CASE NO.

1
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-32245 May 25, 1979
DY KEH BENG, petitioner,
vs.
INTERNATIONAL LABOR and MARINE UNION OF THE PHILIPPINES, ET AL., respondents.
A. M Sikat for petitioner.
D. A. Hernandez for respondents.

DE CASTRO, J .:
Petitioner Dy Keh Beng seeks a review by certiorari of the decision of the Court of Industrial
Relations dated March 23, 1970 in Case No. 3019-ULP and the Court's Resolution en banc of June
10, 1970 affirming said decision. The Court of Industrial Relations in that case found Dy Keh Beng
guilty of the unfair labor practice acts alleged and order him to
reinstate Carlos Solano and Ricardo Tudla to their former jobs with backwages from
their respective dates of dismissal until fully reinstated without loss to their right of
seniority and of such other rights already acquired by them and/or allowed by law.
1

Now, Dy Keh Beng assigns the following errors
2
as having been committed by the Court of Industrial
Relations:
I
RESPONDENT COURT ERRED IN FINDING THAT RESPONDENTS SOLANO
AND TUDLA WERE EMPLOYEES OF PETITIONERS.
II
RESPONDENT COURT ERRED IN FINDING THAT RESPONDENTS SOLANO
AND TUDLA WERE DISMISSED FROM THEIR EMPLOYMENT BY PETITIONER.
III
RESPONDENT COURT ERRED IN FINDING THAT THE TESTIMONIES ADDUCED
BY COMPLAINANT ARE CONVINCING AND DISCLOSES (SIC) A PATTERN OF
DISCRIMINATION BY THE PETITIONER HEREIN.
IV
RESPONDENT COURT ERRED IN DECLARING PETITIONER GUILTY OF
UNFAIR LABOR PRACTICE ACTS AS ALLEGED AND DESCRIBED IN THE
COMPLAINT.
V
RESPONDENT COURT ERRED IN PETITIONER TO REINSTATE RESPONDENTS
TO THEIR FORMER JOBS WITH BACKWAGES FROM THEIR RESPECTIVE
DATES OF DISMISSALS UNTIL FINALLY REINSTATED WITHOUT LOSS TO
THEIR RIGHT OF SENIORITY AND OF SUCH OTHER RIGHTS ALREADY
ACQUIRED BY THEM AND/OR ALLOWED BY LAW.
The facts as found by the Hearing Examiner are as follows:
A charge of unfair labor practice was filed against Dy Keh Beng, proprietor of a basket factory, for
discriminatory acts within the meaning of Section 4(a), sub-paragraph (1) and (4). Republic Act No.
875,
3
by dismissing on September 28 and 29, 1960, respectively, Carlos N. Solano and Ricardo Tudla
for their union activities. After preliminary investigation was conducted, a case was filed in the Court of
Industrial Relations for in behalf of the International Labor and Marine Union of the Philippines and two of
its members, Solano and Tudla In his answer, 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. Moreover,
Dy Keh Beng countered with a special defense of simple extortion committed by the head of the labor
union, Bienvenido Onayan.
After trial, the Hearing Examiner prepared a report which was subsequently adopted in toto by the
Court of Industrial Relations. An employee-employer relationship was found to have existed between
Dy Keh Beng and complainants Tudla and Solano, although Solano was admitted to have worked on
piece basis.
4
The issue therefore centered on whether there existed an employee employer relation
between petitioner Dy Keh Beng and the respondents Solano and Tudla .
According to the Hearing Examiner, the evidence for the complainant Union tended to show that
Solano and Tudla became employees of Dy Keh Beng from May 2, 1953 and July 15,
1955,
5
respectively, and that except in the event of illness, their work with the establishment was
continuous although their services were compensated on piece basis. Evidence likewise showed that at
times the establishment had eight (8) workers and never less than five (5); including the complainants,
and that complainants used to receive ?5.00 a day. sometimes less.
6

According to Dy Keh Beng, however, Solano was not his employee for the following reasons:
(1) Solano never stayed long enought at Dy's establishment;
(2) Solano had to leave as soon as he was through with the
(3) order given him by Dy;
(4) When there were no orders needing his services there was nothing for him to do;
(5) When orders came to the shop that his regular workers could not fill it was then
that Dy went to his address in Caloocan and fetched him for these orders; and
(6) Solano's work with Dy's establishment was not continuous. ,
7

According to petitioner, these facts show that respondents Solano and Tudla are only piece workers,
not employees under Republic Act 875, where an employee
8
is referred to as
shall include any employee and shag not be limited to the employee of a particular
employer unless the Act explicitly states otherwise and shall include any individual
whose work has ceased as a consequence of, or in connection with any current labor
dispute or because of any unfair labor practice and who has not obtained any other
substantially equivalent and regular employment.
while an employer
9

includes any person acting in the interest of an employer, directly or indirectly but
shall not include any labor organization (otherwise than when acting as an employer)
or anyone acting in the capacity of officer or agent of such labor organization.
Petitioner really anchors his contention of the non-existence of employee-employer relationship on
the control test. He points to the case of Madrigal Shipping Co., Inc. v. Nieves Baens del Rosario, et
al., L-13130, October 31, 1959, where the Court ruled that:
The test ... of the existence of employee and employer relationship is whether there
is an understanding between the parties that one is to render personal services to or
for the benefit of the other and recognition by them of the right of one to order and
control the other in the performance of the work and to direct the manner and method
of its performance.
Petitioner contends that the private respondents "did not meet the control test in the fight of the ...
definition of the terms employer and employee, because there was no evidence to show that
petitioner had the right to direct the manner and method of respondent's work.
10
Moreover, it is
argued that petitioner's evidence showed that "Solano worked on a pakiaw basis" and that he stayed in
the establishment only when there was work.
While this Court upholds the control test
11
under which an employer-employee relationship exists
"where the person for whom the services are performed reserves a right to control not only the end to be
achieved but also the means to be used in reaching such end, " it finds no merit with petitioner's
arguments as stated above. 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.
12
Considering the
finding by the Hearing Examiner that the establishment of Dy Keh Beng is "engaged in the manufacture of
baskets known as kaing,
13
it is natural to expect that those working under Dy would have to observe,
among others, Dy's requirements of size and quality of the kaing. Some control would necessarily be
exercised by Dy as the making of the kaingwould be subject to Dy's specifications. Parenthetically, since
the work on the baskets is done at Dy's establishments, it can be inferred that the proprietor Dy could
easily exercise control on the men he employed.
As to the contention that Solano was not an employee because he worked on piece basis, this Court
agrees with the Hearing Examiner that
circumstances must be construed to determine indeed if payment by the piece is just
a method of compensation and does not define the essence of the relation. Units of
time ... and units of work are in establishments like respondent (sic) just yardsticks
whereby to determine rate of compensation, to be applied whenever agreed upon.
We cannot construe payment by the piece where work is done in such an
establishment so as to put the worker completely at liberty to turn him out and take in
another at pleasure.
At this juncture, it is worthy to note that Justice Perfecto, concurring with Chief Justice Ricardo Paras
who penned the decision in "Sunrise Coconut Products Co. v. Court of Industrial Relations" (83
Phil..518, 523), opined that
judicial notice of the fact that the so-called "pakyaw" system mentioned in this case
as generally practiced in our country, is, in fact, a labor contract -between employers
and employees, between capitalists and laborers.
Insofar as the other assignments of errors are concerned, there is no showing that the Court of
Industrial Relations abused its discretion when it concluded that the findings of fact made by the
Hearing Examiner were supported by evidence on the record. Section 6, Republic Act 875 provides
that in unfair labor practice cases, the factual findings of the Court of Industrial Relations are
conclusive on the Supreme Court, if supported by substantial evidence. This provision has been put
into effect in a long line of decisions where the Supreme Court did not reverse the findings of fact of
the Court of Industrial Relations when they were supported by substantial evidence.
14

Nevertheless, considering that about eighteen (18) years have already elapsed from the time the
complainants were dismissed,
15
and that the decision being appealed ordered the payment of
backwages to the employees from their respective dates of dismissal until finally reinstated, it is fitting to
apply in this connection the formula for backwages worked out by Justice Claudio Teehankee in "cases
not terminated sooner."
16
The formula cans for fixing the award of backwages without qualification and
deduction to three years, "subject to deduction where there are mitigating circumstances in favor of the
employer but subject to increase by way of exemplary damages where there are aggravating
circumstances.
17
Considering there are no such circumstances in this case, there is no reason why the
Court should not apply the abovementioned formula in this instance.
WHEREFORE; the award of backwages granted by the Court of Industrial Relations is herein
modified to an award of backwages for three years without qualification and deduction at the
respective rates of compensation the employees concerned were receiving at the time of dismissal.
The execution of this award is entrusted to the National Labor Relations Commission. Costs against
petitioner.
SO ORDERED.
Teehankee, Makasiar, Guerrero, and Melencio-Herrera, JJ., concur.
Fernandez, J., took no part.






CASE NO. 2
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. L-64048 August 29, 1986
PETROPHIL CORPORATION, petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION, ANSELMO B. ENCARNACION AND GERSHER
ENGINEERING WORKS, respondents.
Linda P. Ilagan for petitioners.

PARAS, J .:
The instant petition which seeks the review and reversal of the Decision dated January 25, 1983 of
respondent National Labor Relations Commission in NLRC Case No. 246-LR-XI-77, raises the
following questions-
1. Which was the employer of respondent Anselmo B. Encarnacion-petitioner Petrophil Corporation
or respondent Gersher Engineering Works?
2. Was Anselmo B. Encarnacion illegally dismissed? and
3. What benefits, if any was he entitled to and from whom?
Private respondent, Anselmo B. Encarnacion, had been working as a casual employee of various job
contractors in Petrophil's premises since 1963 when the firm was still under the ownership and
management of Esso Standard Philippines. On December 21, 1973, Esso Standard Philippines was
sold to Petrophil Corporation. At that time, Anselmo B. Encarnacion was working at the bulk plant as
an employee of one Juanito Campos who had a job contract with Esso Standard Philippines. The
said job contract was continued by Petrophil Corporation so respondent Encarnacion remained
working at the bulk plant. In March 1976, respondent Gersher Engineering Works entered into a
service contract with Petrophil and thereafter placed respondent Encarnacion in its payroll
Sometime in March 28, 1977, respondent Gersher received a letter from Petrophil Corporation
complaining about the unsatisfactory performance of respondent Encarnacion. As a result,
respondent Gersher decided to re-assign Encarnacion to Caltex Phil. Inc. with whom said
respondent Gersher had also a contract. Respondent Encarnacion refused to be reassigned to
Caltex unless he was made to occupy the same position of warehouseman as in Petrophil
Corporation and since the position available at Caltex was that of equipment maintainer, respondent
Encarnacion refused to be transferred. Instead he filed a complaint for illegal dismissal against
respondent Gersher and in the alternative, against petitioner Petrophil Corporation, before the Labor
Relations Division of the then Department of Labor.
In a decision dated September 26, 1977, Labor Arbiter Modesto R. Rosales rendered judgment
holding that respondent Encarnacion was the employee of respondent Gersher Engineering Works
and not of petitioner Petrophil Corporation; that respondent Encarnacion was not illegally dismissed;
but that he is entitled to receive from respondent Gersher the 13th month pay of P340.00 covering
the year from March 15, 1976 to March 26, 1977 and the emergency monthly living allowance of
P100.00 for the same period. The claim for holiday and vacation leave pay was dismissed for
insufficiency of evidence. The judgment further ordered respondent Gersher to accept respondent
Encarnacion back to work to be assigned as helper in any of its contractual jobs (except Petrophil
Corporation) with the same salary and without loss of seniority and other benefits appurtenant to his
position. Respondent Encarnacion was also ordered to report and present himself for work with
respondent Gersher within five (5) days from notice, otherwise he would be considered to have
abandoned his work. The case against Petrophil Corporation was dismissed.
Respondent Encarnacion appealed the decision to respondent National Labor Relations
Commission Respondent Gersher did not appeal from the said decision, neither did it file an answer
to Encarnacion's appeal.
On January 25, 1985, the National Labor Relations Commission rendered judgment modifying the
decision of the Labor Arbiter and holding that Encarnacion was the employee of Petrophil
Corporation and not of respondent Gersher and that he had been illegally dismissed. The dispositive
portion of the decision of the respondent Commission reads-
WHEREFORE, respondent Petrophil is hereby ordered to:
1. Immediately reinstate the complainant in his former position without loss of
seniority rights and privileges, with fixed backwages equivalent to three years,
without qualification or deduction; and
2. Pay the complainant emergency cost-of-living allowances and 13th month pay
both covering the period corresponding to backwages.
Hence, the instant petition which We find to be meritorious.
On the first issue raised, We agree with the findings of the Labor Arbiter that respondent
Encarnacion was the employee of respondent Gersher and not petitioner Petrophil Corporation. This
fact was admitted by no less than Gersher in its position paper which it filed with the Labor Relations
Division of the then Department of Labor. Thus, in the said position paper, respondent Gersher
states
2. That the complainant started work with respondent Gersher Engineering
Work sometime on or about March 15, 1976 but that after March 31, 1977, the
complainant left his work with the herein respondent and never came back; he has
not notified the respondent herein that he was no longer reporting for work; that the
said respondent herein only hired the said complainant on March 15, 1976 until the
date mentioned above.
3. That sometime on or about March l, 1976 respondent Gersher Engineering Work
entered into a contract of services with respondent Petrophil Corporation, as an
independent contractor. ...
4. That after said contract was consummated, the complainant Anselmo Encarnacion
commenced work on or about March 15, 1976 with said respondent with monthly
salary of P340.00. ...
The payrolls of respondent Gersher also show that respondent Encarnacion was its employee. For
the period from March 15, 1976 and continuously up to March 31, 1977, respondent Encarnacion
was receiving his salary from respondent Gersher. There was never an instance during this period
that Encarnacion received his salary from Petrophil Corporation.
Anent the issues of his alleged illegal dismissal and his entitlement to benefits from his employer,
We likewise agree with the decision of the Labor Arbiter that respondent Encarnacion was not
dismissed but was only demoted and transferred to Caltex Phil. Inc. because of his failure to observe
proper diligence in his work, and also because of his indolence, habitual tardiness and absences.
But following his demotion and transfer, Encarnacion refused to report for work anymore. As aptly
ruled by the Labor Arbiter this regard-
Anent the issue of illegal dismissal respondent Gersher Engineering Works allege
(sic) that Encarnacion was not separated from the service but was only demoted
from the position of helper and transferred to the contract of respondent Gersher
Engineering Works with Caltex Philippines Corporation without reduction in salary
due to his failure to observe proper diligence in his work, habitual tardiness, habitual
absences and indolence in his assigned work.
Time and again, this Office has sustained the view that it is management prerogative
to transfer, demote, discipline and even to dismiss an employee to protect its
business, provided it is not tainted with unfair labor practice.
The record, however, is bereft of any evidence to show that the demotion and
transfer of Encarnacion was due to unfair labor practice acts defined under Article
249 ... (third official edition of the Labor Code of the Philippines, as amended), hence
the act of Gersher Engineering Works in transferring and demoting complainant
Encarnacion is anchored on just and valid grounds. (pp. 19-20, Rollo)
Considering the foregoing, reinstatement of respondent Encarnacion and payment of his money
claims should be made by respondent Gersher Engineering Works, his employer which has
evidently accepted the decision of the Labor Arbiter by not appealing therefrom Petitioner Petrophil
Corporation is absolved from any and all liability.
WHEREFORE, the appealed decision dated January 25, 1983 of the National Labor Relations
Commission is hereby REVERSED and SET ASIDE and in lieu thereof, the decision dated
September 26, 1977 of Labor Arbiter Modesto Rosales is ordered reinstated. No pronouncement as
to costs.
SO ORDERED.
Feria (Chairman), Fernan, Alampay and Gutierrez, Jr., JJ., concur.



CASE NO.3
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 78711 June 27, 1990
ABOITIZ SHIPPING EMPLOYEES ASSOCIATION, LAZARO ABAIGAR, VICTORIANO ANIBAN,
FELIPE BATERZAL, RUFINO YAGUIT, JONNIE YAGUIT and EUGENIO BALBUENA, petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION and ABOITIZ SHIPPING
CORPORATION, respondents.
Rogelio B. De Guzman for petitioners.
Bienvenido A. Salinas, Jr. for private respondent.

PARAS, J .:
This is a petition for certiorari to set aside the Resolutions of the public respondent National Labor
Relations Commission (NLRC) dated April 30, 1987 and May 29, 1987 affirming the Decision of
August 23, 1985 rendered by Labor Arbiter Julio P. Andres, Jr. holding that:
... respondent Aboitiz Shipping Corporation could not be guilty of said charge (unfair
labor practice through dismissal) for lack of employer-employee relationship between
them and the individual complainants at the time said act was allegedly committed in
April 1985. (p. 165, Rollo)
and consequently dismissing the case for lack of merit. Hence, this petition anchored on two
grounds:
1. GRAVE ABUSE OF DISCRETION COMMITTED BY THE NATIONAL LABOR
RELATIONS COMMISSION WHICH AMOUNTS TO LACK OF JURISDICTION.
2. THE RESOLUTIONS SOUGHT TO BE REVIEWED ARE NOT IN ACCORD WITH
LAW AND APPLICABLE DECISIONS OF THIS HONORABLE COURT. (p. 2
Comment, p. 166, Rollo)
The real issue however which surfaces from the allegations and arguments of the parties is whether
or not an employer-employee relationship existed between respondent Aboitiz Shipping Corporation
(ABOITIZ, for short) and the petitioners-workers at the time of the latter's alleged dismissal on April
26, 1985.
The six (6) petitioners herein claimed that they were employed as carpenters by respondent
corporation until their illegal dismissal on April 26, 1985. They alleged that they were all allegedly
dismissed by Ben Baguio and his spouse on April 26, 1985 just a day after the inspection made by
Efren Bautista of the National Capital Region of the Ministry of Labor and Employment on
respondent ABOITIZ in connection with LSED-4-408-85, a labor case which same complainants filed
with the Ministry of Labor and Employment. According to the complainants, said act of the Baguios
constitute unfair labor practice defined under par. (f) of Article 249 of the Labor Code, as amended,
and the resultant dismissal of the individual complainants is illegal as there was allegedly no just
cause nor were they duly afforded due process of law. They thus, pray that the respondent
corporation be held liable for unfair labor practice through dismissal, damages and attorney's fees.
Respondent ABOITIZ denies that the petitioners were their employees at the time of their dismissal
but are employees of respondent Ben Baguio by virtue of a Service Contract dated June 16, 1984. A
pertinent portion of which reads as follows:
8. That it is understood and agreed that there is no employer-employee relationship
between the FIRST PARTY (Aboitiz Shipping Corporation) and SECOND PARTY
(Narben's Service Contractor) much less any of the latter's carpenters. The SECOND
PARTY shall have the right to hire and fire such employees, exercise general control
as to the time, manner and method of performance of work; that the sole interest of
the FIRST PARTY is that all its properties, cargoes, equipments and other
appurtenances be safe and protected from destruction, pilferage, damage and other
losses as envisioned in paragraph 9. The SECOND PARTY shall hold free from any
liability the FIRST PARTY from any claim of whatsoever nature which the carpenters
of the SECOND PARTY may institute either against the FIRST PARTY and
SECOND PARTY. (pp. 3-4, NLRC Resolution; pp. 3-4, Rollo)
On their part, spouses Ben and Leonarda Baguio aver that they are the proprietors of Narben's
Service Contractor engaged in contracting carpentry jobs and has a service contract with respondent
Aboitiz Shipping Corporation. Spouses Baguio admit that the petitioners were indeed their
employees whose duties were to do carpentry work, subject to the condition that the moment their
works were finished, their employment would end, and that they would be re-hired once respondent
ABOITIZ would enter into another contract. Petitioners submit the following pieces of evidence in
support of the presence of employer-employee relationship with respondent Aboitiz, viz:
(1) Social Security Numbers:
03-173171-0 Lazaro Abaigar;
06-112277-9 Felipe Baterzal;
03-634457-0 Rufino Yaguit;
03-77089084 Jonnie Yaguit;
07-4915-8 Eugenio Balbuena; and
03-78050193 Victoriano Aniban
(2) Deduction for Social Security Premitims from their salaries;
(3) Company Identification Cards issued to petitioners, examples of which are
Annexes "B", "B-1" and "B-2", of Petition;
(4) Withholding of taxes as evidenced by BIR Form W-2 Annexes "C" to "C-5", of
Petition; and
(5) Time Cards and normal conduct of employer-employee relations enumerated in
the above Statement of Facts. (Memorandum of Petitioners, p. 212, Rollo)
They therefore pray that the resolutions of public respondent be set aside; that this Court declare the
illegality of dismissal of individual petitioners; and that their reinstatement with full backwages to
private respondent as regular employees thereof be granted.
In the resolution of April 18, 1988, this Court gave due course to the petition and required the parties
to file their simultaneous memoranda within thirty (30) days from notice.
Records reveal that petitioners are not regular employees of the private respondent at the time of
their alleged illegal dismissal. For one, petitioners, on June 20, 1984, filed individual application for
employment with Narben's Service Contractor. They were eventually issued payslips, deducted SSS
premiums, Pag-ibig fund and withholding tax from their salaries by this Contractor.
As held in Mafinco Trading Corporation vs. Ople, 70 SCRA 139 (1976), the existence of employer-
employee relationship is determined by four (4) 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. From a reading of the provisions of the aforesaid service contract, the
concurrence of these four elements on NARBEN's will easily be noted. For NARBEN's had the right
to hire the necessary number of carpenters to accomplish the carpentry requirements of respondent
corporation and to fire them. It had charge of the payment of wages of its laborers and the power of
administrative supervision and general control as to the time, manner and method of performance of
work.
All the above evidences constitute positive proofs that the petitioners-workers were, at the time in
question, in the employ of NARBEN's and not anymore of respondent Corporation. Respondent
NLRC, therefore, did not err in refusing to give weight to petitioners' uncorroborated claim that they
were continuously employees of Aboitiz Shipping Corporation.
With regard to the issuance of Id's to petitioners by private respondent, it appears that these Id's
were special Id's and is different from those issued to its regular employees. On these special
Identification cards, the following words are written: THIS IS TO CERTIFY THAT THE BEARER
WHOSE PICTURE APPEAR ON THIS CARD IS AUTHORIZED TO HAUL, OPERATE, AND
TRANSACT BUSINESS WITH ABOITIZ SHIPPING CORPORATION. On the other hand, appearing
on the regular or probationary employee's Id cards are the following words: "THIS IS TO CERTIFY
THAT THE BEARER WHOSE PICTURE AND PERSONAL DATA APPEAR ON THIS CARD IS AN
EMPLOYEE OF ABOITIZ SHIPPING CORPORATION." (pp. 109-110, Rollo)
Besides, the issue of the existence of employer-employee relationship between the parties in the
case at bar is a question of fact which has already been resolved by the labor arbiter and upheld by
the National Labor Relations Commission. Review of labor cases are confined to questions of
jurisdiction or grave abuse of discretion. We find that no grave abuse of discretion W-as committed
by public respondent NLRC in affirming the non-existence of employer-employee relationship
between petitioners and private respondent.
PREMISES CONSIDERED, the petition is hereby DISMISSED for lack of merit.
SO ORDERED.
Melencio-Herrera (Chairperson), Padilla, Sarmiento and Regalado, JJ., concur.


CASE NO. 4
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 121327 December 20, 2001
CECILIO P. DE LOS SANTOS and BUKLOD MANGGAGAWA NG CAMARA
(BUMACA), petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION (SECOND DIVISION), HON. COMMISSIONERS
VICTORIANO R. CALAYCAY, RAUL T. AQUINO, and ROGELIO I. RAYALA, CAMARA STEEL
INDUSTRIES INC., JOSELITO JACINTO, ALBERTO F. DEL PILAR, DENNIS ALBANO,
MERCEDITA G. PASTRANA, TOP-FLITE and RAUL RUIZ, respondents.
BELLOSILLO, J .:
This is a petition for certiorari under Rule 65 assailing the Decision of public respondent National
Labor Relations Commission (NLRC) which remanded this case to the Labor Arbiter who ruled that
petitioner Cecilio P. de los Santos was illegally dismissed by private respondent Camara Steel, Inc.,
and as a consequence, ordered his immediate reinstatement. Specifically, the dispositive portion of
the Labor Arbiter's Decision promulgated 23 May 1999 states
WHEREFORE, premises considered, respondent Camara Steel Industries, Inc. is hereby
ordered to reinstate complainant Cecilio de los Santos to his former position within ten (10)
days from receipt of this Resolution without loss of seniority rights and other benefits with full
back wages from date of dismissal up to actual date of reinstatement which is hereby
computed as of even date as follows:
From 8/23/93-12/15/93 = 3.73 mos.
P118 x 26 days x 3.73 mos. = P11,443.64
12/16/93 - 3/29/94 = 3.43 mos.
135 x 26 days x 3.43 mos. = 12,039.30
Total Backwages as of
3/29/94
P23,482.94
Respondent Camara Steel Industries, Inc. is also ordered to pay complainant 10% for and as
attorney's fees.
All other claims are hereby dismissed for lack of merit.
On 3 May 1991 petitioner De los Santos started working at Camara Steel Industries Inc. (CAMARA
STEEL), a company engaged in the manufacture of steel products such as LPG cylinders and
drums. He was first assigned at the LPG assembly line, then later, as operator of a blasting
machine. While performing his task as such operator, he met an accident that forced him to go on
leave for one and a half (1-1/2) months. Upon his return, he was designated as a janitor assigned to
clean the premises of the company, and occasionally, to transfer scrap and garbage from one site to
another.
1

On 11 May 1993 petitioner was doing his usual chores as a janitor of CAMARA STEEL when he
momentarily left his pushcart to answer the call of Narciso Honrado, scrap in-charge, who
summoned him to the company clinic. There Honrado handed him a box which he placed on top of a
drum in his pushcart for transfer to the other lot of the company near gate 2. On his way out of gate
2, however, the security guard on duty found in the box handed to him by Honrado two (2) pieces of
electric cable measuring 2.26 inches each and another piece of 1.76 meters with a total estimated
value of P50.00 to P100.00. Apprehensive that he might be charged with theft, petitioner De los
Santos explained that the electric cord was declared a scrap by Honrado whose instructions he was
only following to transfer the same to the adjacent lot of the company as scrap.
Narciso Honrado admitted responsibility for the haul and his error in declaring the electric cables as
scrap. The general manager, apparently appeased by Honrado's apology, issued a memorandum
acknowledging receipt of his letter of apology and exculpated him of any wrongdoing.
Taking an unexpected volte face, however, the company through its counsel filed on 9 July 1993 a
criminal complaint for frustrated qualified theft against Honrado and herein petitioner De los Santos.
The complaint however was subsequently dismissed by the Provincial Prosecutor of Pasig for lack of
evidence.
2

On 23 August 1993, upon request of Top-Flite, alleged manpower agency of De los Santos,
CAMARA STEEL terminated his services.
Aggrieved by his illegal termination, De los Santos sought recourse with the Labor Arbiter who on 29
March 1994 rendered a decision ordering respondent CAMARA STEEL to reinstate Delos Santos to
his former position within ten (10) days without loss of seniority rights and other benefits with full
back wages from date of dismissal up to actual reinstatement as herein before stated.
CAMARA STEEL went to the NLRC for recourse. Top-Flite filed a Motion for Intervention praying
that it be permitted to intervene in the appeal as co-respondent and, accordingly, be allowed to
submit its own memorandum and other pleadings.
3

On 23 May 1995 the NLRC reversed the Labor Arbiter and ordered the return of the entire records of
the case to the arbitration branch of origin for further proceedings. In its Decision, NLRC specified
the reasons for the remand to the Labor Arbiter
4

First, as respondents have broadly implied, having alleged that he was an employee of
Camara Steel, it was complainant's burden to prove this allegation as a fact, not merely
through his uncorroborated statements but through independent evidence. As noted by
respondents, he has not submitted one piece of evidence to support his premise on this
matter except for his sworn statement.
Secondly, the Arbiter maintained that the contract of services submitted by respondents was
insufficient to prove that complainant was an employee of Top-Flite, but he has obviously
omitted consideration of Annexes F, G, H and I which are time sheets of the complainant
with Top-Flite and the corresponding time cards which he punches in for Camara Steel.
The NLRC further noted that under the circumstances it became appropriate to conduct a formal
hearing on the particular issue of whether an employer-employee relationship existed between the
parties, which issue was determinative of the nature of petitioner's dismissal by CAMARA STEEL.
That being so, according to the NLRC, it was necessary for the Labor Arbiter to issue the
appropriate directive to summon Top-Flite as a necessary party to the case, for the manpower
agency to submit its own evidence on the actual status of petitioner.
As pointed out by petitioner, the errors in the disputed decision by the NLRC are: (a) NLRC violated
due process of law when it did not consider the evidence on record; (b) CAMARA STEEL, and not
Top-Flite, is the real employer of petitioner; (c) Contrary to the finding of NLRC, Top-Flite was made
a party respondent in the illegal dismissal case docketed as NLRC-NCR No. 00-08-05302-93 and
the NLRC was therefore in error in remanding the case to the Labor Arbiter for further proceedings.
Petitioner De los Santos contends that NLRC was in grave error when it ruled that, with the
exception of a bare assertion on his sworn statement, he "has not submitted one piece of evidence
to support his premise"
5
that he was in fact an employee of CAMARA STEEL.
To underscore NLRC's oversight, petitioner brings to our attention and specifies the pieces of
evidence which he presented before the Labor Arbiter on 19 November 1993 also appended as
Annexes to petitioner's "Traverse to Camara's Position Paper and Reply:" (a) Annex "E" to "E-1"
Approval signature of Camara's Department head, Reynaldo Narisma, without which petitioner
cannot render overtime; (b) Annex "F" Petitioner's daily time record for 8/3/92 to 8/9/92; (c) Annex
"F-1" Signature of private respondent Mercedita Pastrana, approving in her capacity as Assistant
Manager of Camara Steel; (d) Annex "F-2" Signature of private respondent Dennis Albano,
Personnel Manager of Camara Steel Industries Inc. also co-signing for approval; (e) Annex "F-3"
Signature of Narisma, as Department Head of Camara Steel Industries Inc. where petitioner is
working; (f) Annex "G" Daily Time Record of petitioner for 7/6/92 to 7/12/92; (g) Annex "G-1"
Signature of Camara Steel Assistant Manager; (h) Annex "G-2" Signature of Camara's Personnel
Manager, Dennis Albano, approving; (i) Annex "G-3" Signature of Camara's Department Head
where petitioner is working, Mr. Narisma, approving; (j) Annex "H" to "H-1" Petitioner's Daily Time
Card (representative samples) with name and logo of Camara Steel Industries Inc.; and, (k) Annex
"J" Affidavit of Complainant.
All these pieces of evidence which, according to petitioner De los Santos, were not properly
considered by NLRC, plainly and clearly show that the power of control and supervision over him
was exercised solely and exclusively by the managers and supervisors of CAMARA STEEL. Even
the power to dismiss was also lodged with CAMARA STEEL when it admitted in page 3 of its Reply
that upon request by Top-Flite, the steel company terminated his employment after being allegedly
caught committing theft.
Petitioner De los Santos also advances the view that Top-Flite, far from being his employer, was in
fact a "labor-only" contractor as borne out by a contract whereby Top-Flite undertook to supply
CAMARA STEEL workers with "warm bodies" for its factory needs and edifices. He insists that such
contract was not a job contract but the supply of labor only. All things considered, he is of the firm
belief that for all legal intents and purposes, he was an employee a regular one at that of
CAMARA STEEL.
In its comment, private respondent CAMARA STEEL avers that far from being its employee, De los
Santos was merely a project employee of Top-Flite who was assigned as janitor in private
respondent company. This much was acknowledged by Top-Flite in its Motion for Intervention filed
before the NLRC.
6
Such allegation, according to private respondent CAMARA STEEL, supports all
along its theory that De los Santos' assignment to the latter as janitor was based on an independent
contract executed between Top-Flite and CAMARA STEEL.
7

Respondent CAMARA STEEL further argues that crystal clear in the Motion for Intervention of Top-
Flite is its allegation that it was in fact petitioner's real employer as his salaries and benefits during
the contractual period were paid by Top-Flite; not only that, De los Santos was dismissed by
CAMARA STEEL upon the recommendation of Top-Flite. These ineluctably show that Top-Flite was
not only a job contractor but was in truth and in fact the employer of petitioner.
In his petition, De los Santos vigorously insists that he was the employee of respondent CAMARA
STEEL which in turn was not only denying the allegation but was finger-pointing Top-Flite as
petitioner's real employer. De los Santos again objects to this assertion and claims that Top-Flite, far
from being an employer, was merely a "labor-only" contractor.
In the maze and flurry of claims and counterclaims, several contentious issues continue to stick out
like a sore thumb. Was De los Santos illegally dismissed? If so, by whom? Was his employer
respondent CAMARA STEEL, in whose premises he was allegedly caught stealing, or was it Top-
Flite, the manpower services which allegedly hired him?
Inextricably intertwined in the resolution of these issues is the determination of whether there existed
an employer-employee relationship between CAMARA STEEL and respondent De Los Santos, and
whether Top-Flite was an "independent contractor" or a "labor-only" contractor. A finding that Top-
Flite was a "labor-only" contractor reduces it to a mere agent of CAMARA STEEL which by statute
would be responsible to the employees of the "labor-only" contractor as if such employees had been
directly employed by the employer.
Etched in an unending stream of cases are the four (4) standards in determining the existence of an
employer-employee relationship, namely: (a) the manner of selection and engagement of the
putative employee; (b) the mode of payment of wages; (c) the presence or absence of power of
dismissal; and, (d) the presence or absence of control of the putative employee's conduct. Most
determinative among these factors is the so-called "control test."
As shown by the evidence on record, De los Santos was hired by CAMARA STEEL after undergoing
an interview with one Carlos Suizo, its timekeeper who worked under the direct supervision of one
Renato Pacion, a supervisor of CAMARA STEEL. These allegations are contained in the
affidavit
8
executed by De los Santos and were never disputed by CAMARA STEEL. Also remaining
uncontroverted are the pieces of documentary evidence adduced by De los Santos consisting of
daily time records marked Annexes "F" and "G" which, although bearing the heading and logo of
Top-Flite, were signed by officers of respondent CAMARA STEEL, and Annexes "H" and "I" with the
heading and logo of CAMARA STEEL.
Incidentally, we do not agree with NLRC's submission that the daily time records serve no other
purpose than to establish merely the presence of De los Santos within the premises of CAMARA
STEEL. Contrarily, these records, which were signed by the company's officers, prove that the
company exercised the power of control and supervision over its employees, particularly De los
Santos. There is dearth of proof to show that Top-Flite was the real employer of De los Santos other
than a naked and unsubstantiated denial by CAMARA STEEL that it has no power of control over De
los Santos. Records would attest that even the power to dismiss was vested with CAMARA STEEL
which admitted in its Reply that "Top-Flite requested CAMARA STEEL to terminate his employment
after he was caught by the security guard committing theft."
A cursory reading of the above declaration will confirm the fact that the dismissal of De los Santos
could only be effected by CAMARA STEEL and not by Top-Flite as the latter could only "request" for
De los Santos' dismissal. If Top-Flite was truly the employer of De los Santos, it would not be asking
permission from or "requesting" respondent CAMARA STEEL to dismiss De los Santos considering
that it could very well dismiss him without CAMARA STEEL's assent.
All the foregoing considerations affirm by more than substantial evidence the existence of an
employer-employee relationship between De los Santos and CAMARA STEEL.
As to whether petitioner De los Santos was illegally terminated from his employment, we are in full
agreement with the Labor Arbiter's finding that he was illegally dismissed. As correctly observed by
the Labor Arbiter, it was Narciso Honrado, scrap in-charge, who handed the box containing the
electrical cables to De los Santos. No shred of evidence can show that De los Santos was aware of
its contents, or if ever, that he conspired with Honrado in bilking the company of its property. What is
certain however is that while Honrado admitted, in a letter of apology, his culpability for the
unfortunate incident and was unconditionally forgiven by the company, De los Santos was not only
unceremoniously dismissed from service but was charged before the court for qualified theft (later
dismissed by the public prosecutor for lack of evidence). For sure, De los Santos cannot be held
more guilty than Honrado who, being the scrap in-charge, had the power to classify the cables
concerned as scrap.
Neither can we gratify CAMARA STEEL's contention that petitioner was validly dismissed for loss of
trust and confidence. As provided for in the Labor Code:
Art. 282. Termination by employment An employer may terminate an employment for any
of the following causes: x x x (c) Fraud or willful breach by the employee of the trust reposed
in him by his employer or duly authorized representative x x x x
Of course, it must be stressed that loss of confidence as a just cause for the termination of
employment is based on the premise that the employee holds a position of trust and confidence, as
when he is entrusted with responsibility involving delicate matters, and the task of a janitor does not
fall squarely under this category.
Petitioner De los Santos argues that Top-Flite was merely a "labor-only" contractor. To fortify his
stance, De los Santos brings to our attention the contract of service
9
dated 8 February 1991 between
CAMARA STEEL and Top-Flite which provides:
1) The contractor (Top-Flite) shall provide workers (non-skilled) six (6) days a week for the
Client's (Camara) factory and edifices.
However, both respondent CAMARA STEEL and Top-Flite
10
are adamant in their belief that the latter
was not a "labor-only" contractor as they rely on another provision of the contract which states
2) The Contractor warrants the honesty, reliability, industry and cooperative disposition of the
person it employs to perform the job subject to this contract, and shall employ such persons
only as are in possession of health certificates and police clearances x x x
The preceding provisions do not give a clear and categorical answer as regards the real character of
Top-Flite's business. For whatever its worth, the invocation of the contract of service is a tacit
admission by both parties that the employment of De los Santos was by virtue of such contract. Be
that as it may, Top-Flite, much less CAMARA STEEL, cannot dictate, by the mere expedient of a
unilateral declaration in a contract, the character of its business, i.e., whether as "labor-only"
contractor, or job contractor, it being crucial that its character be measured in terms of and
determined by the criteria set by statute. The case of Tiu v. NLRC
11
succinctly enunciates this
statutory criteria
Job contracting is permissible only if the following conditions are met: 1) the contractor
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 2) the contractor 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.
"Labor-only contracting" as defined in Sec. 4, par. (f), Rule VIII-A, Book III, of the Omnibus Rules
Implementing the Labor Code states that a "labor-only" contractor, prohibited under this Rule, is an
arrangement where the contractor or subcontractor merely recruits, supplies or places workers to
perform a job, work or service for a principal and the following elements are present: (a) The
contractor or subcontractor does not have substantial capital or investment to actually perform the
job, work or service under its own account or responsibility; and, (b) The employees recruited,
supplied or placed by such contractor or subcontractor are performing activities which are directly
related to the main business of the principal.
Applying the foregoing provisions, the Court finds Top-Flite to be a "labor-only" contractor, a mere
supplier of labor to CAMARA STEEL, the real employer. Other than its open declaration that it is an
independent contractor, no substantial evidence was adduced by Top-Flite to back up its claim. Its
revelation that it provided a sweeper to petitioner would not suffice to convince this Court that it
possesses adequate capitalization to undertake an independent business.
12
Neither will the
submission prosper that De los Santos did not perform a task directly related to the principal
business of respondent CAMARA STELL. As early as in Guarin v. NLRC
13
we ruled that "the jobs
assigned to the petitioners as mechanics, janitors, gardeners, firemen and grasscutters were directly
related to the business of Novelty as a garment manufacturer," reasoning that "for the work of
gardeners in maintaining clean and well-kept grounds around the factory, mechanics to keep the
machines functioning properly, and firemen to look out for fires, are directly related to the daily
operations of a garment factory."
In its comment respondent CAMARA STEEL emphatically argues that Top-Flite, although impleaded
as respondent in NLRC-NCR Cases Nos. 00-0704761-93 and 00-0805061-93, subject of the present
appeal, was never summoned for which reason it was deprived of procedural due process; basically
the same line of argument adopted by the NLRC in its decision to remand the case to the arbitration
branch of origin. CAMARA STEEL obviously wants to impress upon us that Top-flite, being a
necessary party, should have been summoned and the failure to do so would justify the remand of
the case to the Labor Arbiter.
We are not persuaded. The records show that Top-Flite was not only impleaded in the
aforementioned case but was in fact afforded an opportunity to be heard when it submitted a position
paper. This much was admitted by Top-Flite in par. 5 of its Motion for Intervention where it stated
that "movant submitted its position paper in the cases mentioned in the preceding paragraph but the
Presiding Arbiter ignored the clear and legal basis of the position of the movant."
14
In other words,
the failure of Top-Flite to receive summons was not a fatal procedural flaw because it was never
deprived of the opportunity to ventilate its side and challenge petitioner in its position paper, not to
mention the comment which it submitted through counsel before this Court.
15
It moved to intervene
not because it had no notice of the proceedings but because its position paper allegedly was not
considered by the Labor Arbiter. While jurisdiction over the person of the defendant can be acquired
by service of summons, it can also be acquired by voluntary appearance before the court which
includes submission of pleadings in compliance with the order of the court or tribunal. A fortiori,
administrative tribunals exercising quasi-judicial powers are unfettered by the rigidity of certain
procedural requirements subject to the observance of fundamental and essential requirements of
due process in justiciable cases presented before them. In labor cases, a punctilious adherence to
stringent technical rules may be relaxed in the interest of the workingman. A remand of the case, as
the NLRC envisions, would compel petitioner, a lowly worker, to tread once again the calvary of a
protracted litigation and flagellate him into submission with the lash of technicality.
WHEREFORE, the petition is GRANTED and the appealed Decision of the NLRC is REVERSED
and SET ASIDE and the Decision of the Labor Arbiter promulgated 23 May 1999 is REINSTATED
and ADOPTED as the Decision in this case.
SO ORDERED.
Mendoza, Quisumbing and De Leon, Jr., JJ ., concur.
Buena, J ., on official business





















CASE NO. 5
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 121948 October 8, 2001
PERPETUAL HELP CREDIT COOPERATIVE, INC., petitioner,
vs.
BENEDICTO FABURADA, SISINITA VILLAR, IMELDA TAMAYO, HAROLD CATIPAY, and the
NATIONAL LABOR RELATIONS COMMISSION, Fourth Division, Cebu City, respondents.
SANDOVAL-GUTIERREZ, J .:
On January 3, 1990, Benedicto Faburada, Sisinita Vilar, Imelda Tamayo and Harold Catipay, private
respondents, filed a complaint against the Perpetual Help Credit Cooperative, Inc. (PHCCI),
petitioner, with the Arbitration Branch, Department of Labor and Employment (DOLE), Dumaguete
City, for illegal dismissal, premium pay on holidays and rest days, separation pay, wage differential,
moral damages, and attorney's fees.
Forthwith, petitioner PHCCI filed a motion to dismiss the complaint on the ground that there is no
employer-employee relationship between them as private respondents are all members and co-
owners of the cooperative. Furthermore, private respondents have not exhausted the remedies
provided in the cooperative by-laws.
On September 3, 1990, petitioner filed a supplemental motion to dismiss alleging that Article 121 of
R.A. No. 6939, otherwise known as the Cooperative Development Authority Law which took effect
on March 26, 1990, requires conciliation or mediation within the cooperative before a resort to
judicial proceeding.
On the same date, the Labor Arbiter denied petitioner's motion to dismiss, holding that the case is
impressed with employer-employee relationship and that the law on cooperatives is subservient to
the Labor Code.
On November 23, 1993, the Labor Arbiter rendered a decision, the dispositive portion of which
reads:
WHEREFORE, premises considered, judgment is hereby rendered declaring complainants
illegally dismissed, thus respondent is directed to pay Complainants backwages computed
from the time they were illegally dismissed up to the actual reinstatement but subject to the
three year backwages rule, separation pay for one month for every year of service since
reinstatement is evidently not feasible anymore, to pay complainants 13th month pay, wage
differentials and Ten Percent (10%) attorney's fees from the aggregate monetary award.
However, complainant Benedicto Faburada shall only be awarded what are due him in
proportion to the nine and a half months that he had served the respondent, he being a part-
time employee. All other claims are hereby dismissed for lack of merit.
The computation of the foregoing awards is hereto attached and forms an integral part of this
decision."
On appeal,
1
the NLRC affirmed the Labor Arbiter's decision.
Hence, this petition by the PHCCI.
The issue for our resolution is whether or not respondent judge committed grave abuse of discretion
in ruling that there is an employer-employee relationship between the parties and that private
respondents were illegally dismissed.
Petitioner PHCCI contends that private respondents are its members and are working for it as
volunteers. Not being regular employees, they cannot sue petitioner.
In determining the existence of an employer-employee relationship, the following elements are
considered: (1 ) the selection and engagement of the worker or the power to hire; (2) the power to
dismiss; (3) the payment of wages by whatever means; and (4) the power to control the worker's
conduct, with the latter assuming primacy in the overall consideration. No particular form of proof is
required to prove the existence of an employer-employee relationship. Any competent and relevant
evidence may show the relationship.
2

The above elements are present here. Petitioner PHCCI, through Mr. Edilberto Lantaca, Jr., its
Manager, hired private respondents to work for it. They worked regularly on regular working hours,
were assigned specific duties, were paid regular wages and made to accomplish daily time records
just like any other regular employee. They worked under the supervision of the cooperative
manager. But unfortunately, they were dismissed.
That an employer-employee exists between the parties is shown by the averments of private
respondents in their respective affidavits, carefully considered by respondent NLRC in affirming the
Labor Arbiter's decision, thus:
Benedicto Faburada Regular part-time Computer programmer/ operator. Worked with the
Cooperative since June 1, 1988 up to December 29, 1989. Work schedule: Tuesdays and
Thursdays, from 1:00 p.m. to 5:30 p.m. and every Saturday from 8:00 to 11:30 a.m. and 1:00
to 4:00 p.m. and for at least three (3) hours during Sundays. Monthly salary: P1,000.00
from June to December 1988; P1,350.00 - from January to June 1989; and P1,500.00 from
July to December 1989. Duties: Among others, Enter data into the computer; compute
interests on savings deposits, effect mortuary deductions and dividends on fixed deposits;
maintain the masterlist of the cooperative members; perform various forms for
mimeographing; and perform such other duties as may be assigned from time to time.
Sisinita Vilar Clerk. Worked with the Cooperative since December 1, 1987 up to
December 29, 1989. Work schedule: Regular working hours. Monthly salary: P500.00
from December 1, 1987 to December 31, 1988; P1,000.00 from January 1, 1989 to June
30, 1989; and P1,150.00 from July 1, 1989 to December 31, 1989. Duties: Among others,
Prepare summary of salary advances, journal vouchers, daily summary of disbursements to
respective classifications; schedule loans; prepare checks and cash vouchers for regular and
emergency loans; reconcile bank statements to the daily summary of disbursements; post
the monthly balance of fixed and savings deposits in preparation for the computation of
interests, dividends, mortuary and patronage funds; disburse checks during regular and
emergency loans; and perform such other bookkeeping and accounting duties as may be
assigned to her from time to time.
Imelda C. Tamayo Clerk. Worked with the Cooperative since October 19, 1987 up to
December 29, 1989.Work schedule: Monday to Friday - 8:00 to 11:30 a.m and 2:00 to 5:30
p.m.; every Saturday 8:00 to 11:30 a.m and 1:00 to 4:00 p.m; and for one Sunday each
month - for at least three (3) hours. Monthly salary: P60.00 from October to November
1987; P250.00 for December 1987; P500.00 from January to December 1988; P950
from January to June 1989; and P1,000.00 from July to December 1989. Duties: Among
others, pick up balances for the computation of interests on savings deposit, mortuary,
dividends and patronage funds; prepare cash vouchers; check petty cash vouchers; take
charge of the preparation of new passbooks and ledgers for new applicants; fill up members
logbook of regular depositors, junior depositors and special accounts; take charge of loan
releases every Monday morning; assist in the posting and preparation of deposit slips;
receive deposits from members; and perform such other bookkeeping and accounting duties
as may be assigned her from time to time.
Harold D. Catipay Clerk. Worked with the Cooperative since March 3 to December 29,
1989. Work schedule: Monday to Friday 8:00 to 11:30 a.m. and 2:00 to 5:30 p.m.;
Saturday 8:00 to 11:30 a.m. and 1:00 to 4:00 p.m.; and one Sunday each month for at
least three (3) hours. Monthly salary: P900.00 from March to June 1989; P1,050.00 - from
July to December 1989. Duties: Among others, Bookkeeping, accounting and collecting
duties, such as, post daily collections from the two (2) collectors in the market; reconcile
passbooks and ledgers of members in the market; and assist the other clerks in their duties.
All of them were given a memorandum of termination on January 2, 1990, effective
December 29, 1989.
We are not prepared to disregard the findings of both the Labor Arbiter and respondent NLRC, the
same being supported by substantial evidence, that quantum of evidence required in quasi judicial
proceedings, like this one.
Necessarily, this leads us to the issue of whether or not private respondents are regular employees.
Article 280 of the Labor Code provides for three kinds of employees: (1) regular employees or those
who have been engaged to perform activities which are usually necessary or desirable in the usual
business or trade of the employer; (2) project employees or those whose 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 service to be
performed is seasonal in nature and the employment is for the duration of the season; and (3) casual
employees or those who are neither regular nor project employees.
3
The employees who are
deemed regular are: (a) those who have been engaged to perform activities which are usually
necessary or desirable in the usual trade or business of the employer; and (b) those casual
employees who have rendered at least one (1 ) year of service, whether such service is continuous
or broken, with respect to the activity in which they are employed.
4
Undeniably, private respondents
were rendering services necessary to the day-to-day operations of petitioner PHCCI. This fact alone
qualified them as regular employees.
All of them, except Harold D. Catipay, worked with petitioner for more than one (1) year: Benedicto
Faburada, for one and a half (1 1/2) years; Sisinita Vilar, for two (2) years; and Imelda C. Tamayo,
for two (2) years and two (2) months. That Benedicto Faburada worked only on a part-time basis,
does not mean that he is not a regular employee. One's regularity of employment is not determined
by the number of hours one works but by the nature and by the length of time one has been in that
particular job.
5
Petitioner's contention that private respondents are mere volunteer workers, not
regular employees, must necessarily fail. Its invocation of San Jose City Electric Cooperative vs.
Ministry of Labor and Employment (173 SCRA 697, 703 (1989) is misplaced. The issue in this case
is whether or not the employees-members of a cooperative can organize themselves for purposes of
collective bargaining, not whether or not the members can be employees. Petitioner missed the point
As regular employees or workers, private respondents are entitled to security of tenure. Thus, their
services may be terminated only for a valid cause, with observance of due process.
The valid causes are categorized into two groups: the just causes under Articles 282 of the Labor
Code and the authorized causes under Articles 283 and 284 of the same Code. The just causes are:
(1) serious misconduct or willful disobedience of lawful orders in connection with the employee's
work; (2) gross or habitual neglect of duties; (3) fraud or willful breach of trust; (4) commission of a
crime or an offense against the person of the employer or his immediate family member or
representative; and, analogous cases. The authorized causes are: (1) the installation of labor-saving
devices; (2) redundancy; (3) retrenchment to prevent losses; and (4) closing or cessation of
operations of the establishment or undertaking, unless the closing is for the purpose of
circumventing the provisions of law. Article 284 provides that an employer would be authorized to
terminate the services of an employee found to be suffering from any disease if the employee's
continued employment is prohibited by law or is prejudicial to his health or to the health of his fellow
employees
6

Private respondents were dismissed not for any of the above causes. They were dismissed because
petitioner considered them to be mere voluntary workers, being its members, and as such work at its
pleasure. Petitioner thus vehemently insists that their dismissal is not against the law.
Procedural due process requires that the employer serve the employees to be dismissed two (2)
written notices before the termination of their employment is effected: (a) the first, to apprise them of
the particular acts or omissions for which their dismissal is sought and (b) the second, to inform them
of the decision of the employer that they are being dismissed.
7
In this case, only one notice was
served upon private respondents by petitioner. It was in the form of a Memorandum signed by the
Manager of the Cooperative dated January 2, 1990 terminating their services effective December
29, 1989. Clearly, petitioner failed to comply with the twin requisites of a valid notice.
We hold that private respondents have been illegally dismissed.
Petitioner contends that the labor arbiter has no jurisdiction to take cognizance of the complaint of
private respondents considering that they failed to submit their dispute to the grievance machinery
as required by P.D. 175 (strengthening the Cooperative Movement) 8 and its implementing rules and
regulations under LOI 23. Likewise, the Cooperative Development Authority did not issue a
Certificate of Non-Resolution pursuant to Section 8 of R.A. 6939 or the Cooperative Development
Authority Law.
As aptly stated by the Solicitor General in his comment, P.D. 175 does not provide for a grievance
machinery where a dispute or claim may first be submitted. LOI 23 refers to instructions to the
Secretary of Public Works and Communications to implement immediately the recommendation of
the Postmaster General for the dismissal of some employees of the Bureau of Post. Obviously, this
LOI has no relevance to the instant case.
Article 121 of Republic Act No. 6938 (Cooperative Code of the Philippines) provides the procedure
how cooperative disputes are to be resolved, thus:
ART. 121. Settlement of Disputes. Disputes among members, officers, directors, and
committee members, and intra-cooperative disputes shall, as far as practicable, be settled
amicably in accordance with the conciliation or mediation mechanisms embodied in the by-
laws of the cooperative, and in applicable laws.
Should such a conciliation/mediation proceeding fail, the matter shall be settled in a court of
competent jurisdiction."
Complementing this Article is Section
8
of R.A. No. 6939 (Cooperative Development Authority Law)
which reads:
SEC. 8 Mediation and Conciliation. Upon request of either or both parties, the Authority
shall mediate and conciliate disputes within a cooperative or between
cooperatives: Provided, That if no mediation or conciliation succeeds within three (3) months
from request thereof, a certificate of non-resolution shall be issued by the Commission prior
to the filing of appropriate action before the proper courts.
The above provisions apply to members, officers and directors of the cooperative involved in
disputes within a cooperative or between cooperatives.
There is no evidence that private respondents are members of petitioner PHCCI and even if they
are, the dispute is about payment of wages, overtime pay, rest day and termination of employment.
Under Art. 217 of the Labor Code, these disputes are within the original and exclusive jurisdiction of
the Labor Arbiter.
As illegally dismissed employees, private respondents are therefore entitled to reinstatement without
loss of seniority rights and other privileges and to full backwages, inclusive of allowances, plus other
benefits or their monetary equivalent computed from the time their compensation was withheld from
them up to the time of their actual reinstatement.
9
Since they were dismissed after March 21, 1989,
the effectivity date of R.A. 6715
10
they are granted full backwages, meaning, without deducting from
their backwages the earnings derived by them elsewhere during the period of their illegal
dismissal.
11
If reinstatement is no longer feasible, as when the relationship between petitioner and
private respondents has become strained, payment of their separation pay in lieu of reinstatement is
in order.
12

WHEREFORE, the petition is hereby DENIED. The decision of respondent NLRC is AFFIRMED,
with modification in the sense that the backwages due private respondents shall be paid in full,
computed from the time they were illegally dismissed up to the time of the finality of this Decision.
13

SO ORDERED.
Melo, Vitug and Panganiban, JJ., concur.





CASE NO.6
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION

G.R. No. 91552-55 March 10, 1994
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
vs.
FERNANDO MANUNGAS, JR. y GO @ "PERCY", accused-appellant.
The Solicitor General for plaintiff-appellee.
Rolando Gamalinda for accused-appellant.

NOCON, J .:
This is an appeal by accused-appellant Fernando Manungas, Jr. alias "Percy" from the
decision
1
dated October 31, 1989 of the Regional Trial Court of Lingayen, Pangasisnan, Branch 38 in
Criminal Cases Nos. L-3993, L-3994,
L-3996 and L-4000 finding him guilty beyond reasonable doubt of the crimes of ESTAFA and ILLEGAL
RECRUITMENT, the dispositive portion of which reads:
In the light of what has been stated and discussed above, the court finds and holds
the accused Fernando Manungas y Go alias "Percy" guilty beyond peradventure of
doubt of the crimes filed against him and conformable thereto, hereby pronounces
judgment as follows:
In Criminal Case No. L-3993, the court declares accused, Fernando Manungas y Go
alias "Percy" guilty of estafa for the sum of P16,800.00 as alleged in the information
filed against him and there being no aggravating nor mitigating circumstance, and
applying the Indeterminate Sentence Law in his favor, said accused is hereby
sentenced to suffer the prison term from two (2) years, eleven (11) months and ten
years (10) days as minimum to five (5) years, five (5) months and eleven (11) days of
prision correccional as maximum and to pay the costs of the proceedings.
The court further orders the accused to reimburse the offended party, Wilfrey
Mabalot, the sum of sixteen thousand eight hundred (P16,800.00) pesos which is the
amount of money paid and delivered to him by said complaining witness without
subsidiary imprisonment in case of insolvency.
In Criminal Case No. L-3994, the court likewise declares the accused, Fernando
Manungas y Go alias "Percy" guilty of estafa for the sum of P17,550.00 as charged
in the information. And there being no aggravating nor mitigating circumstance
present, and applying the Indeterminate Sentence Law in his favor, the accused is
hereby sentenced to suffer an indeterminate prison term from two (2) years, eleven
(11) months and ten (10) days as minimum to five (5) years, five (5) months and (11)
days ofprision correccional as maximum and to pay the costs of the proceedings.
The court further directs the accused to reimburse the offended party, Danilo
Ramirez the sum of seventeen thousand five hundred fifty (P17,550.00) pesos which
the accused took from the complaint without subsidiary imprisonment in case of
insolvency.
In Criminal Case No. L-3996, the court also declares the accused, Fernando
Manungas y Go alias "Percy" guilty of estafa for eighteen thousand six hundred
(P18,600.00) pesos as charged in the information filed against him. There being no
aggravating nor mitigating circumstance present, and applying the Indeterminate Law
in his favor, said accused is hereby sentenced to suffer an indeterminate prison term
from two (2) years, eleven months (11) months and ten (10) days asminimum to five
(5) years, five (5) months and eleven (11) days of prision
correccional as maximumand to pay the costs of the proceedings.
The court also directs the accused to reimburse the offended party the sum of
eighteen thousand six hundred (P18,600.00) pesos which is the amount paid and
delivered by the offended party to him without subsidiary imprisonment in case of
insolvency.
In Criminal Case No. L-4000, the court likewise holds the accused, Fernando
Manungas y Go alias "Precy" guilty of the crime of Illegal Recruitment on Large
Scale as charged in the information filed against him, defined and penalized under
the provisions of Article 39, par. (a) of Presidential Decree No. 2018 amending
Articles 38 and 39 of P.D. No. 442, otherwise known as the Labor Code of the
Philippines, and conformable thereto, hereby sentences the said accused to suffer
the penalty of Life Imprisonment and to pay a fine of One Hundred Thousand
(P100,000.00) pesos without subsidiary imprisonment in case of insolvency pursuant
to law.
The accused shall serve the penalties herein imposed against him successively or
one after the other according to their severity.
2

Based on the evidence adduced before the trial court, the facts of the case are as follows:
Sometime in April of 1987, accused-appellant Fernando Manungas, Jr. went to Barangay Legaspi,
Tayug, Pangasinan where he stayed in the house of Arturo and Lilia de Vera to recruit workers for
employment abroad. During his stay, accused-appellant was able to convince complainants Wilfrey
Mabalot, Danilo Ramirez, Leonardo Estanoco and Crisanto Collado to apply as janitors in Saudi
Arabia. He told them to bring all the necessary documents for the processing of their applications to
his office in Manila.
On April 29, 1987, complainants went to accused-appellant's office located at Room 611, L and S
Bldg., 1414 Roxas Blvd., Ermita, Manila and paid accused-appellant P250.00 each for their medical
examination. Thereafter, accused-appellant required the complainants to pay, on various occasions,
placement fees and other expenses incurred in the processing of their papers and issued
corresponding receipts for said amounts. The total amount paid by the complainants to accused-
appellant are the following: Wilfrey Mabalot P16,800.00; Danilo Ramirez P17,550.00,
Leonardo Estanoco 18,600.00, and Crisanto Collado 13,300.00
When complainants failed to leave for Saudi Arabia, they requested Luis "Jing" Ramirez, to verify
with the Philippine Overseas Employment Administration (POEA) whether accused-appellant was
licensed to recruit workers for abroad. They subsequently learned that he was not as shown by the
Certification issued by the POEA.
3

Thereafter, complaints filed against accused-appellant complaints for Estafa defined under par. 2(a),
Article 315 of the Revised Penal Code and Illegal Recruitment on a Large Scale. In due course,
informations fro three (3) counts of Estafa (Criminal Cases Nos. L-3993, L-3994 and L-3996) and
Illegal Recruitment on a Large Scale (Criminal Case No. L-4000) were filed against accused-
appellant before the Regional Trial Court of Lingayen, Pangasinan.
On the other hand, accused-appellant maintained that he was the operations manager of the ZG
Recruitment and Placement Agency, a duly licensed recruitment agency. Sometime in April 1987, he
went to Barangay Legaspi, Tayug, Pangasinan and recruited complainants to work in Saudi Arabia
as janitors. Unfortunately, the job order for the janitorial services was awarded to Express Placement
Agency instead of ZG Recruitment and Placement agency. Thereafter, accused-appellant
transferred complainants' application for overseas employment to Nora Cunanan of Express
Placement Agency. Accused-appellant also turned over the fees paid by the complainants to Nora
Cunanan as evidenced by the receipts
4
issued by the latter. When Nora Cunanan absconded with the
money of the complainants, accused-appellant filed an estafa case against Nora Cunanan after securing
a Special Power of Attorney from the complainants to prosecute and collect their money. However, he
was not able to attend the hearing as he was arrested in connection with the these cases.
Accused-appellant maintains that he did not make false representations to the complainants when
he requited the latter for employment abroad as he had told complainants that he is only an
employee of a licensed recruitment agency in Manila. He further claims that he was not motivated by
any deceitful intentions and had not caused any damage to the complainants because the amounts
of money given to him by the latter were actually spent for their medical tests and other documents
necessary for their overseas employment.
Article 13 (b) of the Labor Code defines "Recruitment and Placement" as:
Any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or
procuring workers, and includes referrals, contract services, promising or advertising
for employment, locally or abroad, whether for profit or not: Provided, That any
person or entity which, in any manner, offers or promises for a fee employment to
two or more persons shall be deemed engaged in recruitment and placement.
In the instant case, accused-appellant told complainants to submit to him their pictures, birth
certificates, NBI clearances and the necessary documents for the processing of their employment in
Saudi Arabia. Thereafter, accused-appellant collected from each of the complainants payment for
the their respective passport, training fee, placement fee, medical tests and other sundry expenses
which unquestionably constitutes acts of recruitment within the meaning of the law. Besides, there is
illegal recruitment when one gives the impression of his ability to send a worker abroad
5
and there is
evidence that accused-appellant had represented to the complainants that he could send them abroad as
janitors in Saudi Arabia. And because of his representation, complainants gave their hard-earned money
to accused-appellant in consideration of the same representation. As pointed out by the Solicitor General
in his brief:
It may be that at the time appellant recruited private complainants, he was then the
operations manager of the ZGR Placement Agency, a duly licensed recruitment
agency. But, as amply established by the evidence, the recruitment of private
complainants was appellant's own personal undertaking. He did not do it for the
agency. This is clearly shown by the sequence of events that led to the
consum[m]ation of the transaction in question. Thus: it was appellant who talked
private complainants into applying for employment abroad; when private
complainants signified their interest, he alone was the one who informed them of the
documents that they have to secure; he too was the one who demanded and
received from them the fees for medical examination, passport, authentication,
training, placement and psycho and AIDS test; also, he was the one who assured
them of employment abroad and of the return of their money in the event of their
non-deployment; moreover, it was he who undertook to inform private complainants
of their departure.
But that is not all. When private complainants failed to receive notice of their
departure as promised them by appellant, they had somebody verify with the POEA if
appellant was a licensed recruiter. This circumstance shows all the more that indeed
appellant represented himself to be the recruiter, otherwise it would have been the
status of the agency with which he allegedly worked for, that private complainants
would have requested to be verified.
6

As to accused-appellant's claim that he did not misappropriate the money given to him by the
complainants as he had turned over the latters' placement fees to Nora Cunanan, who subsequently
absconded with the complainant's money, the trial court correctly held that:
The version of the defense has the nature of a cock and bull story which is difficult
and hard to accept. It is something that is fantastic and ridiculous. It is within the
realm of fiction and patently a mere fabrication to exculpate the accused from the
consequences of his nefarious and deceitful activities. If it is really true that the
complainants were transferred and accommodated by the agency of Nora Cunanan,
why did not the accused and Mrs. Lydia Zamora who appear to be both intelligent
take the necessary prudence and caution of putting the supposed agreement to
transfer in writing considering the amounts of funds involved in the alleged transfer.
Logic and common sense dictate that under such a situation, the accused and Mrs.
Zamora take ordinary care of their concerns. To impress the court that there was
really a transfer made, the accused claimed that there was a estafa case filed
against Mrs. Cunanan before the City Fiscal's Office in Manila. It is however
surprising why Atty. Jose Torrefranca who was engaged by the accused to file the
estafa case did not present any letter-complaint or any charged sheet filed against
Mrs. Cunanan. He did not even mention the Fiscal who investigated the case. More
intriguing is the fact that counsel does not know what happened to the alleged case
of estafa after he filed the same. Likewise, when Mrs. Lydia Zamora declared, she
claimed that the case filed against Nora Cunanan was before the Regional Trial
Court and not in the City Fiscal's Office.
Defense also made capital of the special power of atty. executed by the
complainants (exhibit 4) and their letters sent to the accused (exhibits 5, 6, 7 and 8)
to convince the court that the real culprit in the whole mess in Nora Cunanan. The
complainants made convincing explanation why they signed the special power of
attorney. Wilfrey Mabalot declared that when the accused asked him to sign the
document, he was told that its purpose is to facilitate their departure and when he
signed the letter exhibit "6" he was just told to sign by the accused and because the
latter was in [a] hurry, he signed without knowing its contents. He likewise explained
that being a mere high school graduate he was not able to understand the imports of
its contents. Danilo Ramirez explained that when he signed the special power of
attorney, he did not read the contents because the accused was in [a] hurry in
returning to Manila and that he sent the three letters to the accused while he was
confined in jail because Manungas asked him to help him (accused) recover the
money given to Mrs. Cunanan. Leonardo Estanoco declared, that he signed exhibit
"4" because the accused told him that the document will be used to facilitate the
processing of their papers. He did not understand its contents because he only
understands little English.
7

Thus accused-appellant is guilty of the crimes of Estafa and Illegal Recruitment. Under Article 38 of
the Labor Code, as amended, the crime of illegal recruitment is qualified when the same is
committed against three (3) or more persons.
A person who violates any of the provisions under Article 13(b) and Article 34 of the Labor Code can
be charged and convicted separately of illegal recruitment and estafa [Revised Penal Code, Article
315, 2(a)] because illegal recruitment is a malum prohibitum where the criminal intent of the accused
is not necessary for a conviction while estafa is a malum in se where criminal intent of the accused is
necessary for a conviction.
WHEREFORE, finding the accused-appellant guilty of the crimes of estafa and illegal recruitment in
a large scale, decision of the trial court is hereby AFFIRMED.
SO ORDERED.
Narvasa, C.J., Padilla, Regalado and Puno, JJ., concur.











CASE NO. 7
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION

G.R. No. 113547 February 9, 1995
PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
vs.
ANITA BAUTISTA y LATOJA, accused-appellant.

PUNO, J .:
Four (4) separate Informations
1
were filed before the Regional Trial Court of Manila (Branch XLI)
against accused ANITA BAUTISTA y LATOJA, charging her with the crimes of Illegal Recruitment In
Large Scale
2
and Estafa.
3

Upon arraignment on January 29, 1992, accused pleaded NOT GUILTY.
4
The four (4) cases were
tried jointly.
After trial, the court a quo found accused guilty as charged.
5
In the illegal recruitment case, she was
meted the penalty of life imprisonment and ordered to pay P 100,000.00 as fine. In the estafa cases, she
was sentenced from two (2) years, eight (8) months and twenty one (21) days of prision correccional as
minimum, to six (6) years, five (5) months and eleven (11) days of prision mayor as maximum for each
count of estafa, and pay each complainant the amount of P40,000.00 as civil indemnity.
Accused, thru counsel, filed her Notice of Appeal, dated March 6, 1992, indicating her desire to
elevate her case to this Court.
6
The records of the case were, however, transmitted by the trial court to
the Court of Appeals. In its Decision
7
dated November 26, 1993, the appellate court affirmed appellant's
conviction. However, it modified the penalty for the three (3) estafa cases. The dispositive portion of the
decision of the appellate court states:
WHEREFORE, in Criminal Case No. 92-102377, the Court finds accused Anita
Bautista GUILTY BEYOND REASONABLE DOUBT of the crime of illegal
recruitment, described and penalized under Article 13 (b), Article 38 (a) and (b) and
Article 39 (a) of the Labor Code, and imposes upon her the penalty of life
imprisonment and fine of P100,000.00. . . .
Insofar as Criminal Case No. 92-102378, Criminal Case No. 92-102379 and Criminal
Case No. 92-102380, the Court renders judgment, finding accused Anita
Bautista GUILTY BEYOND REASONABLE DOUBT of the crime of estafa, described
and penalized under Article 315 par. 2 (a) of the Revised Penal Code, and
sentencing her in each criminal case to the indeterminate penalty of (sic) from FOUR
(4) YEARS and TWO (2) MONTHS of prision correccional, as minimum, to NINE (9)
YEARS of prision mayor, as maximum, and to pay each complainants Remigio
Fortes, Anastacio Amor and Dominador Costales, the amount of P40,000.00, without
subsidiary imprisonment in case of insolvency, with costs. Accordingly, the penalty
imposed upon accused by the lower court is MODIFIED.
IT IS SO ORDERED.
Pursuant to Section 13 of Rule 124, the appellate court elevated to us the records of the case for
review. Notice was given to appellant for her to file additional Brief if she so desires. None was filed
in her behalf.
The facts are as found by the appellate court:
Sometime in August 1991, accused Anita Bautista approached Romeo Paguio at the
latter's restaurant at 565 Padre Faura St., Manila, and offered job openings abroad.
At that time, Paguio had relatives who were interested to work abroad. Accused, who
also operated a restaurant nearby at Padre Faura, informed Paguio that she knew
somebody who could facilitate immediate employment in Taiwan for Paguio's
relatives. Accused Anita Bautista introduced Rosa Abrero to Paguio. Abrero informed
him that the applicants could leave for Taiwan within a period of one-month from the
payment of placement fees. They informed Paguio that the placement fee was
P40,000.00 for each person. Paguio contacted his relatives, complainants Remigio
Fortes and Dominador Costales who were his brothers-in-law, and Anastacio Amor,
a cousin, who lost no time raising the needed money and gave the same to Paguio.
The three were to work as factory workers and were to be paid $850.00 monthly
salary each. Paguio gave Rosa Abrero P20,000.00, which would be used in following
up the papers of the complainants; later he gave accused P40,000.00 and
P60,000.00 in separate amounts, totalling P100,000.00, as the remaining balance.
Abrero and accused Bautista promised Paguio and complainants that the latter could
leave for Taiwan before September 25, 1991. As September 25, 1991 approached,
accused Bautista informed Paguio and complainants that there was a delay in the
latter's departure because their tickets and visas had not yet been released. Accused
re-scheduled the complainants' departure to October 10, 1991. Came October 10,
1991, and complainants were still not able to leave. Paguio then required accused
Bautista to sign the "Acknowledgment Receipt," dated October 11, 1991, in which
accused admitted having received the sum of P100,000.00 from Paguio,
representing payment of plane tickets, visas and other travel documents (Exhibit A).
Paguio asked accused to return complainants' money; accused, however, promised
that complainants could leave for Taiwan before Christmas. From POEA, Paguio
secured a certification, dated January 9, 1992 attesting that Annie Bautista and Rosa
Abrero are not licensed or authorized to recruit workers for overseas employment
(Exhibit B). Complainants Fortes, Amor and Costales, as well as Paguio, gave their
written statements at the Office of the Assistant Chief Directorial Staff for Intelligence
of the WPDC, complaining about their being victims of illegal recruitment by Rosa
Abrero and Annie Bautista (Exhibits C, D, E and F).
The issue boils down to whether or not reasonable doubt exists to warrant the acquittal of appellant
Anita Bautista.
We find none.
The Labor Code defines recruitment and placement as referring to "any act of canvassing, enlisting,
contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contract
services, promising or advertising for employment, locally or abroad, whether for profit or
not: Provided that any person or entity which, in any manner, offers or promises for a fee
employment to two or more persons shall be deemed engaged in recruitment and placement."
8

It is settled that the essential elements of the crime of illegal recruitment in large scale are: (1) the
accused engages in the recruitment and placement of workers, as defined under Article 13 (b) or in
any prohibited activities under Article 34 of the Labor Code; (2) accused has not complied with the
guidelines issued by the Secretary of Labor and Employment, particularly with respect to the
securing of a license or an authority to recruit and deploy workers, either locally or overseas; and (3)
accused commits the same against three (3) or more persons, individually or a group.
9

For her exculpation, appellant denied she recruited complainants for employment abroad. She
claimed Romeo Paguio was the one who approached her and asked for someone who could help
his relatives work abroad. She thus introduced Rosa Abrero, a regular customer at her restaurant, to
Paguio. In turn, Paguio introduced Abrero to complainants in their subsequent meeting. Further,
appellant testified she was present during the recruitment of complainants since their meeting with
Abrero was held at her restaurant. Appellant likewise stressed she did not receive the amount of
P100,000.00, as stated in the Acknowledgment Receipt, dated October 11, 1991, but merely
acknowledged that said sum was received by Rosa Abrero from Romeo Paguio.
Appellant's defense does not persuade us.
Appellant's active participation in the recruitment process of complainants belies her claim of
innocence. Complainants' recruitment was initiated by appellant during her initial meeting with
Romeo Paguio. She gave the impression to Romeo Paguio and the complainants that her cohort,
Rosa Abrero, could send workers for employment abroad. She introduced Rosa Abrero to Romeo
Paguio. Both women assured the departure of complainants to Taiwan within one month from
payment of the placement fee of P40,000.00 per person. They even claimed that complainants
would work as factory workers for a monthly salary of $850.00 per person. Moreover, it was
appellant who informed Romeo Paguio that complainants' scheduled trip to Taiwan would be on
October 10, 1991, instead of the original departure date of September 25, 1991, due to some
problems on their visas and travel documents.
Her close association with Rosa Abrero is further strengthened by the Acknowledgment Receipt,
dated October 11, 1991, which was prepared by Romeo Paguio for the protection of complainants.
The receipt reads:
ACKNOWLEDGMENT RECEIPT
P100,000.00 October 11, 1991
RECEIVED FROM: ROMEO PAGUIO, the amount of ONE HUNDRED THOUSAND
(P100,000.00) PESOS, Philippine Currency, representing the payment (of) plane
ticket, visa and other travel documents.
CONFORME:
By:
(Sgd.) ROMEO PAGUIO (Sgd.) MRS. ANNIE BAUTISTA
c/o Rosa Abrero
SIGNED IN THE PRESENCE OF:
(Sgd.) Anastacio Amor Remigio Fortes
Dominador Costales
Said receipt shows that appellant collected the P100,000.00 for and in behalf of Rosa Abrero, and
bolsters Romeo Paguio's allegation that he gave P20,000.00 to Rosa Abrero, while the rest was
received by appellant. Notably, in its Decision, dated February 14, 1992, the trial court observed:
The denial(s) made by the accused of any participation in the recruitment of the
complainants do not persuade. The evidence at hand shows that she acknowledged
in writing the receipt of P100,000.00 from witness Romeo Paguio who was all along
representing the complainants in securing employment for them in Taiwan. Her
denial of having actually received the money in the sum of P100,000.00, the receipt
of which she voluntarily signed is not convincing. By her own admission, she is a
restaurant operator. In other words, she is a business woman. As such, she ought to
know the consequences in signing any receipt. That she signed Exh. "A" only goes to
show that fact, as claimed by Romeo Paguio, that she actually received the same.
It is uncontroverted that appellant and Rosa Abrero are not authorized or licensed to engage in
recruitment activities.
10
Despite the absence of such license or authority, appellant participated in the
recruitment of complainants. Since there are at least three (3) victims in this case, appellant is correctly
held criminally liable for illegal recruitment in large scale.
11

We shall now discuss appellant's culpability under the Revised Penal Code, specifically Article 315
thereof, inasmuch as her conviction for offenses under the Labor Code does not avert punishment
for offenses punishable by other laws.
12

The elements of estafa are as follows: (1) that the accused defrauded another (a) by abuse of
confidence, or (b) by means of deceit; and (2) that damage or prejudice capable of pecuniary
estimation is caused by the offended party or third party.
In the case at bench, it is crystal clear that complainants were deceived by appellant and Rosa
Abrero into believing that there were, indeed, jobs waiting for them in Taiwan. The assurances given
by these two (2) women made complainants part with whatever resources they have, in exchange
for what they thought was a promising job abroad. Thus, they sold their carabaos, mortgaged or sold
their parcels of land and even contracted loans to raise the much needed money, the P40,000.00
placement fee, required of them by accused and Rosa Abrero.
The penalty for estafa depends on the amount defrauded. Article 315 of the Revised Penal Code
provides: "the penalty of prision correccional in its maximum period to prision mayor in its minimum
period (or imprisonment ranging from 4 years, 2 months and 1 day to 8 years), if the amount of the
fraud is over P12,000.00 but does notexceed P22,000.00 pesos, and if such amount exceeds the
latter sum, the penalty provided in this paragraph shall be imposed in its maximum period (6 years, 8
months and 21 days to 8 years), adding one year for each additional P10,000.00 pesos; but the total
penalty which may be imposed shall not exceed twenty years. In such case, and in connection with
the accessory penalties which may be imposed and for the purpose of other provisions of this Code,
the penalty shall be termed prision mayor or reclusion temporal, as the case may be.
The amount defrauded in such estafa case (Criminal Case Nos. 92-102378, 92-102379, 92-102380)
is P 40,000.00. As prescribed in Article 315, supra, the penalty should be imposed in the maximum
period (6 years, 8 months and 21 days to 8 years) plus one (1) year, there being only one (1)
P10,000.00 in excess of P22,000.00. Applying the Indeterminate Sentence Law, the maximum
penalty should be taken from the aforesaid period, while the minimum term of the indeterminate
penalty shall be within the range of the penalty next lower in degree, that is prision correccional in
its minimum and medium periods which has a duration of 6 months, 1 day to 4 year and 2 months.
Considering the foregoing, the appellant court correctly imposed the indeterminate penalty of four (4)
years and two (2) months of prision correccional, as minimum, to nine (9) years of prision mayor, as
maximum.
WHEREFORE, premises considered, the decision of the Court of Appeals, finding appellant ANITA
BAUTISTA guilty beyond reasonable doubt of the crimes of Illegal Recruitment in Large
Scale (Criminal Case Nos. 92-102377) and Estafa (Criminal Case Nos. 92-102378, 92-102379, 92-
102380) is AFFIRMED. No Costs.
SO ORDERED.
Narvasa, C.J., Bidin, Regalado and Mendoza, JJ., concur.

















CASE NO. 8
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION

G.R. No. 113161 August 29, 1995
PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
vs.
LOMA GOCE y OLALIA, DAN GOCE and NELLY D. AGUSTIN, accused. NELLY D.
AGUSTIN, accused-appellant.

REGALADO, J .:
On January 12, 1988, an information for illegal recruitment committed by a syndicate and in large
scale, punishable under Articles 38 and 39 of the Labor Code (Presidential Decree No. 442) as
amended by Section 1(b) of Presidential Decree No. 2018, was filed against spouses Dan and Loma
Goce and herein accused-appellant Nelly Agustin in the Regional Trial Court of Manila, Branch 5,
alleging
That in or about and during the period comprised between May 1986 and June 25,
1987, both dates inclusive, in the City of Manila, Philippines, the said accused,
conspiring and confederating together and helping one another, representing
themselves to have the capacity to contract, enlist and transport Filipino workers for
employment abroad, did then and there willfully and unlawfully, for a fee, recruit and
promise employment/job placement abroad, to (1) Rolando Dalida y Piernas, (2)
Ernesto Alvarez y Lubangco, (3) Rogelio Salado y Savillo, (4) Ramona Salado y
Alvarez, (5) Dionisio Masaya y de Guzman, (6) Dave Rivera y de Leon, (7) Lorenzo
Alvarez y Velayo, and (8) Nelson Trinidad y Santos, without first having secured the
required license or authority from the Department of Labor.
1

On January 21, 1987, a warrant of arrest was issued against the three accused but not one of them
was arrested.
2
Hence, on February 2, 1989, the trial court ordered the case archived but it issued a
standing warrant of arrest against the accused.
3

Thereafter, on learning of the whereabouts of the accused, one of the offended parties, Rogelio
Salado, requested on March 17, 1989 for a copy of the warrant of arrest.
4
Eventually, at around
midday of February 26, 1993, Nelly Agustin was apprehended by the Paraaque police.
5
On March 8,
1993, her counsel filed a motion to revive the case and requested that it be set for hearing "for purposes
of due process and for the accused to immediately have her day in court"
6
Thus, on April 15, 1993, the
trial court reinstated the case and set the arraignment for May 3, 1993,
7
on which date of Agustin pleaded
not guilty
8
and the case subsequently went to trial.
Four of the complainants testified for the prosecution. Rogelio Salado was the first to take the
witness stand and he declared that sometime in March or April, 1987, he was introduced by Lorenzo
Alvarez, his brother-in-law and a co-applicant, to Nelly Agustin in the latter's residence at Factor,
Dongalo, Paraaque, Metro Manila. Representing herself as the manager of the Clover Placement
Agency, Agustin showed him a job order as proof that he could readily be deployed for overseas
employment. Salado learned that he had to pay P5,000.00 as processing fee, which amount he gave
sometime in April or May of the same year. He was issued the corresponding receipt.
9

Also in April or May, 1987, Salado, accompanied by five other applicants who were his relatives,
went to the office of the placement agency at Nakpil Street, Ermita, Manila where he saw Agustin
and met the spouses Dan and Loma Goce, owners of the agency. He submitted his bio-data and
learned from Loma Goce that he had to give P12,000.00, instead of the original amount of
P5,000.00 for the placement fee. Although surprised at the new and higher sum, they subsequently
agreed as long as there was an assurance that they could leave for abroad.
10

Thereafter, a receipt was issued in the name of the Clover Placement Agency showing that Salado
and his aforesaid co-applicants each paid P2,000.00, instead of the P5,000.00 which each of them
actually paid. Several months passed but Salado failed to leave for the promised overseas
employment. Hence, in October, 1987, along with the other recruits, he decided to go to the
Philippine Overseas Employment Administration (POEA) to verify the real status of Clover
Placement Agency. They discovered that said agency was not duly licensed to recruit job applicants.
Later, upon learning that Agustin had been arrested, Salado decided to see her and to demand the
return of the money he had paid, but Agustin could only give him P500.00.
11

Ramona Salado, the wife of Rogelio Salado, came to know through her brother, Lorenzo Alvarez,
about Nelly Agustin. Accompanied by her husband, Rogelio, Ramona went to see Agustin at the
latter's residence. Agustin persuaded her to apply as a cutter/sewer in Oman so that she could join
her husband. Encouraged by Agustin's promise that she and her husband could live together while
working in Oman, she instructed her husband to give Agustin P2,000.00 for each of them as
placement fee, or the total sum of P4,000.00.
12

Much later, the Salado couple received a telegram from the placement agency requiring them to
report to its office because the "NOC" (visa) had allegedly arrived. Again, around February, or
March, 1987, Rogelio gave P2,000.00 as payment for his and his wife's passports. Despite follow-up
of their papers twice a week from February to June, 1987, he and his wife failed to leave for
abroad.
13

Complainant Dionisio Masaya, accompanied by his brother-in-law, Aquiles Ortega, applied for a job
in Oman with the Clover Placement Agency at Paraaque, the agency's former office address.
There, Masaya met Nelly Agustin, who introduced herself as the manager of the agency, and the
Goce spouses, Dan and Loma, as well as the latter's daughter. He submitted several pertinent
documents, such as his bio-data and school credentials.
14

In May, 1986, Masaya gave Dan Goce P1,900.00 as an initial downpayment for the placement fee,
and in September of that same year, he gave an additional P10,000.00. He was issued receipts for
said amounts and was advised to go to the placement office once in a while to follow up his
application, which he faithfully did. Much to his dismay and chagrin, he failed to leave for abroad as
promised. Accordingly, he was forced to demand that his money be refunded but Loma Goce could
give him back only P4,000.00 in installments.
15

As the prosecution's fourth and last witness, Ernesto Alvarez took the witness stand on June 7,
1993. He testified that in February, 1987, he met appellant Agustin through his cousin, Larry Alvarez,
at her residence in Paraaque. She informed him that "madalas siyang nagpapalakad sa Oman" and
offered him a job as an ambulance driver at the Royal Hospital in Oman with a monthly salary of
about $600.00 to $700.00.
16

On March 10, 1987, Alvarez gave an initial amount of P3,000.00 as processing fee to Agustin at the
latter's residence. In the same month, he gave another P3,000.00, this time in the office of the
placement agency. Agustin assured him that he could leave for abroad before the end of 1987. He
returned several times to the placement agency's office to follow up his application but to no avail.
Frustrated, he demanded the return of the money he had paid, but Agustin could only give back
P500.00. Thereafter, he looked for Agustin about eight times, but he could no longer find her.
17

Only herein appellant Agustin testified for the defense. She asserted that Dan and Loma Goce were
her neighbors at Tambo, Paraaque and that they were licensed recruiters and owners of the Clover
Placement Agency. Previously, the Goce couple was able to send her son, Reynaldo Agustin, to
Saudi Arabia. Agustin met the aforementioned complainants through Lorenzo Alvarez who
requested her to introduce them to the Goce couple, to which request she acceded.
18

Denying any participation in the illegal recruitment and maintaining that the recruitment was
perpetrated only by the Goce couple, Agustin denied any knowledge of the receipts presented by the
prosecution. She insisted that the complainants included her in the complaint thinking that this would
compel her to reveal the whereabouts of the Goce spouses. She failed to do so because in truth, so
she claims, she does not know the present address of the couple. All she knew was that they had
left their residence in 1987.
19

Although she admitted having given P500.00 each to Rogelio Salado and Alvarez, she explained
that it was entirely for different reasons. Salado had supposedly asked for a loan, while Alvarez
needed money because he was sick at that time.
20

On November 19, 1993, the trial court rendered judgment finding herein appellant guilty as a
principal in the crime of illegal recruitment in large scale, and sentencing her to serve the penalty of
life imprisonment, as well as to pay a fine of P100,000.00.
21

In her present appeal, appellant Agustin raises the following arguments: (1) her act of introducing
complainants to the Goce couple does not fall within the meaning of illegal recruitment and
placement under Article 13(b) in relation to Article 34 of the Labor Code; (2) there is no proof of
conspiracy to commit illegal recruitment among appellant and the Goce spouses; and (3) there is no
proof that appellant offered or promised overseas employment to the complainants.
22
These three
arguments being interrelated, they will be discussed together.
Herein appellant is accused of violating Articles 38 and 39 of the Labor Code. Article 38 of the Labor
Code, as amended by Presidential Decree No. 2018, provides that any recruitment activity, including
the prohibited practices enumerated in Article 34 of said Code, undertaken by non-licensees or non-
holders of authority shall be deemed illegal and punishable under Article 39 thereof. The same
article further provides that illegal recruitment shall be considered an offense involving economic
sabotage if any of these qualifying circumstances exist, namely, (a) when illegal recruitment is
committed by a syndicate, i.e., if it is carried out by a group of three or more persons conspiring
and/or confederating with one another; or (b) when illegal recruitment is committed in large
scale, i.e., if it is committed against three or more persons individually or as a group.
At the outset, it should be made clear that all the accused in this case were not authorized to engage
in any recruitment activity, as evidenced by a certification issued by Cecilia E. Curso, Chief of the
Licensing and Regulation Office of the Philippine Overseas Employment Administration, on
November 10, 1987. Said certification states that Dan and Loma Goce and Nelly Agustin are neither
licensed nor authorized to recruit workers for overseas
employment.
23
Appellant does not dispute this. As a matter of fact her counsel agreed to stipulate that
she was neither licensed nor authorized to recruit applicants for overseas employment. Appellant,
however, denies that she was in any way guilty of illegal recruitment.
24

It is appellant's defensive theory that all she did was to introduce complainants to the Goce spouses.
Being a neighbor of said couple, and owing to the fact that her son's overseas job application was
processed and facilitated by them, the complainants asked her to introduce them to said spouses.
Allegedly out of the goodness of her heart, she complied with their request. Such an act, appellant
argues, does not fall within the meaning of "referral" under the Labor Code to make her liable for
illegal recruitment.
Under said Code, recruitment and placement refers to any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring workers, and includes referrals, contract services,
promising or advertising for employment, locally or abroad, whether for profit or not; provided, that
any person or entity which, in any manner, offers or promises for a fee employment to two or more
persons shall be deemed engaged in recruitment and placement.
25
On the other hand, referral is the
act of passing along or forwarding of an applicant for employment after an initial interview of a selected
applicant for employment to a selected employer, placement officer or bureau.
26

Hence, the inevitable query is whether or not appellant Agustin merely introduced complainants to
the Goce couple or her actions went beyond that. The testimonial evidence hereon show that she
indeed further committed acts constitutive of illegal recruitment. All four prosecution witnesses
testified that it was Agustin whom they initially approached regarding their plans of working
overseas. It was from her that they learned about the fees they had to pay, as well as the papers
that they had to submit. It was after they had talked to her that they met the accused spouses who
owned the placement agency.
As correctly held by the trial court, being an employee of the Goces, it was therefore logical for
appellant to introduce the applicants to said spouses, they being the owners of the agency. As such,
appellant was actually making referrals to the agency of which she was a part. She was therefore
engaging in recruitment activity.
27

Despite Agustin's pretensions that she was but a neighbor of the Goce couple, the testimonies of the
prosecution witnesses paint a different picture. Rogelio Salado and Dionisio Masaya testified that
appellant represented herself as the manager of the Clover Placement Agency. Ramona Salado was
offered a job as a cutter/sewer by Agustin the first time they met, while Ernesto Alvarez remembered
that when he first met Agustin, the latter represented herself as "nagpapaalis papunta sa
Oman."
28
Indeed, Agustin played a pivotal role in the operations of the recruitment agency, working
together with the Goce couple.
There is illegal recruitment when one gives the impression of having the ability to send a worker
abroad."
29
It is undisputed that appellant gave complainants the distinct impression that she had the
power or ability to send people abroad for work such that the latter were convinced to give her the money
she demanded in order to be so employed.
30

It cannot be denied that Agustin received from complainants various sums for purpose of their
applications. Her act of collecting from each of the complainants payment for their respective
passports, training fees, placement fees, medical tests and other sundry expenses unquestionably
constitutes an act of recruitment within the meaning of the law. In fact, appellant demanded and
received from complainants amounts beyond the allowable limit of P5,000.00 under government
regulations. It is true that the mere act of a cashier in receiving money far exceeding the amount
allowed by law was not considered per se as "recruitment and placement" in contemplation of law,
but that was because the recipient had no other participation in the transactions and did not conspire
with her co-accused in defrauding the victims.
31
That is not the case here.
Appellant further argues that "there is no evidence of receipts of collections/payments from
complainants to appellant." On the contrary, xerox copies of said receipts/vouchers were presented
by the prosecution. For instance, a cash voucher marked as Exhibit D,
32
showing the receipt of
P10,000.00 for placement fee and duly signed by appellant, was presented by the prosecution. Another
receipt, identified as Exhibit E,
33
was issued and signed by appellant on February 5, 1987 to
acknowledge receipt of P4,000.00 from Rogelio and Ramona Salado for "processing of documents for
Oman." Still another receipt dated March 10, 1987 and presented in evidence as Exhibit F, shows that
appellant received from Ernesto Alvarez P2,000.00 for "processing of documents for Oman."
34

Apparently, the original copies of said receipts/vouchers were lost, hence only xerox copies thereof
were presented and which, under the circumstances, were admissible in evidence. When the original
writing has been lost or destroyed or cannot be produced in court, upon proof of its execution and
loss or destruction, or unavailability, its contents may be proved by a copy or a recital of its contents
in some authentic document, or by the recollection of witnesses.
35

Even assuming arguendo that the xerox copies presented by the prosecution as secondary evidence
are not allowable in court, still the absence thereof does not warrant the acquittal of appellant.
In People vs. Comia,
36
where this particular issue was involved, the Court held that the complainants'
failure to ask for receipts for the fees they paid to the accused therein, as well as their consequent failure
to present receipts before the trial court as proof of the said payments, is not fatal to their case. The
complainants duly proved by their respective testimonies that said accused was involved in the entire
recruitment process. Their testimonies in this regard, being clear and positive, were declared sufficient to
establish that factum probandum.
Indeed, the trial court was justified and correct in accepting the version of the prosecution witnesses,
their statements being positive and affirmative in nature. This is more worthy of credit than the mere
uncorroborated and self-serving denials of appellant. The lame defense consisting of such bare
denials by appellant cannot overcome the evidence presented by the prosecution proving her guilt
beyond reasonable doubt.
37

The presence of documentary evidence notwithstanding, this case essentially involves the credibility
of witnesses which is best left to the judgment of the trial court, in the absence of abuse of discretion
therein. The findings of fact of a trial court, arrived at only after a hearing and evaluation of what can
usually be expected to be conflicting testimonies of witnesses, certainly deserve respect by an
appellate court.
38
Generally, the findings of fact of the trial court on the matter of credibility of witnesses
will not be disturbed on appeal.
39

In a last-ditch effort to exculpate herself from conviction, appellant argues that there is no proof of
conspiracy between her and the Goce couple as to make her liable for illegal recruitment. We do not
agree. The evidence presented by the prosecution clearly establish that appellant confabulated with
the Goces in their plan to deceive the complainants. Although said accused couple have not been
tried and convicted, nonetheless there is sufficient basis for appellant's conviction as discussed
above.
In People vs. Sendon,
40
we held that the non-prosecution of another suspect therein provided no ground
for the appellant concerned to fault the decision of the trial court convicting her. The prosecution of other
persons, equally or more culpable than herein appellant, may come later after their true identities and
addresses shall have been ascertained and said malefactors duly taken into custody. We see no reason
why the same doctrinal rule and course of procedure should not apply in this case.
WHEREFORE, the appealed judgment of the court a quo is hereby AFFIRMED in toto, with costs
against accused-appellant Nelly D. Agustin.
SO ORDERED.
Narvasa, C.J., Puno, Mendoza and Francisco, JJ., concur.