G.R. No. 177592
June 9, 2014
FACTS:
Alilin, et al. are laborers hired by Romualdo D. Gindang
Contractor and RDG to work in the premises of Petron's bulk plant. Their dates
of hiring range from 1968 to 1993. In 2000, Petron and RDG entered into a
Contract of Services for the period June 1, 2000 to May 31, 2002 whereby RDG
undertook to provide Petron with janitorial, maintenance, tanker receiving,
packaging and other utility services in its Mandaue Bulk Plant. This contract
was extended on July 31, 2002 and further extended until September 30, 2002.
Upon expiration, no further extension was made. Thus, on October 16, 2002,
Alilin, et al. were barred from continuing their services with Petron.
Hence, the filing of a complaint for illegal dismissal, etc. against
Petron, claiming to be the latter's regular employees. Petron, on the other
hand, alleges that they are employees of RDG, an independent contractor. It
presented the following pieces of evidence: (1) RDG's Certificate of
Registration of Business Name issued by DTI; (2) RDG's Certificate of
Registration issued by DOLE; (3) Contractor's Pre-Qualification Statement; (4)
Conflict of Interest Statement signed by Romeo Gindang as manager of RDG; (5)
RDG's Audited Financial Statements for the years 1998, 1999 and 2000; (6) RDG's
Mayor's Permit for the years 2000 and 2001; (7) RDG's Certificate of
Accreditation issued by DTI; (8) performance bond and insurance policy; (9) SSS
Online Inquiry System Employee Contributions and Employee Static Information;
and (10) Romeo's affidavit stating that he had paid the salaries of his
employees assigned to Petron.
LA found against Petron and ruled that Alilin, et al. are its
regular employees because their jobs were directly related to Petron's business
operations; they worked under the supervision of Petron's foreman; they were
using Petron's tools and equipment in the performance of their works. NLRC
affirmed the ruling. However, CA reversed the ruling and found RDG to be a
legitimate contractor.
ISSUE: Whether or not RDG is a legitimate contractor
HELD:
Petron
failed to discharge the burden of proving that RDG is a legitimate contractor.
Hence, the presumption that RDG is a labor-only contractor stands.
The audited financial statements and other financial documents of
RDG for the years 1999 to 2001 establish that it does have sufficient working
capital to meet the requirements of its service contract. In fact, the
financial evaluation conducted by Petron of RDG's financial statements for years
1998-2000 showed RDG to have a maximum financial capability of Php4.807 Million
as of December 1998, and PHp1.611 Million as of December 2000. Petron was able
to establish RDG's sufficient capitalization when it entered into the service
contract in 2000. The Court stresses though that this determination of RDG's
status as an independent contractor is only with respect to its financial
capability for the period covered by the financial and other documents
presented. In other words, the evidence adduced merely proves that RDG was
financially qualified as a legitimate contractor but only with respect to its
last service contract with Petron in the year 2000.
As may be recalled, petitioners have rendered work for Petron for
a long period of time even before the service contract was executed in 2000.
The respective dates on which petitioners claim to have started working for
Petron, as well as the fact that they have rendered continuous service to it
until October 16, 2002, when they were prevented from entering the premises of
Petron's Mandaue Bulk Plant, were not at all disputed by Petron. In fact,
Petron even recognized that some of the petitioners were initially fielded by
Romualdo Gindang, the father of Romeo, through RDG's precursor, Romualdo D.
Gindang Contractor, while the others were provided by Romeo himself when he
took over the business of his father in 1989. Hence, while Petron was able to
establish that RDG was financially capable as a legitimate contractor at the
time of the execution of the service contract in 2000, it nevertheless failed
to establish the financial capability of RDG at the time when petitioners
actually started to work for Petron in 1968, 1979, 1981, 1987, 1990, 1992 and
1993.
Petron's
power of control over petitioners exists in this case
The facts that petitioners were hired by Romeo or his father and
that their salaries were paid by them do not detract from the conclusion that
there exists an employer-employee relationship between the parties due to
Petron's power of control over petitioners. One manifestation of the power of
control is the power to transfer employees from one work assignment to another.
Here, Petron could order petitioners to work outside of their regular
"maintenance/utility" job. Also, petitioners were required to report
for work every day at the bulk plant, observe an 8:00 a.m. to 5:00 p.m. daily
work schedule, and wear proper uniform and safety helmets as prescribed by the
safety and security measures being implemented within the bulk plant. All these
imply control. In an industry where safety is of paramount concern, control and
supervision over sensitive operations, such as those performed by the
petitioners, are inevitable if not at all necessary. Indeed, Petron deals with
commodities that are highly volatile and flammable which, if mishandled or not
properly attended to, may cause serious injuries and damage to property and the
environment. Naturally, supervision by Petron is essential in every aspect of
its product handling in order not to compromise the integrity, quality and
safety of the products that it distributes to the consuming public.
Petitioners
already attained regular status as employees of Petron
Petitioners were given various work assignments such as tanker
receiving, barge loading, sounding, gauging, warehousing, mixing, painting,
carpentry, driving, gasul filling and other utility works. Petron refers to
these work assignments as menial works which could be performed by any
able-bodied individual. The Court finds, however, that while the jobs performed
by petitioners may be menial and mechanical, they are nevertheless necessary
and related to Petron's business operations. If not for these tasks, Petron's
products will not reach the consumers in their proper state. Indeed,
petitioners' roles were vital inasmuch as they involve the preparation of the
products that Petron will distribute to its consumers.
- The principal who alleges that the contractor is a legitimate one has the burden of proving permissible contracting
- For a contractor to be considered a legitimate one, it must have substantial capitalization for the entire duration that the contractor's employees were assigned at the principal's premises
