Angel Jardin vs NLRC and Goodman Taxi (Philjama International Inc.

FACTS:
Petitioners were drivers of the respondent, a domestic corporation engaged in the operation of Goodman
Taxi. Petitioners used to drive the taxi of the respondents on a 24 hour work schedule under the boundary system
and they would earn an average of 400 a day. Nevertheless, the respondent admittedly regularly deducts from the
petitioners daily earnings 30 pesos for the washing of the taxi units. Believing that the deduction is illegal, petitioners
decided to form a labor union to protect their rights and interest. Upon learning of this by the respondent, he refused
to let the petitioners to drive his taxi units, the latter suspected that they were singled out because they are the active
members of the union. Thereafter, they filed a complaint to the labor arbiter for unfair labor practice, illegal dismissal
and illegal deduction of the washing fees. The labor arbtiter dismissed the complaint, but was reversed by the NLRC.
Respondent filed for a motion for reconsideration but was denied, remaining hopeful, again filed a motion for
reconsideration for the second time and was entertained and an order was rendered in their favour. Petitioners, filed
for reconsideration.

ISSUE:
Whether or not employer-employee relationship exist.

HELD:
Yes. In the number of cases decided by the court, it ruled that the relationship between operators and drivers
under the boundary system is that of employer-employee and not of lessor-lessee as argued by the NLRC. The court
already explained that in the lease of chattels, the lessor loses complete control over the chattel leased although the
lessee cannot be reckless in the use thereof, otherwise he would be responsible for the damages to the lessor. In the
case of operators and drivers, the former exercise supervision and control over the latter. The management of the
business is in the owners hand. The owner as holder of the certificate of public convenience must see to it that the
drivers follow the route prescribed by the franchising authority. The fact that the drivers do not received fixed salary
but get only that excess of the boundary is not sufficient to withdraw the relationship between that of the employer-
employee. This is based in the four fold test provided to determine the relationship, to wit: (1) the selection and
engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control the
employee's conduct, or the so-called "control test." Of these four, the last one is the most important.The so-called
"control test" is commonly regarded as the most crucial and determinative indicator of the presence or absence of an
employer-employee relationship. Since the relationship was already determined the termination of employment was
illegal for it did not comply with the notice and hearing prior termination and further there was no just cause for such
termination. In the issue of the washing fee, the court held that it was a valid deduction. It is incumbent upon the
driver to restore the unit he has driven to the same clean condition when he took it out.