Aurora Land Project Corp

vs.
NLRC and Dagui
GR No 114733, 02.01.1997
By Richard Troy A. Colmenares
USA College of Law
6/17/14 10:24:23 AM
Nature of the Case
A petition for certiorari seeking reversal of NLRC decision which modified petitioners liability for separation pay and attorneys fees as ruled
by the labor arbiter.

Facts
Private respondent worked as maintenance and repairs man for almost 40 years in the apartments and buildings owned by petitioner. The
daughter of the owner, the petitioner, alleged that his work was unsatisfactory and so dismissed private respondent. Private respondent filed
a complaint of illegal dismissal to the labor arbiter, who in turn ruled in favor of private respondent for separation pay and attorneys fees.
Petitioner appealed before the NLRC which affirmed the decision of labor arbiter, but lowered the separation pay and deleted the attorneys
fees. Petitioners thus filed petition for certiorari implicating NLRC with grave abuse of discretion for four reasons.

Issue(s)
(1). Whether private respondent is an employee petitioner?
(2). Whether private respondent has been illegally dismissed?

Held
(1). Yes. In fact, private respondent is a regular employee.

The Court, consistent with the labor arbiter and NLRCs ruling, is not convinced that private respondent is only a contractual
employee. To qualify as a contractual one employee, one must have substantial capital investment (Sec.8, Rule VIII, Book III of the
IRR of the Labor Code). Petitioners showed no proof that private respondent was a contractual employee. The same ruling based
on fact is within the jurisdiction of the labor arbiter and NLRC.

All the elements of the four-fold test in identifying employer-employee relationship (E2e; power to hire, payment of wages, power to
fire, and power of control over conduct of employee) are present in the instant case. The fact the private respondent was paid on a
daily basis admits that he is an employee compensated by way of wages and not by profit. The petitioner had indeed the power of
dismissal over private respondent.

The mere existence of the power of control is enough to show its compliance with the four-fold test. This is the case with petitioner
and the same is not negated by the fact the petitioner does not directly supervise the performance of the private respondent. He
works between 7AM to 4PM within the premises of the petitioner, and thus, naturally has to receive supervision over his work from
the petitioner. There are two ways to determine a regular employee, and whichever is applied does not negate the fact that private
respondent is a regular employee by definition - 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 and
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 (Art. 280, Labor Code).

The petitioners contest that private respondent is not a regular employee by reason that he performs a specific job function and
only while the same exists, falling as an exception
1
to Art. 280. The same argument is disproved by petitioners act of not submitting
a mandatory report of termination for their alleged project employee, private respondent.

(2). Yes.

Due process requires the right to be heard and to defend himself with the option of counsel, noted as procedural and substantive
due process. The mandatory notice of hearing and notice of dismissal was absent in the instant case, making private respondent
an illegally dismissed employee.

To correct is the plain error committed by the labor arbiter and NLRC by not awarding backwages. The Court relaxes strict
construction of procedural requirements (private respondents failure to appeal for backwages) in pursuit of justice. Thus, the
decision of the labor arbiter and NLRC are modified to include backwages reckoning from the time private was re-employed until
the day he was illegally dismissed, as well as other benefits entitled to him by law.

1
Art. 280, Labor Code xxx 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 services to be performed is seasonal in nature and the employment is for the
duration of the season.