EN BANC

G.R. No. L-12582             January 28, 1961

LVN PICTURES, INC., petitioner-appellant, vs.PHILIPPINE MUSICIANS Guild (FFW) and COURT OF INDUSTRIAL RELATIONS, respondents-appellees.

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G.R. No. L-12598             January 28, 1961

SAMPAGUITA PICTURES, INC., petitioner-appellant, vs.PHILIPPINE MUSICIANS Guild (FFW) and COURT OF INDUSTRIAL RELATIONS, respondents-appellees.

Nicanor S. Sison for petitioner-appellant.Jaime E. Ilagan for respondent-appellee Court of Agrarian Relations.Gerardo P. Cabo Chan for respondent-appellee Philippine Musicians Guild.

CONCEPCION, J.:

Petitioners herein, LVN Pictures, Inc. and Sampaguita Pictures, Inc. seek a review by certiorari of an order of the Court of Industrial Relations in Case No. 306-MC thereof, certifying the Philippine Musicians Guild (FFW), petitioner therein and respondent herein, as the sole and exclusive bargaining agency of all musicians working with said companies, as well as with the Premiere Productions, Inc., which has not appealed. The appeal of LVN Pictures, Inc., has been docketed as G.R. No. L-12582, whereas G.R. No. L-12598 is the appeal of Sampaguita Pictures, Inc. Involving as they do the same order, the two cases have been jointly heard in this Court, and will similarly be disposed of.

In its petition in the lower court, the Philippine Musicians Guild (FFW), hereafter referred to as the Guild, averred that it is a duly registered legitimate labor organization; that LVN Pictures, Inc., Sampaguita Pictures, Inc., and Premiere Productions, Inc. are corporations, duly organized under the Philippine laws, engaged in the making of motion pictures and in the processing and distribution thereof; that said companies employ musicians for the purpose of making music recordings for title music, background music, musical numbers, finale music and other incidental music, without which a motion picture is incomplete; that ninety-five (95%) percent of all the musicians playing for the musical recordings of said companies are members of the Guild; and that the same has no knowledge of the existence of any other legitimate labor organization representing musicians in said companies. Premised upon these allegations, the Guild prayed that it be certified as the sole and exclusive bargaining agency for all musicians working in the aforementioned companies. In their respective answers, the latter denied that they have any musicians as employees, and alleged that the musical numbers in the filing of the companies are furnished by independent contractors. The lower court, however, rejected this pretense and sustained the theory of the Guild, with the result already adverted to. A reconsideration of the order complained of having been denied by the Court en banc, LVN Pictures, inc., and Sampaguita Pictures, Inc., filed these petitions for review forcertiorari.

Apart from impugning the conclusion of the lower court on the status of the Guild members as alleged employees of the film companies, the LVN Pictures, Inc., maintains that a petition for certification cannot be entertained when the existence of employer-employee relationship between the parties is contested. However, this claim is neither borne out by any legal provision nor supported by any authority. So long as, after due hearing, the parties are found to bear said relationship, as in the case at bar, it is proper to pass upon the merits of the petition for certification.

It is next urged that a certification is improper in the present case, because, "(a) the petition does not allege and no evidence was presented that the alleged musicians-employees of the respondents constitute a proper bargaining unit, and (b) said alleged musicians-employees represent a majority of the other numerous employees of the film companies constituting a proper bargaining unit under section 12 (a) of Republic Act No. 875."

The absence of an express allegation that the members of the Guild constitute a proper bargaining unit is fatal proceeding, for the same is not a "litigation" in the sense in which this term is commonly understood, but a mere investigation of a non-adversary, fact finding character, in which the investigating agency plays the part of a disinterested investigator seeking merely to ascertain the desires of employees as to the matter of their representation. In connection therewith, the court enjoys a wide discretion in determining the procedure necessary to insure the fair and free choice of bargaining representatives by employees.1 Moreover, it is alleged in the petition that the Guild it a duly registered legitimate labor organization and that ninety-five (95%) percent of the musicians playing for all the musical recordings of the film companies involved in these cases are members of the Guild. Although, in its answer, the LVN Pictures, Inc. denied both allegations, it appears that, at the hearing in the lower court it was merely the status of the musicians as its employees that the film companies really contested. Besides, the substantial difference between the work performed by said musicians and that of other persons who participate in the production of a film, and the peculiar circumstances under which the services of that former are engaged and rendered, suffice to show that they constitute a proper bargaining unit. At this juncture, it should be noted that the action of the lower court in deciding upon an appropriate unit for collective bargaining purposes is discretionary (N.L.R.B. v. May Dept. Store Co., 66 Sup. Ct. 468. 90 L. ed. 145) and that its judgment in this respect is entitled to almost complete finality, unless its action is arbitrary or capricious (Marshall Field & Co. v. N.L.R.B. [C.C.A. 19431, 135 F. 2d. 891), which is far from being so in the cases at bar.

Again, the Guild seeks to be, and was, certified as the sole and exclusive bargaining agency for the musicians working in the aforesaid film companies. It does not intend to represent the other employees therein. Hence, it was not necessary for the Guild to allege that its members constitute a majority of all the employees of said film companies, including those who are not musicians. The real issue in these cases, is whether or not the musicians in question are employees of the film companies. In this connection the lower court had the following to say:

As a normal and usual course of procedure employed by the companies when a picture is to be made, the producer invariably chooses, from the musical directors, one who will furnish the musical background for a film. A price is agreed upon verbally between the producer and musical director for the cost of furnishing such musical background. Thus, the musical director may compose his own music specially written for or adapted to the picture. He engages his own men and pays the corresponding compensation of the musicians under him.

When the music is ready for recording, the musicians are summoned through 'call slips' in the name of the film company (Exh 'D'), which show the name of the musician, his musical instrument, and the date, time and place where he will be picked up by the truck of the film

company. The film company provides the studio for the use of the musicians for that particular recording. The musicians are also provided transportation to and from the studio by the company. Similarly, the company furnishes them meals at dinner time.

During the recording sessions, the motion picture director, who is an employee of the company, supervises the recording of the musicians and tells what to do in every detail. He solely directs the performance of the musicians before the camera as director, he supervises the performance of all the action, including the musicians who appear in the scenes so that in the actual performance to be shown on the screen, the musical director's intervention has stopped.

And even in the recording sessions and during the actual shooting of a scene, the technicians, soundmen and other employees of the company assist in the operation. Hence, the work of the musicians is an integral part of the entire motion picture since they not only furnish the music but are also called upon to appear in the finished picture.

The question to be determined next is what legal relationship exits between the musicians and the company in the light of the foregoing facts.

We are thus called upon to apply R.A. Act 875. which is substantially the same as and patterned after the Wagner Act substantially the same as a Act and the Taft-Hartley Law of the United States. Hence, reference to decisions of American Courts on these laws on the point-at-issue is called for.

Statutes are to be construed in the light of purposes achieved and the evils sought to be remedied. (U.S. vs. American Tracking Association, 310 U.S. 534, 84 L. ed. 1345.) .

In the case of National Labor Relations Board vs. Hearts Publication, 322 U.S. 111, the United States Supreme Court said the Wagner Act was designed to avert the 'substantial obstruction to the free flow of commerce which results from strikes and other forms of industrial unrest by eliminating the causes of the unrest. Strikes and industrial unrest result from the refusal of employers' to bargain collectively and the inability of workers to bargain successfully for improvement in their working conditions. Hence, the purposes of the Act are to encourage collective bargaining and to remedy the workers' inability to bargaining power, by protecting the exercise of full freedom of association and designation of representatives of their own choosing, for the purpose of negotiating the terms and conditions of their employment.'

The mischief at which the Act is aimed and the remedies it offers are not confined exclusively to 'employees' within the traditional legal distinctions, separating them from 'independent contractor'. Myriad forms of service relationship, with infinite and subtle variations in the term of employment, blanket the nation's economy. Some are within this Act, others beyond its coverage. Large numbers will fall clearly on one side or on the other, by whatever test may be applied. Inequality of bargaining power in controversies of their wages, hours and working conditions may characterize the status of one group as of the other. The former, when acting alone may be as helpless in dealing with the employer as dependent on his daily wage and as unable to resist arbitrary and unfair treatment as the latter.'

To eliminate the causes of labor dispute and industrial strike, Congress thought it necessary to create a balance of forces in certain types of economic relationship. Congress recognized those economic relationships cannot be fitted neatly into the containers designated as 'employee' and 'employer'. Employers and employees not in proximate relationship may be

drawn into common controversies by economic forces and that the very dispute sought to be avoided might involve 'employees' who are at times brought into an economic relationship with 'employers', who are not their 'employers'. In this light, the language of the Act's definition of 'employee' or 'employer' should be determined broadly in doubtful situations, by underlying economic facts rather than technically and exclusively established legal classifications. (NLRB vs. Blount, 131 F [2d] 585.)

In other words, the scope of the term 'employee' must be understood with reference to the purposes of the Act and the facts involved in the economic relationship. Where all the conditions of relation require protection, protection ought to be given .

By declaring a worker an employee of the person for whom he works and by recognizing and protecting his rights as such, we eliminate the cause of industrial unrest and consequently we promote industrial peace, because we enable him to negotiate an agreement which will settle disputes regarding conditions of employment, through the process of collective bargaining.

The statutory definition of the word 'employee' is of wide scope. As used in the Act, the term embraces 'any employee' that is all employees in the conventional as well in the legal sense expect those excluded by express provision. (Connor Lumber Co., 11 NLRB 776.).

It is the purpose of the policy of Republic Act 875; (a) To eliminate the causes of industrial unrest by protecting the exercise of their right to self-organization for the purpose of collective bargaining. (b) To promote sound stable industrial peace and the advancement of the general welfare, and the best interests of employers and employees by the settlement of issues respecting terms and conditions of employment through the process of collective bargaining between employers and representatives of their employees.

The primary consideration is whether the declared policy and purpose of the Act can be effectuated by securing for the individual worker the rights and protection guaranteed by the Act. The matter is not conclusively determined by a contract which purports to establish the status of the worker, not as an employee.

The work of the musical director and musicians is a functional and integral part of the enterprise performed at the same studio substantially under the direction and control of the company.

In other words, to determine whether a person who performs work for another is the latter's employee or an independent contractor, the National Labor Relations relies on 'the right to control' test. Under this test an employer-employee relationship exist where the person for whom the services are performed reserves the right to control not only the end to be achieved, but also the manner and means to be used in reaching the end. (United Insurance Company, 108, NLRB No. 115.).

Thus, in said similar case of Connor Lumber Company, the Supreme Court said:.

'We find that the independent contractors and persons working under them are employees' within the meaning of Section 2 (3) of its Act. However, we are of the opinion that the independent contractors have sufficient authority over the persons working under their immediate supervision to warrant their exclusion from the unit. We shall include in the unit the employees working under the supervision of the independent contractors, but exclude the contractors.'

'Notwithstanding that the employees are called independent contractors', the Board will hold them to be employees under the Act where the extent of the employer's control over them indicates that the relationship is in reality one of employment. (John Hancock Insurance Co., 2375-D, 1940, Teller, Labor Dispute Collective Bargaining, Vol.).

The right of control of the film company over the musicians is shown (1) by calling the musicians through 'call slips' in 'the name of the company; (2) by arranging schedules in its studio for recording sessions; (3) by furnishing transportation and meals to musicians; and (4) by supervising and directing in detail, through the motion picture director, the performance of the musicians before the camera, in order to suit the music they are playing to the picture which is being flashed on the screen.

Thus, in the application of Philippine statutes and pertinent decisions of the United States Courts on the matter to the facts established in this case, we cannot but conclude that to effectuate the policies of the Act and by virtue of the 'right of control' test, the members of the Philippine Musicians Guild are employees of the three film companies and, therefore, entitled to right of collective bargaining under Republic Act No. 875.

In view of the fact that the three (3) film companies did not question the union's majority, the Philippine Musicians Guild is hereby declared as the sole collective bargaining representative for all the musicians employed by the film companies."

We are fully in agreement with the foregoing conclusion and the reasons given in support thereof. Both are substantially in line with the spirit of our decision in Maligaya Ship Watchmen Agency vs. Associated Watchmen and Security Union, L-12214-17 (May 28, 1958). In fact, the contention of the employers in the Maligaya cases, to the effect that they had dealt with independent contractors, was stronger than that of the film companies in these cases. The third parties with whom the management and the workers contracted in the Maligaya cases were agencies registered with the Bureau of Commerce and duly licensed by the City of Manila to engage in the business of supplying watchmen to steamship companies, with permits to engage in said business issued by theCity Mayor and the Collector of Customs. In the cases at bar, the musical directors with whom the film companies claim to have dealt with had nothing comparable to the business standing of said watchmen agencies. In this respect, the status of said musical directors is analogous to that of the alleged independent contractor in Caro vs. Rilloraza, L-9569 (September 30, 1957), with the particularity that the Caro case involved the enforcement of the liability of an employer under the Workmen's Compensation Act, whereas the cases before us are merely concerned with the right of the Guild to represent the musicians as a collective bargaining unit. Hence, there is less reason to be legalistic and technical in these cases, than in the Caro case.

Herein, petitioners-appellants cite, in support of their appeal, the cases of Sunripe Coconut Product Co., Inc vs. CIR (46 Off. Gaz., 5506, 5509), Philippine Manufacturing Co. vs. Santos Vda. de Geronimo, L-6968 (November 29, 1954), Viana vs. Al-Lagadan, L-8967 (May 31, 1956), and Josefa Vda. de Cruz vs. The Manila Hotel Co. (53 Off. Gaz., 8540). Instead of favoring the theory of said petitioners-appellants, the case of the Sunripe Coconut Product Co., Inc. is authority for herein respondents-appellees. It was held that, although engaged as piece-workers, under the "pakiao" system, the "parers" and "shellers" in the case were, not independent contractor, butemployees of said company, because "the requirement imposed on the 'parers' to the effect that 'the nuts are pared whole or that there is not much meat wasted,' in effect limits or controls the means or details by which said workers are to accomplish their services" — as in the cases before us.

The nature of the relation between the parties was not settled in the Viana case, the same having been remanded to the Workmen's Compensation Commission for further evidence.

The case of the Philippine Manufacturing Co. involved a contract between said company and Eliano Garcia, who undertook to paint a tank of the former. Garcia, in turn engaged the services of Arcadio Geronimo, a laborer, who fell while painting the tank and died in consequence of the injuries thus sustained by him. Inasmuch as the company was engaged in the manufacture of soap, vegetable lard, cooking oil and margarine, it was held that the connection between its business and the painting aforementioned was purely casual; that Eliano Garcia was an independent contractor; that Geronimo was not an employee of the company; and that the latter was not bound, therefore, to pay the compensation provided in the Workmen's Compensation Act. Unlike the Philippine Manufacturing case, the relation between the business of herein petitioners-appellants and the work of the musicians is not casual. As held in the order appealed from which, in this respect, is not contested by herein petitioners-appellants — "the work of the musicians is an integral part of the entire motion picture." Indeed, one can hardly find modern films without music therein. Hence, in the Caro case (supra), the owner and operator of buildings for rent was held bound to pay the indemnity prescribed in the Workmen's Compensation Act for the injury suffered by a carpenter while working as such in one of said buildings even though his services had been allegedly engaged by a third party who had directly contracted with said owner. In other words, the repair work had not merely a casual connection with the business of said owner. It was a necessary incident thereof, just as music is in the production of motion pictures.

The case of Josefa Vda. de Cruz vs. The Manila Hotel Co., L-9110 (April 30, 1957) differs materially from the present cases. It involved the interpretation of Republic Act No. 660, which amends the law creating and establishing the Government Service Insurance System. No labor law was sought to be construed in that case. In act, the same was originally heard in the Court of First Instance of Manila, the decision of which was, on appeal, affirmed by the Supreme Court. The meaning or scope if the term "employee," as used in the Industrial Peace Act (Republic Act No. 875), was not touched therein. Moreover, the subject matter of said case was a contract between the management of the Manila Hotel, on the one hand, and Tirso Cruz, on the other, whereby the latter greed to furnish the former the services of his orchestra, consisting of 15 musicians, including Tirso Cruz, "from 7:30 p.m. to closing time daily." In the language of this court in that case, "what pieces the orchestra shall play, and how the music shall be arranged or directed, the intervals and other details — such are left to the leader'sdiscretion."

This is not situation obtaining in the case at bar. The musical directors above referred to have no such control over the musicians involved in the present case. Said musical directors control neither the music to be played, nor the musicians playing it. The film companies summon the musicians to work, through the musical directors. The film companies, through the musical directors, fix the date, the time and the place of work. The film companies, not the musical directors, provide the transportation to and from the studio. The film companies furnish meal at dinner time.

What is more — in the language of the order appealed from — "during the recording sessions, the motion picture director who is an employee of the company" — not the musical director — "supervises the recording of the musicians and tells them what to do in every detail". The motion picture director — not the musical director — "solely directs and performance of the musicians before the camera". The motion picture director "supervises the performance of all the actors, including the musicians who appear in the scenes, so that in the actual performance to be shown in the screen, the musical director's intervention has stopped." Or, as testified to in the lower court, "the movie director tells the musical director what to do; tells the music to be cut or tells additional music in this part or he eliminates the entire music he does not (want) or he may want more drums or move violin or piano, as the case may be". The movie director "directly controls the activities of the musicians." He "says he wants more drums and the drummer plays more" or "if he wants more violin or he does not like that.".

It is well settled that "an employer-employee relationship exists . . .where the person for whom the services are performed reserves a right to control not only the end to be achieved but also the means to be used in reaching such end . . . ." (Alabama Highway Express Co., Express Co., v. Local 612, 108S. 2d. 350.) The decisive nature of said control over the "means to be used", is illustrated in the case of Gilchrist Timber Co., et al., Local No. 2530 (73 NLRB No. 210, pp. 1197, 1199-1201), in which, by reason of said control, the employer-employee relationship was held to exist between the management and the workers, notwithstanding the intervention of an alleged independent contractor, who had, and exercise, the power to hire and fire said workers. The aforementioned control over the means to be used" in reading the desired end is possessed and exercised by the film companies over the musicians in the cases before us.

WHEREFORE, the order appealed from is hereby affirmed, with costs against petitioners herein. It is so ordered.

Paras, C.J., Bengzon, Padilla, Bautista Angelo, Labrador, Reyes, J.B.L., Barrera, Paredes and Dizon, JJ., concur.Gutierrez David, J., took no part.

Perez vs. Pomar (G.R. No. L-1299, November 16, 1903)

Facts:            The petitioner Don Vicente Perez filed before the Court of First Instance of Laguna a complaint asking the court to determine the amount due to him for the services he rendered in the Tabacalera Company and that the defendant Eugenio Pomar be condemned to the payment of damages amounting to $3,200, gold, together with the costs of suit. Prior to this event, the petitioner was asked to be an English interpreter between the defendant and the military authorities and that after that incident, the petitioner continued to render his services to the respondent and that he obtained passes and accompanied Pomar upon his journeys to some of the towns in Province of Laguna( e.g conferences between the respondent and the colonel commanding the local garrison, conferences with Captain Lemen in the town of Pilar, major in command in Pagsanjan about the shipment of goods from Manila) and that the plaintiff was assured by the respondent that in every

rendered service to the said company, there would be such payment. Thus, caused him to abandon his soap business and suffered damages in the sum of $3,200. The defendant filed for dismissal of the complaint denying the allegations stated by the petitioner. He also stated that Perez borrowed from time to time money amounting to $175 for his soap business, that Perez purposes in accompanying him is to extend his business and mercantile relations,  free transportation, and that Perez had acted as interpreter of his own free will without any offer of payment and therefore no legal relation between them existed.

Issue:       Whether or not  the respondent is oblige to pay the continued service rendered by the petitioner.

Held:       Yes. The Court decision is that the judgement should be rendered against Don Eugenio Pomar for the payment to the plaintiff of the sum of 200 Mexican pesos.

Ratio:         The Court ruled out that  if there is a tacit and mutual consent as to the rendition of the services, the defendant is still obliged to pay such compensation to the petitioner even if there is no written contract entered between the two parties on the basis of quasi-contract. When one party knowingly receives something for nothing, the courts may impose a quasi contract. Under a quasi contract, neither

party is originally intended to create an agreement. Instead, an arrangement is imposed by a judge to rectify an occurrence of unjust enrichment. On the services rendered by the petitioner  in the province of Laguna, it follows that there was a bilateral obligation on the part of both parties because the  defendant accepted the benefit of the service rendered by the petitioner and that in turn the petitioner expected him to pay his rendition of service. Provided in Article 22 of the Civil Code, Every person who through an act of performance by another, or any other means, acquires or comes into possession of something at the expense of the latter without just or legal ground, shall return the same to him. The fact that the defendant consented to accept an interpreter's services on various occasions, rendered in his behalf and not considered as free, it is  just that he should pay the reasonable payment because it is well-known principle of law that no one should be permitted to enrich himself to the damage of another.

G.R. No. L-9069             March 28, 1958

VICENTE UY CHAO, petitioner, vs.MANUEL AGUILAR and ERNESTO RAMOS, respondents.

Pedro G. Uy for petitioner.Alfredo R. Gomez for respondent Ernesto Ramos.Paredes, San Diego and Paredes for respondent Manuel Aguilar.

PADILLA, J.:

This is an appeal under section 46, Act No. 3428, as amended by Act No. 3812, Commonwealth Act No. 210 and Republic Act No. 772, from a decision rendered by the Workmen's Compensation Commissioner on 18 March 1955, which affirmed a referee's amended decision of 7 December 1954, awarding respondent Manuel Aguilar.

1. . . . the sum of FIVE HUNDRED THIRTY-THREE and 14/100 PESOS (P533.14) by way of compensation still due and unpaid;

2. . . . the additional sum of FIFTEEN PESOS (P15.00) as reimbursement for medical expenses incurred; and

3. . . . the sum of SEVEN PESOS (P7.00) as administrative costs.

to be paid by La Boda de Plata and absolved respondent , Ernesto Ramos from any liability (W.C.C. Case No. 26372).

It appears that at about 10:00 o'clock in the evening of November 1953, respondent Aguilar suffered physical injury as a result of the sudden fall of the whole save of a glassware store known as La Boda de Plata and owned by the petitioner Uy Chao, while he (respondent Aguilar) together with two other laborers was on top of said eave removing the galvanized iron sheets covering the frame of the eave. In the afternoon of the same day respondent Ramos engaged respondent Aguilar for the said work.

In this appeal petitioner Uy Chao raises two questions of law: (1) respondent Ramos was the statutory employer for the purposes of the Workmen's Compensation Act, and not he, the petitioner, and (2) the employment of respondent Aguilar to repair or replace the eave of the glassware store was casual and not for the purpose of the occupation or business of the petitioner.

The petitioner contends that respondent Ramos was an independent contractor and the statutory employer of the injured laborer, respondent Aguilar; that as such respondent Ramos should be held liable for the injuries sustained by the laborer; and that he (the petitioner) should be exempted from any liability.

There is, however, no need of passing upon the point whether respondent Ramos was an independent contractor, because even if the services of respondent Aguilar were engaged by petitioner Uy Chao directly or through an agent or contractor, still respondent Aguilar, the injured laborer, is not entitled to compensation for the simple reason that his employment was purely casual and was not for the purposes of the petitioner's business or occupation.

Section 39 (b) of Act No. 3428 as amended, known otherwise as the Workmen's Compensation Act, provides that —

(b) "Laborer" is used as a synonym of "Employee" and means every person who has entered the employment of, or works under a service or apprenticeship contract for an employer. It does not include a person with those employment is purely casual and is not for the purposes of occupation or business of the employer. . . . (Emphasis supplied.)

Clearly, the Workmen's Compensation Act does not include an employment for labor that is purely casual and is not for the purposes of the employer's occupation or business. The employment of respondent Aguilar to help in the repair or replacement of the eave of a commercial store owned by petitioner Uy Chao was purely casual, because such work would occur only when the said structure should be damaged or broken. When it would be broken and repaired, nobody could foresee. It may safely be stated that the work on the eave would not be made at fixed intervals. The employment of a carpenter and a tinsmith for its repair or replacement was therefore only occasional, sporadic and for a short time.

It is clear that the repair or dismantlement of the eave was not for the purpose of the petitioner's occupation or business. The petitioner was a glassware dealer. He bought and sold glassware. It is difficult to see the connection of the repair or dismantlement with the buying and selling of

glassware. Repair is restoration to a sound or good state after decay, dilapidation, injury or partial destruction.1 It is essentially a process of reconstruction, or of fixing broken or damaged parts of a structural whole. On the other hand, selling glassware is transferring the ownership over commodities on goods from the seller to the buyer for a certain valuable consideration.

Respondents contend that the repair of the eave was for the purposes of the petitioner's occupation or business of selling glassware. They argue that the said structure "being part of petitioner's store, it stands to reason that any repair made on it must be a repair made on petitioner's store and the employment for such repair must, therefore, be an employment for petitioner's — business that of maintaining a store," and that "whatever was or is sold in that store, be it glassware or any other commodity, is merely an incident to the petitioner's business of maintaining the store." In Philippine Manufacturing Company vs. Santos Vda. de Geronimo et al., 96 Phil., 276, his Court ruled that the painting of an elevated water tank belonging to the Philippine Manufacturing Company was not for the purposes of the Company's business or occupation of manufacturing soap, vegetable lard, cooking oil and margarine and in De los Santos vs. Javier, 58 Phil., 82, it was held by this Court that the construction of a corral is not for the purposes of the business or occupation of buying and selling hogs and curing ham, because the defendant who engages in buying and selling hogs and curing ham "is not a buying contractor, and it was not his business to construct buildings."

The rule in Caro vs. Rilloraza et al., (102 Phil., 61), where this Court by a vote of 6 to 4 held that the laborer who while constructing a window railing of a building "fell to the ground and broke his leg, as the wooden platform on which he and another carpenter were working collapsed," was entitled to receive compensation from the owner of the building, is not applicable to the present case, because there the building was for lease for income purposes and the "repair, maintenance and painting thereof, with a view to attracting or keeping tenants and of inducing them to pay a good or increased rental is most certainly, part of said business." Here, the petitioner was engaged not in house-letting business but in buying and selling glassware.

The decision of the Workmen's Compensation Commissioner appealed from is reversed, and the petitioner Uy Chao absolved from liability, without pronouncement as to costs.

Bengzon, Montemayor, Reyes, A., Bautista Angelo, Endencia and Felix, JJ., concur.

G.R. Nos. L-63550-51 January 31, 1984

RJL MARTINEZ FISHING CORPORATION and/or PENINSULA FISHING CORPORATION, petitioners, vs.NATIONAL LABOR RELATIONS COMMISSION and ANTONIO BOTICARIO, ISIDRO FARIOLAN, FERNANDO SEVILLA, TOTONG ROLDAN, ROGER ESQUILLA, MARIO MIRANDA, EDUARDO ESPINOSA, ALBERTO NOVERA, ANTONIO PATERNO, MARCIANO PIADORA, MARIO ROMERO, CLINITO ESQUILLA, ALEJO BATOY, BOBBY QUITREZA, ROLANDO DELA TORRE, HERNANI REVATEZ, RODOLFO SEVILLA, ROLANDO ANG, JUANITO PONPON, HOSPINIANO CALINDEZ, JOSE MABULA, DEONG DE LEON, MELENCIO CONEL and ALFREDO BULAONG, respondents.

Martinez, Bermudez & Associates for petitioners.

The Solicitor General for respondent NLRC.

 

MELENCIO-HERRERA, J.:

Petition for Certiorari, Prohibition and mandamus assailing the Decision of respondent National Labor Relations Commission (NLRC) in Cases Nos. AB-4-11054-81 and AB-8-12354-81 entitled Antonio Boticario, et al. vs. RJL Fishing Corporation and/or Peninsula Fishing Corporation, dated November 26, 1982, as well as the Order, dated February 14, denying petitioners' Manifestation and Omnibus Motion to dismiss private respondents' appeal. The dispositive portion of the challenged resolution reads:

WHEREFORE, in view of the foregoing considerations, the Decision appealed from is hereby set aside and another one entered, directing respondents-appellees: (1) to reinstate complainants-appellants to their former work, without loss of seniority rights and other privileges appertaining thereto; (2) to pay complainants-appellants full backwages computed from the date they were dismissed up to the date they are actually reinstated; (3) to pay complainants-appellants legal holiday pay, emergency living allowance and 13th month pay in accordance with law; and (4) to pay complainants-appellants who are entitled to incentive leave pay, as herein above determined, according to law.

The claims for overtime pay and premium pay for holiday and rest day are dismissed.

SO ORDERED. 1

This case was originally assigned to the Second Division but because of the pendency of a lower-numbered case, G.R. No. 63474, entitled RJL Martinez Fishing Corporation vs. National Labor Relations Commission, et als.before the First Division, involving the same petitioners and their workers (albeit a different group and not exactly Identical issues), this case was transferred to the latter, Division for proper action and determination. G.R. No. 63474 was dismissed by the First Division on August 17, 1983 for lack of merit.

Petitioner corporations are principally engaged in the deep-sea fishing business. Since 1978, private respondents were employed by them as stevedores at Navotas Fish Port for the unloading of tuna fish catch from petitioners' vessels and then loading them on refrigerated vans for shipment abroad.

On March 27, 1981, private respondents Antonio Boticario, and thirty (30) others, upon the premise that they are petitioners' regular employees, filed a complaint against petitioners for non-payment of overtime pay, premium pay, legal holiday pay, emergency allowance under P.D. Nos. 525, 1123, 1614, 1634, 1678, 1713, 1751, 13th month pay (P.D. 851), service incentive leave pay and night shift differential. 2

Claiming that they were dismissed from employment on March 29, 1981 as a retaliatory measure for their having failed the said complaint private respondents filed on the said complaint, private respondents filed on April 21, 1981 another complaint against petitioners for Illegal Dismissal and for Violation of Article 118 of the Labor Code, as amended. 3 Upon petitioners' motion, these two cases were consolidated and tried jointly.

In disputing any employer-employee relationship between them, petitioners contend that private respondents are contract laborers whose work terminated upon completion of each unloading, and that in the absence of any boat arrivals, private respondents did not work for petitioners but were free to work or seek employment with other fishing boat operators.

On February 25, 1982, the Labor Arbiter upheld petitioners' position ruling that the latter are extra workers, who were hired to perform specific tasks on contractual basis; that their work is intermittent depending on the arrival of fishing vessels; that if there are no fish to unload and load, they work for some other fishing boat operators; that private respondent Antonio Boticario had executed an employment contract under which he agreed to act as a labor contractor and that the other private respondents are his men; that even assuming that private respondents are employees of petitioners, their employer-employee relation is co-terminous with each unloading and loading job; that in the same manner, petitioners are not under any obligation to hire petitioners exclusively, hence, when they were not given any job on March 29, 1981, no dismissal was effected but that they were merely not rehired.4

On April 1, 1982, private respondents received the Decision of the Labor Arbiter dismissing their complaints. On April 19, 1982, they filed an appeal before respondent NLRC, which took cognizance thereof.

In its Decision of November 26, 1982, the NLRC reversed the findings of the Labor Arbiter, and resolved, as previously stated, to uphold the existence of employer-employee relationship between the parties.

Petitioners resorted to a "Manifestation and Omnibus Motion to Dismiss Appeal and to Vacate and/or to Declare Null and Void the Decision of this Honorable Commission Promulgated on November 25 (should be 26), 1982" but the same was denied, hence, the instant recourse.

As prayed for, a Temporary Restraining Order to enjoin the enforcement of the questioned decision of respondent NLRC was issued on April 20, 1983, and on August 15, 1983, the Petition was given due course by the Second Division.

Petitioners submit the following issues for resolution:

I. Whether or not the appeal from the decision of Labor Arbiter filed by private respondents is within the l0-day reglementary period;

II. Whether or not respondent NLRC erred in reversing the decision of the Labor Arbiter despite the failure to furnish petitioners with a copy of the appeal;

III. Whether or not there is an employer-employee relationship between the parties;

IV. Whether or not private respondents are entitled to legal holiday pay, emergency living allowance, thirteenth month pay and incentive leave pay.

1. Petitioners, joined by the Solicitor General, contend that the appeal filed by private respondents from the Decision of the Labor Arbiter was filed out of time considering that they received copy of the same on April 1, 1982 but that they filed their appeal only on April 19, 1982, or 18 days later. If we were to reckon the 10-day reglementary period to appeal as calendar days, as held in the case of Vir-Jen Shipping and Marine Services, Inc. vs. NLRC, et al. 5 , private respondents' appeal was, indeed, out of time. However, it was clear from Vir-Jen that the calendar day basis of computation would apply only "henceforth" or to future cases. That ruling was not affected by this Court's Resolution of November 18, 1983 reconsidering its Decision of July 20, 1982. When the appeal herein was filed on April 19, 1982, the governing proviso was found in Section 7, Rule XIII of the Rules and Regulations implementing the Labor Code along with NLRC Resolution No. 1, Series of 1977, which based the computation on "working days". They very face of the Notice of Decision itself 6 indicated aggrieved party could appeal within 10 "working days" from receipt of copy of the resolution appealed from. From April 1

to April 19, 1982 is exactly ten (10) working days considering the Holy Week and the two Saturdays and Sundays that supervened in between that period. In other words, private respondents' appeal, having been filed during the time that the prevailing period of appeal was ten (10) working days and prior to the Vir-Jen case promulgated on July 20, 1982, it must be held to have been timely filed.

2. Anent the failure of private respondents to furnish petitioners with a copy of their memorandum on appeal, suffice it to state that the same is not fatal to the appeal. 7

3. The issue of the existence of an employer-employee relationship between the parties is actually a question of fact, and the finding of the NLRC on this point is bonding upon us, the exceptions to the general rule being absent in this case. Besides the continuity of employment is not the determining factor, but rather whether the work of the laborer is part of the regular business or occupation of the employer. 8 We are thus in accord with the findings of respondent NLRC in this regard.

Although it may be that private respondents alternated their employment on different vessels when they were not assigned to petitioners' boats, that did not affect their employee status. The evidence also establishes that petitioners had a fleet of fishing vessels with about 65 ship captains, and as private respondents contended, when they finished with one vessel, they were instructed to wait for the next. As respondent NLRC had found:

We further find that the employer-employee relationship between the parties herein is not co-terminous with each loading and unloading job. As earlier shown, respondents are engaged in the business of fishing. For this purpose, they have a fleet of fishing vessels. Under this situation, respondents' activity of catching fish is a continuous process and could hardly be considered as seasonal in nature. So that the activities performed by herein complainants, i.e. unloading the catch of tuna fish from respondents' vessel and then loading the same to refrigerated vans, are necessary or desirable in the business of respondents. This circumstances makes the employment of complainants a regular one, in the sense that it does not depend on any specific project or seasonal activity. 9

The employment contract signed by Antonio Boticario, 10 which described him as "labor contractor", is not really so inasmuch as wages continued to be paid by petitioners and he and the other workers were uniformly paid. He was merely asked the petitioners to recruit other workers. Besides, labor-contracting is prohibited under Sec. 9(b), Rule VIII, Book III — Rules and Regulations Implementing the Labor Code as amended. 11 Directly in point and controlling is the ruling in an analogous case, Philippine Fishing Boat Officers and Engineers Union vs. CIR, 12 reading:

The Court holds, therefore, that the employer-employee relationship existed between the parties notwithstanding evidence to the fact that petitioners Visayas and Bergado, even during the time that they worked with respondent company alternated their employment on different vessels when they were not assigned on the company's vessels. For, as was stressed in the above-quoted case ofIndustrial-Commercial-Agricultural Workers Organization vs. CIR, 16 SCRA 562 [1966], "that during the temporary layoff the laborers are considered free to seek other employment is natural, since the laborers are not being paid, yet must find means of support" and such temporary cessation of operations "should not mean starvation for employees and their families."

4. Indeed, considering the length of time that private respondents have worked for petitioner — since 1978 — there is justification to conclude that they were engaged to perform activities usually necessary or desirable in the usual business or trade of petitioners and are, therefore, regular employees. 13 As such, they are entitled to the benefits awarded them by respondent NLRC.

WHEREFORE, the instant Petition for Certiorari, Prohibition and Mandamus is hereby dismissed and the Temporary Restraining Order heretofore issued is hereby dissolved.

Costs against petitioners.

SO ORDERED.

Teehankee (Chairman), Plana, Relova and Gutierrez, Jr., JJ., concur.