SONZA V. ABS-CBN BROADCASTING CORP., G.R. NO.

138051, JUNE 10, 2004

FACTS: In May, 1994, ABS-CBN signed an agreement with the Mel and Jay Management
and Development Corporation (MJMDC). ABS-CBN was represented by its corporate
officers while MJMDC was represented by Sonza as president and general manager and Mel
Tiangco as its Executive Vice President and treasurer. Referred to in the agreement as agent,
MJMDC agreed to provide Sonza’s services exclusively to ABS-CBN as talent for radio and
television. ABS-CBN agreed to pay Sonza P310,000 as talent fee for the first year, and
P317,000 for the 2nd and 3rd year.

In April, 1996, Sonza wrote to ABS-CBN a letter stating therein his irrevocable resignation,
in view of the recent events concerning his program and career. Then, Sonza then filed a
complaint before the Department of Labor and Employment (DOLE) alleging that ABS-CBN
did not pay his salaries, separation pay, and service incentive leaves, 13 th month pay, and
other payments due to him. ABS-CBN contended that no employer-employee relationship
existed between them, However ABS-CBN continue to remit Sonza’s monthly talent fees but
opened another account for that said purpose.

The Labor Arbiter dismissed the complaint since according to him, there is no employer-
employee relationship between the parties. NLRC affirmed the Labor Arbiter’s decision,
which in turn was affirmed by the CA.

ISSUE: Whether or not there was employer-employee relationship between the parties. 

RULING: Case law has consistently held that the elements of an employee-employer

relationship are selection and engagement of the employee, the payment of wages, the power
of dismissal and the employer’s power to control the employee on the means and methods by
which the work is accomplished. The last element, the so-called "control test", is the most
important element. 

Sonza’s services to co-host its television and radio programs are because of his peculiar
talents, skills and celebrity status. 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. All the talent fees and benefits paid to Sonza were the
result of negotiations that led to the Agreement. For violation of any provision of the
Agreement, either party may terminate their relationship. 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. 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. 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-CBN’s control. ABS-CBN did not
instruct Sonza how to perform his job. ABS-CBN merely reserved the right to modify the
program format and airtime schedule "for more effective programming." ABS-CBN’s sole
concern was the quality of the shows and their standing in the ratings. 

Clearly, ABS-CBN did not exercise control over the means and methods of performance of
Sonza’s work. A radio broadcast specialist who works under minimal supervision is an
independent contractor. Sonza’s work as television and radio program host required special
skills and talent, which Sonza admittedly possesses. 
ABS-CBN claims that there exists a prevailing practice in the broadcast and entertainment
industries to treat talents like Sonza as independent contractors. The right of labor to security
of tenure as guaranteed in the Constitution arises only if there is an employer-employee
relationship under labor laws. Individuals with special skills, expertise or talent enjoy the
freedom to offer their services as independent contractors. The right to life and livelihood
guarantees this freedom to contract as independent contractors. The right of labor to security
of tenure cannot operate to deprive an individual, possessed with special skills, expertise and
talent, of his right to contract as an independent contractor.