CASE No. 10 Singer Sewing Machine Co. vs. Drilon, et.al GR. No.

91307 FACTS: On February 15, 1989, the respondent union, collectors o !in"er !e#in" $achine %o&pany'!in"er $achine %ollectors (nion')a"uio *!+$,%()-, iled a petition or direct certi ication as the sole and e.clusi/e bar"ainin" a"ent o all collectors o 0etitioner *1%o&pany2-. 3he %o&pany opposed the petition &ainly on the "round that the union &e&bers are actually not e&ployees but are independent contractors as e/idenced by the collection a"ency a"ree&ent #hich they si"ned. $ed',rbiter, indin" that there e.ists an e&ployer'e&ployee relationship bet#een the union &e&bers and the %o&pany, granted the petition or certi ication election . On appeal, !ecretary o 4abor Fran5lin $. 6rilon a ir&ed it. 0etitioners contend that respondent 4abor !ecretary disre"arded the #ell'settled rule that co&&ission a"ents are not e&ployees but are independent contractors7 the public respondents patently erred in indin" that there e.ists an e&ployer'e&ployee relationship. 3he respondents, on the other hand, insist that the pro/isions o the %ollection ,"ency ,"ree&ent contradict the %o&pany8s position that the union &e&bers are independent contractors. 3o pro/e that union &e&bers are e&ployees, it is asserted that they 9per or& the &ost desirable and necessary acti/ities or the continuous and e ecti/e operations o the business o the petitioner %o&pany9 * citing Article !"0 o the #a$or Code-. 0etitioners :uote para"raph ; o the %ollecti/e ,"ency ,"ree&ent #hich states that an a"ent shall utili<e only receipt or&s authori<ed and issued by the %o&pany. 3hey also note para"raph 3 #hich states that an a"ent has to sub&it and deli/er at least once a #ee5 or as o ten as re:uired a report o all collections &ade usin" report or&s urnished by the %o&pany. ,nd that &onthly collection :uota re:uired by the %o&pany is dee&ed by respondents as a control &easure o/er the &eans by #hich an a"ent is to per or& his ser/ices. %SS&E: =ON pri/ate respondents are re"ular e&ployees o the co&pany on the alle"ed "round that they are per or&in" acti/ities desirable or necessary to the business. 'E#D: No. The nat(re o the relationship $etween a co)pan* and its collecting agents depends on the circ()stances o each partic(lar relationship. Not all collecting agents are e)plo*ees and neither are all collecting agents independent contractors. The collectors co(ld all (nder either categor* depending on the acts o each case. 3he %ollectin" ,"ency ,"ree&ent con ir&s the status o the collectin" a"ent in this case as an independent contractor not only because he is e.plicitly described as such but also because the pro/isions per&it hi& to per or& collection ser/ices or the

co&pany #ithout bein" sub>ect to the control o the latter e.cept only as to the result o his #or5. , ter a care ul analysis o the contents o the a"ree&ent, 3he %ourt rules in a/or o the petitioner. Further, respondent !ecretary 6rilon did not consider e.istin" acts in his decision? 1. 3he collection a"ents are not re:uired to obser/e o ice hours or report to !in"er8s o ice e/eryday e.cept, naturally and necessarily, or the purpose o re&ittin" their collections. ;. 3he collection a"ents do not ha/e to de/ote their ti&e e.clusi/ely or !+NG@R. 3here is no prohibition on the part o the collection a"ents ro& #or5in" else#here. Nor are these a"ents re:uired to account or their ti&e and sub&it a record o their acti/ity. 3. 3he &anner and &ethod o e ectin" collections are le t solely to the discretion o the collection a"ents #ithout any inter erence on the part o !in"er. A. 3he collection a"ents shoulder their transportation e.penses incurred in the collections o the accounts assi"ned to the&. 5. 3he collection a"ents are paid strictly on co&&ission basis. 3he a&ounts paid to the& are based solely on the a&ounts o collection each o the& &a5e. 3hey do not recei/e any co&&ission i they do not e ect any collection e/en i they put a lot o e ort in collectin". 3hey are paid co&&ission on the basis o actual collections. B. 3he co&&issions earned by the collection a"ents are directly deducted by the& ro& the a&ount o collections they are able to e ect. 3he net a&ount is #hat is then re&itted to !in"er.9 *Rollo, pp. 7'83he %ourt inds the contention o the respondents that the union &e&bers are e&ployees under ,rticle ;80 o the 4abor %ode. 3he de inition that re"ular e&ployees are those #ho per or& acti/ities #hich are desirable and necessary or the business o the e&ployer is not deter&inati/e in this case. ,ny a"ree&ent &ay pro/ide that one party shall render ser/ices or and in behal o another or a consideration e/en #ithout bein" hired as an e&ployee. 3his is precisely true in the case o an independent contractorship as #ell in an a"ency a"ree&ent. 3he %ourt a"rees #ith the petitionerCs ar"u&ent that ,rticle ;80 is not the yardstic5 or deter&inin" the e.istence o an e&ploy&ent relationship because it &erely distin"uishes bet#een t#o 5inds o e&ployees, i.e. re"ular e&ployees and casual e&ployees, or purposes o deter&inin" the ri"ht o an e&ployee to certain bene its, to >oin or or& a union, or to security o tenure. ,rticle ;80 does not apply #here the e.istence o an e&ploy&ent relationship is in dispute.