Professional Documents
Culture Documents
First Division (G.R. NO. 170087, August 31, 2006) : Decision
First Division (G.R. NO. 170087, August 31, 2006) : Decision
399
FIRST DIVISION
[ G.R. NO. 170087, August 31, 2006 ]
ANGELINA FRANCISCO, PETITIONER, VS. NATIONAL
LABOR RELATIONS COMMISSION, KASEI CORPORATION,
SEIICHIRO TAKAHASHI, TIMOTEO ACEDO, DELFIN LIZA,
IRENE BALLESTEROS, TRINIDAD LIZA AND RAMON
ESCUETA, RESPONDENTS.
DECISION
YNARES-SANTIAGO, J.:
This petition for review on certiorari under Rule 45 of the Rules of Court seeks to
annul and set aside the Decision and Resolution of the Court of Appeals dated
October 29, 2004[1] and October 7, 2005,[2] respectively, in CA-G.R. SP No. 78515
dismissing the complaint for constructive dismissal filed by herein petitioner
Angelina Francisco. The appellate court reversed and set aside the Decision of the
National Labor Relations Commission (NLRC) dated April 15, 2003,[3] in NLRC
NCR CA No. 032766-02 which affirmed with modification the decision of the Labor
Arbiter dated July 31, 2002,[4] in NLRC-NCR Case No. 30-10-0-489-01, finding that
private respondents were liable for constructive dismissal.
In 1995, petitioner was hired by Kasei Corporation during its incorporation stage.
She was designated as Accountant and Corporate Secretary and was assigned to
handle all the accounting needs of the company. She was also designated as Liaison
Officer to the City of Makati to secure business permits, construction permits and
other licenses for the initial operation of the company.[5]
Although she was designated as Corporate Secretary, she was not entrusted with the
corporate documents; neither did she attend any board meeting nor required to do so.
She never prepared any legal document and never represented the company as its
Corporate Secretary. However, on some occasions, she was prevailed upon to sign
documentation for the company.[6]
:
In 1996, petitioner was designated Acting Manager. The corporation also hired Gerry
Nino as accountant in lieu of petitioner. As Acting Manager, petitioner was assigned
to handle recruitment of all employees and perform management administration
functions; represent the company in all dealings with government agencies,
especially with the Bureau of Internal Revenue (BIR), Social Security System (SSS)
and in the city government of Makati; and to administer all other matters pertaining
to the operation of Kasei Restaurant which is owned and operated by Kasei
Corporation.[7]
For five years, petitioner performed the duties of Acting Manager. As of December
31, 2000 her salary was P27,500.00 plus P3,000.00 housing allowance and a 10%
share in the profit of Kasei Corporation.[8]
On October 15, 2001, petitioner asked for her salary from Acedo and the rest of the
officers but she was informed that she is no longer connected with the company.[11]
Since she was no longer paid her salary, petitioner did not report for work and filed
an action for constructive dismissal before the labor arbiter.
To prove that petitioner was not an employee of the corporation, private respondents
submitted a list of employees for the years 1999 and 2000 duly received by the BIR
showing that petitioner was not among the employees reported to the BIR, as well as
a list of payees subject to expanded withholding tax which included petitioner. SSS
records were also submitted showing that petitioner's latest employer was Seiji
Corporation.[13]
The Labor Arbiter found that petitioner was illegally dismissed, thus:
SO ORDERED.[14]
On April 15, 2003, the NLRC affirmed with modification the Decision of the Labor
Arbiter, the dispositive portion of which reads:
2) The awards representing moral and exemplary damages and 10% share
in profit in the respective accounts of P100,000.00 and P361,175.00 are
deleted;
SO ORDERED.[15]
SO ORDERED.[16]
The appellate court denied petitioner's motion for reconsideration, hence, the present
recourse.
The core issues to be resolved in this case are (1) whether there was an employer-
employee relationship between petitioner and private respondent Kasei Corporation;
and if in the affirmative, (2) whether petitioner was illegally dismissed.
Considering the conflicting findings by the Labor Arbiter and the National Labor
Relations Commission on one hand, and the Court of Appeals on the other, there is a
need to reexamine the records to determine which of the propositions espoused by
the contending parties is supported by substantial evidence.[17]
We held in Sevilla v. Court of Appeals[18] that in this jurisdiction, there has been no
uniform test to determine the existence of an employer-employee relation. Generally,
courts have relied on the so-called right of control test 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. In addition to the standard of
right-of-control, the existing economic conditions prevailing between the parties,
like the inclusion of the employee in the payrolls, can help in determining the
existence of an employer-employee relationship.
However, in certain cases the control test is not sufficient to give a complete picture
of the relationship between the parties, owing to the complexity of such a
relationship where several positions have been held by the worker. There are
instances when, aside from the employer's power to control the employee with
respect to the means and methods by which the work is to be accomplished,
economic realities of the employment relations help provide a comprehensive
analysis of the true classification of the individual, whether as employee,
independent contractor, corporate officer or some other capacity.
The better approach would therefore be to adopt a two-tiered test involving: (1) the
putative employer's power to control the employee with respect to the means and
methods by which the work is to be accomplished; and (2) the underlying economic
realities of the activity or relationship.
This two-tiered test would provide us with a framework of analysis, which would
take into consideration the totality of circumstances surrounding the true nature of
:
the relationship between the parties. This is especially appropriate in this case where
there is no written agreement or terms of reference to base the relationship on; and
due to the complexity of the relationship based on the various positions and
responsibilities given to the worker over the period of the latter's employment.
The control test initially found application in the case of Viaña v. Al-Lagadan and
Piga,[19] and lately in Leonardo v. Court of Appeals,[20] where we held that there is
an employer-employee relationship when the person for whom the services are
performed reserves the right to control not only the end achieved but also the manner
and means used to achieve that end.
Thus, the determination of the relationship between employer and employee depends
upon the circumstances of the whole economic activity,[22] such as: (1) the extent to
which the services performed are an integral part of the employer's business; (2) the
extent of the worker's investment in equipment and facilities; (3) the nature and
degree of control exercised by the employer; (4) the worker's opportunity for profit
and loss; (5) the amount of initiative, skill, judgment or foresight required for the
success of the claimed independent enterprise; (6) the permanency and duration of
the relationship between the worker and the employer; and (7) the degree of
dependency of the worker upon the employer for his continued employment in that
line of business.[23]
By applying the control test, there is no doubt that petitioner is an employee of Kasei
Corporation because she was under the direct control and supervision of Seiji
Kamura, the corporation's Technical Consultant. She reported for work regularly and
served in various capacities as Accountant, Liaison Officer, Technical Consultant,
:
Acting Manager and Corporate Secretary, with substantially the same job functions,
that is, rendering accounting and tax services to the company and performing
functions necessary and desirable for the proper operation of the corporation such as
securing business permits and other licenses over an indefinite period of
engagement.
Under the broader economic reality test, the petitioner can likewise be said to be an
employee of respondent corporation because she had served the company for six
years before her dismissal, receiving check vouchers indicating her salaries/wages,
benefits, 13th month pay, bonuses and allowances, as well as deductions and Social
Security contributions from August 1, 1999 to December 18, 2000.[26] When
petitioner was designated General Manager, respondent corporation made a report to
the SSS signed by Irene Ballesteros. Petitioner's membership in the SSS as
manifested by a copy of the SSS specimen signature card which was signed by the
President of Kasei Corporation and the inclusion of her name in the on-line inquiry
system of the SSS evinces the existence of an employer-employee relationship
between petitioner and respondent corporation.[27]
Furthermore, the affidavit of Seiji Kamura dated December 5, 2001 has clearly
established that petitioner never acted as Corporate Secretary and that her
designation as such was only for convenience. The actual nature of petitioner's job
was as Kamura's direct assistant with the duty of acting as Liaison Officer in
representing the company to secure construction permits, license to operate and other
requirements imposed by government agencies. Petitioner was never entrusted with
corporate documents of the company, nor required to attend the meeting of the
:
corporation. She was never privy to the preparation of any document for the
corporation, although once in a while she was required to sign prepared
documentation for the company.[30]
The second affidavit of Kamura dated March 7, 2002 which repudiated the
December 5, 2001 affidavit has been allegedly withdrawn by Kamura himself from
the records of the case.[31] Regardless of this fact, we are convinced that the
allegations in the first affidavit are sufficient to establish that petitioner is an
employee of Kasei Corporation.
Granting arguendo, that the second affidavit validly repudiated the first one, courts
do not generally look with favor on any retraction or recanted testimony, for it could
have been secured by considerations other than to tell the truth and would make
solemn trials a mockery and place the investigation of the truth at the mercy of
unscrupulous witnesses.[32] A recantation does not necessarily cancel an earlier
declaration, but like any other testimony the same is subject to the test of credibility
and should be received with caution.[33]
In affording full protection to labor, this Court must ensure equal work opportunities
regardless of sex, race or creed. Even as we, in every case, attempt to carefully
balance the fragile relationship between employees and employers, we are mindful
of the fact that the policy of the law is to apply the Labor Code to a greater number
of employees. This would enable employees to avail of the benefits accorded to them
by law, in line with the constitutional mandate giving maximum aid and protection to
labor, promoting their welfare and reaffirming it as a primary social economic force
in furtherance of social justice and national development.
SO ORDERED.
[1]Rollo, pp. 9-22. Penned by Associate Justice Eloy R. Bello, Jr. and concurred in
by Associate Justices Regalado E. Maambong and Lucenito N. Tagle.
[8] Id.
[10] Id.
[17]Abante, Jr. v. Lamadrid Bearing & Parts Corporation, G.R. No. 159890, May
28, 2004, 430 SCRA 368, 379.
[18]G.R. Nos. L-41182-3, April 15, 1988, 160 SCRA 171, 179-180, citing Visayan
Stevedore Transportation Company v. Court of Industrial Relations, 125 Phil. 817,
820 (1967).
[22]
Rutherford Food Corporation v. McComb, 331 U.S. 722, 727 (1947); 91 L.Ed.
1772, 1777 (1946).
[23]See Brock v. Lauritzen, 624 F.Supp. 966 (E.D. Wisc. 1985); Real v. Driscoll
Strawberry Associates, Inc., 603 F.2d 748 (9th Cir. 1979); Goldberg v. Whitaker
House Cooperative, Inc., 366 U.S. 28, 81 S.Ct. 933, 6 L.Ed.2d 100 (1961); Bartels v.
Birmingham, 332 U.S. 126, 67 S.Ct. 1547, 91 L.Ed. 1947 (1947).
[24] Halferty v. Pulse Drug Company, 821 F.2d 261 (5th Cir. 1987).
[25] Weisel v. Singapore Joint Venture, Inc., 602 F.2d. 1185 (5th Cir. 1979).
[29] G.R. No. 66890, April 15, 1988, 160 SCRA 568, 571.
[32] People v. Joya, G.R. No. 79090, October 1, 1993, 227 SCRA 9, 26-27.
[33] People v. Davatos, G.R. No. 93322, February 4, 1994, 229 SCRA 647, 651.
[34]
Globe-Mackay Cable and Radio Corporation v. National Labor Relations
Commission, G.R. No. 82511, March 3, 1992, 206 SCRA 701, 711-712.
[35] Leonardo v. National Labor Relations Commission, 389 Phil. 118, 126 (2000).