LU vs ENOPIA The payment of respondents’ wages based on the percentage share of the

fish catch would not be sufficient to negate the employer-employee

Same; Same; Equity Jurisdiction; Supreme Court; When there is a conflict relationship existing between them.
among the factual findings of the antecedent deciding bodies like the Labor
Arbiter (LA), the National Labor Relations Commission (NLRC) and the —The payment of respondents’ wages based on the percentage
Court of Appeals (CA), it is proper, in the exercise of the Supreme Court’s share of the fish catch would not be sufficient to negate the
(SC’s) equity jurisdiction, to review and reevaluate the factual issues and employer-employee relationship existing between them. As held in
to look into the records of the case and reexamine the questioned findings. Ruga v. NLRC, 181 SCRA 266 (1990): x x x [I]t must be noted
that petitioners received compensation on a percentage
—We reiterate the doctrine that the existence of an employer- commission based on the gross sale of the fish-catch, i.e., 13% of
employee relationship is ultimately a question of fact. Generally, the proceeds of the sale if the total proceeds exceeded the cost of
We do not review errors that raise factual questions. However, the crude oil consumed during the fishing trip, otherwise, only
when there is a conflict among the factual findings of the 10% of the proceeds of the sale. Such compensation falls within
antecedent deciding bodies like the LA, the NLRC and the CA, it is the scope and meaning of the term “wage” as defined under Article
proper, in the exercise of Our equity jurisdiction, to review and 97(f) of the Labor Code, thus: (f) “Wage” paid to any employee
reevaluate the factual issues and to look into the records of the shall mean the remuneration or earnings, however designated,
case and reexamine the questioned findings. In dealing with capable of being expressed in terms of money, whether fixed or
factual issues in labor cases, substantial evidence or that amount ascertained on a time, task, piece or commission basis, or other
of relevant evidence which a reasonable mind might accept as method of calculating the same, which is payable by an employer
adequate to justify a conclusion is sufficient. to an employee under a written or unwritten contract of
Labor Law; Employer-Employee Relationship; Elements of.— employment for work done or to be done, or for services rendered
or to be rendered, and included the fair and reasonable value, as
In determining the existence of an employer-employee determined by the Secretary of Labor, of board, lodging, or other
relationship, the following elements are considered: (1) the facilities customarily furnished by the employer to the employee.
selection and engagement of the workers; (2) the power to control
the worker’s conduct; (3) the payment of wages by whatever Regular Employees; Security of Tenure; As respondents were petitioner’s
means; and (4) the power of dismissal. We find all these elements regular employees, they are entitled to security of tenure under Section 3,
present in this case. It is settled that no particular form of Constitution.
evidence is required to prove the existence of an employer- As respondents were petitioner’s regular employees, they are
employee relationship. Any competent and relevant evidence to entitled to security of tenure under Section 3, Article XIII of the
prove the relationship may be admitted. 1987 Constitution. It is also provided under Article 279 of the
Control Test; It is not essential that the employer actually supervises the Labor Code, that the right to security of tenure guarantees the
performance of duties by the employee. It is enough that the former has a right of employees to continue in their employment absent a just
right to wield the power. or authorized cause for termination. Considering that respondents
were petitioner’s regular employees, the latter’s act of asking them
—It was established that petitioner exercised control over to sign the joint fishing venture agreement which provides that the
respondents. It should be remembered that the control test merely venture shall be for a period of one year from the date of the
calls for the existence of the right to control, and not necessarily agreement, subject to renewal upon mutual agreement of the
the exercise thereof. It is not essential that the employer actually parties, and may be pre-terminated by any of the parties before
supervises the performance of duties by the employee. It is the expiration of the one-year period, is violative of the former’s
enough that the former has a right to wield the power. security of tenure. And respondents’ termination based on their
refusal to sign the same, not being shown to be one of those just
causes for termination under Article 282, is, therefore, illegal.

1
Termination of Employment; Illegal Dismissals; Reinstatement; On August 25, 1997, petitioners filed their complaint for illegal dismissal,
Backwages; An employee who is unjustly dismissed from work shall be monetary claims and damages. Petitioners alleged that their refusal to sign
entitled to reinstatement without loss of seniority rights and other the Joint Venture Fishing Agreement is not a just cause for their
privileges and to his full backwages, inclusive of allowances, and to his termination.
other benefits or their monetary equivalent computed from the time his
compensation was withheld from him up to the time of his actual
reinstatement. On the other hand, Lu denied having dismissed petitioners, claiming that
their relationship was one of joint venture where he provided the vessel
—An employee who is unjustly dismissed from work shall be and other fishing paraphernalia, while petitioners, as industrial partners,
entitled to reinstatement without loss of seniority rights and other provided labor by fishing in the high seas. Lu alleged that there was no
privileges and to his full backwages, inclusive of allowances, and to employer-employee relationship as its elements were not present
his other benefits or their monetary equivalent computed from the
time his compensation was withheld from him up to the time of his
HELD; YES
actual reinstatement. Respondents who were unjustly dismissed
from work are entitled to reinstatement and backwages, among
others. However, We agree with the CA that since most (if not all)
of the respondents are already employed in different deep-sea
fishing companies, and considering the strained relations between
MGTR and the respondents, reinstatement is no longer viable.
Thus, the CA correctly ordered the payment to each respondent his
separation pay equivalent to one month for every year of service
reckoned from the time he was hired as fishermen-crew member
of F/B MG-28 by MGTR until the finality of this judgment.

FACTS:

Respondents were hired from January 20, 1994 to March 20, 1996 as crew
members of the fishing mother boat F/B MG-28 owned by respondent
Joaquin "Jake" Lu (herein petitioner Lu) who is the sole proprietor of
Mommy Gina Tuna Resources [MGTR] based in General Santos City.
Petitioners and Lu had an income-sharing arrangement wherein 55% goes
to Lu, 45% to the crew members, with an additional 4% as "backing
incentive." They also equally share the expenses for the maintenance and
repair of the mother boat, and for the purchase of nets, ropes and payaos.

Sometime in August 1997, Lu proposed the signing of a Joint Venture

Fishing Agreement between them, but petitioners refused to sign the same
as they opposed the one-year term provided in the agreement. According
to petitioners, during their dialogue on August 18, 1997, Lu terminated
their services right there and then because of their refusal to sign the
agreement.

2
Arica vs. National Labor Relations Commission time’ within the purview of Section 5, Rule I, Book III of the Rules and
Regulations Implementing the Labor Code.
Labor Relations; “Waiting Time”; The 30-minute assembly time practiced
by the employees of the company (private respondent), cannot be
Furthermore, the thirty (30)-minute assembly is a deeply-rooted, routinary
considered “waiting time”, and is therefore not compensable. practice of the employees, and the proceedings attendant thereto are not
—Noteworthy is the decision of the Minister of Labor, on May 12, infected with complexities as to deprive the workers the time to attend to
other personal pursuits. In short, they are not subject to the absolute
1978 in the aforecited case (Associated Labor Union vs. Standard
control of the company during this period, otherwise, their failure to report
(Phil.) Fruit Corporation, NLRC Case No. 26-LS-XI-76) where
in the assembly time would justify the company to impose disciplinary
significant findings of facts and conclusions had already been made measures.
on the matter. The Minister of Labor held: “The thirty (30)-minute
assembly time long practiced and institutionalized by mutual
consent of the parties under Article IV, Section 3, of the Collective
Bargaining Agreement cannot be considered as ‘waiting time’
within the purview of Section 5, Rule I, Book III of the Rules and
Regulations Implementing the Labor Code. x x x Furthermore, the
thirty (30)-minute assembly is a deeply-rooted, routinary practice
of the employees, and the proceedings attendant thereto are not
infected with complexities as to deprive the workers the time to
attend to other personal pursuits. They are not new employees as
to require the company to deliver long briefings regarding their
respective work assignments. Their houses are situated right on
the area where the farms are located, such that after the roll call,
which does not necessarily require the personal presence, they can
go back to their houses to attend to some chores. In short, they
are not subject to the absolute control of the company during this
period, otherwise, their failure to report in the assembly time
would justify the company to impose disciplinary measures.”

Teofilo Arica et al and 561 others sued Standard Fruits Corporation

(STANFILCO) Philippines for allegedly not paying the workers for their
assembly time which takes place every work day from 5:30am to 6am.
The assembly time consists of the roll call of the workers; their getting of
assignments from the foreman; their filling out of the Laborer’s Daily
Accomplishment Report; their getting of tools and equipment from the
stockroom; and their going to the field to work. The workers alleged that
this is necessarily and primarily for STANFILCO’s benefit.

ISSUE: Whether or not the worker’s assembly time should be paid.

HELD: No. The thirty minute assembly time long practiced and
institutionalized by mutual consent of the parties under Article IV, Section
3, of the Collective Bargaining Agreement cannot be considered as ‘waiting

3
 which they are individually assigned is completed, they would be
assigned to the next project or a phase thereof. In other words,
they belonged to a 'work pool' from which the company would
draw workers for assignment to other projects at its discretion.
They are, therefore, actually 'non-project employees.'" From the
foregoing, it is clear that petitioner is a project employee
considering that he does not belong to a "work pool" from which
Hilario Rada Vs NLRC the company would draw workers for assignment to other projects
at its discretion. It is likewise apparent from the facts obtaining
herein that petitioner was utilized only for one particular project,
Labor Law; Appeals; Technical rules not binding and prior resort to
the MNEE Stage 2 Project of respondent company. Hence, the
amicable settlement; An appeal by the employer may be perfected only
termination of herein petitioner is valid by reason of the
upon the posting of a cash or surety bond.
completion of the project and the expiration of his employment
contract.
—While it is true that the payment of the supersedeas bond is an
essential requirement in the perfection of an appeal, however,
Conditions of Employment; Hours of Work; Hours worked shall include all
where the fee had been paid although payment was delayed, the
time during which an employee is suffered or permitted to work.
broader interests of justice and the desired objective of resolving
controversies on the merits demands that the appeal be given due
course. Besides, it was within the inherent power of the NLRC to —Anent the claim for overtime compensation, we hold that
have allowed late payment of the bond, considering that the petitioner is entitled to the same. The fact that he picks up
aforesaid decision of the labor arbiter was received by private employees of Philnor at certain specified points along EDSA in
respondent on October 3, 1989 and its appeal was duly filed on going to the project site and drops them off at the same points on
October 13, 1989. However, said decision did not state the amount his way back from the field office going home to Marikina, Metro
awarded as backwages and overtime pay, hence the amount of the Manila is not merely incidental to petitioner's job as a driver. On
supersedeas bond could not be determined. It was only in the the contrary, said transportation arrangement had been adopted,
order of the NLRC of February 16,1990 that the amount of the not so much for the convenience of the employees, but primarily
supersedeas bond was specified and which bond, after an for the benefit of the employer, herein private respondent. This
extension granted by the NLRC, was timely filed by private fact is inevitably deducible from the Memorandum of respondent
respondent. company: "The herein Respondent resorted to the above transport
arrangement because from its previous project construction
supervision experiences, Respondent found out that project delays
Termination of Employment; Where the employment has been fixed for a
and inefficiencies resulted from employees' tardiness; and that the
specific project or undertaking the completion or termination of which has
problem of tardiness, in turn, was aggravated by transportation
been determined at the time of the engagement of the employee, the
problems, which varied in degrees in proportion to the distance
employment is not to be deemed regular.
between the project site and the employees' residence. In view of
this lesson from experience, and as a practical, if expensive,
—A non-project employee is different in that the employee is hired solution to employees' tardiness and its concomitant problems,
for more than one project. A non-project employee, vis-a-vis a Respondent adopted the policy of allowing certain employees—not
project employee, is best exemplified in the case of Fegurin, et al. necessarily project drivers—to bring home project vehicles, so that
vs. National Labor Relations Commission, et al. wherein four of the employees could be afforded fast, convenient and free
petitioners had been working with the company for nine years, one transportation to and from the project field office.
for eight years, another for six years, the shortest term being
three years. In holding that petitioners are regular employees, this
Court therein explained: "Considering the nature of the work of
petitioners, that of carpenter, laborer or mason, their respective
jobs would actually be continuous and on-going. When a project to
4
In 1977, Hilario Rada was contracted by Philnor Consultants and Planners, drops them off at the same points on his way back from the field office
Inc. as a driver. He was assigned to a specific project in Manila. The going home to Marikina, Metro Manila is not merely incidental to Rada’s
contract he signed was for 2.3 years. His task was to drive employees to job as a driver. On the contrary, said transportation arrangement had
the project from 7am to 4pm. He was allowed to bring home the company been adopted, not so much for the convenience of the employees, but
vehicle in order to provide a timely transportation service to the other primarily for the benefit of Philnor. As embodied in Philnor’s memorandum,
project workers. The project he was assigned to was not completed as they allowed their drivers to bring home their transport vehicles in order
for them to provide a timely transport service and to avoid delay – not
scheduled hence, since he has a satisfactory record, he was re-contracted
really so that the drivers could enjoy the benefits of the company vehicles
for an additional 10 months. After 10 months the project was not yet
nor for them to save on fair.
completed. Several contracts thereafter were made until the project was
finished in 1985.

At the completion of the project, Rada was terminated as his employment

was co-terminous with the project. He later sued Philnor for non payment
of separation pay and overtime pay. He said he is entitled to be paid OT
pay because he uses extra time to get to the project site from his home
and from the project site to his home everyday – in total, he spends an
average of 3 hours OT every day.

ISSUE: Whether or not Rada is entitled to separation pay and OT pay.

HELD: Separation pay – NO. Overtime pay – Yes.

Separation Pay

The SC ruled that Rada was a project employee whose work was
coterminous with the project for which he was hired. Project employees, as
distinguished from regular or non-project employees, are mentioned in
Section 281 of the Labor Code as those ‘where the 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.

‘Project employees are not entitled to termination pay if they are

terminated as a result of the completion of the project or any phase
thereof in which they are employed, regardless of the number of projects
in which they have been employed by a particular construction company.
Moreover, the company is not required to obtain clearance from the
Secretary of Labor in connection with such termination.’

OT Pay

Rada is entitled to OT pay. The fact that he picks up employees of Philnor

at certain specified points along EDSA in going to the project site and
5