VILLAMARIA VS CA

G.R. No. 165881 (2006) – Callejo, Sr., J.

TICKER: jeepney driver/buyer

FACTS:
Oscar Villamaria, Jr. was the owner of Villamaria Motors, a sole proprietorship engaged in
assembling passenger jeepneys with a public utility franchise to operate along the Baclaran-
Sucat route. By 1995, Villamaria stopped assembling jeepneys and retained only nine, four of
which operated by employing drivers on a “boundary basis.” One of those drivers was
respondent Bustamante.

Bustamante remitted 450 a day to Villamaria as boundary and kept the residue of his daily
earnings as compensation for driving the vehicle. In August 1997, Villamaria verbally agreed to
sell the jeepney to Bustamante under a “boundary-hulog scheme”, where Bustamante would
remit to Villamaria P550 a day for a period of 4 years; Bustamane would then become the
owner of the vehicle and continue to drive the same under Villamaria’s franchise, but with Php
10,000 downpayment.

August 7, 1997, Villamaria executed a contract entitled “Kasunduan ng Bilihan ng Sasakyan sa

Pamamagitan ng Boundary Hulog”. The parties agreed that if Bustamante failed to pay the
boundary- hulog for 3 days, Villamaria Motors would hold on to the vehicle until Bustamante
paid his arrears, including a penalty of 50 a day; in case Bustamante failed to remit the daily
boundary-hulog for a period of one week, the Kasunduan would cease to have the legal effect
and Bustamante would have to return the vehicle to Villamaria motors.

In 1999, Bustamante and other drivers who also had the same arrangement failed to pay their
respective boundary-hulog. The prompted Villamaria to serve a “Paalala”. On July 24, 2000.
Villamaria took back the jeepney driven by Bustamante and barred the latter from driving the
vehicle. Bustamante then filed a complaint for illegal dismissal.

*Labor Arbiter: petition dismissed.

*NLRC: dismissed appeal.
*CA: reversed NLRC, awarded Bustamante separation pay and backwages.
Hence, this petition for review on certiorari.

ISSUES:
1) Whether or not employer-employee relationship existed between petitioner and respondent
2) Whether or not the Labor Arbiter has jurisdiction over a complaint for illegal dismissal in such
a case.

RULING:
1) Yes.
 Under the boundary-hulog scheme incorporated in the Kasunduan, a dual juridical
relationship was created between petitioner and respondent: that of employer-employee
and vendor-vendee. The Kasunduan did not extinguish the employer-employee
relationship of the parties extant before the execution of said deed. The boundary
system is a scheme by an owner/operator engaged in transporting passengers as a
common carrier to primarily govern the compensation of the driver, that is, the latter’s
daily earnings are remitted to the owner/operator less the excess of the boundary which
represents the driver’s compensation. Under this system, the owner/operator
 exercises control and supervision over the driver. Moreover, taking back the jeepney
doesn’t terminate employer-employee relationship under the Kasunduan.
 .The management of the business is still in the hands of the owner/operator, who, being
the holder of the certificate of public convenience, must see to it that the driver follows
the route prescribed by the franchising and regulatory authority, and the rules
promulgated with regard to the business operations.
 The driver performs activities which are usually necessary or desirable in the
usual business or trade of the owner/operator. Under the Kasunduan, respondent
was required to remit Php 550 daily to petitioner, an amount which represented the
boundary of petitioner as well as respondent’s partial payment (hulog) of the purchase
price of the jeepney. Thus, the daily remittances also had a dual purpose: that of
petitioner’s boundary
and respondent’s partial payment (hulog) for the vehicle.
 The existence of an employment relation is not dependent on how the worker is
paid but on the presence or absence of control over the means and method of the
work. The amount earned in excess of the “boundary hulog” is equivalent to wages and
the fact that the power of dismissal was not mentioned in the Kasunduan did not mean
that private respondent never exercised such power, or could not exercise such power.

2) Yes.
 The jurisdiction of Labor Arbiters and the NLRC under Article 217 of the Labor
Code is limited to disputes arising from an employer-employee relationship which
can only be resolved by reference to the Labor Code, other labor statutes or their
collective bargaining agreement. When the principal relief is to be granted under labor
legislation or a collective bargaining agreement, the case falls within the exclusive
jurisdiction of the Labor Arbiter and the NLRC even though a claim for damages might
be asserted as an incident to such claim.
o In the instant case, the petitioner failed to substantiate allegations with solid,
sufficient proof. Notably, private respondent’s allegation viz, that he retrieved the
vehicle from the gas station, where respondent abandoned it, contradicted his
statement in the Paalala that he would enforce the provision (in the Kasunduan)
to the effect that default in the remittance of the boundary hulog for 1 week would
result in the forfeiture of the unit. Petitioner did not submit any police report to
support his claim that respondent really figured in a vehicular mishap. Neither did
he present the affidavit of the guard from the gas station to substantiate his claim
that respondent abandoned the unit there.
ATIENZA VS SALUTA
G.R. No. 233413 (2019) – Reyes, J. Jr., J.

TICKER: family driver, not company driver; rights governed by Civil Code, not LC

FACTS:
Noel Sacramento Saluta filed a complaint against CRV Corporation (CRV) and petitioner Cellia
Atienza for illegal dismissal, non-payment of wages, overtime pay, holiday pay, premium pay for
work on holidays and rest day, illegal deduction, and issuance of a certificate of employment.
He alleged that he is a company driver under the employ of CRV Corporation. He was assigned
to drive for Celia Atienza, one of the company’s top officials and received P9,000 monthly
salary. As one of the company drivers, his work was absolutely necessary and desirable to the
usual business of the company. He also contends that he received his salaries through the ATM
like the other employees of the company.

For her part, Atienza contended that Saluta was not dismissed from work, rather, he abandoned
his job when he refused to report for work and took a leave of absence without permission. She
claimed that Saluta was not an employee of CRV Corporation, but was hired by Atienza as her
personal/family driver with a monthly salary of P9,000 and free board and lodging. His duty was
simply to drive for her and her family to anywhere they wish to go.

Labor Arbiter’s decision:

Labor Arbiter dismissed respondent’s complaint except insofar as his claim for illegal deduction
and request for the issuance of a certificate of employment are concerned. LA held that
respondent failed to prove by substantial evidence that he was an employee of CRV
Corporation.

NLRC decision:
The NLRC reversed and set aside the decision of the Labor Arbiter. The NLRC held that while it
may be true that the respondent failed to present substantial evidence to prove that he was
under the employ of CRV Corporation as one of its drivers, it is also true that petitioner did not
dispute that respondent was driving for her. By alleging that the respondent was her personal
driver, it becomes incumbent upon her to prove their employer-employee relationship which she
failed to do.

CA decision:
The appellate court affirmed the Decision of the NLRC with modification in that it imposed a 6%
interest per annum on all the monetary awards granted to the respondent from the finality of
judgment until fully paid.

ISSUES:
1) Whether or not Saluta was an employee of CRV Corporation.
2) Whether or not in illegal dismissal cases, the employer bears the burden of proving that the
termination was for a valid or authorized cause
3) Whether or not there is abandonment of work
4) Whether or not the rights of a family driver are still governed by the labor code

RULING:
1) No. I resolving the issue of whether Saluta was an employee of CRV Corporation, it held
that to ascertain the existence of an employer-employee relationship, jurisprudence has
 invariably adhered to the four-fold test, to wit: 1) the selection and engagement of the
employee; 2) the payment of wages; 3) the power of dismissal; 4) the power to control
the employee’s conduct, or the so-called “control test.”
 Although no particular form of evidence is required to prove the existence
of an employer-employee relationship, and any competent and relevant
evidence to prove the relationship may be admitted, a finding that the
relationship exists must nonetheless rest on a substantial evidence, or
such amount of relevant evidence which a reasonable mind might accept
as adequate to justify a conclusion.
 In this case, a scrutiny of the records will bear out that Saluta failed to
substantiate his claim that he was a company driver of CRV Corporation. He did
not present any document that would show that his services had been engaged
by CRV Corporation.
 Both the NLRC and the CA made it Atienza’s obligation to prove that Saluta was
under her employ and not a company driver of CRV Corporation. The Court does
not agree. It must be emphasized that the rule of the thumb remains: the onus
probandi falls on Saluta to establish or substantiate his claim by the
requisite quantum of evidence given that it is axiomatic that whoever
claims entitlement to the benefits provided by law should establish his or
her right thereto. Unfortunately, Saluta failed to hurdle the required burden of
proof as would give ground for this Court to agree with him.

2) Generally, yes. It is axiomatic that in illegal dismissal cases, the employer bears the
burden of proving that the termination was for a valid or authorized cause. HOWEVER,
there are cases wherein the facts and the evidence do not establish prima facie
that the employee was dismissed from employment.
 Before the employer is obliged to prove that the dismissal was legal, the
employee must first establish by substantial evidence the fact of his
dismissal from service. If there is no dismissal, then there can be no
question as to the legality or illegality thereof.
 In this case, Saluta’s bare claim of having been dismissed from employment by
Atienza, unsubstantiated by impartial and independent evidence, is insufficient to
establish such fact of dismissal. Bare and unsubstantiated allegations do not
constitute substantial evidence and have no probative value.

3) None. The Court finds that there is no abandonment in this case. Aside from his
absence from work, Atienza failed to present any proof of Saluta’s overt conduct which
clearly manifested his desire to end his employment. Settled is the rule that mere
absence or failure to report for work is not tantamount to abandonment of work.
 This is especially so in light of his having filed a case for illegal dismissal which is
inconsistent with abandonment of employment. The filing of such complaint is
proof enough of his desire to return to work, thus, negating any suggestion of
abandonment.

4) No. The SC held that the Civil Code shall govern the rights of family drivers.
 Section 44 of RA 10361 (Domestic Workers Act or Batas Kasambahay)
expressly repealed Chapter III (Employment of Househelpers) of the Labor Code
which includes Arts. 141-149 that used to govern the rights of the family drivers
under the Labor Code.
 The Kasambahay Law, on the other hand, made no mention of family drivers in
the enumeration of those workers who are covered by the law. Section 4 (d) of
the Kasambahay Law pertaining to who are included in the enumeration of
domestic or household help cannot also be interpreted to include family drivers
because the latter category of worker is clearly not included.
 Due to the express repeal of the Labor Code provisions pertaining to
household helpers, which includes family drivers, by the Kasambahay Law,
and the non-applicability of the Kasambahay Law to family drivers, there is
a need to revert back to the Civil Code provisions (Arts. 1689, 1697, 1699,
Section 1, Chapter 3, Title VIII, Book IV thereof). Since what were expressly
repealed by the Kasambahay Law were only Articles 141 to 152, Chapter III
of the Labor Code on Employment of Househelpers, and the Labor Code
did not repeal the Civil Code provisions concerning household service
which impliedly includes family drivers, the said Civil Code provisions
stand.
 Given that there is neither dismissal nor abandonment in this case, none of the
party is entitled to claim any indemnity from the other. Verily, in a case where the
employee’s failure to work was occasioned neither by his abandonment nor by a
termination, the burden of economic loss is not rightfully shifted to the employer;
each party must bear his own loss. Thus, Saluta’s act of not reporting to work
after a verbal miscommunication cannot justify the payment of any form of
remuneration.
 The P9,000 salary Saluta receives every month is reasonable and in accordance
with the Civil Code. Hence, Atienza may not be made to pay Saluta wage
differentials; Atienza is also not liable to Saluta for the payment of holiday pay,
13th month pay and service incentive leave pay because persons in the
personal service of another, such as family drivers, are exempted from the
coverage of such benefits pursuant to the Labor Code and the
implementing rules of PD 851.
 The reversal of the judgment rendered by the appellate court will not inure
to the benefit of CRV Corporation considering that CRV Corporation did not
appeal the decision of the appellate court.