Nitto Enterprises v. NLRC & Roberto Capili / GR No.

114337 /
9.29.95 / Apprenticeship and Learnership
F: Capili (PR) is an employee of Nitto Enterprises. Capili, an apprentice
machinist accidentally injured the leg of the office secretary, on the same
day Capili also managed to injure himself on while working, he was
hospitalized and P incurred 1K-hospital bill. The day after, PR was asked to
resign, subject to payment of his salary and further medical requirement.
PR signed a quitclaim. Days later PRs family sued for illegal dismissal and
payment of monetary benefits. LA favored P. LA said PR acted w/ gross
negligence and that he does not have the proper attitude in such
employment. NLRC reversed. P argues that since PR is only an apprentice
and that he signed a apprenticeship agreement. Hence this petition.
I: WON the NLRC committed grave abuse of discretion.
R: Petitioners argument is erroneous.
In the case at bench, the apprenticeship agreement between petitioner
and private respondent was executed on May 28, 1990 allegedly
employing the latter as an apprentice in the trade of "core maker/molder."
On the same date, an apprenticeship program was prepared by petitioner
and submitted to the Department of Labor and Employment. However,
the apprenticeship Agreement was filed only on June 7, 1990.
Notwithstanding the absence of approval by the Department of Labor and
Employment, the apprenticeship agreement was enforced the day it was
signed. Based on the evidence before us, petitioner did not comply
with the requirements of the law. Article 57 of the Labor Code
provides that the State aims to "establish a national apprenticeship
program through the participation of employers, workers and government
and non-government agencies" and "to establish apprenticeship
standards for the protection of apprentices." To translate such
objectives into existence, prior approval of the DOLE to any
apprenticeship program has to be secured as a condition sine
qua non before any such apprenticeship agreement can be fully
enforced. The role of the DOLE in apprenticeship programs and
agreements cannot be debased.
Also, the twin requirements of notice and hearing constitute the essential
elements of due process.

And since the apprenticeship is invalid, PR is considered as a Regular

Employee.

LVN Pictures v. Philippine Musicians Guild & CIR / GR L1258212598 / 1.28.61 / Employer-Employee Relationship - Importance /
Concepcion, J P:
F: LVN and Sampaguita (P) seeks to de-certify CIRs (PR) certification that
PMG-The Musical Directors as the sole and exclusive bargaining agency of
all musicians working with P. P also maintains that the certification cannot
be granted since there is no Employee-Employer relationship, PR argues
otherwise.
I: (1) WON the musicians working for P are its employees; (2)
WON there could be any legal relationship between the P and the
musicians.
R: Affirmed.
The musical directors in the instant case have no control over the
musicians involved in the present case. Said directors control neither the
music to be played, nor the musicians playing it. The film companies
summon the musicians to work, through the musical directors. The film
companies, through the musical directors, provide the transportation to
and from the studio. The film companies furnish meal at dinner time. The
motion picture director who is an employee of the company not the
musical director supervises the recording of the musicians and tells
them what to do in every detail, and solely directs the performance of the
musicians before the camera. Held: An employer-employee
relationship exists between the musicians and the film
companies. The relationship exists 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. (Alabama Highway Express Co. vs. Local, 612, 108 S. 2d
350.)
212 E: "Employer" includes any person acting in the interest of an
employer, directly or indirectly. The term shall not include any labor
organization or any of its officers or agents except when acting
as employer.

212 F: "Employee" includes any person in the employ of an employer. The

term shall not be limited to the employees of a particular
employer, unless the Code so explicitly states. It shall include any
individual whose work has ceased as a result of or in connection with any
current labor dispute or because of any unfair labor practice if he has not
obtained any other substantially equivalent and regular employment.
Employer-employee relationship is an agreement between parties
to render service in exchange for compensation. [Compania
Maritima v. Ernesta Cabagnot Vda. de Hio, G.R. No. L-17367-69, February
28, 1963]. However, these contracts are impressed with public
interest that they must yield to the common good. [Article 1700,
Civil Code]. Hence, the presence or absence of employeremployee relationship is a question of law. [Insular Life Assurance
Co., Ltd. v. NLRC, G.R. No. 119930, March 12, 1998; Tabas v. California
Manufacturing, G.R. No. 80680, January 26, 1989; SSS v. CA, G.R. No.
100388, December 14, 2000].
Employer Any person, natural or juridical, domestic or foreign, who
carries on in the Philippines any trade, business, industry, undertaking or
activity of any kind and uses the services of another person who is under
his order as regards the employment [Section 8(c), R.A. No. 8282].
Employee Any person in the employ of an employer. The term shall not
be limited to the employees of a particular employer, unless the Labor
Code so explicitly states. It shall include any individual whose work has
ceased as a result of or in connection with any current labor dispute or
because of any unfair labor practice if he has not obtained any other
substantially equivalent and regular employment. [Art 212 (f), Labor
Code].
A better definition is provided by Azucena: a natural person who is
hired, directly or indirectly, by a natural or juridical person to
perform activities related to the business of the hirer who,
directly or through an agent, supervises or controls the work
performance and pays the salary or wage of the hiree. [Cesario
Azucena, Jr., Everyones Labor Code, p. 56 (2012)].

Rosario Brothers Inc. v. Ople & NLRC, etc. / GR No. L-53590 /

7.31.84 / Employer-Employee Relationships Test to Determine /
Relova, J p:
F: P argues that there exists no EER between them and PR, it is Ps
submission, because of the series of memorandas issued by them from
1973-77, which reveals that P had no control and/or supervision over the
work of the PRs. PR are workers in the clothing business of P, where they
are working under a Piece-Work basis; SSS registered through P; members
of the UNION acknowledged by P. PR then claimed that P violated PD 851
and 525 (13th month pay & Emergency Living Allowance), LA favored P
and declared that there is no EER. NLRC affirmed, Minister of Labor ruled
otherwise. Hence this.
I: WON there is EER.
R: Affirmed. As held in Mafinco Trading Corporation vs. Ople, 70 SCRA
139, the existence of employer-employee relationship is determined by
the following elements, namely: (1) the selection and engagement of
the employee (done by PR); (2) the payment of wages (Weekly
wages on a piece-work basis [Art 97(F) Labor Code; (3) the power
of dismissal (as in the memorandas issued by PR); and (4) the
power to control employees' conduct (Operation Conduct)
although the latter is the most important element. On the other
hand, an independent contractor is one who exercises independent
employment and contracts to do a piece of work according to his own
methods and without being subjected to control of his employer except as
to the result of his work.

The control test is the most important element. It is based on the extent of control the
hirer exercises over a worker. The greater the supervision and control the hirer exercises, the
likelihood that the worker is an employee is higher. [Sonza v. ABS-CBN, G.R. no. 138051,
June 10, 2004].

However, it is not the actual exercise of the right to control but the mere existence of the
right to control that determines the power of control. [Zanotte Shoes v. NLRC, G.R. No.
100664, February 13, 1995].

The existence of the right to control, in order to prove the existence of an employeremployee relationship, must be established by substantial evidence, which is that amount of
relevant evidence that a reasonable mind might accept as adequate to justify a conclusion
[Legend Hotel v. Titanium Corp., G.R. No. 153511, July 18, 2012].

Two-Tiered Approach (Economic Dependence Test)

1.

First Tier: Control Test

2.

Second Tier: Existing economic conditions between the parties are used to determine whether
EER exists [Francisco v. NLRC, G.R. No. 170087, August 31, 2006].

3.

The standard of economic dependence is whether the worker is dependent on the alleged
employer for his continued employment in that line of business. [Orozco v. CA, GR No. 155207,
August 13, 2008].

Manila Golf v. IAC & Llamar / GR No. 64948 / 9.27.94 / EmployerEmployee Relationships Test to Determine / Narvasa, C.J p:
F: Caddies of P, are demanding that they be included in the coverage of
the Social Security System through the SSC, arguing that they are
employees of P. P on the other hand, they have no direct control over PR.
SSC Dismissed the Petition. IAC ruled for P, hence this petition.
I: WON there is EER.
R: As long as it is, the list made in the appealed decision detailing the
various matters of conduct, dress, language, etc. covered by the
petitioner's regulations, does not, in the mind of the Court, so
circumscribe the actions or judgment of the caddies concerned as to
leave them little or no freedom of choice whatsoever in the manner of
carrying out their services. In the very nature of things, caddies must
submit to some supervision of their conduct while enjoying the privilege
of pursuing their occupation within the premises and grounds of whatever
club they do their work in. For all that is made to appear, they work
for the club to which they attach themselves on sufferance but,
on the other hand, also without having to observe any working
hours, free to leave anytime they please, to stay away for as long
as they like. It is not pretended that if found remiss in the
observance of said rules, any discipline may be meted them
beyond barring them from the premises which, it may be
supposed, the Club may do in any case even absent any breach of
the rules, and without violating any right to work on their part.
All these considerations clash frontally with the concept of
employment. The IAC would point to the fact that the Club suggests the
rate of fees payable by the players to the caddies as still another
indication of the latter's status as employees. It seems to the Court,
however, that the intendment of such fact is to the contrary,
showing that the Club has not the measure of control over the
incidents of the caddies' work and compensation that an
employer would possess. The Court agrees with petitioner that
the group rotation system so-called, is less a measure of
employee control than an assurance that the work is fairly
distributed, a caddy who is absent when his turn number is called
simply losing his turn to serve and being assigned instead the
last number for the day.

La Suerte Cigar v. Director of BLR / GR No. L-55674 / 7.25.83 /

Employer-Employee Relationships Test to Determine / Guerrero,
J p:
F: P argues that 14 of the alleged members of the UNION, whose
petitioning for certification to become a recognized labor union in the
company, are not employees of P, but where independent contractors,
which is necessary to meet the 30% consent requirement. Med Arbiter
dismissed Ps petition. Director of BLR reversed, hence this petition.
I: WON the 14 dealers are employees or independent contractors.
R: They are Dealers or Independent Contractors. Accordingly, after
considering the terms and stipulations of the Dealership Contracts which
are clear and leave no doubt upon the intention of the contracting
parties in establishing the relationship between the dealers on
one hand and the company on the other as that of buyer and
seller, the Supreme Court finds that the status thereby created is
one of independent contractorship, pursuant to the first rule in the
interpretation of contracts that the literal meaning of the stipulations shall
control. (Article 1370, New Civil Code)
The Supreme Court rulings in Mafinco Trading Corp. vs. Ople, 70 SCRA
139, where the Court reiterated the "control test" earlier laid down in
Investment Planning Corp. vs. Social Security System, 21 SCRA 924 and
Social Security System vs. Hon. Court of Appeals and Shrino (Phils.) Inc.,
37 SCRA 579 are authoritative and controlling. In the Shrino case, the
Court held that the common law rule of determining the existence of
employer-employee relationship, principally the "control is test" applies in
this jurisdiction. Where the element of control is absent; where a
person who words 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, relationship of employer and
employee does not exist.

Tabas v. CMC / GR No. 80680 / 1.26.89 / Employer-Employee

Relationships Test to Determine / Sarmiento, J p:
F: P demands reinstatement and benefits. CMC filed to dismiss, claiming
that there is no EER since Ps are promotional merchandisers pursuant to a
manpower supply agreement with LIVI manpower services, w/c
agreement provided that CMC has no control or supervision whatsoever
over Ps. On the other hand it is also stipulated that cola and holidays will
be charged directly to CMC, whose payroll will be delivered through LIVI at
CMC. Ps now claims that they became regular CMC employees. LA ruled
that there is no EER in light of the manpower supply contract.
I: WON there is an EER.
R: Reversed. The fact that the petitioners have been hired on a
"temporary or seasonal" basis merely is no argument either. As we held
in Philippine Bank of Communications v. NLRC, a temporary or
casual employee, under Article 218 of the Labor Code, becomes
regular after service of one year, unless he has been contracted
for a specific project. And we cannot say that merchandising is a
specific project for the obvious reason that it is an activity
related to the day-to-day operations of California. The records show
that the petitioners had been given an initial six-month contract, renewed
for another six months. Accordingly, under Article 281 of the Code,
they had become regular employees of California and had
acquired a secure tenure. Hence, they cannot be separated
without due process of law.
It has been likewise held, based on Article 106 of the Labor Code,
that notwithstanding the absence of a direct employer-employee
relationship between the employer in whose favor work had been
contracted out by a "labor-only" contractor, and the employees,
the former has the responsibility, together with the "labor-only"
contractor, for any valid labor claims, by operation of law. The
reason, so we held, is that the "labor-only" contractor is
considered "merely an agent of the employer," and liability must
be shouldered by either one or shared by both.
The nature of one's business is not determined by self-serving
appellations one attaches thereto but by the tests provided by
statute and prevailing case law. The bare fact that Livi maintains
a separate line of business does not extinguish the equal fact

that it has provided California with workers to pursue the latter's

own business.

Insular Life v. NLRC & Basiao / GR No. 84484 / Employer-Employee

Relationships Test to Determine / Narvasa, J p:
F: PR entered into a contract to solicit for insurance applications in 1968
later, on 1972, they entered into an Agency Management Contract (AMC)
P later terminated the AMC, w/c prompted PR to sue, which led to P
terminating also his original contract. Basiao complained for the
unclaimed commissions to the MOL, P argues that MOL has no jurisdiction
and that since PR is an independent contractor. LA found for PR, NLRC
affirmed, hence this.
I: WON PR had become the Companys employee.
R: Reversed. What is germane is Basiao's status under the contract
of July 2, 1968, not the length of his relationship with the
Company to justify employment relationship. Basiao was not an
employee but a commission agent, an independent contractor
whose claim for unpaid commissions should have been litigated
in an ordinary civil action.
The 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 do not create
employer- employee relationship. While, the rules that control or
fix the methodology and bind or restrict the party hired to the
use of such means create employer-employee relationship.
Rules and regulations governing the conduct of the business are provided
for in the Insurance Code and enforced by the Insurance Commissioner. It
is 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. But 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.

Sonza v. ABS-CBN / GR No. 13051 / 6.10.04 / Employer-Employee

Relationships Test to Determine / Carpio, J p:
F: ABS-CBN entered into an agreement w/ MEL&JAY Management and
Development Corp. (MJMDC) to host a TV program, there will be a
monthly talent fee of 310K for the 1 st year and 317 for the 2nd and 3rd
year. Sonza later wrote to ABS-CBN for the rescission of the agreement in
view of PRs failure to pay him his salaries and other benefits. LA ruled in
favor of PR, which NLRC affirmed and the CA dismissed.
I: WON Sonza is an Employee of ABS-CBN.
R: Petition denied.
Unique skills, talent and celebrity status not possessed by
ordinary employees are indicative of an independent contractor;
The power to bargain talent fees way above the salary scales of
ordinary
employees
indicates
an
independent
contractual
relationship A radio/television broadcast specialist who works under
minimal supervision is an independent contractor; The KBP code
applies to broadcasters, not to employees of radio and television
stations; Not all rules imposed by the hiring party on the hired
party indicate that the latter is an employee of the former; In the
broadcast industry, exclusivity is not necessarily the same as
control; Three parties involved in labor- only contracting; Talents
as Independent Contractors
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.
Applying the control test, SONZA is not an employee but an
independent contractor. 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.

Brotherhood Labor Unity Movement of the Philippines v. Zamora /

GR No. L-48645 / 01.07.87 / Employer-Employee Relationships
Test to Determine / Gutierrez, Jr., J:
F: Ps are cargadores and pahinantes working on for as long as 7 years on
average, on a piece rate basis working to load, unload, or piling of bottles
produced by SMC. 140 organized and affiliated themselves to BLUMP (PR),
they later striked, and SMC refused to bargain w/ them, alleging that they
are not employees, rather they were independent contractors they were
later denied work. Sued for illegal dismissal, SMC moved for dismissal. LA
and NLRC ruled for SMC, hence this.
I: WON there exists an EER.
R: Petition Granted, reinstatement w/ back wages. Payment by piece does
not define the essence of employment relation. In this case, the
alleged independent contractors were paid a lump sum
representing only the salaries the workers were entitled to,
arrived at by adding the salaries of each worker which depend on
the volume of work they had accomplished individually.
The existence of an independent contractor relationship is generally
established by the following criteria: "whether or not the contractor is
carrying on an independent business; the nature and extent of
the work; the skill required; the term and duration of the
relationship; the right to assign the performance of a specified
piece of work; the control and supervision of the work to another;
the employer's power with respect to the hiring, firing and
payment of the contractor's workers; the control of the premises;
the duty to supply the premises tools, appliances, materials and
labor; and the mode, manner and terms of payment"
In this case, none of the above criteria exists. Highly unusual and
suspect is the absence of a written contract to specify the
performance of a specified piece of work, the nature and extent
of the work and the term and duration of the relationship.
Also, for an average of seven (7) years, each of the workers had worked
continuously and exclusively for the company's shipping and warehousing
department. Thus, they were engaged to perform activities necessary or
desirable in the usual business or trade of the respondent, and are
therefore regular employees.

SMC v. NLRC / GR No. 80774 / 5.31.88 / EER Jurisdiction /

Feliciano, J p:
F: Vega (PR) and employee of P, submitted a proposal to render the
product of PR to be a more sustainable product (Beer). P dismissed his
proposal and denied him of the cash award that is mandatory to any
employee who can deliver such advancement. PR sued, P in MOLE,
claiming that P is using his proposal and is claiming the cash award. P on
the other hand claimed that PRs submission was turned down because it
lacks originality, and claims that the LA had no jurisdiction, because PR
bypassed Ps grievance machinery. LA turned down PR, NLRC ruled
otherwise, hence this.
I: WON the LA and NLRC had Jurisdiction.
R: Set Aside. The important principle that runs through these three
(3) cases is that where the claim to the principal relief sought is
to be resolved not by reference to the Labor Code or other labor
relations statute or a collective bargaining agreement but by the
general civil law, the jurisdiction over the dispute belongs to the
regular courts of justice and not to the Labor Arbiter and the NLRC. In
such situations, resolution of the dispute requires expertise, not
in labor management relations nor in wage structures and other
terms and conditions of employment, but rather in the
application of the general civil law. Clearly, such claims fall
outside the area of competence or expertise ordinarily ascribed
to Labor Arbiters and the NLRC and the rationale for granting
jurisdiction over such claims to these agencies disappears.
While paragraph 3 above refers to "all money claims of workers," it is not
necessary to suppose that the entire universe of money claims that might
be asserted by workers against their employers has been absorbed into
the original and exclusive jurisdiction of Labor Arbiters. It is evident
that there is a unifying element which runs through paragraphs 1
to 5 of Art. 217 and that is, that they all refer to cases or
disputes arising out of or in connection with an employeremployee relationship. This is, in other words, a situation where the
rule of noscitur a sociis may be usefully invoked in clarifying the scope of
paragraph 3, and any other paragraph of Article 217 of the Labor Code,
as amended.
Thus, whether or not an enforceable contract, albeit implied and
innominate, had arisen between petitioner Corporation and private

respondent Vega in the circumstances of this case, and if so, whether or

not it had been breached, are preeminently legal questions,
questions not to be resolved by referring to labor legislation and
having nothing to do with wages or other terms and conditions of
employment, but rather having recourse to our law on contracts.
PEPSI Cola v. Gal-lang, et. al / GR No. 89621 / 9.24.91 / EER
Jurisdiction / Cruz, J p:
F: PRs were employees of the petitioner who were suspected of irregular
disposition of empty Pepsi Cola bottles, they were criminally charged
which was dismissed, in the course they were terminated from
employment. PRs lodged a complaint with NLRC Tacloban, they also sued
for malicious criminal prosecution in RTC Tacloban. P claimed that since
there is now a case with the LA, civil suit should be dismissed. Dismissed,
but was reconsidered by PR judge, hence this.
I: WON RTC Leyte had jurisdiction.
R: Dismissed. It must be stressed that not every controversy involving
workers and their employers can be resolved only by the labor arbiters.
This will be so only if there is a "reasonable causal connection"
between the claim asserted and employee-employer relations to
put the case under the provisions of Article 217. Absent such a
link, the complaint will be cognizable by the regular courts of
justice in the exercise of their civil and criminal jurisdiction.
The case now before the Court involves a complaint for damages for
malicious prosecution which was filed with the Regional Trial Court of
Leyte by the employees of the defendant company. It does not appear
that there is a "reasonable causal connection" between the complaint and
the relations of the parties as employer and employees. The complaint
did not arise from such relations and in fact could have arisen
independently of an employment relationship between the parties. No
such relationship or any unfair labor practice is asserted. What the
employees are alleging is that the petitioners acted with bad
faith when they filed the criminal complaint which the Municipal
Trial Court said was intended "to harass the poor employee" and
the dismissal of which was affirmed by the Provincial Prosecutor
"for lack of evidence to establish even a slightest probability that
all the respondents herein have committed the crime imputed
against them." This is a matter which the labor arbiter has no

competence to resolve as the applicable law is not the Labor

Code but the Revised Penal Code.

Medina & Ong v. Judge Bartolome, Aboitiz and Pepsi Cola / GR No.
L-59825 / 9.11.82 / EER Jurisdiction / Abad Santos, J p:
F: Ps former employees of PRs company, alleging that PR Aboitiz
dismissed and publicly humiliated Ps w/o provocation. Ps sued. PR argues
that CFI Makati had no jurisdiction, w/c was denied, pending litigation the
Labor Code was amended, PR now re-raised their jurisdiction contention
basing from Art. 217(b), PR judge granted. Hence this petition.
I: WON the Labor Code has any relevance to the relief sought.
R: Granted. It is obvious from the complaint that the plaintiffs have not
alleged any unfair labor practice. Theirs is a simple action for
damages for tortious acts allegedly committed by the
defendants. Such being the case, the governing statute is the
Civil Code and not the Labor Code. It results that the orders under
review are based on a wrong premise.
Where plaintiffs' complaint for damages arising from the alleged
disgraceful termination of employment does not allege any unfair
labor practice, theirs is a simple action for damages for tortious
acts allegedly committed by the defendants.

PNB v. Cabansag / GR 157010 / 6.21.05 / EER Jurisdiction /

Panganiban, J p:
F: Cabansag (PR) was hired by PNB as a Branch Credit Officer in
Singapore, in a probationary status for 3 months, pending regularization.
4 months into job, performing well with mentions, PR was advised by coemployees that the Branch manager is asking him to resign, because of
retrenchment, and that they need a chinese for his position, PR did not
resign. PR was eventually terminated. PR sued in Manila, LA ruled in favor
of PR, w/c NLRC affirmed, so did CA.
I: WON NLRC Manila had jurisdiction, and is it most convenient.
R: Affirmed. The jurisdiction of labor arbiters and the NLRC is
specified in Article 217 of the Labor Code as follows: "ART. 217.
Jurisdiction of Labor Arbiters and the Commission. . . .
"SECTION 10. Money Claims. . . . Based on the foregoing
provisions, labor arbiters clearly have original and exclusive
jurisdiction over claims arising from employer-employee
relations, including termination disputes involving all workers,
among whom are overseas Filipino workers (OFW).
That permit (SG Laws), however, does not automatically mean
that the non-citizen is thereby bound by local laws only, as
averred by petitioner. It does not at all imply a waiver of one's
national laws on labor. Absent any clear and convincing evidence to
the contrary, such permit simply means that its holder has a legal status
as a worker in the issuing country.
Noteworthy is the fact that respondent likewise applied for and secured
an Overseas Employment Certificate from the POEA through the
Philippine Embassy in Singapore. The Certificate declaring her a bona
fide contract worker for Singapore. Under Philippine law, this
document authorized her working status in a foreign country and entitled
her to all benefits and processes under our statutes, covered by
Philippine labor laws and policies upon certification by the POEA.
Hence, petitioner cannot escape the application of Philippine
laws or the jurisdiction of the NLRC and the labor arbiter.
The appellate court was correct in holding that respondent was already a
regular employee at the time of her dismissal, because her three-month
probationary period of employment had already ended. This ruling is in
accordance with Article 281 of the Labor Code: "An employee who is

allowed to work after a probationary period shall be considered a regular

employee." As a regular employee, respondent was entitled to all rights,
benefits and privileges provided under our labor laws.

Urbanes v. Secretary of DOLE & SSS / GR No. 122791 / 2.19.03 /

EER Jurisdiction / Carpio Morales, J p:
F: Petitioner, provides security services to SSS. During the effectivity of
the agreement, petitioner requested the SSS for upward adjustment of
their contract rate in view of Wage Order No. NCR-03. For failure to heed
the request, petitioner pulled out his agency's services from the premises
of SSS and filed a complaint seeking the implementation of Wage Order
No. NCR-03 to the DOLE. Regional LA ruled in favor of P, which was later
overturned by the Secretary of DOLE, hence this.
I: WON DOLE has jurisdiction.
F: The relief sought here has to do with the enforcement of the contract
between petitioner and the SSS which was deemed amended by virtue of
Wage Order No. NCR-03. The controversy subject of the case at bar
is thus a civil dispute, the proper forum for the resolution of
which is the civil courts. At any rate, the complaint must be
dismissed for lack of cause of action. The liability of the SSS to
reimburse petitioner arises only if and when petitioner pays his
employee-security guards "the increases" mandated by Wage
Order No. NCR-03. The records do not show that petitioner has paid the
mandated increases to the security guards. The security guards in fact
have filed a complaint with the NLRC against petitioner relative to, among
other things, underpayment of wages.

Yusen Air & Sea Services Phils, Inc. v. Villamor / GR No. 154060 /
8.16.05 / EER Jurisdiction / Garcia, J p:
F: PR is employed by P as a branch manager; w/c was later reclassified as
a Division Manager, w/c he held until he resigned in 2.1.02. PR then
worked for another company in the same line of business. P Sued, citing
the undertaking which PR agreed with P in lieu of his employment. On the
other hand P apparently sued through the NLRC P for illegal dismissal, PR
also did not answer the civil suit, instead he submitted a motion to
dismiss, and arguing that said court had no jurisdiction. RTC dismissed Ps
complaint. Hence this recourse.
I: WON RTC had the proper jurisdiction.
R: Remanded for Trial. Actually, the present case is not one of first
impression. In a kindred case, Dai-Chi Electronics Manufacturing vs.
Villarama, with a substantially similar factual backdrop, we held that an
action for breach of contractual obligation is intrinsically a civil dispute.
Petitioner does not ask for any relief under the Labor Code of the
Philippines. It seeks to recover damages agreed upon in the
contract as redress for private respondent's breach of his
contractual obligation to its "damage and prejudice." Such cause
of action is within the realm of Civil Law, and jurisdiction over the
controversy belongs to the regular courts. The cause of action is
based on a quasi-delict or tort, which has no reasonable causal
connection with any of the claims provided for in Article 217,
jurisdiction over the action is with the regular courts.
The Court, therefore, believes and so holds that the "money claims of
workers" referred to in paragraph 3 of Article 217 embraces
money claims which arise out of or in connection with the
employer-employee relationship, or some aspect or incident of
such relationship. Put a little differently, that money claims of workers
which now fall within the original and exclusive jurisdiction of Labor
Arbiters are those money claims which have some reasonable causal
connection with the employer-employee relationship. (SMC v. NLRC)
It is basic that jurisdiction over the subject matter is determined
upon the allegations made in the complaint, irrespective of
whether or not the plaintiff is entitled to recover upon the claim
asserted therein, which is a matter resolved only after and as a
result of a trial. Neither can jurisdiction of a court be made to depend
upon the defenses made by a defendant in his answer or motion to

dismiss. If such were the rule, the question of jurisdiction would depend
almost entirely upon the defendant.