Paulino Ungos III

Lawyer | Law Professor | Author

Tag: specific denial

  • Existence of the Right to Control the Manner of Doing the Work

    P alleged that he was employed sometime in October 1996, as a fitter/welder by O, Inc., a corporation engaged in the business of ship building. As a fitter/welder, P assembled, welded, fitted, installed, and repaired certain barge components. P presented a copy of his O, Inc. company Identification Card (ID), Certificate of Employment (COE) dated 5 February 2001, and time keeper report.

    P stated that sometime in 2003, O, Inc. changed its corporate name to S, Inc., maintained the same line of business, and retained in its employ P and other O, Inc. employees.

    P further stated that sometime in May 2006, he was assigned to Lamao, Limay, Bataan to do a welding job on one of S, Inc.’s barges. On 11 May 2006, an explosion occurred which caused P to sustain third degree burns on certain parts of his body. P was then hospitalized from 11 May until 6 June 2006 and had received financial assistance from S, Inc. for the duration of his confinement.

    P alleged that S, Inc. verbally dismissed him from service effective 1 May 2008 due to lack of work, which was why he filed a complaint for illegal dismissal against S, Inc.

    S, Inc. denied that it engaged P as its regular employee. In support of its claim that no employer-employee relationship existed between them, S, Inc. pointed out that it was only incorporated sometime in November 2002, several years after O, Inc. engaged P as its fitter/welder in 1996. Furthermore, S, Inc. maintained that it was a separate and distinct entity from O, Inc. and that no such change of corporate name as claimed by P.

    S, Inc. alleged that, at best, P was only a helper brought in by its regular employees on certain occasions when repairs were needed to be done on its barges. It stressed that it did not engage P on a regular basis as his work on the barges was merely temporary or occasional. It further stated that P was free to seek employment elsewhere at any given time.

    Was P an employee of S, Inc.?

    In Parayday v. Shogun Shipping Co., Inc.,1G.R. No. 204555, July 6, 2020. the Supreme Court declared that an employer-employee relationship existed between P and S, Inc.

    Initially, the Court did not give credence to the ID and COE presented by P, for the said documents were issued by O, Inc. and not by S, Inc. The Court also did not consider the time keeper report presented by P because their genuineness and due execution were unverifiable.

    Nonetheless, the Court found that S, Inc. failed to categorically deny the following circumstances:

    • Sometime in May 2006, it permitted P to work on repairs on one of its barges. It was also found that S, Inc. did not also deny that P worked for it until he was supposedly verbally dismissed from employment on 1 May 2008. Notably, S, Inc. even admitted that P was called in to do repairs on its barges.
    • P was duly compensated for his work done on the barges. S, Inc. even categorically admitted that it provided him financial assistance when he was hospitalized from 11 May until 6 June 2006. It also did not disprove P’s allegation that it continued to pay his salaries after he was discharged from the hospital on 7 June 2006.
    • P was verbally dismissed on 1 May 2008. The Court noted S, Inc.’s allegation that P only did repair work whenever the same was available. The Court viewed that it was S, Inc. that determined the cessation of P’s services.

    According to the Court, the Rules of Court2Under Rule 8, Section 11., which supplements the NLRC Rules of Procedure, provides that allegations which are not specifically denied are deemed admitted.

    As regards S, Inc.’s power of control over P, the Court emphasized that the control test calls merely for the existence of the right to control the manner of doing the work and not the actual exercise of the right.3Dy Keh Beng v. International Labor and Marine Union of the Philippines, G.R. No. L-32245, May 25, 1979, 179 PHIL 131-139. The Court added that an employer’s power of control, particularly over personnel working under the employer, is deemed inferred, more so when said personnel are working at the employer’s establishment.

    In the present case, the Court found that P worked on the barges alongside regular employees of S, Inc. and that S, Inc. did not deny that he was taking orders from its engineers as to the required specifications on how the barges of Shogun Ships should be repaired. For the Court, it could thus logically infer that S, Inc., to some degree, exercised control or had the right to control the work of P.

    P was an employee of S, Inc.

    Further reading:

    • Parayday v. Shogun Shipping Co., Inc., G.R. No. 204555, July 6, 2020.

  • IDs, Uniforms, and Vague Affidavits

    Arnulfo alleged that in 1994 he was hired as a butcher by Ernesto (the proprietor of Kalookan Slaughterhouse) and was made to work the entire week, from 6:30 P.M. to 7:30 A.M. with a daily wage of P700.00, that later became P500.00.

    Arnulfo narrated that on July 21, 2014, he suffered from a headache and was unable to report for duty. The next day, Ernesto informed him that he could no longer report for work due to his old age.

    Aggrieved by these developments, Arnulfo filed a complaint for illegal dismissal against Ernesto.

    Ernesto, on the other hand, asserted that Arnulfo was an independent butcher engaged by his Operation Supervisor, Cirilo, and he was paid based on the number of hogs he butchered. Ernesto added that Arnulfo was only called into the slaughterhouse when customers brought hogs to be slaughtered.

    In arguing against Arnulfo’s claim of illegal dismissal, Ernesto contended that he imposed policies on the entry to the premises of Kalookan Slaughterhouse, which applied to employees, dealers, independent butchers, hog and meat dealers, and trainees. In this regard, Noelberto (one of Ernesto’s employees) stated that Arnulfo violated said policies and then misconstrued the disallowance to enter the slaughterhouse as an act of dismissal.

    Although the Office of the Labor Arbiter found that Arnulfo was hired by Ernesto himself, the National Labor Relations Commission and the Court of Appeals, however, ruled that Arnulfo was engaged by Cirilo (Ernesto’s Operation Supervisor) and he was Cirilo’s own employee.

    Was Arnulfo an employee of Ernesto?

    The Supreme Court ruled in the affirmative.

    The Court reiterated the settled rule that to determine the existence of an employer-employee relationship, four elements generally need to be considered, namely: (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. The Court stated that these elements or indicators comprise the so-called ‘four-fold’ test of employment relationship.

    In the present case, it was found that the butchering services rendered by Arnulfo at the Kalookan Slaughterhouse was undisputed.

    However, Arnulfo was also found to have presented the following pieces of evidence:
    (1) an identification card and three gate passes stating that he was a butcher at the Kalookan Slaughterhouse;
    (2) log sheets for three days showing that he reported for work; and
    (3) a trip ticket showing that Arnulfo was the captain of a group of personnel that went to Bataan.

    The Court also considered Ernesto’s admission (by way of Noelberto’s statement) that uniforms were given to all employees, including Arnulfo.

    The Court reiterated its ruling in Masonic Contractor, Inc. v. Madjos1G.R. No. 185094, November 25, 2009 in that it is common practice for companies to provide identification cards to individuals not only as a security measure, but more importantly to identify the bearers thereof as bona fide employees of the firm or institution that issued them. The provision of company-issued identification cards and uniforms, said the Court, indubitably constitutes substantial evidence sufficient to support the existence of the employment relation.

    For the Court, the totality of Arnulfo’s evidence and the admissions of Ernesto led it to conclude that Arnulfo was Ernesto’s employee.

    On the other hand, the Court looked into Ernesto’s claims that Cirilo was the employer of Arnulfo and the person who paid the latter’s wages. However, the Court found no evidence supporting said claims. The Court even stated that Cirilo was not shown to (1) possess substantial capital and investment to have an independent business; (2) be Arnulfo’s employer; and (3) pay his salaries. Other than Cirilo’s Sinumpaang Salaysay, no document was presented to show that he paid Arnulfo’s salaries.

    Moreover, the Court stated when Ernesto denied that Arnulfo was his employee but alleged that the latter rendered services as Cirilo’s employee, Ernesto effectively admitted the substantial fact that Arnulfo has been rendering butchering services for several years. The Court considered such denial as negative pregnants2denials pregnant with the admission of the substantial facts in the pleading responded to which are not squarely denied which acknowledged that Ernesto indeed employed Arnulfo.

    The Court stressed that while Cirilo claimed to be Arnulfo’s employer, he also admitted that he never exercised any control over the means and methods by which Arnulfo rendered butchering services. Said the Court, if Cirilo was Arnulfo’s employer, he should have had control over Arnulfo’s means and methods for doing his job. As the Sinumpaang Salaysay of Cirilo reads, he only monitored whether the butchers finished their work.

    However, record revealed that Noelberto (Ernesto’s employee), was the one who actually exercised control in that he reprimanded Arnulfo (1) for his failure to properly store his butchering knives; (2) for coming to Kalookan Slaughterhouse with dirty clothes; (3) for reporting for work drunk; and (4) for not having an I.D. before going to the slaughterhouse.

    The Court concluded that all the foregoing circumstances established that Ernesto (through Cirilo) engaged Arnulfo, paid for his salaries, and in effect had the power to dismiss him. Further, Ernesto (through Noelberto) exercised control over Arnulfo’s conduct.

    To the mind of the Court, Ernesto was Arnulfo’s employer.

    Was Arnulfo illegally dismissed from employment?

    The Court found that Arnulfo was illegally dismissed from employment. This was because Ernesto failed to specifically deny that on July 22, 2014, Arnulfo was informed that he could no longer report for work.

    According to the Court, Noelberto only alleged that he merely barred Arnulfo from entering the slaughterhouse in several instances because of his failure to wear his I.D. and uniform but he failed to state that this was done on July 22, 2014.

    The Court ruled that Noelberto’s silence on this matter was deemed as an admission by Ernesto that Arnulfo was indeed dismissed on July 22, 2014.3Section 11, Rule 8 of the Rules of Court provides: SECTION 11. Allegations Not Specifically Denied Deemed Admitted. — Material averments in a pleading asserting a claim or claims, other than those as to the amount of unliquidated damages, shall be deemed admitted when not specifically denied.

    Having been illegally dismissed, the Court affirmed the Office of the Labor Arbiter’s awards of separation pay and backwages.

    Further reading:

    • Fernandez v. Kalookan Slaughterhouse, Inc., G.R. No. 225075, June 19, 2019.