master fisherman locally known as "maestro" in charge of recruiting others to
complete the crew members are considered employees, not industrial partners, of the boat-
owners. In an earlier case of Abong vs. WCC, 54 SCRA 379 (1973) where petitioner therein, Dr.
Agustin Abong, owner of the fishing boat, claimed that he was not the employer of the fishermen
crew members because of an alleged partnership agreement between him, as financier, and
Simplicio Panganiban, as his team leader in charge of recruiting said fishermen to work for him,
we affirmed the finding of the WCC that there existed an employer-employee relationship
between the boat-owner and the fishermen crew members not only because they worked for and
in the interest of the business of the boat-owner but also because they were subject to the control,
supervision and dismissal of the boat-owner, thru its agent, Simplicio Panganiban, the alleged
"partner" of Dr. Abong; that while these fishermen crew members were paid in kind, or by
"pakiao basis" still that fact did not alter the character of their relationship with Dr. Abong as
employees of the latter.

In Philippine Fishing Boat Officers and Engineers Union vs. Court of Industrial Relations, 112
SCRA 159 (1982), we held that the employer-employee relationship between the crew members
and the owners of the fishing vessels engaged in deep sea fishing is merely suspended during the
time the vessels are drydocked or undergoing repairs or being loaded with the necessary
provisions for the next fishing trip. The said ruling is premised on the principle that all these
activities i.e., drydock, repairs, loading of necessary provisions, form part of the regular
operation of the company fishing business.