MR. ALBERT TECSON/MRS. MARIPOL TECSON, OWNERS/MANAGERS, DERM CORNER HAIR AND BEAUTY SALON, PETITIONERS, VS. NATIONAL LABOR RELATIONS COMMISSION (7TH DIVISION, CEBU CITY) AND MEL…
LOPEZ, J.:
“WHEREFORE, premises considered, the decision of the Labor Arbiter, dated 30 May 2012, is hereto AFFIRMED in toto.
SO ORDERED.”[5]
The disputed Resolution states:
“WHEREFORE, the instant motion is DENIED.
SO ORDERED.”[6]
UNDISPUTED FACTS
Petitioners spouses Albert and Maripol Tecson are the owners of Derm Corner Hair and Beauty Salon located at Perdices Street, corner San Juan Street, Dumaguete City. Private respondent Melanie Catiil, on the other hand, was the salon’s manicurist since 2004 up to the time when she was allegedly dismissed from employment on April 10, 2011.
Version of the Private Respondent
Private respondent Catiil’s work schedule at the salon was from 9:30 in the morning to 7:00 in the evening. However, she was only allowed to leave after the last customer has left. During such working hours, she was prohibited from entertaining customers elsewhere. The salon’s employees, including herein private respondent, were mandated to wear the uniform issued to them so as to maintain proper decorum and good grooming.
Private respondent’s compensation was on a percentage-per-customer-served basis. Her total monthly income would reach up to nine thousand pesos (PhP9,000.00). However, during her working stint at the salon, she was not paid 13th month pay and overtime pay.
On April 8, 2011, at around 9:00 in the morning, petitioner Maripol Tecson learned that private respondent Catiil brought her personal white hand towel to use in servicing her customers. Petitioner Maripol Tecson took Catiil’s act as an insult on her part as the owner of the salon. She became mad. Such anger worsened when she overheard Catiil telling a co-employee that she brought such white hand towel because the ones supplied by the salon have already looked soiled, and that she felt uncomfortable using them to her customers.
Filled with rage, petitioner Maripol Tecson pounded her index finger on Catiil’ forehead while calling her stupid in the face of the salon employees and some customers. Catiil tried to explain but Maripol Tecson refused to listen. Instead, she went on with her physical and verbal attacks on Catiil and told her never to come back. Instead of heeding such command, Catiil tried to compose herself and returned to work until closing time.
On April 11, 2011, Catiil returned to the salon. On that day, petitioner Albert Tecson summoned her and informed her of the great insult which she caused him and his wife. He told her that it was so rude of Catiil to bring her personally brought towel and use it in the course of her work at the salon. Thereafter, Albert Tecson terminated her services.
Aggrieved of the immediate termination without notice, private respondent Catiil filed a Complaint for illegal dismissal, non-payment of overtime pay, holiday pay, premium pay for work done on holiday, rest day, 13th month pay, allowances, separation pay, damages and attorney’s fees.
Version of the Petitioners
Petitioners claimed that private respondent Catiil was not a regular employee of the salon. She was a manicurist paid on commission basis. They claimed that Catiil was free to report for duty or not depending on her need to earn for that day. They likewise insisted that Catiil was not illegally dismissed as she was the one who voluntarily refused to report back to the salon after the encounter.
Ruling of the Labor Arbiter and NLRC
On May 30, 2012, the Labor Arbiter ruled that private respondent Catiil was a regular employee of the salon. It declared that petitioner spouses had a hand in the selection of private respondent Catiil and controls her attendance at work. The labor tribunal found the version of private respondent Catiil more credible as it was in accord with the ordinary conduct of human affairs and it was duly supported by substantial evidence. The dispositive portion of the Labor Arbiter’s Decision reads:
“WHEREFORE, judgment is hereby declared that the complainant was ILLEGALLY DISMISSED. Respondents are hereby directed to pay the complainant the sum of P181,000.00 representing her backwages and separation pay and shall continue to run until this judgment becomes final, plus 10% attorney’s fees.
SO ORDERED.”[7]
On appeal, the NLRC affirmed the Decision of the Labor Arbiter. Public respondent commission ruled that herein petitioners had the power to control the means and methods by which private respondent used to service the salon’s clients. The decretal portion of the NLRC Decision reads:
“WHEREFORE, premises considered, the decision of the Labor Arbiter, dated 30 May 2012, is hereto AFFIRMED in toto.
SO ORDERED.[8]
On Motion for Reconsideration[9], public respondent NLRC upheld its previous Decision in a Resolution[10] dated March 27, 2013 finding no valid legal grounds to merit its review.
Pained, petitioners file the instant petition submitting, in brief, the following assignment of errors:
I.
THE HONORABLE NLRC, BY ABUSE OF DISCRETION, COMPLETELY DISREGARDED THE TESTIMONY OF RESPONDENTS’ WITNESS MARIVIC Z. ENJERTO WHERE SHE SAID THAT THE COMPLAINANT “NEVER CAME BACK UNTIL RESPONDENTS (REFERRING TO SPOUSES TECSON) LEARNED THAT SHE IN FACT FILED A CASE AGAINST SPOUSES TECSON.” THIS TESTIMONIAL EVIDENCE SHOWS THAT THERE WAS NO EMPLOYEE WHO WAS ILLEGALLY DISMISSED, BUT RATHER, A BUSINESS PARTNER LEAVING THE PREMISES OF THE WORK PLACE WHICH WAS PROVIDED BY THE CAPITAL-PARTNER.II.
THE NLRC, BY ABUSE OF DISCRETION, COMPLETELY DISREGARDED THE FACT THAT COMPLAINANT DELIBERATELY, WHIMSICALLY AND CAPRICIOUSLY THREATENED TO FILE A LABOR CASE AGAINST RESPONDENTS AFTER A BUSINESS ARGUMENT WHICH IS AN OPEN DISPLAY OF BAD FAITH ON THE PART OF A PARTNER.III.
THE NLRC, BY ABUSE OF DISCRETION, WAS COMPLETELY INSENSIBLE OF THE FACT THAT NOWHERE IN EVIDENCE DID THE COMPLAINANT CONVINCINGLY SHOWED THE EXISTENCE OF EMPLOYER-EMPLOYEE RELATIONSHIP UNDER THE FOUR-FOLD TEST ESTABLISHED BY THE SUPREME COURT.IV.
THE NLRC, BY ABUSE OF DISCRETION, IRRESPONSIBLY EQUATED THE INSTANT ISSUES TO THAT OF THE CASE OF CORPORAL VS. NLRC (341 SCRA 658). THE COMPARISON IS ERRONEOUS.V.
THE NLRC, BY ABUSE OF DISCRETION, CONVENIENTLY DISREGARDED THE FACT THAT NOWHERE IN EVIDENDE IS THERE PROOF, APART FROM THE SELF-SERVING DECLARATION OF THE COMPLAINANT, THAT THERE WAS INDEED A DISMISSAL THAT TOOK PLACE.[11]
OUR RULING
The petition is devoid of merit.
Petitioners insist that the labor tribunal’s finding of illegal dismissal, which was affirmed by the NLRC, is completely bereft of factual and legal bases. Nowhere in the records of the case did private respondent convincingly show the existence of an employer-employee relationship on the basis of the four-fold test mandated by the Supreme Court. The labor tribunal, in fact, failed to consider Marivic Z. Enjerto’s testimony that private respondent Catiil never came back to the salon after the argument between the parties in the salon. This proves that no employee was dismissed but merely a business partner leaving the work premises after an argument with the business partner. Other than that, private respondent’s declarations were merely self-serving which should be given lesser credence.
Petitioners further claim that they, as owners of the salon, had no control over the work of its manicurists, including herein private respondent. The only control they had over Catiil was the number of customers served so as to determine the sharing of their profits. Private respondent should thus be considered as an independent contractor as she is under the control of the salon only as regards the results of her work, but not as to the details or the manner of performing the work.
In fine, petitioners assail the labor tribunals’ conclusion that there was an employer-employee relationship between them and private respondent Catiil. If there was, is private respondent considered a regular employee; and if she was an employee, was she validly dismissed from employment?
There was an employer-employee relationship between the parties; private respondent Catiil was a regular employee; and she was illegally dismissed from employment.
At the outset, it is well to note that where a petition for certiorari under Rule 65 of the Rules of Court alleges grave abuse of discretion, as in this case, the petitioner should establish that the respondent court or tribunal acted in a capricious, whimsical, arbitrary or despotic manner in the exercise of its jurisdiction as to be equivalent to lack of jurisdiction. In this case, nowhere in the petition did petitioners sufficiently show that the Decision rendered by public respondent NLRC was rendered with abuse of discretion that was so patent and gross that would warrant striking it down through a petition for certiorari. Petitioners mainly limited their discussion on NLRC’s failure to give credence to the testimony of the witness they presented; and their insistence that private respondent is merely a business partner, not its employee. Clearly, petitioners failed on their duty to demonstrate with definiteness the grave abuse of discretion that would justify the proper availment of a petition for certiorari under Rule 65 of the Rules of Court.
Jurisprudence tells Us that in the determination of whether an employer-employee relationship exists between two parties, the four-fold test is applied to determine the existence of the elements of such relationship.[12] In Pacific Consultants International Asia, Inc. v. Schonfeld[13], the Highest Court set out the elements of an employer-employee relationship, thus:
Jurisprudence is firmly settled that whenever the existence of an employment relationship is in dispute, four elements constitute the reliable yardstick: (a) the selection and engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employer’s power to control the employee’s conduct. It is the so-called “control test” which constitutes the most important index of the existence of the employer-employee relationship that is, whether the employer controls or has reserved the right to control the employee not only as to the result of the work to be done but also as to the means and methods by which the same is to be accomplished. Stated otherwise, an 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 means to be used in reaching such end.
In the instant case, We concur with the Labor Arbiter in his findings that herein petitioners employers controlled the selection, attendance and work of private respondent Catiil thereby proving the existence of some of the elements enunciated by the Supreme Court. The words of the Labor Arbiter provide, to wit:
“In the evidence presented, it is obvious to Us that the complainant was chosen to work with the respondents’ beauty salon. It is also very obvious that the salon was making service income out of the efforts of the complainant for which the complainant was given her commission. Complainant herself admits she was making at least P300.00/daily from her monthly commission.
To the mind of this Office, respondents, in their selection of their manicurist, will choose someone who is competent in her trade and someone who knows how to deal with their customers for the simple reason that it cannot afford to lose customers or their goodwill because their employee bungled in their job. In this case, the complainant worked with the respondents for seven years. This could only mean that the respondents approved the quality of work that the complainant delivered to the salon. otherwise, she could have been asked to leave for the simple reason that why should the salon retain a manicurist who cannot deliver income?
xxx xxx xxx
Having laid down the basis above, this Office do (sic) not agree on the assertion that the complainant would come and go as she please. First, the complainant has already delivered goodwill in form of loyal customers for the salon based on the foregoing calculations which the salon earns. Common sense would tell it cannot afford to have that kind of relationship that a worker would just come as he/she pleases. The steady income by which the salon earned from the services of the manicurist is substantial amount for the salon that can pay rent and electricity for the salon. And if the manicurist would not report to their salon and instead work in her own time doing the service at the homes of the customers, the salon would lose the income equivalent to 60% percent.[14]
It is clear therefore that herein petitioners engaged the services of herein private respondent to work as its manicurist; retained her services for seven (7) years; and continuously paid the forty percent (40%) commission of the customers she served constitutive of the elements of an employer-employee relationship.
Petitioners further contend that the fact that private respondent was paid on commission basis is proof that she was not its employee.
We do not agree.
The mere fact that private respondent was paid on commission basis does not affect or change her status as a regular employee. The test for determining whether an employee is regular or casual has nothing to do with the manner of computing or paying an employee’s wages or compensation. Rather,
The primary standard, . . ., of determining a regular (as against casual) employment is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. The test is whether the former is usually necessary or desirable in the usual business or trade of the employer. The connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety. Also, if the employee has been performing the job for at least one year, even if the performance is not continuous or merely intermittent, the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity if not indispensability of that activity to the business. Hence, the employment is also considered regular, but only with respect to such activity and while such activity exists.”
It is undeniable that manicure and pedicure services are some of the customary services provided by salons. Undoubtedly, private respondent’s work as a manicurist is a work necessary and desirable in the business of petitioner salon. Added to that, without the services of private respondent, herein petitioners could not have earned sixty percent (60%) of the income derived from private respondent’s clients. Also, the fact that private respondent has been connected with the salon for seven (7) years patently established that the latter falls squarely within the ambit of a regular employee as provided in Article 280 of the Labor Code, which reads:
Art. 280. Regular and Casual Employment. – The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer, except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season.
Under Article 280 of the Labor Code, a regular employee is (1) one who is engaged to perform activities that are necessary or desirable in the usual trade or business of the employer, or (2) a casual employee who has rendered at least one year of service, whether continuous or broken, with respect to the activity in which he is employed.[15] Applying the foregoing requirements in the context of this case, private respondent is patently considered a regular employee.
Petitioners further aver that NLRC was wrong when it concluded that private respondent was not an independent contractor. Considering the fact that private respondent supplied her own working implements like the nail cutters, pushers, nippers, etc.; shared in the earnings of the salon with its owners; and chose her own manner of performing her work, she should be deemed an independent contractor.
We see no merit in petitioners’ arguments.
An independent contractor is one who undertakes “job contracting”, i.e., a person who (a) carries on an independent business and undertakes the contract work on his own account under his own responsibility according to his own manner and method, free from the control and direction of his employer or principal in all matters connected with the performance of the work except as to the results thereof, and (b) has substantial capital or investment in the form of tools, equipment, machineries, work premises, and other materials which are necessary in the conduct of the business.[16]
In the present case, this Court, one with the labor tribunal, is convinced that private respondent is not an independent contractor. First, private respondent did not carry on her independent business. She was hired by petitioner spouses principally to attend to the needs of the customers in the salon. The nature of the work performed by private respondent was directly related to petitioners’ business of operating a salon. Second, she did not have a substantial capital or investment in the form of tools, equipment, work premises and other materials which are necessary in the conduct of the business. What the private respondent owned were only nail cutters, nail polishes, the nippers – nothing else. By no standard can these be considered substantial capital necessary to operate a salon. Third, based on the records, private respondent was not given any work assignment apart from Derm Corner Hair and Beauty Salon. Fourth, private respondent was mandated to observe the rules and regulations of the salon pertaining, among others, the wearing of uniform and job performance. In view of the foregoing, it is clear that private respondent was an of employee petitioner salon, not an independent contractor.
The second issue for determination is whether or not private respondent was illegally dismissed from employment.
An employee cannot be dismissed except for just[17] or authorized[18] cause as found in the Labor Code and after due process.[19]
Herein petitioners insist that private respondent was not terminated as she was the one who abandoned her job and refused to come back to work.
Petitioners’ insistence is erroneous.
Abandonment of work, or the deliberate and unjustified refusal of an employee to resume his employment, is a just cause for the termination of employment under paragraph (b) of Article 282 of the Labor Code, since it constitutes neglect of duty. The jurisprudential rule is that abandonment is a matter of intention that cannot be lightly presumed from equivocal acts. To constitute abandonment, two elements must concur: (1) the failure to report for work or absence without valid or justifiable reason, and (2) a clear intent, manifested through overt acts, to sever the employer-employee relationship. The employer bears the burden of showing a deliberate and unjustified refusal by the employee to resume his employment without any intention of returning.[20]
Furthermore, it is a settled doctrine that the filing of a complaint for illegal dismissal is inconsistent with abandonment of employment. An employee who takes steps to protest his dismissal cannot logically be said to have abandoned his work. The filing of such complaint is proof enough of his desire to return to work, thus negating any suggestion of abandonment.[21]
In this case, petitioners, as the employers, have the burden of proving abandonment. However, records of the case manifestly show that there was no sufficient proof to establish abandonment. While it may be true that petitioners presented an affidavit[22] of Marivic Enjerto stating that the altercation between Maripol Tecson and private respondent actually happened on April 8, 2011 and not on April 11 as ruled by the labor tribunal; and that private respondent was the one who left the salon with threats of filing a complaint before the DOLE and never returned to work, We still put less credence on her declarations as she, as an employee of the salon, can be considered as a biased and interested witness, making her testimony less believable. More importantly, she was not present at the time Mr. Tecson terminated herein private respondent. Hence, she could not have witnessed the termination of herein private respondent. Moreover, private respondent’s filing of the complaint for illegal dismissal strongly speaks against the petitioners’ charge of abandonment as it is illogical for an employee to abandon his employment and, thereafter, file a complaint for illegal dismissal.
In view of the foregoing, it is clear that private respondent Catiil was illegally dismissed as she was terminated from work without any just or authorized cause.
The normal consequences of illegal dismissal are reinstatement without loss of seniority rights and the payment of backwages computed from the time the employee’s compensation was withheld from him up to the time of his actual reinstatement.[23] Where reinstatement is no longer viable as an option, separation pay equivalent to one (1) month salary for every year of service should be awarded as an alternative. The payment of separation pay is in addition to payment of backwages.[24]
The computation of backwages depends on the final awards adjudged as a consequence of illegal dismissal, in that when separation pay is ordered in lieu of reinstatement, as in this case, backwages is computed from the time of dismissal until the finality of the decision.[25] As regards the computation of separation pay, it shall be computed at one (1) month pay (for those with one year or less of service), or one-half (1/2) month pay for every year of service (for those with more than a year of service), whichever is higher, a fraction of at least six (6) months being considered one whole year.[26]
In the present case, the Labor Arbiter, as affirmed by the NLRC, correctly found that due to the strained relations between the parties, separation pay is to be awarded to Catiil in lieu of her reinstatement. Under the doctrine of strained relations, the payment of separation pay is considered an acceptable alternative to reinstatement when the latter option is no longer desirable or viable.[27] Thus, We see no error, on the part of public respondent NLRC, in affirming the monetary awards granted to herein private respondent Catiil.
WHEREFORE, premises considered, the instant Petition for Certiorari is DENIED. The assailed March 27, 2013 Resolution and November 28, 2012 Decision of the NLRC, Seventh Division, Cebu City is hereby AFFIRMED WITH MODIFICATION that private respondent Melanie Catiil shall be awarded full backwages from April 10, 2011 until the finality of this Court’s Decision. In all other respects, We affirm.
The labor arbiter is hereby ORDERED to make another recomputation according to the above directive.
SO ORDERED.
Delos Santos, E.L., Chairperson, and Lagura-Yap , M.B, JJ., concur.
[1] Rollo, pp. 3-21
[2] Id, p. 191
[3] Id, p. 173-183
[4] Id, pp. 22-28
[5] Id, p. 183
[6] Id, p. 191
[7] Id, p. 28
[8] Id, p. 183
[9] Id, pp. 184-189
[10] Resolution dated March 27, 2013, Id, p. 191
[11] Id, Pp. 8-10
[12] Tongko vs. The Manufacturers Life Insurance Co., et. al., G.R. No. 167622, November 7, 2008
[13] G.R. No. 166920, February 19, 2007
[14] Rollo, pp.25-26
[15] Caparoso, et. al., vs. Court of Appeals, et. al., G.R. No. 155505, February 15, 2007
[16] Corporal, et. al., vs. Court of Appeals, et. al., G.R. No. 129315, October 2, 2000 citing Section 8, Rule VIII, Book III, of the Omnibus Rules Implementing the Labor Code; Ponce vs. NLRC, (1998)
[17] Art. 282. Termination by employer. An employer may terminate an employment for any of the following causes:
- Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work;
- Gross and habitual neglect by the employee of his duties;
- Fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative;
- Commission of a crime or offense by the employee against the person of his employer or any immediate member of his family or his duly authorized representatives; and
- Other causes analogous to the foregoing.
[18] Art. 283. Closure of establishment and reduction of personnel. The employer may also terminate the employment of any employee due to the installation of labor-saving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title, by serving a written notice on the workers and the Ministry of Labor and Employment at least one (1) month before the intended date thereof. In case of termination due to the installation of labor-saving devices or redundancy, the worker affected thereby shall be entitled to a separation pay equivalent to at least his one (1) month pay or to at least one (1) month pay for every year of service, whichever is higher. In case of retrenchment to prevent losses and in cases of closures or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses, the separation pay shall be equivalent to one (1) month pay or at least one-half (1/2) month pay for every year of service, whichever is higher. A fraction of at least six (6) months shall be considered one (1) whole year.
[19] Mitsubishi Motors Philippines Corporation vs. Chrysler Philippines Labor Union, et. al., G.R. No. 148738, June 29, 2004 citing Bolinao Security and Investigation Service, Inc. v. Arsenio M. Toston, G.R. No. 139135, January 29, 2004
[20] CRC Agricultural Trading, et. al. Vs. NLRC, et. al., G.R. No. 177664, December 23, 2009
[21] MZR Industries, et. al., vs. Colambot, G.R. No. 179001, August 28, 2013
[22] Rollo, pp. 47-50
[23] At note 21 citing Tomas Claudio Memorial College, Inc. v. Court of Appeals and Pedro Natividad, G.R. No. 152568 February 16, 2004
[24] Dreamland Hotel Resort, et. Al., vs. Stephen Johnson, G.R. No. 191455, March 12, 2014
[25] See Bani Rural Bank Inc, et. al., vs. De Guzman, et. al., G.R. No. 170904, November 13, 2013
[26] Genuino Ice Company Inc., et. al., vs. Lava, et.al., G.R. No. 190001, March 23, 2011
[27] Id