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American President Lines v. Hon. Jacobo Clave (Pres. Exec. Assistant Office of the Pres.

), NLRC, Ministry of
Labor, Maritime Security Union, Indiv. Complainnats headed by Julian Advincula and Sheriff Leon Navea; June
29, 1989; Barredo, J.
Facts

Company went into a contract with Marine Security Agency to guard their vessels in the port. Contract was for 1
year and may only be terminated by either party upon 30 days notice. The arrangement was that Marine Security
Agency would hire and assign the guards, lump sum given to agency who in turn determined the compensation of
the individual watchmen.
Contract was terminated and they executed a new contract with the Phil. Scout Veterans Security and
Investigation Agency.
Union abolished themselves due to termination of contract, inability of Agency to provide employment and inability
of members and Union to provide maintenance.
Respondents claim that that the termination of the contract was primarily because of misunderstanding that had
intervened between the APL represented by your Capt. Morris, and Mr. A. Tinsay, operator of said watchmens
agency, and that the operator of the Marine Security Agency then allegedly threatened to cause trouble to the
APL, and particularly to Capt. Morris. Union soon passed reso reviving itself.
Individual complainants headed by Julian Advincula filed ULP against petitioner company. Their complaint,
wherein they charged that the petitioner had refused to negotiate an agreement with them and had discriminated
against them with regard to their tenure of employment by dismissing them on January 1, 1961, for no other
reason than their membership with the union and union activities, was lodged with the defunct Court of Industrial
Relations. But case transferred to NLRC due to legislation
LA: found for complainants, reinstatement+backwages NLRC, Minister of Labor and Office of Pres. Affirmed.

ISSUE: WON there existed an employer-employee relationship between the petitioner and the individual watchmen of the
Marine Security Agency who are alleged to be members of the respondent union?
HELD: NO. Complaint for ULP dismissed.

To determine the existence of ER-EE rel: (1) selection and engagement of the EE (2) payment of wages (3) power of
dismissal (4) power to control the EEs conduct (most important element)
The Court fails to see how the complaining watchmen of the Marine Security Agency can be considered as employees of
the petitioner. It is the agency that recruits, hires, and assigns the work of its watchmen. Hence, a watchman can not
perform any security service for the petitioners vessels unless the agency first accepts him as its watchman. With respect
to his wages, the amount to be paid to a security guard is beyond the power of the petitioner to determine. Also no power
to dismiss (can ask to change guard but agency still has final say) and contract has clearly ended
It necessarily follows that petitioner cannot be guilty of ULP as charged by the private respondents. Under RA 875, Sec.
13, a ULP may committed only within the context of the EE-ER relationship
On the ULP issue, desire to negotiate agreement must be expressed through a written notice (no showing in this case), no
evidence that termination was due to alleged union activities
The most telling evidence of the shallowness of private respondents charge of unfair labor practice is the respondent
unions own resolution to abolish itself. If respondent union felt aggrieved by the unfair labor practice it had imputed to the
petitioner, why did it abolish itself? Instead of putting an end to its own existence, why did it not prosecute its charge with
dispatch considering that an unfair labor practice by an employer is an affront against the very integrity and existence of a
union?
What is worse is that in its resolution of abolition, the respondent union confessed that it is the Marine Security Agency
that provided employment to its members. To Our minds, there can be no clearer proof that such an admission that it is
indeed the agency, not the petitioner, that is the employer of its watchmen.