TOPIC: EMPLOYER-EMPLOYEE RELATIONSHIP/ JUSISDICTION OF LABOR

ARBITER

G.R. No. 223825, January 20, 2020

LUIS G. GEMUDIANO, JR., PETITIONER, v. NAESS SHIPPING PHILIPPINES, INC.
AND/OR ROYAL DRAGON OCEAN TRANSPORT, INC. AND/OR PEDRO MIGUEL F.
OCA, RESPONDENTS.
DOCTRINE: if the Court were to make a distinction between the perfection of a contract of
employment and the commencement of an employment relationship on its face, and so rule that a
mere perfected contract would make the jurisdiction of the case fall under regular courts, the
Court will arrive at a dangerous conclusion where domestic seafarers' only recourse in law in
case of breach of contract is to file a complaint for damages before the Regional Trial Court. In
so doing, domestic seafarers would have to pay filing fees which his overseas counterpart need
not comply with in filing a complaint before the labor arbiters. 17 As a necessary consequence, the
domestic seafarers would need to prove their claim by preponderance of evidence or "evidence
which is of greater weight, or more convincing than that which is offered in opposition to it,"
which is greater than what overseas seafarers need to discharge in cases before labor arbiters,
where they only have to prove their claims by substantial evidence or " hat amount of evidence
which a reasonable mind might accept as adequate to support a conclusion."
FACTS: petitioner applied with Naess Shipping. He had an interview with Naess Shipping and
completed the training on International Safety Management (ISM) Code at the Far East Maritime
Foundation, Inc. As advised by Naess Shipping's crewing manager Leah G. Fetero (Fetero),
petitioner underwent the mandatory pre-employment medical examination (PEME) where he
was declared fit for sea service. The expenses for the PEME were shouldered by petitioner.

On February 15, 2013, petitioner signed an Embarkation Order duly approved by Fetero
stipulating the terms and conditions of his employment, and directing him to request for all the
necessary documents and company properties from the person he was going to replace in his
vessel of assignment.

On February 18, 2013, Naess Shipping, for and in behalf of its principal Royal Dragon, executed
a "Contract of Employment for Marine Crew on Board Domestic Vessels" (contract of
employment) engaging the services of petitioner as Second Officer aboard the vessel "M/V
Meiling 11," an inter-island bulk and cargo carrier, for a period of six months with a gross
monthly salary of P30,000.00. It was stipulated that the contract shall take effect on March 12 ,
2013. On March 8, 2013, petitioner received a call from Fetero informing him that Royal Dragon
cancelled his embarkation. Thus, he filed a complaint for breach of contract against respondents
before the Arbitration Branch of the NLRC. Respondents, on the other hand, argued that
petitioner's employment did not commence because his deployment was withheld by reason of
misrepresentation. They stressed that petitioner did not disclose the fact that be is suffering from
diabetes mellitus and asthma which render him unfit for sea service. They claimed that the Labor
Arbiter has no jurisdiction over the petitioner's complaint for breach of contract , invoking the
absence of employer-employee relationship.

ISSUE:
1. Whether there exists an Employer-employee relationship.
2. Whether the Labor Arbiter has jurisdiction over the case.
RULING:
1. In the instant case, there is no doubt that there was already a perfected contract of
employment between petitioner and respondents. The contract had passed the negotiation
stage or "the time the prospective contracting parties manifest their interest in the
contract."11 It had reached the perfection stage or the so-called " birth of the contract" as it
was clearly shown that the essential elements of a contract, i.e., consent, object, and
cause, were all present at the time of its constitution. Petitioner and Fetero, respondents'
Crewing Manager, freely entered into the contract of employment, affixed their
signatures thereto and assented to the terms and conditions of the
contract (consent), under which petitioner binds himself to render service (object) to
respondents on board the domestic vessel " M/V Meiling 11" for the gross monthly salary
of P30,000.00 (cause). An examination of the terms and conditions agreed upon by the
parties will show that their relationship as employer and employee is encapsulated in the
perfected contract of employment. Thus, by virtue of said contract, respondents and
petitioner assumed obligations which pertain to those of an employer and an employee.
Consequently , the employer-employee relationship between petitioner and respondents
should be deemed to have arisen as of the agreed effectivity date of the contract of
employment, or on March 12, 2013.
At this point, it is settled that an employer-employee relationship exists between
respondents and petitioner.

2. While there are cases which hold that the existence of an employer-employee relationship
does not negate the civil jurisdiction of the trial courts, 16 in this particular case, we find
that jurisdiction properly lies with the Labor Arbiter.

The determination of propriety of petitioner's non-deployment necessarily involves the

interpretation and application of labor laws, which are within the expertise of labor tribunals. The
question of whether respondents are justified in cancelling the deployment of petitioner requires
determination of whether a subsequent advice from the same medical provider as to the health of
petitioner could validly supersede its initial finding during the required PEME that petitioner is
fit to work.
TOPIC:

NATURE OF EMPLOYMENT

GERRY MOJICA VS GENERALI PILIPINAS LIFE INSURANCE COMPANY, INC.

GR NO. 222455 SEPTEMBER 18, 2019

DOCTRINE:

Under the four-fold test in determining the existence of an employer-employee

relationship which considers the following elements: (1) the power to hire; (2) the payment of
wages; (3) the power to dismiss; and (4) the power to control, the last is the most important
factor.

Facts:

Petitioner used to be a Unit Manager and Associate Branch Manager of respondent.

Respondent alleged that petitioner used to be its agent, designated as Unit Manager and later as
Associate Branch Manager. Respondent maintains that under the Unit Manager's Agreement and
Associate Branch Manager's Agreement executed by the parties on 19 January 2001 and 24
January 2002, respectively, respondent hired petitioner as an agent and independent contractor,
and not as employee of respondent. On the other hand, petitioner asserted that he was an
employee of respondent, and not its agent or independent contractor. The Court of Appeals found
that petitioner was authorized to: (1) recruit insurance agents with whom he exercised the right to
assign, control and supervise the performance of activities necessary for the operations of his
unit; (2) supply his branch with the necessary tools, with an option of availing the monthly
drawing allowance to meet his requirement pursuant to the terms of the Memorandum of
Agreement; and (3) choose how to conduct his business. Furthermore, petitioner received
commissions and not salaries or wages.

Issue:

Whether the petitioner is an independent contractor and not an employee of respondent

Ruling:

Yes. Under the four-fold test in determining the existence of an employer-employee

relationship which considers the following elements: (1) the power to hire; (2) the payment of
wages; (3) the power to dismiss; and (4) the power to control, the last is the most important
factor. In here, petitioner carried on the business of his unit independently and exercised wide
latitude in the conduct of his business. In fact, as expressly stated in the Unit Manager's
Agreement and the Associate Branch Manager's Agreement, petitioner was "free to exercise his
own judgment as to time, place and means of soliciting insurance." Also petitioner earned
through commissions and was not paid a fixed salary or wage. Hence, petitioner is an
independent contractor and not an employee of respondent

G.R. No. 235315. July 13, 2020

HENRY T. PARAGELE, ROLAND ELLY C. JASO, JULIE B. APARENTE, RODERICO S. ABAD, MILANDRO B. ZAFE
JR., RICHARD P. BERNARDO, JOSEPH C. AGUS, ROMERALD S. TARUC, ZERNAN BAUTISTA, ARNOLD
MOTITA, JEFFREY CANARIA, ROMMEL F. BULIC,

HENRY N. CHING, NOMER C. OROZCO, JAMESON M. FAJILAN, JAY ALBERT E. TORRES, RODEL P. GALERO,
CARL LAWRENCE JASA NARIO, ROMEO SANCHEZ MANGALI III, FRANCISCO ROSALES JR., BONICARL
PENAFLORIDA USARAGA, JOVEN P. LICON, NORIEL BARCITA SY, GONZALO MANABAT BAWAR, DAVID
ADONIS S. VENTURA, SOLOMON PICO SARTE, JONY F. LIBOON, JONATHAN PERALTA ANITO, JEROME
TORRALBA, AND JAYZON MARSAN, Petitioners,

vs.

GMA NETWORK, INC., Respondent.

DOCTRINE:

Only casual employees performing work that is neither necessary nor desirable to the usual business
and trade of the employer are required to render at least one (1) year of service to attain regular status.
Employees who perform functions which are necessary and desirable to the usual business and trade of
the employer attain regular status from the time of engagement.

FACTS:

Petitioners claimed that they were regular employees of GMA, having been employed at least a year and
a half by GMA. However, GMA denied the existence of an employer-employee relationship as they were
engaged as mere "pinch-hitters or relievers" whose services were engaged only when there was a need
for a substitute or additional workforce.

The Labor Arbiter dismissed the petition for failure to prove the existence of an employer- employee
relationship, and thus, no illegal dismissal could have ensued. On appeal, the NLRC modified the LA’s
decision finding the petitioners as employees of GMA, but only Roxin Lazaro as a regular employee for
serving 477 days as a cameraman. The NLRC added that the existence of an employer-employee
relationship between petitioners and GMA does not automatically mean that petitioners were regular
employees of GMA. Petitioners should have rendered at least one year of service before they can be
considered regular employees. Upon appeal to the CA, it affirms the decision of NLRC that only one of
the petitioners is regular.

Hence, the present petition to be declared as regular employees of GMA who were illegally dismissed
from their service.

ISSUE:

WON an employer-employee relationship existed between the petitioners and GMA.

WON the petitioners are regular employees.

WON the petitioners are illegally dismissed.

RULING:

The petition is meritorious.

On the issue of the existence of employer-employee relationship

The Court finds that there exists an employer-employee relationship between the petitioners and the
respondent. A four-fold test has been applied in determining the existence of an employer- employee
relationship. Thus, to be considered employees of GMA, petitioners must prove the following: (1) that
GMA engaged their services; (2) that GMA compensated them; (3) that GMA had the power to dismiss
them; and more importantly, (4) that GMA exercised control over the means and methods of their work.

On the power of hiring, GMA concedes that it engaged petitioners to perform functions which had been
found by NLRC and CA to be necessary and desirable to GMA's usual business as both a television and
broadcasting company.

On the payment of wages, there is no question that GMA directly compensated petitioners for their
services.
On the power to dismiss, GMA maintains that petitioners were merely "disengaged" from service, and
this Court has ruled time and again that disengagement in the context of an employer- employee
relationship amounts to dismissal.

On the power of control, it becomes necessary to determine whether GMA exercised control over the
means and methods of petitioners' work. The petitioners were hired by GMA as camera operators, and
there is no showing that they were hired because of their "unique skills, talent and celebrity status not
possessed by ordinary employees", thus not making the petitioners as separate independent
contractors. More importantly, the petitioners were subject to GMA’s control and supervision based
upon the evidence adduced. GMA provided the equipment they used during tapings. GMA also assigned
supervisors to monitor their performance and guarantee their compliance with company protocols and
standards. Hence, there exists an employer-employee relationship between the petitioners and
respondent.

On the issue of petitioners being regular employees

The Court finds the petitioners as regular employees of the respondent.

GMA argues the facts that the petitioners should have rendered at least one year of service before they
attain regular status. However, GMA does not refute the finding that petitioners performed functions
necessary and desirable to its usual business. From the plain language of the second paragraph of Article
295 of the Labor Code, it is clear that the requirement of rendering "at least one (1) year of service"
before an employee is deemed to have attained regular status, only applies to casual employees. An
employee is regarded as a casual employee if he or she was engaged to perform functions which are not
necessary and desirable to the usual business and trade of the employer. Thus, when one is engaged to
perform functions which are necessary and desirable to the usual business and trade of the employer,
engagement for a year-long duration is not a controlling consideration.

Petitioners were never casual employees precisely because they performed functions that were
necessary and desirable to the usual business of GMA. They did not need to render a year's worth of
service to be considered regular employees. GMA is primarily engaged· in the business of broadcasting,
which encompasses the production of television programs. Following the nature of its business, GMA is
naturally and logically expected to engage the service of camera operators such as petitioners, in case it
ceases business by failing to shoot and record any television program. Again, that petitioners' work as
camera operators was necessary and desirable to the usual business of GMA has long been settled by
the consistent rulings of both NLRC and CA. And this Court is certain that the petitioners were GMA’s
regular employees.
On the issue of illegal dismissal

As regular employees, petitioners enjoy the right to security of tenure. Thus, they may only be
terminated for just or authorized cause, and after due notice and hearing. The burden to prove that a
dismissal was anchored on a just or authorized cause rests on the employer. The employer's failure to
discharge this burden leads to no other conclusion than that a dismissal was illegal.

GMA failed to ensure that petitioners' dismissals were made in keeping with the requirements of
substantive and procedural due process. As illegally dismissed employees, pet1t10ners are entitled to
reinstatement to their positions with full backwages computed. from the time of dismissal up to the
time of actual reinstatement

WHEREFORE, this Court resolves to GRANT the Petition. The petitioners are DECLARED regular
employees of respondent GMA Network, and are ORDERED REINSTATED to their former positions and to
be PAID back wages, allowances, and other benefit from the time of their illegal dismissal up to the time
of their actual reinstatement.
G.R. No. 223825, January 20, 2020
LUIS G. GEMUDIANO, JR., PETITIONER, v. NAESS SHIPPING PHILIPPINES, INC.
AND/OR ROYAL DRAGON OCEAN TRANSPORT, INC. AND/OR PEDRO MIGUEL F.
OCA, RESPONDENTS.
TOPIC: EMPLOYER-EMPLOYEE RELATIONSHIP/ JUSISDICTION OF LABOR
ARBITER
DOCTRINE: if the Court were to make a distinction between the perfection of a contract
of employment and the commencement of an employment relationship on its face, and
so rule that a mere perfected contract would make the jurisdiction of the case fall under
regular courts, the Court will arrive at a dangerous conclusion where domestic
seafarers' only recourse in law in case of breach of contract is to file a complaint for
damages before the Regional Trial Court. In so doing, domestic seafarers would have to
pay filing fees which his overseas counterpart need not comply with in filing a complaint
before the labor arbiters.17 As a necessary consequence, the domestic seafarers would
need to prove their claim by preponderance of evidence or "evidence which is of greater
weight, or more convincing than that which is offered in opposition to it," which is greater
than what overseas seafarers need to discharge in cases before labor arbiters, where
they only have to prove their claims by substantial evidence or " hat amount of evidence
which a reasonable mind might accept as adequate to support a conclusion."
FACTS: petitioner applied with Naess Shipping. He had an interview with Naess
Shipping and completed the training on International Safety Management (ISM) Code at
the Far East Maritime Foundation, Inc. As advised by Naess Shipping's crewing
manager Leah G. Fetero (Fetero), petitioner underwent the mandatory pre-employment
medical examination (PEME) where he was declared fit for sea service. The expenses
for the PEME were shouldered by petitioner.

On February 15, 2013, petitioner signed an Embarkation Order duly approved by Fetero
stipulating the terms and conditions of his employment, and directing him to request for
all the necessary documents and company properties from the person he was going to
replace in his vessel of assignment.

On February 18, 2013, Naess Shipping, for and in behalf of its principal Royal Dragon,
executed a "Contract of Employment for Marine Crew on Board Domestic Vessels"
(contract of employment) engaging the services of petitioner as Second Officer aboard
the vessel "M/V Meiling 11," an inter-island bulk and cargo carrier, for a period of six
months with a gross monthly salary of P30,000.00. It was stipulated that the contract
shall take effect on March 12 , 2013. On March 8, 2013, petitioner received a call from
Fetero informing him that Royal Dragon cancelled his embarkation. Thus, he filed a
complaint for breach of contract against respondents before the Arbitration Branch of
the NLRC. Respondents, on the other hand, argued that petitioner's employment did not
commence because his deployment was withheld by reason of misrepresentation. They
stressed that petitioner did not disclose the fact that be is suffering from diabetes
mellitus and asthma which render him unfit for sea service. They claimed that the Labor
Arbiter has no jurisdiction over the petitioner's complaint for breach of contract , invoking
the absence of employer-employee relationship.

ISSUE:
3. Whether there exists an Employer-employee relationship.
4. Whether the Labor Arbiter has jurisdiction over the case.
RULING:
3. In the instant case, there is no doubt that there was already a perfected
contract of employment between petitioner and respondents. The contract had
passed the negotiation stage or "the time the prospective contracting parties
manifest their interest in the contract." 11 It had reached the perfection stage or the
so-called " birth of the contract" as it was clearly shown that the essential
elements of a contract, i.e., consent, object, and cause, were all present at the
time of its constitution. Petitioner and Fetero, respondents' Crewing Manager,
freely entered into the contract of employment, affixed their signatures thereto
and assented to the terms and conditions of the contract (consent), under which
petitioner binds himself to render service (object) to respondents on board the
domestic vessel " M/V Meiling 11" for the gross monthly salary of
P30,000.00 (cause). An examination of the terms and conditions agreed upon by
the parties will show that their relationship as employer and employee is
encapsulated in the perfected contract of employment. Thus, by virtue of said
contract, respondents and petitioner assumed obligations which pertain to those
of an employer and an employee. Consequently , the employer-employee
relationship between petitioner and respondents should be deemed to have
arisen as of the agreed effectivity date of the contract of employment, or on
March 12, 2013.
At this point, it is settled that an employer-employee relationship exists between
respondents and petitioner.

4. While there are cases which hold that the existence of an employer-employee
relationship does not negate the civil jurisdiction of the trial courts, 16 in this
particular case, we find that jurisdiction properly lies with the Labor Arbiter.

The determination of propriety of petitioner's non-deployment necessarily involves the

interpretation and application of labor laws, which are within the expertise of labor
tribunals. The question of whether respondents are justified in cancelling the
deployment of petitioner requires determination of whether a subsequent advice from
the same medical provider as to the health of petitioner could validly supersede its initial
finding during the required PEME that petitioner is fit to work.
 The four-fold test used in determining the existence of employer-employee
relationship involves an inquiry into: (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 method by
which the work is to be accomplished.

G.R. No. 210741 October 14, 2020

GESOLGON vs CYBERONE PH., INC.

FACTS:
Petitioners were hired by Mikrut, CEO of CyberOne AU (Australian company) and CyberOne PH, as part-
time home-based remote Customer Service Representatives of CyberOne AU, thereafter, became full
time and permanent employees and were eventually promoted as Supervisors. Meanwhile, Mikrut,
asked petitioners, to become dummy directors and/or incorporators of CyberOne PH to which
petitioners agreed. As a result, petitioners were promoted as Managers and were given increases in
their salaries. However, in their payroll, their salaries decreased and petitioners were only given
P20,000.00 each as 13th month pay for the year 2010. Then, Mikrut made petitioners choose one from
three options: (a) to take an indefinite furlough and be placed in a manpower pool to be recalled in case
there is an available position; (b) to stay with CyberOne AU but with an entry level position as home-
based Customer Service Representative; or (c) to tender their irrevocable resignation. Petitioners were
constrained to pick the first option in order to save their jobs. On the other hand, respondent denied
that any employer-employee relationship existed between petitioners and CyberOne PH. They insisted
that petitioners were incorporators or directors and not regular employees of CyberOne PH but were
employees of CyberOne AU.

ISSUE: Whether or not Employer-Employee relationship exist with the petitioners and CyberOne PH.

HELD: None. The four-fold test used in determining the existence of employer-employee relationship
involves an inquiry into: (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 method by which the work is to be accomplished. Based on record, petitioners were
requested by respondent Mikrut to become stockholders and directors of CyberOne PH with each one
of them subscribing to one share of stock. However, petitioners contend that they were hired as
employees of CyberOne PH as shown by the pay slips indicating that CyberOne PH paid them Pl 0,000.00
monthly net of mandatory deductions. Other than the pay slips presented by petitioners, no other
evidence was submitted to prove their employment by CyberOne PH. Petitioners failed to present any
evidence that they rendered services to CyberOne PH as employees thereof. Lastly, the power of control
of CyberOne PH over petitioners is not supported by evidence on record. To reiterate, petitioners failed
to prove the manner by which CyberOne PH alledgedly supervised and controlled their work. In fact,
petitioners failed to mention their functions and duties as employees of CyberOne PH. They merely
relied on their allegations that they were hired and paid by CyberOne PH without specifying the terms of
their employment as well as the degree of control CyberOne PH had over the means and method by
which their work would be accomplished.