People of the Philippines vs Manungas

A Summary of a Decision of the Supreme Court of the Philippines

G.R. No. 91552-55 March 10, 1994

THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
vs.
FERNANDO MANUNGAS, JR. y GO @ "PERCY", accused-appellant.

Facts of the case:

In 1987, accused-appellant Fernando Manungas, Jr. recruited Wilfrey Mabalot, Danilo Ramirez, Leonardo Estanoco and Crisanto Collado to work as janitors in Saudi-Arabia. In connection with this, Fernando required the applicants the several amounts for medical, placement and other fees. The applicants failed to be deployed to Saudi however, and upon verification with POEA, they found out that Fernando was not a licensed recruiter. Complainants filed complaints of Estafa and Illegal Recruitment on a Large Scale against Fernando. Fernando maintained that he was not illegally recruiting because he was connected with a duly licensed recruitment agency, and that only because the job openings was subsequently awarded to another recruitment agency that the applicants he recruited were not able to leave for Saudi.

Issue:

Whether or not Fernando was guilty of Illegal Recruitment on a Large Scale, given the circumstances.

Ruling:

The Supreme Court ruled that Fernando, despite of his being connected with a licensed recruitment agency, was still guilty of illegal recruitment under the Labor Code, because he performed the acts of recruitment as defined in Article 13 of the Labor Code, by himself. He was the one who recruited the applicants, and he was the one who required of them the fees he collected himself. Illegal recruitment was also qualified because he recruited more than three persons.



Kristine Hermosa

Development Bank of the Philippines vs Secretary of Labor and Employment

A Summary of a Decision of the Supreme Court of the Philippines

G.R. No. 79351 November 28, 1989

DEVELOPMENT BANK OF THE PHILIPPINES, petitioner, vs.THE HON. SECRETARY OF LABOR, CRESENCIA DIFONTORUM, ET AL., respondents.

Facts of the case:

Private respondents won a case for illegal dismissal, unfair labor practice, illegal deductions from salaries and violation of the minimum wage law against Riverside Mills Corporation. Consequently, a writ of execution was issued, on October 22, 1985 , against the goods and chattel of RMC. Said assets however had already been foreclosed by petitioner Development Bank of the Philippines (DBP) through an extra-judicial proceedings as early as 1983. Private respondents, in a motion, moved for the delivery of RMC properties in possession of DBP, relying on the provisions of Article 110 of the Labor Code giving them first preference over the mortgaged properties of RMC for the satisfaction of the judgment rendered in their favor. Which motion was granted. On appeal, the decision was affirmed.

Issue:

Whether or not Article 110 of the Labor Code finds application on the instant case. Article 110 provides that in case of bankruptcy or liquidation of an employer's business, his workers enjoy first preference as regards wages due them for services rendered during the period prior to the bankruptcy or liquidation.

Ruling:

The Supreme Court held that Article 110 cannot be applied in the instant case because the important requisite that employer's business must be bankrupt is lacking. The Supreme Court ruled that in the Philippine jurisdiction, bankruptcy, insolvency and general judicial liquidation proceedings are the only means to establish that a business is bankrupt or insolvent. Absent of such judicial declaration, the business cannot be considered bankrupt for the purpose of applying the provisions of Article 110.

Rosewood Processing, Inc. vs National Labor Relations Commission

A Summary of a Decision of the Supreme Court of the Philippines

G.R. Nos. 116476-84 May 21, 1998

ROSEWOOD PROCESSING, INC., petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION, NAPOLEON C. MAMON, ARSENIO GAZZINGAN, ROMEO C. VELASCO, ARMANDO L. BALLON, VICTOR E. ALDEZA, JOSE L. CABRERA, VETERANS PHILIPPINE SCOUT SECURITY AGENCY, and/or ENGR. SERGIO JAMILA IV, respondents.

Facts of the case:

Private respondents were security guards of Veterans Philippine Scout Security Agency. Some were assigned to other companies and detailed to Rosewood, while others are re-assigned to other companies from Rosewood, and still others were put on “floating” status without assignment. Most were underpaid or their wages were never paid. All these circumstances led to the filing of a complaint for illegal dismissal, underpayment of wages, and for nonpayment of overtime pay, legal holiday pay, premium pay for holiday and rest day, thirteenth month pay, cash bond deposit, unpaid wages and damages was filed against Veterans Philippine Scout Security Agency and/or Sergio Jamila IV (collectively referred to as the "security agency," for brevity). Thereafter, petitioner Rosewood Processing, Inc. was impleaded as a third-party respondent by the security agency. In due course, Labor Arbiter Ricardo C. Nora rendered a consolidated Decision dated March 26, 1993 finding the security agency and Rosewood as solidarily liable to pay the monetary benefits due the security guards.

Issue:

Whether or not petitioner Rosewood was solidarily liable with the security agency for the non-payment of wages, as provided in Articles 106, 107 and 109 of the Labor Code.

Ruling:

The Supreme Court held that while it is undisputable that by operation of the provisions of Articles 106, 107 and 109, the Employer which is Rosewood has solidary liability for payment of wage differentials, such liability however should only be to the extent of the period when the respondent guards were under its employment. For the periods where said guards were assigned somewhere else, the Supreme Court held that Rosewood cannot be liable. The Supreme Court further held that since there was no evidence presented pointing to the fact that Rosewood conspired with the security agency in illegally dismissing the guards, it cannot be made liable to pay back wages as provided in Article 109. Finally, since an order to pay back wages and separation pay is invested with a punitive character, such that an indirect employer should not be made liable without a finding that it had committed or conspired in the illegal dismissal, then Rosewood, which was no longer the employer of the guards when they were dismissed, should not be compelled to pay since it was clear that it took no part in the illegal dismissal.

Shoppers Gain Supermart vs NLRC

A Summary of a Philippine Supreme Court Decision

G.R. No. 110731 July 26, 1996

SHOPPERS GAIN SUPERMART, JERRY TAN, JACK TAN and HEIRS OF JAMES TAN, petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION, SHOPPERS GAIN SUPERMART EMPLOYEES UNION-UMP and EDUARDO TARROSA, WARLITO AQUAIADAN, ARREO JOSE, MAGDALENA ARZAGA, JEROGE BANAGA, CORA BOLOTAOLO, ELMAR DOLUNTAR, FRANCISCO CABULADA, EVELYN CENA, ROQUITO CENA, JUANITO DAYMON, PABLITO ESMAS, ARTEMIO GERE, ROSALINDA GO, ROLITO HANDIG, ALBERTO HOLANDA, AIDA JAVIER, AVELINO JAVIER, JR., JESUS LEGASPI, MARIETA LEGASPI, PEDRO LOPEZ, ELARIO LOS BANES, GEORGE MANAL, EMMA MATIRA, RAFAEL MENODIADO, LUCILA MONARES, MYRNA ORTIZ, TERESITA PANGAHIN, ALFREDO PERLAS, JR., PACITA MANALO, ORLANDO SAN JOSE, TERESITA SANTOS, TERESITA SENGSENG, and NARCITO TUAZON; respondents.

Facts of the case:

From 1982 to 1990, private respondents had worked in the Shoppers Gain Supermarket in various capacities as "merchandiser, cashier, bagger, check-out personnel, sales lady, printer/film and warehouseman" for at least one year each. Private respondents were part of a pool of workers supplied by three (3) manpower service companies under "labor-only" contracts. In December of 1990, due to an unavoidable circumstance, petitioner constrained to stop its business and consequently terminate its contract with the three (3) manpower service companies. Petitioner was able to pay separation pays for its regular employees but not for private respondents.

A complaint for illegal dismissal was filed for which the Labor Arbiter rendered a decision finding Shoppers Gain Supermarket guilty of labor-only contracting and ordered it to pay separation pay and backwages to respondents. On appeal, the National Labor Relations Commission affirmed said decision. Elevating the case to the Supreme Court, petitioners raised the following grounds inter alia:

(a) That for employer-employee to exist, the following requirements must be satisfied, namely: (1) selection and engagement of the employees; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control employees' conduct; and

(b) Since the manpower agencies themselves admitted per their respective position papers that they selected, hired, paid, disciplined, dismissed and controlled the private respondents, it followed that the latter are not the employees of the petitioner corporation but of the agencies only.

Issue:

Whether or not private respondents are considered employees of petitioner Shoppers Gain Supermarket in view of the fact that they were merely furnished through labor-only contracts with three manpower agencies.

Ruling:

The Supreme Court held that what was controlling in the issue is the provisions of Artcile 106 of the Labor Code and not that of Article 208. The former clearly defines what constitute labor-only contractor as differentiated from a direct contractor, including the legal effects of each, while the latter is merely for the purpose of determining whether or not an employee is considered regular. Based on the provision of Article 106, the Supreme Court ruled that the petitioner was indeed the direct employer of private respondents and was therefore 0bliged to pay them separation pay. The Supreme Court reasoned that since it is undeniable that the private respondents' work as merchandisers, cashiers, baggers, check-out personnel, sales ladies, warehousemen and so forth were directly related, necessary and vital to the day-to-day operations of the supermarket and that their jobs involved normal and regular functions in the ordinary business of the petitioner corporation, the provision of Article 106 clearly applied thus making the manpower agencies merely agents of petitioner corporation. Consequently, private respondents are considered employees of petitioner Shoppers Gain Supermart.

Guarin vs National Labor Relations Commission

Summary of a Philippine Supreme Court Decision

G.R. No. 86010 October 3, 1989

LEOPOLDO GUARIN and ONE HUNDRED TWENTY (120) OTHERS, petitioners, vs.NATIONAL LABOR RELATIONS COMMISSION, LIPERCON SERVICES, INC., and/or NOVELTY PHILIPPINES, INC., respondents.

Facts of the case:

In 1983, private respondents Lipercon Services, Inc. and Novelty Philippines, Inc. entered into a "Contract of Services" in which the former, for a contract price, undertook to provide the latter with Contractual Laborers/Helpers/Janitors. For this reason, petitioners were hired by Lipercon to work with Novelty as helpers, janitors, janitresses, firemen, and mechanics. Petitioners worked with Novelty as such for three years. In 1986, Novelty terminated its agreement with Lipercon and consequently petitioners were dismissed. Petitioners filed an illegal dismissal case against Novelty and Lipercon, in which case the Labor Arbiter ruled that petitioners were regular employees of Novelty and declared their dismissal illegal. Both employers appealed. The National Labor Relations Commission reversed the Labor Arbiter's decision and ruled that Lipercon was an independent contractor. It ordered Lipercon to reinstate petitioners.

Issue:

Whether or not Lipercon is an independent contractor and the petitioners are its employees.

Ruling:

The Supreme Court ruled that as provided in Article 106 of the Labor Code, and as can be gleaned from the agreement between Lipercon and Novelty, it was clear that Lipercon was a "labor-only" contractor and thus served merely an agent of Novelty tasked to provide it with manpower. Lipercon's contention that it is an independent contractor because it claimed to have substantial capital and investment in tools and equipment was not given merit because it was not able to present substantial evidence to that effect. On the contrary, the Supreme Court held that petitioners' works were directly related to the daily operations of a garment factory since gardeners work to maintain clean and well-kept grounds around the factory, mechanics to keep the machines functioning properly, and firemen to look out for fires. This fact is confirmed, according to the Court, by Novelty's rehiring the workers or renewing the contract with Lipercon every year from 1983 to 1986, a period of three (3) years.

As Lipercon was a "labor-only" contractor, the workers it supplied Novelty became regular employees of the latter and the Court ordered their reinstatement with backwages.

Kamayan Point Hotel vs National Labor Relations Commission

A Summary of a Decision of the Supreme Court of the Philippines

G.R. No. 75289 August 31, 1989

Facts of the case:

Kamayan Point Hotel had been giving its employees the so-called "14th Month Pay" from 1979 to 1981. In 1982 however, it suffered losses due to a bad business decision and eventually closed business in 1984. In 1982, due to said financial difficulty, it was not able to give said 14th Month Pay to its employees so that in 1983, private respondent Federation of Free Workers (FFW) filed a complaint with the Labor Arbiter for its non-payment. The Labor Arbiter rendered a decision in favor of FFW, which decision on appeal to the National Labor Relations Commission (NLRC) was affirmed with modification. Both the FFW, Labor Arbiter and NLRC were one in contending that although there was no law granting the 14th Month Pay, still the employees of Kamayan Point Hotel were still entitled to it by virtue of said practice having ripened into a company practice that can no longer be withdrawn without violating the statutory prohibition against diminution of benefits.

Issue:

Whether or not the non-granting of the 14th Month Pay which had been granted before amounted to a violation of the statutory prohibition against diminution of benefits as contained in Article 100 of the Labor Code of the Philippines which provides "Nothing in this Book shall be construed to eliminate or in any way diminish supplements, or other employee benefits being enjoyed at the time of promulgation of this Code".

Ruling:

The Supreme Court ruled that such was not a diminution of benefits being enjoyed at the time of the promulgation of the Labor Code on the following reasons:

1. The first reason was obviously because the Labor Code took effect in 1974 while said benefit was given only starting 1979, so that it cannot be said that said benefit was already being enjoyed by Kamayan Point's employees at the time of promulgation of the Labor Code. Thus, that particular provision has no application in the case at bar.
2. Since there is no law making the granting of a 14th Month Pay mandatory, the same can only be considered as additional benefit which is gratuitous in nature, and for which, the employees cannot make demands.
3. Kamayon Point cannot be obliged to assume a "double burden" by requiring it to grant 14th Month Pay on top of the mandatory 13th Month Pay and similar benefits merely because it had, out of its liberality, given the same before. Since it is no longer in the financial position to grant said benefit, it cannot be punished because of liberality in the past, by compelling it to give what it is not capable of giving.

Bisig ng Manggagawa vs Philippine Refining Co.

A Summary of a Decision of the Supreme Court of the Philippines

G.R. No. L-27761 September 30, 1981

Facts of the case:

In 1966, petitioner union Bisig ng Manggagawa ng Philippine Refining Company, Inc. filed with the Court of First Instance of Manila a petition for declaratory relief seeking, among others, the judgement that their Christmas bonus be included as part of their basic pay for the computation of overtime pay. Petitioner based its contention primarily on the ruling of the Supreme Court in NAWASA vs. NAWASA Consolidated Unions, et all G.R. No. L-18938, August 31, 1964, 11 SCRA 766 where it was declared that the 'regular rate' is also deemed to include other incentives and bonuses which employers may receive as part of their regular pay.

Respondent Philippine Refining Company, Inc. on the other hand contended that in their collective bargaining agreement (CBA), the parties never intended to include the employees' Christmas bonus in the computation of the overtime pay, and that it did agree to raise the overtime rate to 50% instead of 25% of the regular base pay precisely on the consideration that it be based only on the regular base pay and should not include Christmas bonus.

Issue:

The issue resolved by the Supreme Court was whether or not, in the interpretation of the provision of the CBA of the parties on overtime pay, the term "regular base pay" should include Christmas bonus, and that in case it should not, whether such interpretation would contravene the principle established in the Nawasa vs Nawasa case.

Ruling:

The Supreme Court ruled that the term "regular base pay" is clear, unequivocal and requires no interpretation. It held that the term means regular basic pay which necessarily EXCLUDES money received in different concepts such as Christmas bonus and other fringe benefits. The Court observed that in framing up their CBA escpecially on the provision regarding overtime pay, it was only the regular base pay that was considered, and the same fact was undeniably known to the petitioner - the very reason, according to the court, why it attempted to have a different provision pertaining to overtime pay which would include Christmas bonus and other benefits. This factual information by itself constrains the petitioner to question the intention of that particular phrase in their CBA pertaining to overtime pay but could only claim that it violated the Nawasa doctrine and insist that it be reformed to conform to said doctrine.

The Supreme Court held that the Nawasa ruling did not limit that the computation of overtime pay to be based solely on the employees' regular wage or salary, which according to law includes bonuses and other benefits. What is important is that the product resulting from the computation must always be equal or higher than the statutory requirement of 25% more than the regular wage. In the case at bar, the formula adopted by the CBA is 50% more than the regular basi pay, which when computer is much higher than what can be arrived at using the statutory formula. Thus, the Court declared that the provisions of the CBA as to the computation of overtime pay has amply complied with what is required by law, and therefore is valid and not in contravention to the Nawasa doctrine.