I.

THE FACTS, BRIEFLY

The President of respondent company hired complainant as a
personal driver in Manila. After a misunderstanding between said
President and Complainant, the latter constructively resigned by going
on an Absence WithOut Leave (AWOL), a fact which was duly
acknowledged by the President. Comes now Complainant suing
respondent company raising money claims before the labor arbiter.
II. ISSUE RAISED BY RESPONDENT:
Existence of the employer-employee relationship between
complainant and respondent.
III. DISCUSSION
A. The right to raise a labor dispute against respondent
company in hinged on the existence of the employer-employee
relationship, which is a question of fact, which must be proved
by substantial evidence.
1. Complainant has not produced any proof that he is an employee
of respondent company. He has presented no Identification Card
issued by the respondent, he is not included in the official
payroll, nor did he go through the formal hiring processes of
respondent company. He was merely handpicked by the
company President to be his driver. In case of Javier v. Fly Ace
Corporation1 the court belied the claim of complainant that he
was an employee of respondent corporation due to the fact that
he had not presented evidence to that effect, not being able to
produce evidence such as the Company ID or any pay slips. The
case reiterates the basic rule of evidence in relation to labor
cases, to quote:
In dealing with factual issues in labor cases, substantial evidence that
amount of relevant evidence which a reasonable mind might accept as adequate
to justify a conclusion is sufficient Although Section 10, Rule VII of the New
Rules of Procedure of the NLRC allows a relaxation of the rules of procedure
and evidence in labor cases, this rule of liberality does not mean a complete
dispensation of proof. Labor officials are enjoined to use reasonable means to
ascertain the facts speedily and objectively with little regard to technicalities or
formalities but nowhere in the rules are they provided a license to completely
discount evidence, or the lack of it. The quantum of proof required, however,
must still be satisfied.
The case of Lopez v. Bodega City2 also enumerated other possible evidence of
employment a contract of employment, SSS, or even Medicare forms, in addition to
emphasizing the determinative power of the 4-Fold Test.
B. The existence of the employer-employee relationship may be
subjected to the Four Fold Test as held in Pacific Consultants
International Asia, Inc. v. Schonfeld3
2. Under the Four Fold Test, otherwise known as the control test, the
employee must first prove that he: (a) he was selected and engaged by
the employer; (b) that the employer pays his wages; (c) that the
employer has the power to dismiss him; and, (d) that the employee
has the power to control his conduct.

1 G.R. No. 192558, Feb. 15, 2012

2 G.R. No. 155731, Sept. 3, 2007
3 G.R. No. 166920, Feb. 19, 2007

C. The employee has not proven that he was selected and engaged
by respondent company.
3. Respondent company did not select, nor engage complainant. Rather,
it was the company President that selected the complainant based on
a personal recommendation made to him by an acquaintance.
D. The company President pays the employees wages.
4. Wages of complainant are paid directly by the company President, thru
personal funds, only subject to reimbursement by the company as a
fringe benefit to which the company President is entitled to by virtue of
his position.
5. Revenue Regulation No. 03-98 defines fringe benefits as:

"FRINGE BENEFIT" means any good, service, or other benefit

furnished or granted by an employer in cash or in kind, in
addition to basic salaries, to an individual employee (except rank
and file employee as defined in these regulations) such as, but
not limited to the following:
xxx
(4) Household personnel, such as maid, driver and others;

6. The company merely reimburses the salary paid by the company

President as allowed by Revenue Regulation No. 03-98 in the
guidelines for implementation of the said fringe benefit located in
the same regulation:
(4) Household expenses Expenses of the employee
which are borne by the employer for household
personnel, such as salaries of household help,
personal driver of the employee, or other similar
personal expenses (like payment for homeowners
association dues, garbage dues, etc.) shall be treated as
taxable fringe benefits.
7. The company also has taken upon itself the registration
and payment of the GSIS, SSS, and Pag-Ibig dues of the
complainant as part and parcel of the fringe benefit
granted by the company to the company President.
E. Respondent company does not have control over the person
of the complainant.
8. Respondent company had absolutely no control over the person
of the complainant, instead being subject to the beck and call of
the company President in his personal capacity. He was never
subject to the control of any other person in the company, nor
was he required to report at respondents base of operations in
Surigao nor were his working hours monitored by any person
other than the company President.
9. Even considering if respondent corporation exercised a degree of
control over the person of complainant, the case of Consulta v.
Court of Appeals4. It was held that:
It should, however, be obvious that not every form of
control that the hiring party reserves to himself over the
4 G.R. No. 145443, March 18, 2005,

conduct of the party hired in relation to the services

rendered may be accorded the effect of establishing an
employer-employee relationship between them in the legal
or technical sense of the termRealistically, it would be a
rare contract of service that gives untrammeled freedom
to the party hired and eschews any intervention
whatsoever in his performance of the engagement.
F. Respondent did not have the power to terminate employees
services.
10.
Respondent had no power to dismiss complainant, there
being no relationship between them other than the
reimbursement of the employer for the complainants salary, and
the registration and payment of his dues for the SSS,
GSIS, and Pag-Ibig.
G. The Two Tiered,
application in this case:

Economic

Dependence

Test

finds

11.
The case of Francisco v. NLRC5 provides that the two tiered
test is especially appropriate in this case where there is
no written agreement or terms of reference to base the
relationship on; and due to the complexity of the relationship
based on the various positions and responsibilities given to the
worker over the period of the latters employment.
12.

The same case pronounces the economic dependence test:

The proper standard of economic dependence is whether
the worker is dependent on the alleged employer for his
continued employment in that line of business.

13.
Complainant is not dependent upon respondent for his
continued employment. The payment of his salaries is not
sourced directly from respondent, but rather from the company
president, reimbursed to the latter as a fringe benefit by virtue of
his position in respondent company. The loss of the same benefit
will not result in complainants automatic dismissal from service,
proving that he is not the employee of respondent not being
economically dependent on the respondent.

5 G.R. No. 170078, Aug. 31, 2006