1) Henry is an employer.

a. If the question to ask was “why", what would be your answer based on the
Four- Fold Test.

The Four-Fold Test determines if there exists an Employer-Employee

Relationship between parties by looking for the presence of its four components
which are the: Selection Test, Wage Test, Dismissal Test and the Control Test.

In order to ascertain why Henry is an employer all these test should apply to him
in the following manner:

i. He is an employer because he has the power and authority to hire

employees through a standard employee selection process.
ii. He is an employer because he is obligated by law to pay an wage or
salary prescribed in the employment contract to the employee.
iii. He is an employer because He has the authority to dismiss the Employee
for a just and authorized cause and thru a notice of dismissal.
iv. Ultimately, he is an employer because he has the power to control the
means and methods that the Employee must do in order to accomplish a
task.

b. If the question to ask was “how", what would be your answer based on the
Two-Tier Test.

The Two-Tiered Test determines the existence of the Employer-Employee

Relationship through the presence of Control and the Economic Dependence.

Thus, in order to detect if how Henry is considered as an employer the following

aspects must concur.
i. Henry must have the power and authority to control the means and
methods that the Employee must do in order to accomplish a task.
ii. The work done by the Employee should be an integral part of Henry's
business.
iii. Lastly, the Employee must have a degree of dependency upon the
employer for the former's continued employment in that line of business.

2) Employer-Employee relationship is a question of both fact and law. As a

question of law, its meaning is supplied by law. As a question of fact, labor
tribunals determine when it exists. When can a Labor Arbiter conclude EER
between a principal, contractor and worker? Explain.

Control is the determining factor for the existence of an Employer-Employee

Relationship. However, in cases where a worker is hired by a contractor to work for a
principal, the Labor Arbiter must first determine if the contractor is a legitimate job
contractor, independent from control of the principal, or a labor-only contractor, who is a
mere agent of the principal.

If the Contractor is a Legitimate-Job Contractor, then there might be an Employer-

Employee Relationship between the Contractor and the Employee once it was found that

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 the former has the power to control the means and methods that the latter should use to
accomplish a task.

If, on the other hand, the Contractor is a Labor-only Contractor then his exercise of the
power to control will only prove that Employer-Employee Relationship exists between the
principal and the employee, since a labor-only contractor is a mere agent of the principal
and thus merges its legal personality to the latter.

3) Since X Co. failed to present clear and convincing evidence that George stole a
co-employee's watch, the Labor Arbiter resolved the doubt in his favor and
declared illegal his dismissal. Did the Labor Arbiter apply Art. 4 of the Labor Code
correctly?

Yes, because Article 4 of the Labor Code may also be applied to Labor contracts and
evidence presented in Labor-proceedings.

In the case at bar, the doubt arising from the lack of evidence proving that the employee
stole something which became the reason for his dismissal may be resolved under Art. 4
which provides that all doubts must be resolved in favor of labor.

4) On the third month of learnership, Ramon was dismissed. The Labor Arbiter
found the company's defense unsubstantiated. Can the Labor Arbiter order his
reinstatement even after the expiration of his 3-month learnership agreement?
Explain.

Article 75 par. d of the Labor Code provides:

ART. 75. LEARNERSHIP AGREEMENT. —Any employer desiring to employ

learners shall enter into a learnership agreement with them, which agreement
shall include:

xxxx

(d) A commitment to employ the learners, if they so desire, as regular

employees upon completion of the learnership. All learners who have
been allowed or suffered to work during the first two (2) months shall be
deemed regular employees if training is terminated by the employer
before the end of the stipulated period through no fault of the learner.

The Employer is obligated to hire the learner as a regular employee if during the first two
months of training the learnership was terminated by the employer before the end of the
stipulated period through no fault of the learner.

In the case at bar, since Ramon's dismissal was found to be unsubstantiated, it shows
his termination was of no fault of his and as per Article 75 of the Labor Code the Labor
Arbiter may order his reinstatement as a regular employee.

5) A, B, C and D were promised employment in Hong Kong by X, Y, and Z who failed

to deploy them after collecting placement fees. Prosecuted for economic
sabotage, X and Z raised the defense that Y had died during the PI; hence the

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 charge should have been simple Illegal Recruitment only. Would the defense merit
consideration by the trial court?

No, Art. 38 (b) of the Labor Code provides:

(b) Illegal recruitment when committed by a syndicate or in large scale shall be

considered an offense involving economic sabotage and shall be penalized in
accordance with Article 39 hereof.

Illegal recruitment is deemed committed by a syndicate if carried out by a group of three

(3) or more persons conspiring and/or confederating with one another in carrying out any
unlawful or illegal transaction, enterprise or scheme defined under the first paragraph
hereof. Illegal recruitment is deemed committed in large scale if committed against three
(3) or more persons individually or as a group.”

Regardless of the death of the third conspirator, Art. 38(b) of the Labor Code still
provides that an illegal recruitment committed in a large scale, where the offense is
committed against three or more persons individually or as a group, is still considered as
an offense involving economic sabotage.

Hence, in the case at bar, the death of Y will not change the nature of the offense that
was committed.