Atok Big Wedge Company, Inc.

vs Gison
G.R. No. 169510 | August 8, 2011
PERALTA, J.

DIGEST BY: Mac Duguiang Jr.

SUMMARY:
Respondent was a consultant on retainer working for 11 years in the company. He asked to be
registered with SSS. Company declined. Respondent filed a complaint with SSS. Because of this he
was terminated. Respondent filed a complaint for illegal dismissal.

SC said there is no employer-employee relationship. Dismissal is valid.

FACTS:

 February 1992, Respondent Jesus Gison was engaged as part-time consultant on retainer
basis by Petitioner Atok Big Wedge Company.

 Nature of work (may not be important):

o Respondent assisted Company's retained legal counsel with matters pertaining to

the prosecution of cases against illegal surface occupants within the area covered by
the company's mineral claims.

o Petitioner did not require respondent to report to its office on a regular basis, except
when occasionally requested by the management to discuss matters needing his
expertise as a consultant.

o Respondent received a retainer fee of ₱3,000.00 a month

 The parties executed a retainer agreement, but such agreement was misplaced and can no
longer be found.

 The said arrangement continued for the next eleven years.

 Sometime thereafter, since respondent was getting old (56 yo), he requested that petitioner
cause his registration with SSS,

 Petitioner did not accede to his request considering that he was only a retainer/consultant.

 Respondent filed a Complaint with the SSS against petitioner.

 On the same date, Mario Cera, as manager of petitioner, issued a Memorandum terminating
respondent’s retainer contract with the company within 30 days.

 Respondent filed a Complaint for illegal dismissal with the NLRC

 o After he was able to resolve company legal problems (crop damage claims by
farmers and the controversy on share on partnership with Benguet Corporation), he
was permanently assigned by Atok to take charge of some liaison matters and public
relations in Baguio and Benguet Province

o In the succeeding years of his employment, he was designated as liaison officer,

public relation officer and legal assistant.

o Merely because of his filing of complaint with the SSS, petitioner terminated his
services.

 Labor Arbiter Rolando D. Gambito rendered a Decision ruling in favor of the petitioner

company.

o Found no employer-employee relationship between petitioner and respondent

 Respondent then appealed the decision to the NLRC.

o NLRC affirmed the decision of the Labor Arbiter

 Respondent filed a petition before the CA

o CA annulled and set aside the decision of the NLRC

 Applied Article 280 which distinguishes between two kinds of employees, i.e.,
regular and casual employees.

 Respondent is deemed a regular employee of the petitioner after the

lapse of one year from his employment.

 Hence, the petition before the SC

 Petitioner argues that:

o CA erred in applying Article 280

 The said article only set the distinction between a casual employee from a
regular employee for purposes of determining the rights of an employee to be
entitled to certain benefits.

 It is inapplicable where the existence of an employer-employee relationship is

in dispute
ISSUES:

WN an employer-employee relationship exists between petitioner and respondent.

o The existence of an employer-employee relationship is ultimately a question of fact and the

findings thereon by the Labor Arbiter and the NLRC shall be accorded respect and finality
when supported by substantial evidence.

o Being supported by substantial evidence, such determination should have been

accorded great weight by the CA in resolving the issue.

o To ascertain the existence of an employer-employee relationship jurisprudence has

invariably adhered to the four-fold test, to wit:

o (1) the selection and engagement of the employee;

o (2) the payment of wages;

o (3) the power of dismissal; and

o (4) the power to control the employee's conduct, or the so-called "control test." 

o 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.

o Under the control test, an employer-employee relationship exists where the

person for whom the services are performed reserves the right to control not
only the end achieved, but also the manner and means to be used in reaching
that end.

o Applying the aforementioned test, an employer-employee relationship is apparently absent in

the case at bar.

o Respondent was not required to report everyday during regular office hours of
petitioner.

o Respondent's monthly retainer fees were paid to him either at his residence or a
local restaurant.

o Petitioner did not prescribe the manner in which respondent would accomplish any of
the tasks in which his expertise as a liaison officer was needed

o Respondent was left alone and given the freedom to accomplish the tasks using his
own means and method.
 o Respondent was assigned tasks to perform, but petitioner did not control the manner
and methods by which respondent performed these tasks.

o Verily, the absence of the element of control on the part of the petitioner engenders a
conclusion that he is not an employee of the petitioner.

o Moreover, respondent clearly admitted that petitioner hired him in a limited capacity only and
that there will be no employer-employee relationship between them as averred in
respondent's Position Paper

o “It was also agreed by Mr. Torres and the complainant that his participation on this
particular problem of Atok will be temporary since the problem was then
contemplated to be limited in nature, hence, there will be no employer-employee
relationship between him and Atok.”

o Furthermore, despite the fact that petitioner made use of the services of respondent for
eleven years, he still cannot be considered as a regular employee of petitioner.

o Article 280 of the Labor Code is not applicable in the case at bar.

o The said provision is not the yardstick for determining the existence of an
employment relationship because it merely distinguishes between two kinds of
employees, i.e., regular employees and casual employees, for purposes of
determining the right of an employee to certain benefits, to join or form a union, or to
security of tenure;

o it does not apply where the existence of an employment relationship is in dispute.

o Considering that there is no employer-employee relationship between the parties, the

termination of respondent did not constitute illegal dismissal warranting.

RULING:

WHEREFORE, the petition is GRANTED. The Decision and the Resolution of the Court of Appeals
are REVERSED and SET ASIDE.

SO ORDERED.