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Timestamp: 2019-04-19 14:26:45+00:00

Document:
G.R. No. 176240 - ROLANDO SASAN, SR., LEONILO DAYDAY, MODESTO AGUIRRE, ALEJANDRO ARDIMER, ELEUTERIO SACIL, WILFREDO JUEGOS, PETRONILO CARCEDO and CESAR PACIENCIA v. NATIONAL LABOR RELATIONS COMMISSION 4TH DIVISION, EQUITABLE-PCI BANK and HELPMATE, INC.
ROLANDO SASAN, SR., LEONILO DAYDAY, MODESTO AGUIRRE, ALEJANDRO ARDIMER, ELEUTERIO SACIL, WILFREDO JUEGOS, PETRONILO CARCEDO and CESAR PACIENCIA, Petitioners, v. NATIONAL LABOR RELATIONS COMMISSION 4TH DIVISION, EQUITABLE-PCI BANK and HELPMATE, INC., Respondents.
Assailed in this Petition for Review under Rule 45 of the Rules of Court are the Decision1 dated 24 April 2006 of the Court of Appeals in CA-G.R. SP No. 79912, which affirmed the Decision dated 22 January 2003 of the National Labor Relations Commission (NLRC) in NLRC Case No. V-000241-2002 finding that Helpmate, Inc. (HI) is a legitimate independent job contractor and that the petitioners were not illegally dismissed from work; and the Resolution2 dated 31 October 2006 of the same court denying the Motion for Reconsideration filed by the petitioners.
O 23 July 2001, petitioners filed with the Arbitration Branch of the NLRC in Cebu City separate complaints14 against E-PCIBank and HI for illegal dismissal, with claims for separation pay, service incentive leave pay, allowances, damages, attorney's fees and costs. Their complaints were docketed as NLRC RAB-VII Case No. 07-1381-2001 and raffled to Labor Arbiter Jose G. Gutierrez (Labor Arbiter Gutierrez) for their proper disposition. Subsequently, on 22 August 2001, the petitioners15 amended their complaints to include a claim for 13th month-pay.
Several conciliation hearings were scheduled by Labor Arbiter Gutierrez but the parties still failed to arrive at a mutually beneficial settlement; hence, Labor Arbiter Gutierrez ordered that they submit their respective position papers.
In their position papers, petitioners claimed that they had become regular employees of E-PCIBank with respect to the activities for which they were employed, having continuously rendered janitorial and messengerial services to the bank for more than one year; that E-PCIBank had direct control and supervision over the means and methods by which they were to perform their jobs; and that their dismissal by HI was null and void because the latter had no power to do so since they had become regular employees of E-PCIBank.
For its part, E-PCIBank averred that it entered into a Contract for Services with HI, an independent job contractor which hired and assigned petitioners to the bank to perform janitorial and messengerial services thereat. It was HI that paid petitioners' wages, monitored petitioners' daily time records (DTR) and uniforms, and exercised direct control and supervision over the petitioners and that therefore HI has every right to terminate their services legally. E-PCIBank could not be held liable for whatever misdeed HI had committed against its employees.
HI, on the other hand, asserted that it was an independent job contractor engaged in the business of providing janitorial and related services to business establishments, and E-PCIBank was one of its clients. Petitioners were its employees, part of its pool of janitors/messengers assigned to E-PCIBank. The Contract for Services between HI and E-PCIBank expired on 15 July 2000. E-PCIBank no longer renewed said contract with HI and, instead, bidded out its janitorial requirements to two other job contractors, Able Services and Puritan. HI designated petitioners to new work assignments, but the latter refused to comply with the same. Petitioners were not dismissed by HI, whether actually or constructively, thus, petitioners' complaints before the NLRC were without basis.
Labor Arbiter Gutierrez focused on the following issues: (a) whether petitioners were regular employees of HI; (b) whether petitioners were illegally dismissed from their employment; and (c) whether petitioners were entitled to their money claims.
V - Rolando Sasan, Sr.
The NLRC promulgated its Decision on 22 January 2003 modifying the ruling of Labor Arbiter Gutierrez. The NLRC took into consideration the documentary evidence presented by HI for the first time on appeal and, on the basis thereof, declared HI as a highly capitalized venture with sufficient capitalization, which cannot be considered engaged in "labor-only contracting."
Distressed by the decision of the NLRC, petitioners sought recourse with the Court of Appeals by filing a Petition for Certiorari25 under Rule 65 of the 1997 Rules of Civil Procedure docketed as CA-G.R. SP No. 79912.
As to the question of whether or not, as a legitimate independent job contractor, respondent HI illegally dismissed the petitioners. We rule in the negative.
I. ACCEPTING AND APPRECIATING THE PIECES OF EVIDENCE SUBMITTED BY RESPONDENTS DURING APPEAL, ALL EXISTING DURING THE TIME THE NLRC RAB 7'S TRIAL, CONTRARY TO THIS HONORABLE COURT'S PREVIOUS ESTABLISHED DECISIONS.
II. REVERSING, WITHOUT ANY LEGAL BASIS, THE FACTUAL FINDING OF NLRC RAB 7 THAT THE RESPONDENT HI WAS LABOR ONLY CONTRACTOR.
Before proceeding to the substantive issues, we first address the procedural issues raised by petitioners.
[T]he NLRC is not precluded from receiving evidence, even for the first time on appeal, because technical rules of procedure are not binding in labor cases.
The settled rule is that the NLRC is not precluded from receiving evidence on appeal as technical rules of evidence are not binding in labor cases. In fact, labor officials are mandated by the Labor Code to use every and all reasonable means to ascertain the facts in each case speedily and objectively, without regard to technicalities of law or procedure, all in the interest of due process. Thus, in Lawin Security Services v. NLRC, and Bristol Laboratories Employees' Association-DFA v. NLRC, we held that even if the evidence was not submitted to the labor arbiter, the fact that it was duly introduced on appeal to the NLRC is enough basis for the latter to be more judicious in admitting the same, instead of falling back on the mere technicality that said evidence can no longer be considered on appeal. Certainly, the first course of action would be more consistent with equity and the basic notions of fairness.
Section 3. - Original document must be produced; exceptions. ' When the subject of inquiry is the contents of a document, no evidence shall be admissible other than the original document itself x x x.
Petitioners had more than adequate opportunity when they filed their motion for reconsideration before the NLRC, their Petition to the Court of Appeals and even to this Court, to refute or present their counter-evidence to the documentary evidence presented by HI. Having failed in this respect, petitioners cannot now be heard to complain about these documentary evidences presented by HI upon which the NLRC and the Court of Appeals based its finding that HI is a legitimate job contractor.
The essence of due process is simply an opportunity to be heard, or as applied to administrative proceedings, a fair and reasonable opportunity to explain one's side. It is also an opportunity to seek a reconsideration of the action or ruling complained of. It is not the denial of the right to be heard but denial of the opportunity to be heard that constitutes violation of due process of law. Petitioners herein were afforded every opportunity to be heard and to seek reconsideration of the adverse judgment against them. They had every opportunity to strengthen their positions by presenting their own substantial evidence to controvert those submitted by E-PCIBank and HI before the NLRC, and even before the Court of Appeals. It cannot win its case by merely raising unsubstantiated doubt or relying on the weakness of the adverse parties' evidence.
We now proceed to the resolution of the substantive issues submitted by petitioners for our consideration, particularly, whether HI is a labor-only contactor and E-PCIBank should be deemed petitioners' principal employer; and whether petitioners were illegally dismissed from their employment.
In the case at bar, we find substantial evidence to support the finding of the NLRC, affirmed by the Court of Appeals, that HI is a legitimate job contractor.
for having complied with the requirements as provided for under the Labor Code, as amended, and its Implementing Rules and having paid the registration fee in the amount of ONE HUNDRED PESOS (P100.00) per Official Receipt Number 9042769, dated October 16, 1997.
Having been issued by a public officer, this certification carries with it the presumption that it was issued in the regular performance of official duty.46 In the absence of proof, petitioner's bare assertion cannot prevail over this presumption. Moreover, the DOLE being the agency primarily responsible for regulating the business of independent job contractors, we can presume in the absence of evidence to the contrary that it thoroughly evaluated the requirements submitted by HI as a precondition to the issuance of the Cerificate of Registration.
The evidence on record also shows that HI is carrying on a distinct and independent business from E-PCIBank. The employees of HI are assigned to clients to perform janitorial and messengerial services, clearly distinguishable from the banking services in which E-PCIBank is engaged.
Despite the afore-mentioned compliance by HI with the requisites for permissible job contracting, Labor Arbiter Gutierrez still declared that HI was engaged in prohibited labor-only contracting because it did not possess substantial capital or investment to actually perform the job, work or service under its own account or responsibility. Both the NLRC and the Court of Appeals ruled to the contrary, and we agree.
"Substantial capital or investment" refers to capital stocks and subscribed capitalization in the case of corporations, tools, equipments, implements, machineries and work premises, actually and directly used by the contractor or subcontractor in the performance or completion of the job, work or service contracted out.47 An independent contractor must have either substantial capital or investment in the form of tools, equipment, machineries, work premises, among others. The law does not require both substantial capital and investment in the form of tools, equipment, machineries, etc.48 It is enough that it has substantial capital. In the case of HI, it has proven both.
We have expostulated that once it is established that an entity such as in this case, HI has substantial capital, it was no longer necessary to adduce further evidence to prove that it does not fall within the purview of "labor-only" contracting.49 There is even no need for HI to refute the contention of petitioners that some of the activities they performed such as those of messengerial services are directly related to the principal business of E - PCIBank.
HI has substantial capital in the amount of P20,939,935.72. It has its own building where it holds office and it has been engaged in business for more than a decade now.51 As observed by the Court of Appeals, surely, such a well-established business entity cannot be considered a labor-only contractor.
All these circumstances establish that HI undertook said contract on its account, under its own responsibility, according to its own manner and method, and free from the control and direction of E-PCIBank. Where the control of the principal is limited only to the result of the work, independent job contracting exists. The janitorial service agreement between E-PCIBank and HI is definitely a case of permissible job contracting.
Considering the foregoing, plus taking judicial notice of the general practice in private, as well as in government institutions and industries, of hiring an independent contractor to perform special services,56 ranging from janitorial, security and even technical services, we can only conclude that HI is a legitimate job contractor. As such legitimate job contractor, the law creates an employer-employee relationship between HI and petitioners57 which renders HI liable for the latter's claims.
We further rule that petitioners were not illegally dismissed by HI. Upon the termination of the Contract of Service between HI and E-PCIBank, petitioners cannot insist to continue to work for the latter. Their pull-out from E-PCIBank did not constitute illegal dismissal since, first, petitioners were not employees of E-PCIBank; and second, they were pulled out from said assignment due to the non-renewal of the Contract of Service between HI and E-PCIBank. At the time they filed their complaints with the Labor Arbiter, petitioners were not even dismissed by HI; they were only "off-detail" pending their re-assignment by HI to another client. And when they were actually given new assignments by HI with other clients,59 petitioners even refused the same. As the NLRC pronounced, petitioners' complaint for illegal dismissal is apparently premature.
WHEREFORE, premises considered, the Petition is DENIED for lack of merit. The Decision dated 24 April 2006 and Resolution dated 31 October 2006 of the Court of Appeals are AFFIRMED. Costs against petitioners.
* Per Special Order No. 521, dated 29 September 2008, signed by Chief Justice Reynato S. Puno, designating Associate Justice Adolfo S. Azcuna to replace Associate Justice Ruben T. Reyes, who is on official leave.
1 Penned by Associate Justice Isaias P. Dican with Associate Justices Ramon M. Bato, Jr. and Enrico A. Lanzanas; rollo, pp. 159-167.
3 Now Banco De Oro Unibank; rollo, p. 489.
4 Records are silent as to the date of the initial Contract for Services between HI and E-PCIBank; rollo, p. 383.
5 Commenced work on 27 October 1989 as driver; rollo, p. 46.
6 Commenced work on 8 February 1983 janitor-messenger; id.
7 Commenced work on 15 June 1992 as janitor-messenger; id.
8 Commenced work on 20 January 1990 as electrician; id.
9 Commenced work on 2 June 1992 as driver-messenger; id.
10 Commenced work on 23 July 1990 as driver-messenger; id.
11 Commenced work on 16 September 1984 as janitor-messenger; id.
12 Commenced work on 10 June 1996 as driver-messenger; id.
13 The original complainants before the Labor Arbiter included Dominador Suico, Jr., Roland Mosquera and Mario Juntilla. These three later accepted and reported to their new assignments; rollo, p. 66.
14 Complaints of Alejandro Ardimer, Eleuterio Sacil, Leonilo Dayday, Rolando Sasan, Sr., Modesto Aguirre, Petronilo Carcedo, Cesar Paciencia, Wilfredo Juegos; rollo, pp. 24-45.
15 Dominador Suico, Jr. and Roland Mosquera did not amend their complaint to include a claim for 13th month pay; rollo, p. 73.
16 Book VII, Rule VIII, sec. (d) Contracting or subcontracting refers to an arrangement whereby a principal agrees to put out or farm out with a contractor or subcontractor the performance or completion of a specific job work or service within a definite or predetermined period, regardless of whether such job, work or service is to be performed or completed within or outside the premises of the principal as hereinafter qualified.
(i) The contractor or subcontractor carries on a distinct and independent business and undertakes to perform the job, work or service on its own account and under its own responsibility, according to its own manner and method, and free from the control and direction of the principal in all matters connected with the performance of the work except as to the results thereof.
(iii) The agreement between the principal and contractor or subcontractor assures the contractual employees entitlement to all labor and occupational safety and health standards, free exercise of the right to self-organization, security of tenure, and social and welfare benefits.
22 The Labor Code provides for the solidary liability of any person, partnership, association or corporation which not being an employer contracts with an independent contractor.
ART. 107. Indirect employer. ' The provisions of the immediately preceding Article shall likewise apply to any person, partnership, association or corporation which, not being an employer, contracts with an independent contractor for the performance of any work, task, job or project.
ART. 109. Solidary liability. ' The provisions of existing laws to the contrary notwithstanding, every employer or indirect employer shall be held responsible with his contractor or subcontractor for any violation of any provision of this Code. For purposes of determining the extent of their civil liability under this Chapter, they shall be considered as direct employers.
29 Mayon Hotel and Restaurant v. Adana, G.R. No. 157634, 16 May 2005, 458 SCRA 609, 628; Genuino Ice Co. v. Magpantay, G.R. No. 147790, 27 June 2006, 493 SCRA 195, 204.
Art. 221. Technical rules not binding and prior resort to amicable settlement. - In any proceeding before the Commission or any of the Labor Arbiters, the rules of evidence prevailing in courts of law or equity shall not be controlling x x x.
30 Panlilio v. National Labor Relations Commission, 346 Phil. 30, 35-36 (1997).
31 NFD International Manning Agents v. National Labor Relations Commission, G.R. No. 116629. 16 January 1998, 284 SCRA 239, 245; see also Tanjuan v. Philippine Postal Savings Bank, Inc., 457 Phil. 993, 1005 (2003); Andaya v. National Labor Relations Commission, G.R. No. 157371, 15 July 2005, 463 SCRA 577, 584.
32 G.R. No. 148372, 27 June 2005, 461 SCRA 272, 289.
34 See Furusawa Rubber Philippines, Inc. v. Secretary of Labor and Employment, 347 Phil. 293, 300-301 (1997).
35 Omnibus Rules Implementing the Labor Code, Book III, Rule VIII-A, Section 4(d).
37 Omnibus Rules Implementing the Labor Code, Book III, Rule VIII-A, 16 Section 4(d).
38 Vinoya v. National Labor Relations Commission, 381 Phil. 460, 472 (2000).
39 In legitimate job contracting, the law creates an employer-employee relationship for a limited purpose, i.e., to ensure that the employees are paid their wages. The principal employer becomes jointly and severally liable with the job contractor only for the payment of the employees' wages whenever the contractor fails to pay the same. Other than that, the principal employer is not responsible for any claim made by the employees.
On the other hand, in labor-only contracting, the statute creates an employer-employee relationship for a comprehensive purpose: to prevent a circumvention of labor laws. The contractor is considered merely an agent of the principal employer and the latter is responsible to the employees of the labor-only contractor as if such employees had been directly employed by the principal employer. The principal employer therefore becomes solidarity liable with the labor-only contractor for all the rightful claims of the employees (San Miguel Corporation v. MAERC Integrated Services, Inc., 453 Phil. 543, 566-567 (2003).
41 Acevedo v. Advanstar Company, Inc., G.R. No. 157656, 11 November 2005, 474 SCRA 656, 668.
42 San Miguel Corporation v. MAERC Integrated Services, Inc., supra note 39.
43 Encyclopedia Britannica (Phils), Inc. v. National Labor Relations Commission, 332 Phil. 1, 9 (1996).
46 Dr. Grieve v. Judge Jaca, 465 Phil. 825, 831 (2004).
47 Manaya v. Alabang Country Club, Incorporated, G.R. No. 168988, 19 June 2007, 525 SCRA 140, 157-158.
48 See Neri v. National Labor Relations Commission, G.R. NOS. 97008-09, 21 July 1993, 224 SCRA 717-721.
52 De los Santos v. National Labor Relations Commission, 423 Phil. 1020, 1029 (2001).
56 Filsyn v. National Labor Relations Commission, 327 Phil. 144, 150 (1996); Kimberly Independent Labor Union For Solidarity, Activism and Nationalism-Organized Labor Association In Line Industries and Agriculture v. Drilon, G.R. No. 77629, 9 May 1990, 185 SCRA 190, 204; Coca Cola Bottlers v. National Labor Relations Commission, 366 Phil. 581, 589 (1999).
57 Philippine Bank of Communications v. National Labor Relations Commission, 230 Phil. 430, 439 (1986).

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