ROSARIO BROTHERS INC. (MANILA COD DEPARTMENT STORE), PETITIONER, VS. HON. BLAS F. OPLE, THE NATIONAL LABOR RELATIONS COMMISSION, AND LEONARDO LOVERIA, MARIETTA GALUT, LINDA TAPI…

The issue raised in this case is whether an employer-employee
relationship exists between the petitioner and the private respondents.
It is the submission of petitioner that no such relationship exists or
has been created because the “series of memoranda” issued by petitioner
to the private respondents from 1973 to 1977 would reveal that it had no
control and/or supervision over the work of the private respondents.

Private respondents are tailors, pressers, stitchers and similar workers
hired by the petitioner in its tailoring department (Modes Suburbia).
Some had worked there since 1969 until their separation on January 2,
1978. For their services, they were paid weekly wages on piecework
basis, minus the withholding tax per Bureau of Internal Revenue (BIR)
rules. Further, they were registered with the Social Security System
(SSS) as employees of petitioner and premiums were deducted from their
wages; they were also members of the Avenida-Cubao Manila COD Department
Store Labor Union which has a Collective Bargaining Agreement with the
company; and, they were required to report for work from Monday through
Saturday and to stay in the tailoring shop for no less than eight (8)
hours a day, unless no job order was given them after waiting for two to
three hours, in which case, they may leave and may come back in the
afternoon. Their attendance was recorded through a bundy clock just
like the other employees of petitioner. A master cutter distributes job
orders equally, supervises the work and sees to it that they were
finished as soon as possible. Quoting from the comment of the Solicitor
General, petitioner, in its memorandum, said –

“Once the job orders and the corresponding materials were
distributed to them, private respondents were on their own. They were
free to do their jobs either in the petitioner’s shop or elsewhere at
their option, without observing the regular working time of the company
provided that they finished their work on time and in accordance with
the specifications. As a matter of fact, they were allowed to contract
other persons to do the job for them; and also to accept tailoring jobs
from other establishments.” (p. 202, Rollo)

On September 7, 1977, the private respondents filed with the Regional
Office of the Department (now Ministry) of Labor a complaint for
violation of Presidential Decree 851 (13th month pay) and Presidential
Decree 525, as amended by Presidential Decree 1123 (Emergency Living
Allowance) against herein petitioner.

After petitioner had filed its answer, the case was certified for
compulsory arbitration to the Labor Arbiter who, after due hearing,
rendered a decision on December 29, 1977 dismissing “private
respondents’ claims for unpaid emergency living allowance and 13th month
pay, for lack of merit, upon finding that the complainants (herein
private respondents) are not employees of the respondent (herein
petitioner) within the meaning of Article 267(b) of the Labor
Code. As a consequence, the private respondents were dismissed on
January 2, 1978 and this prompted them to file a complaint for illegal
dismissal with the Ministry of Labor. Meanwhile, the National Labor
Relations Commission (NLRC) affirmed the decision of the Labor Arbiter
and dismissed private respondents’ appeal for lack of merit. However,
upon appeal to the Minister of Labor, the latter reversed the resolution
of the NLRC in a decision, dated March 27, 1979, holding that –

“The decision appealed from must be reversed. It is clearly
erroneous. Complainants and respondent are correct (sic) in considering
their relationship as one between employees and employer. The labor
arbiter should not have made a different finding.

“Complainants were employed as tailors, pressers, stitchers and
coatmakers in the tailoring department of the respondent. They are
hired through a master cutter and the depart­ment head and upon the
approval of the personnel department and the management. They report to
the shop from Monday to Saturday and record their attendance with a
bundy clock. They are required to stay in the shop pre­mises ‘for no
less than 8 hours a day’ unless no job is given them ‘after waiting for
two or three hours’ in which case, they are ‘allowed to leave.’

The employees (tailors, pressers and stitchers) are paid by piece per
week according to the rates established by the company. They are
registered as employees with the Social Security System for which
premiums are deducted from their wages. Taxes are also withheld from
their wages pursuant to BIR rules. Moreover, they enjoy the benefits
due to employees under their collective agreement with the company.

“The tailors are given deadlines on their assigned jobs. They are
required to work on job orders as soon as these are given to them. The
master cutter is ordered ‘to watch out for tailors who postponed their
assigned job up to the last few days of the deadline’ and to report
violators ‘for proper action.’ Tailors are also required to follow the
company code of discipline and the rules and regulations of the
tailoring department. Outright dismissal is meted on anyone who brings
out company patterns.

“Under these facts, the existence of the employment relations can
not be disputed. The respondent itself, in its very first position
papers, accepts this fact. The labor arbiter certainly erred in making a
different finding.

“However, respondent contends that the employees are excluded from
the coverage of PD 525, 851 and 1123 because of the nature of their
employ­ment, there being ‘no fixed time with regards to entry and exit’
and no fixed number of days of work, with respect to said employees. We
have, however, examined carefully the decrees and find absolutely no
indication therein that the employees are indeed excluded. Nor are the
rules implementing the decrees supportive of the respondent’s
contention. On the contrary, the rules argue for the contrary view.

“Section 2 of the rules implementing PD 525 provides: ‘The Decree
shall apply to all employees of covered employers, regardless of their
position, designation or employment status, and irrespective of the
method by which their wages are paid, including temporary, casual,
probationary, and seasonal employees and workers.’ And Section 3, of the
rules implementing PD 851 provides that ‘all employees of covered
employers shall be entitled to benefits provided under the Decree x x x
regardless of their position, designation or employ­ment status, and
irrespective of the method by which their wages are paid.’ Section 2 of
the same rules explicitly provides that the rules apply to ‘workers paid
on piece-rate basis’ or ‘those who are paid a stand­ard amount for
every piece or unit of work produced that is more or less regularly
replicated, without regard to the time spent in producing the same.’

“WHEREFORE, respondent is hereby ordered to pay the emergency
allowances under PD 525 and 1123 and the 13th month pay under PD 851
from the date of the effectivity of said decrees but not earlier than
September 7, 1974 to the following complainants: Leonardo Loveria,
Editha Bayno, Fe Bonita, Ricardo Roxas, Marietta Galut, Mercedes Oliver,
Antonio Mabutol, Clarita Sangle and Jesus Oliver; and the emergency
allowances and 13th month pay under said decrees from the date of the
effectivity of said decrees but not earlier than the date of the date of
the start of their employment, as indicated in the parenthesis after
their names, to the following complainants: Linda Tapiceria (July 14,
1975), Luz Bayno (September 22, 1975), Tito Castañeda (October 20,
1976), Francisca Tapiceria (February 14, 1977), Manuel Mejes (February
20, 1977), Eddie Rodriguez (July 4, 1977) and Nestor Sanchez (July 22,
1977). The Socio-Economic Analyst of the National Labor Relations
Commission is hereby directed to compute the amount of the awards stated
in this order and to submit a report thereon within 20 calendar days
from receipt of this order.” (pp. 37­-40, Rollo)

Thereafter, private respondents filed a motion for issuance of a writ of
execution of the aforesaid decision of the Minister of Labor which was
granted and, partially implemented.

On February 28, 1980, the Labor Arbiter issued an order directing the
Chief of the Research and Information Department of the Commission to
designate a Socio-Economic Analyst to compute the balance of private
respondents’ claims for the 13th month pay and emergency living
allowance in accordance with respondent Minister’s decision of March 27,
1979. Pursuant thereto, a report, dated March 4, 1980, was submitted
computing the balance of private respondents’ claims for emergency
living allowance and 13th month pay up to February 29, 1980 in the total
amount of P71,131.14. A writ of execution was issued for the
satisfaction of said amount.

Hence, the filing of this petition for certiorari, praying, among
others, to annul and set aside the decision of public respondent
Minister of Labor and to dismiss the claims of private respondents.

We cannot sustain the petition. It was filed on April 11, 1980 which
was too late because the Labor Minister’s decision of March 27, 1979,
subject of this judicial review, had already become final. And, not
only that. The questioned decision has already been partially
implemented by the sheriff as shown by his return, dated July 17, 1979
(p. 96, rollo). What is left for execution is the balance of private
respondents’ claim.

Further, the petition is devoid of merit. As held in Mafinco Trading
Corporation vs. Ople, 70 SCRA 139, the existence of employer-employee
relationship is determined by the following elements, namely: (1) the
selection and engagement of the employee; (2) the payment of wages; (3)
the power of dismissal; and (4) the power to control employees’ conduct
although the latter is the most important element. On the other hand,
an independent contractor is one who exercises independent employment
and contracts to do a piece of work according to his own methods and
without being subjected to control of his employer except as to the
result of his work.

1. In the case at bar, as found by the public respondent, the
selection and hiring of private respondents were done by the petitioner,
through the master cutter of its tailoring department who was a regular
employee. The procedure was modified when the employment of personnel
in the tailoring department was made by the management itself after the
applicants’ qualifications had been passed upon by a committee of four.
Later, further approval by the Personnel Department was required.

2. Private respondents received their weekly wages from
petitioner on piece-work basis which is within the scope and meaning of
the term “wage” as defined under Article 97(f) of the New Labor Code (PD
442), thus –

“(f) ‘Wage’ paid to any employee shall mean the remuneration or
earnings, however, designated, capable of being expressed in terms of
money, whether fixed or ascer­tained on a time, task, piece, or
commission basis, or other method of calculating the same, which is
payable by an employer to an employee under a written or un­written
contract of employment for work done or to be done or for services
rendered or to be rendered, and includes the fair and reasonable value,
as determined by the Secretary of Labor, of board, lodging or other
facilities customarily furnished by the employer to the employee. x x
x”

3. Petitioner had the power to dismiss private respondents, as
shown by the various memoranda issued for strict compliance by private
respondents, violations of which, in extreme cases, are grounds for
outright dismissal. In fact, they were dismissed on January 2, 1978,
although, the dismissal was declared illegal by the Labor Arbiter. The
case is pending appeal with the National Labor Relations Commission.

4. Private respondents’ conduct in the performance of their work
was controlled by petitioner, such as: (1) they were required to work
from Monday through Saturday; (2) they worked on job orders without
waiting for the deadline; (3) they were to observe cleanliness in their
place of work and were not allowed to bring out tailoring shop patterns;
and (4) they were subject to quality control by petitioner.

5. Private respondents were allowed to register with the Social
Security System (SSS) as employees of petitioner and premiums were
deducted from their wages just like its other employees. And,
withholding taxes were also deducted from their wages for transmittal to
the Bureau of Internal Revenue (BIR).

6. Well-established is the principle that “findings of
administrative agencies which have acquired expertise because their
jurisdiction is confined to specific matters are generally accorded not
only respect but even finality. Judicial review by this Court on labor
cases do not go so far as to evaluate the sufficiency of the evidence
upon which the Deputy Minister and the Regional Director based their
determinations but are limited to issues of jurisdiction or grave abuse
of discretion (Special Events & Central Shipping Office Workers
Union vs. San Miguel Corporation, 122 SCRA 557).” In the case at bar,
the questioned decision and order of execution of public respondents are
not tainted with unfairness or arbitrariness that would amount to abuse
of discre­tion or lack of jurisdiction and, therefore, this Court finds
no necessity to disturb, much less, reverse the same.

WHEREFORE, premises considered, the petition is dismissed for lack of merit.
SO ORDERED.

Melencio-Herrera, Plana, Gutierrez, Jr., and De La Fuente, JJ., concur.

Teehankee, J., (Chairman), took no part.