Coca Cola Phil. vs Dela Cruz GR No. 184977 FACTS Respondents Dela Cruz and company filed complaints with money claims for regularization against Coca-Cola Bottlers (company) and Peers Integrated Service (contractor1). Respondents claim to be regular employees based on the fact that they are route helpers which are necessary and desirable to regular business of the employer. They also claimed that they worked under the control and supervision of the company while the contractors did not have sufficient capital making said contract a labor-only contract. The company denied the relationship stating that they entered into contracts of services with Peers and Excellent (contractor2) who retained the right to select, hire, dismiss, supervise, control and discipline and pay the salaries of all personnel. They also pointed out that they are in the business of manufacturing, not distribution, hence not necessary and desirableISSUE: W/N the CA erred in holding that there was an ER-EE. (NO) HELD: The CA noted that both the contracts for Peerless and the Excellent show that their obligation was solely to provide the company with the services of contractual employees, and nothing more. These contracted services were for the handling and delivery of the companys products and allied services. Following D.O. 18-02 and the contracts that spoke purely of the supply of labor. The case of Magsalin described in a very significant way the manufacture of soft drinks and the companys sales and distribution activities in relation with one another. The CA was correct when it concluded that the contracted personnel who served as route helpers were really engaged in functions directly related to the overall business of the petitioner. This led to the further CA conclusion that the contracted personnel were under the companys supervision and control since sales and distribution were in fact not the purported contractors independent, discrete and separable activities, but were component parts of sales and distribution operations that the company controlled in its soft drinks business.Coca-Cola Bottlers Phils., Inc., vs. Agito, Oca III, Alariao, Jr., Ong, Arvin, Francisco, and GolezG.R. No. 179546, February 13, 2009

Facts:Respondents filed before the NLRC two complaints against Petitioner, Interserve, Peerless Integrated Services, Inc., Better Builders, Inc., and Excellent Partners, Inc. for reinstatement with backwages, regularization, nonpayment of 13th month pay, and damages. Respondents alleged in their Position Paper that they were salesmen assigned at the Lagro Sales Office of petitioner. They had been in the employ of petitioner for years, but were not regularized. Their employment was terminated on 8 April 2002 without just cause and due process. However, they failed to state the reason/s for filing a complaint against Interserve; Peerless Integrated Services, Inc.; Better Builders, Inc.; and Excellent Partners, Inc. Petitioner Coca-cola filed its Position Paper (with Motion to Dismiss), where it averred that respondents were employees of Interserve who were tasked to perform contracted services in accordance with the provisions of the Contract of Services executed between petitioner and Interserve on 23 March 2002. Said Contract between petitioner and Interserve, covering the period of 1 April 2002 to 30 September 2002, constituted legitimate job contracting, given that the latter was a bona fide independent contractor with substantial capital or investment in the form of tools, equipment, and machinery necessary in the conduct of its business. To prove the status of Interserve as an independent contractor, petitioner presented the following pieces of evidence: (1) the Articles of Incorporation of Interserve; (2) the Certificate of Registration of Interserve with the Bureau of Internal Revenue; (3) the Income Tax Return, with Audited Financial Statements, of Interserve for 2001; and (4) the Certificate of Registration of Interserve as an independent job contractor, issued by the Department of Labor and Employment (DOLE). As a result, petitioner asserted that respondents were employees of Interserve, since it was the latter which hired them, paid their wages, and supervised their work, as proven by: (1) respondents Personal Data Files in the records of Interserve; (2) respondents Contract of Temporary Employment with Interserve; and (3) the payroll records of Interserve. Petitioner, thus, sought the dismissal of respondents complaint against it on the ground that the Labor Arbiter did not acquire jurisdiction over the same in the absence of an employer-employee relationship between petitioner and the respondents.The Labor Arbiter found that respondents were employees of Interserve and not of petitioner. The Labor Arbiter placed considerable weight on the fact that Interserve was registered with the DOLE as an independent job contractor, with total assets amounting to P1,439,785.00 as of 31 December 2001. It was Interserve that kept and maintained respondents employee records, including their Personal Data Sheets; Contracts of Employment; and remittances to the Social Securities System (SSS), Medicare and Pag-ibig Fund, thus, further supporting the Labor Arbiters finding that respondents were employees of Interserve. She ruled that the circulars, rules and regulations which petitioner issued from time to time to respondents were not indicative of control as to make the latter its employees. Unsatisfied with the foregoing Decision of the Labor Arbiter, respondents filed an appeal with the NLRC. In their Memorandum of Appeal, respondents maintained that contrary to the finding of the Labor Arbiter, their work was indispensable to the principal business of petitioner. Respondents supported their claim with copies of the Delivery Agreement between petitioner and TRMD Incorporated, stating that petitioner was engaged in the manufacture, distribution and sale of soft drinks and other related products with various plants and sales offices and warehouses located all over the Philippines. Moreover, petitioner supplied the tools and equipment used by respondents in their jobs such as forklifts, pallet, etc. Respondents were also required to work in the warehouses, sales offices, and plants of petitioner. Respondents pointed out that, in contrast, Interserve did not own trucks, pallets cartillas, or any other equipment necessary in the sale of Coca-Cola products. The NLRC affirmed the Labor Arbiters Decision and pronounced that no employer-employee relationship existed between petitioner and respondents. Aggrieved once more, respondents sought recourse with the Court of Appeals by filing a Petition for Certiorari under Rule 65. The Court of Appeals reversed the NLRC decision. The appellate court ruled that Interserve was a labor-only contractor, with insufficient capital and investments for the services which it was contracted to perform. With only P510,000.00 invested in its service vehicles and P200,000.00 in its machineries and equipment, Interserve would be hard-pressed to meet the demands of daily soft drink deliveries of petitioner in the Lagro area. The Court Appeals concluded that the respondents used the equipment, tools, and facilities of petitioner in the day-to-day sales operations. Additionally, the Court of Appeals determined that petitioner had effective control over the means and method of respondents work as evidenced by the Daily Sales Monitoring Report, the Conventional Route System Proposed Set-up, and the memoranda issued by the supervisor of petitioner addressed to workers, who, like respondents, were supposedly supplied by contractors. The appellate court deemed that the respondents, who were tasked to deliver, distribute, and sell Coca-Cola products, carried out functions directly related and necessary to the main business of petitioner. The appellate court finally noted that certain provisions of the Contract of Service between petitioner and Interserve suggested that the latters undertaking did not involve a specific job, but rather the supply of manpower. Issue:Is Interserve a legitimate job contractor? Ruling: No. With the finding that Interserve was engaged in prohibited labor-only contracting, petitioner shall be deemed the true employer of respondents. As regular employees of petitioner, respondents cannot be dismissed except for just or authorized causes, none of which were alleged or proven to exist in this case, the only defense of petitioner against the charge of illegal dismissal being that respondents were not its employees. Records also failed to show that petitioner afforded respondents the twin requirements of procedural due process, i.e., notice and hearing, prior to their dismissal. Respondents were not served notices informing them of the particular acts for which their dismissal was sought. Nor were they required to give their side regarding the charges made against them. Certainly, the respondents dismissal was not carried out in accordance with law and, therefore, illegal.

Emmanuel Babas et. al. v Lorenzo Shipping Corporation (G.R. No. 186091)FACTS: Lorenzo Shipping Corporation (LSC) is a duly organized domestic corporation engaged in the shipping industry. LSC entered into a General Equipment Maintenance Repair and Management Services Agreement (Agreement) with Best Manpower Services, Inc. (BMSI). Under the Agreement, BMSI undertook to provide maintenance and repair services to LSCs container vans, heavy equipment, trailer chassis, and generator sets. BMSI further undertook to provide checkers to inspect all containers received for loading to and/or unloading from its vessels.Simultaneous with the execution of the Agreement, LSC leased its equipment, tools, and tractors to BMSI. The period of lease was coterminous with the Agreement. BMSI then hired petitioners on various dates to work at LSC as checkers, welders, utility men, clerks, forklift operators, motor pool and machine shop workers, technicians, trailer drivers, and mechanics. In September 2003, petitioners filed with the Labor Arbiter (LA) a complaint for regularization against LSC and BMSI. On October 1, 2003, LSC terminated the Agreement, effective October 31, 2003. Consequently, petitioners lost their employment.BMSI asserted that it is an independent contractor. It averred that it was willing to regularize petitioners; however, some of them lacked the requisite qualifications for the job. LSC averred that petitioners were employees of BMSI and were assigned to LSC by virtue of the Agreement. BMSI is an independent job contractor with substantial capital or investment in the form of tools, equipment, and machinery necessary in the conduct of its business. The Agreement between LSC and BMSI constituted legitimate job contracting. Thus, petitioners were employees of BMSI and not of LSC The Labor Arbiter dismissed petitioners complaint on the ground that petitioners were employees of BMSI. It was BMSI which hired petitioners, paid their wages, and exercised control over them. The NLRC reversed the Labor Arbiter

Issue: Whether or not respondent was engaged in labor-only contracting.

Held:Yes. In De Los Santos v. NLRC, the character of the business, i.e., whether as labor-only contractor or as job contractor, should be measured in terms of, and determined by, the criteria set by statute. The parties cannot dictate by the mere expedience of a unilateral declaration in a contract the character of their business. KILU VS Drilon FACTS Kimberly-Clark Philippines, Inc. (KIMBERLY, for brevity) executed a three-year collective bargaining agreement (CBA) with United Kimberly-Clark Employees Union-Philippine Transport and General Workers' Organization (UKCEU-PTGWO) which expired on June 30, 1986. Within the 60-day freedom period prior to the expiration of and during the negotiations for the renewal of the aforementioned CBA, some members of the bargaining unit formed another union called "Kimberly Independent Labor Union for Solidarity, Activism and Nationalism- Organized Labor Association in Line Industries and Agriculture (KILUSAN-OLALIA). On April 21, 1986, KILUSAN-OLALIA filed a petition for certification election in the Ministry of Labor and Employment (MOLE). KIMBERLY and (UKCEU-PTGWO) did not object to the holding of a certification election but objected to the inclusion of the so-called contractual workers whose employment with KIMBERLY was coursed through an independent contractor, Rank Manpower Company (RANK for short), as among the qualified voters. On June 2, 1986, Med-Arbiter Bonifacio Marasigan, who was handling the certification election case, issued an order declaring those casuals who have worked at least six (6) months as appearing in the payroll months prior to the filing of the instant petition on April 21, 1986 as eligible to vote in the certification election. During the pre-election conference, 64 casual workers were challenged by KIMBERLY and (UKCEU-PTGWO) on the ground that they are not employees, of KIMBERLY but of RANK. It was agreed by all the parties that the 64 voters shall be allowed to cast their votes but that their ballots shall be segregated and subject to challenge proceedings. On July 2, 1986, KILUSAN-OLALIA filed with the med-arbiter a "Protest and Motion to Open and Count Challenged Votes" on the ground that the 64 workers are employees of KIMBERLY within the meaning of Article 212(e) of the Labor Code. On July 7, 1986, KIMBERLY filed an opposition to the protest and motion, asserting that there is no employer-employee relationship between the casual workers and the company. On November 13, 1986, then Minister Sanchez rendered a decision declaring that the other casual employees not performing janitorial and yard maintenance services were deemed labor-only contractual and since labor-only contracting is prohibited, such employees were held to have attained the status of regular employees, the regularization being effective as of the date of the decision. On November 25, 1986, KIMBERLY filed a motion for reconsideration with respect to the regularization of contractual workers. ISSUEWhether those engaged in janitorial or yard maintenance as well as the other casual employees attained the status of regular employee on November 13, 1986.HELD YES. The law thus provides for two kinds of regular employees, namely: 1. those who are engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer; and 2. those who have rendered at least one year of service, whether continuous or broken, with respect to the activity in which they are employed. The individual petitioners herein who have been adjudged to be regular employees fall under the second category. These are the mechanics, electricians, machinists machine shop helpers, warehouse helpers, painters, carpenters, pipefitters and masons. It is not disputed that these workers have been in the employ of KIMBERLY for more than one year at the time of the filing of the Petition for certification election by KILUSAN-OLALIA. Owing to their length of service with the company, these workers became regular employees, by operation of law, one year after they were employed by KIMBERLY through RANK. While the actual regularization of these employees entails the mechanical act of issuing regular appointment papers and compliance with such other operating procedures as may be adopted by the employer, it is more in keeping with the intent and spirit of the law to rule that the status of regular employment attaches to the casual worker on the day immediately after the end of his first year of service. To rule otherwise, and to instead make their regularization dependent on the happening of some contingency or the fulfillment of certain requirements, is to impose a burden on the employee which is not sanctioned by law. That the first stated position is the situation contemplated and sanctioned by law is further enhanced by the absence of a statutory limitation before regular status can be acquired by a casual employee. The law is explicit. As long as the employee has rendered at least one year of service, he becomes a regular employee with respect to the activity in which he is employed. The law does not provide the qualification that the employee must first be issued a regular appointment or must first be formally declared as such before he can acquire a regular status. Obviously, where the law does not distinguish, no distinction should be drawn.