FACTS: Private respondent Rodito Nasayao claimed that sometime in May 1974, he was appointed plant manager of the petitioner corporation, with an alleged compensation of P3,000.00, a month, or 25% of the monthly net income of the company, whichever is greater, and when the company failed to pay his salary for the months of May, June, and July 1974, Rodito Nasayao filed a complaint with the National Labor Relations Commission, Branch IV, for the recovery of said unpaid varies. Petitioners denied that Rodito Nasayao was employed in the company as plant manager with a fixed monthly salary of P3,000.00. They claimed that the undertaking agreed upon by the parties was a joint venture, a sort of partnership, wherein Rodito Nasayao was to keep the machinery in good working condition and, in return, he would get the contracts from end-users for the installation of marble products, in which the company would not interfere. In addition, private respondent Nasayao was to receive an amount equivalent to 25% of the net profits that the petitioner corporation would realize, should there be any. Petitioners alleged that since there had been no profits during said period, private respondent was not entitled to any amount.
The case was submitted for voluntary arbitration and the parties selected the herein respondent Jose T. Collado as voluntary arbitrator. In the course of the proceedings, however, the herein petitioners challenged the arbitrator’s capacity to try and decide the case fairly and judiciously and asked him to desist from further hearing the case.
But, the respondent arbitrator refused. In due time, or on 29 December 1975, he rendered judgment in favor of the complainant, ordering the herein petitioners to pay Rodito Nasayao the amount of P9,000.00, within 10 days from notice.
ISSUE: Whether or not Voluntary Arbitration award, generally final or there are exceptions?
HELD: A voluntary arbitrator by the nature of her fucntions acts in
quasi-judicial capacity. There is no reason why her decisions involving interpretation of law should be beyond this Court’s review. Administrative officials are presumed to act in accordance with law and yet we do hesitate to pass upon their work where a question of law is involved or where a showing of abuse of authority or discretion in their official acts is properly raised in petitions for certiorari.
The decisions of the voluntary arbitrators must be given the highest respect and as a general rule must be accorded a certain measure of finality. This is especially true where the arbitrator chosen by the parties enjoys first rate credentials. It is not correct however, that this respect precludes the exercise of judicial review over their decisions. In spite of statutory provisions making final the decisions of certain administrative agencies, the SC may take cognizance of petitions
questioning these decisions where want of jurisdiction, grave abuse of discretion, violation of due process, denial of substantial justice, or erroneous interpretation of the law are brought to its attention.
ENCYCLOPEDIA BRITANNICA INC. VS. NLRC G.R. NO. 87098
NOV. 4, 1996 TORRES, JR., J.
FACTS: Private respondent was a sales division manager of private petitioner and was in charge of selling the latter’s products through sales representatives. As compensation, private respondent receive commissions from the products sold by his agents. After resigning from office to pursue his private business, he filed a complaint against the petitioner, claiming for non-payment of separation pay and other benefits.
Petitioner alleged that complainant was not its employee but an independent dealer authorized to promote and sell its products and in return, received
commissions therefrom. Petitioner did not have any salary and his income from petitioner was dependent on the volume of sales accomplished. He had his own office, financed the business expense, and maintained his own workforce. Thus petitioner argued that it had no control and supervision over the complainant as
to the manner and means he conducted his business operations. The Labor Arbiter ruled that complainant was an employee of the petitioner company.
Petioner had control over the complainant since the latter was required to make periodic reports of his sales activities to the company.
ISSUE: Whether or not there exists an employer-employee relationship.
HELD: No. Control of employee’s conduct is commonly regarded as the most crucial and determinative indicator of the presence or absence of an employer-employee relationship. Under this, an employer-employer-employee relationship exists where the person for whom the services are performed reserves the right to control not only the end to be achieved, but also the manner and means to be used in reaching that end. The fact that petitioner issued memoranda to private respondent and to other division sales managers did not prove that petitioner had actual control over them. The different memoranda were merely guidelines on company policies which the sales managers follow and impose on their respective agents.
DY KEH BENG VS. INTERNATIONAL LABOR AND MARINE UNION ET., AL.
G.R NO. L-32245 MAY 25, 1979 DE CASTRO, J.
FACTS: A charge for ULP was filed against Dy Keh beng for discriminatory acts within the meaning of RA 875, Section 4(a.1) and 4(a.2) by dismissing Carlos N.
Solano and Ricardo Tudla for their union activities. A case was filed in court and Dy Keh Beng contended that he did not know Tudla and that Solano was not his employee because the latter came to the establishment only when there was work which he did on pakiaw basis, each piece of work being done under a separate contract. The CIR held that an Er-Ee relationship existed between Dy Keh Beng and complainants Tudla and Solano, although Solano was admitted to have worked on piece basis. Petitioner anchors his contention of the non-existence of employee-employer relationship on the control test., arguing that there was no evidence to show that petitioner had the right to direct the manner and method of respondent’s work.
ISSUE: Whether or not there existed an employee-employee relation between petitioner Dy Keh Beng and respondents Solano and Tudla.
HELD: The Court held in the affirmative. According to the Hearing Examiner, the evidence tended to show that the two became employees of Dy Keh Beng from 1953 and 1955, respectively, and that except in the event of illness, their work with the establishment was continuous although their services were compensated
on piece basis. It should be borne in mind that the control test calls merely for the existence of the right to control the manner of doing the work, not the actual exercise of the right. Considering that the establishment of Dy Keh Beng is
“engaged in the manufacture of baskets known as kaing, it is natural to expect that those working under Dy Keh Beng would have to observe, among others, Dy’s requirements of size and quality of the kaing.
ZANOTTE SHOES VS. NLRC G.R. NO. 100665
FEB. 13, 1995 VITUG, J.
FACTS: Private respondents Joseph Lluz, et. al averred that they started to work for petitioners Zanotte Shoes/ Leonardo Lorenzo between 1975 to 1987. They alleged that they worked for a minimum of 12 hours daily, including Sundays and holidays when needed and that they were paid on piece-work basis. Private respondents claimed that it angered petitioner Lorenzo when they requested to be made members of the SSS and that when they demanded an increase in their pay rates, they were prevented from entering the work premises. Private
respondents filed a complaint for illegal discharge against petitioners.
Petitioners, in their Answer, claim that their business operations were only seasonal, normally twice a year- one in June and another in December, when heavy job orders would come in. They contend that private respondents were engaged on purely contractual basis and paid the rates conformably with their respective agreements. The Labor Arbiter rendered judgment in favor of private respondents. He declared that there was an employer-employee relationship between petitioners and private respondents and that the latter were regular employees of the former. The Labor Arbiter concluded that there is neither dismissal nor abandonment, but ordered petitioners to pay the private respondents their separation pay. The NLRC, on appeal, affirmed the Labor Arbiter’s decision.
ISSUE: Whether or not there is an employer-employee relationship between petitioners and private respondents.
HELD: YES. There is an employer-employee relationship between petitioners and private respondents. The work of private respondents is clearly related to and in the pursuit of the principal activity of the petitioners. The indicia used for determining the existence of an employer-employee relationship, all extant in the case at bench, include: (1) the selection and engagement of the employee, (2) the payment of wages, (3) the power of dismissal, and(4)the employer’s power to control the employee with respect to the result of the work to be done and to the means and methods by which the work is to be accomplished. The last
requirement, so herein posed as an issue, refers to the existence of the right to control and not necessarily to the actual exercise of the right. The Court, however, finds the award of separation pay to be unwarranted. The Labor Arbiter,
sustained by the NLRC, concluded that there was neither dismissal nor
abandonment. The fact of the matter is that petitioners have repeatedly indicated their willingness to accept the private respondents, but the latter have steadfastly refused the offer. For being without any clear legal basis, the award of separation pay must thus be set aside. There is nothing, however, that prevents petitioners from voluntarily giving private respondents some amounts on ex gratia basis.