Friday, June 27, 2014

Informal work arrangements ("on call employment") may mean regular employment.

“Benevolence, it is said, does not operate as a license to circumvent labor laws.”
This is all too familiar. You may not know it, but you, too, may be in this situation now or in the past. If not yet, then good for you, you can still prepare for it.
The scenario: You are kind, so when someone comes to you, or has been introduced to you, and earnestly seeks your favour to allow him or her to stay where he could have roof over his or her head, and in return he or she would help in the chores around the house or your little business, you tend to say yes not so much because you need a hand, or he or she possesses the skills you need, if you happen to need one, but out of magnanimity. This, despite your apprehensions given the many horrible and outrageous stories of homeowners or business owners being victimized by the very persons they fed, clothed, and sheltered. Life, indeed, can be cruel.
Fast forward to not-so-distant future. You may have had a little disagreement with your foster friend, or the latter may have violated your relationship, or have done something that would make you rethink keeping him or her, then you decide to kick him or her out of the house or your little business. Days later, you get a summons from the National Labor Relations Commission (NLRC) directing you to answer a complaint for illegal dismissal filed by your erstwhile foster friend. Surprised, you squeak “He was never my employee!” But, was he or was he not?
The case below, although it does not exactly fit the above scenario, discusses how, even given the scenario above, similar relationships are interpreted under the labor laws.
The central question is: would such an arrangement ripen into an employer-employee relationship that would bind a benevolent host to the consequences under the labor code and other labor laws and rules?
Article 280. Regular and casual employment. The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer, except 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 or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season.
An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided, That any employee who has rendered at least one year of service, whether such service is continuous or broken, shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such activity exists. (PD 442, The Labor Code of the Philippines)
The Brief Facts
Esita, the complainant, claims he was an employee of Opulencia, the respondent. Esita explains that he worked as compressor operator in the ice plant owned by opulencia for many years. Opulencia, in denying Esita’s claim, alleges that the latter was merely allowed to work as peon of contractors they had engaged to do major repairs on his Tanauan ice plant. He continues that “while he refused the insistent pleas of Esita for employment in the ice plants due to lack of vacancy, he nonetheless allowed him to stay in the premises of the ice plant for free and to collect fees for crushing or loading ice of the customers and dealers of the ice plant. Opulencia claims that in addition, Esita enjoyed free electricity and water, and was allowed to cultivate crops within the premises of the ice plant to augment his income.”
The Labor arbiter ruled that there existed an employer-employee relationship and ordered Opulencia to pay Esita separation pay, underpayment of wages, 13th month pay, allowances, etc. Opulencia appealed the labor arbiter’s decision to NLRC, which the latter affirmed with modification on the monetary award.
Hence, this Petition.
Raised in this Petition are the following issues:
“that public respondents have no jurisdiction over the instant case;
that Esita's work in the repair and construction of Dr. Opulencia's residence could not have ripened into a regular employment;
that petitioners' benevolence in allowing Esita to stay inside the company's premises free of charge for humanitarian reason deserves commendation rather than imposition of undue penalty;
that Esita's name does not appear in the payrolls of the company which necessarily means that he was not an employee; and, that Esita's statements are inconsistent and deserving of disbelief.”
The Court’s ruling.
“The instant petition lacks merit, hence, must be dismissed.
xxx While the Labor Arbiter and the NLRC may subsequently be found without jurisdiction over a case when it would later appear that no employer-employee relationship existed between the contending parties, such is not the situation in this case where the employer-employee relationship between the petitioners and Esita was clearly established. If the argument of petitioners were to be allowed, then unscrupulous employers could readily avoid the jurisdiction of the Labor Arbiters and NLRC, and may even elude compliance with labor laws only on the bare assertion that an employer-employee relationship does not exist.
Petitioners further argue that "complainant miserably failed to present any documentary evidence to prove his employment. There was no time sheet, pay slip and/or payroll/cash voucher to speak of. Absence of these material documents are necessary fatal to complainant's cause."
We do not agree. No particular form of evidence is required to prove the existence of an employer-employee relationship. Any competent and relevant evidence to prove the relationship may be admitted. For, if only documentary evidence would be required to show that relationship, no scheming employer would ever be brought before the bar of justice, as no employer would wish to come out with any trace of the illegality he has authored considering that it should take much weightier proof to invalidate a written instrument. 2 Thus, as in this case where the employer-employee relationship between petitioners and Esita was sufficiently proved by testimonial evidence, the absence of time sheet, time record or payroll has become inconsequential.
xxx The petitioners point out that even granting arguendo that Esita was indeed a mechanic, he could never be a regular employee because his presence would be required only when there was a need for repair. We cannot sustain this argument. This circumstance cannot affect the regular status of employment of Esita. An employee who is required to remain on call in the employer's premises or so close thereto that he cannot use the time effectively and gainfully for his own purpose shall be considered as working while on call. 8 In sum, the determination of regular and casual employment 9 is not affected by the fact that the employee's regular presence in the place of work is not required, the more significant consideration being that the work of the employee is usually necessary or desirable in the business of the employer. More importantly, Esita worked for 9 years and, under the Labor Code, "any employee who has rendered at least one year of service, whether such service is continuous or broken, shall be considered a regular employee with respect to that activity in which he is employed . . . ." 10
In allowing Esita to stay in the premises of the ice plant and permitting him to cultivate crops to augment his income, there is no doubt that petitioners should be commended; however, in view of the existence of an employer-employee relationship as found by public respondents, we cannot treat humanitarian reasons as justification for emasculating or taking away the rights and privileges of employees granted by law. Benevolence, it is said, does not operate as a license to circumvent labor laws. If petitioners were genuinely altruistic in extending to their employees privileges that are not even required by law, then there is no reason why they should not be required to give their employees what they are entitled to receive. Moreover, as found by public respondents, Esita was enjoying the same privileges granted to the other employees of petitioners, so that in thus treating Esita, he cannot be considered any less than a legitimate employee of petitioners.
WHEREFORE, there being no grave abuse of discretion on the part of public respondents, the instant petition is DISMISSED. Accordingly, the restraining order we issued on 13 May 1991 is LIFTED.
Read the full text of the case here.

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