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Prof. Joselito Guianan Chan's The Labor Code of the Philippines, Annotated Labor Standards & Social Legislation Volume I of a 3-Volume Series 2019 Edition (3rd Revised Edition)
 

 
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UNITED STATES SUPREME COURT JURISPRUDENCE
 

 
PHILIPPINE SUPREME COURT JURISPRUDENCE
 

   
July-1997 Jurisprudence                 

  • G.R. No. 96649-50 July 1, 1997 - PEOPLE OF THE PHIL. v. LYNDON V. MACOY

  • G.R. No. 109660 July 1, 1997 - PEOPLE OF THE PHIL. v. ROMEO NELL

  • G.R. No. 124914 July 2, 1997 - JESUS UGADDAN v. COURT OF APPEALS, ET AL.

  • G.R. No. 123074 July 4, 1997 - PEOPLE OF THE PHIL. v. FERNANDO M. FERNANDEZ

  • Adm. Matter No. MTJ-94-1017 July 7, 1997 - OSCAR B. LAMBINO v. AMADO A. DE VERA

  • Adm. Matter No. P-97-1245 July 7, 1997 - BENIGNO G. GAVIOLA v. NOEL NAVARETTE

  • G.R. No. 105760 July 7, 1997 - PNB v. COURT OF APPEALS, ET AL.

  • G.R. No. 107193 July 7, 1997 - EUGENIO TENEBRO v. COURT OF APPEALS, ET AL.

  • G.R. No. 112006 July 7, 1997 - PEOPLE OF THE PHIL. v. ROBERTO S. DE VERA

  • G.R. No. 114275 July 7, 1997 - IÑIGO F. CARLET v. COURT OF APPEALS, ET AL.

  • G.R. No. 116962 July 7, 1997 - MARIA SOCORRO CACA v. COURT OF APPEALS, ET AL.

  • G.R. Nos. 118940-41 & 119407 July 7, 1997 - PEOPLE OF THE PHIL. v. GREGORIO MEJIA, ET AL.

  • G.R. No. 119872 July 7, 1997 - REMEDIOS NAVOA RAMOS v. COURT OF APPEALS, ET AL.

  • G.R. No. 122206 July 7, 1997 - RAFAEL ARCEGA, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 105284 July 8, 1997 - PEOPLE OF THE PHIL. v. IGNACIO ZUMIL

  • G.R. No. 106099 July 8, 1997 - PEOPLE OF THE PHIL. v. AGUSTIN SOTTO, ET AL.

  • G.R. No. 109814 July 8, 1997 - PEOPLE OF THE PHIL. v. FERNANDO MAALAT

  • G.R. No. 112797 July 8, 1997 - PEOPLE OF THE PHIL. v. NIDA ALEGRO

  • G.R. No. 114265 July 8, 1997 - PEOPLE OF THE PHIL. v. GREGORIO MAGALLANES

  • G.R. No. 115307 July 8, 1997 - MANUEL LAO v. COURT OF APPEALS, ET AL.

  • G.R. No. 115703 July 8, 1997 - EPIFANIO L. CASOLITA, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 117501 July 8, 1997 - SOLID HOMES, INC. v. COURT OF APPEALS, ET AL.

  • G.R. No. 122308 July 8, 1997 - PURITA S. MAPA, ET AL. v. COURT OF APPEALS, ET AL.

  • Adm. Matter No. SC-96-1 July 10, 1997 - DAMASO S. FLORES v. BERNARDO P. ABESAMIS

  • Adm. Matter No. P-97-1236 July 11, 1997 - MADONNA MACALUA v. DOMINGO TIU, JR.

  • Adm. Matter No. P-97-1249 July 11, 1997 - PACITA SY TORRES v. FROILAN S. CABLING

  • G.R. No. 104865 July 11, 1997 - PEOPLE OF THE PHIL. v. VICTORIANO PONTILAR, JR.

  • G.R. Nos. 113511-12 July 11, 1997 - PEOPLE OF THE PHIL. v. DANILO SINOC

  • G.R. No. 115033 July 11, 1997 - PONCIANO T. MATANGUIHAN, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 123204 July 11, 1997 - NATIONWIDE SECURITY AND ALLIED SERVICES, INC. v. NLRC, ET AL.

  • Adm. Matter No. P-95-1158 July 14, 1997 - EUFEMIA BERCASIO v. HERBERTO BENITO, ET AL.

  • G.R. No. 106153 July 14, 1997 - FLORENCIO G. BERNARDO v. COURT OF APPEALS, ET AL.

  • G.R. No. 108838 July 14, 1997 - PAGCOR v. COURT OF APPEALS, ET AL.

  • G.R. Nos. 116528-31 July 14, 1997 - PEOPLE OF THE PHIL. v. MARIETO ADORA

  • G.R. No. 108492 July 15, 1997 - PEOPLE OF THE PHIL. v. NOEL BANIEL, ET AL.

  • G.R. No. 118078 July 15, 1997 - PEOPLE OF THE PHIL. v. OSCAR VILLANUEVA

  • G.R. No. 123379 July 15, 1997 - BAROTAC SUGAR MILLS, INC. v. COURT OF APPEALS, ET AL.

  • G.R. Nos. 115439-41 July 16, 1997 - PEOPLE OF THE PHIL. v. SANDIGANBAYAN, ET AL.

  • G.R. Nos. 120437-41 July 16, 1997 - PEOPLE OF THE PHIL. v. ARMANDO ALVARIO

  • Adm. Matter No. RTJ-97-1382 July 17, 1997 - REXEL M. PACURIBOT v. RODRIGO F. LIM, JR.

  • G.R. No. 105002 July 17, 1997 - PEOPLE OF THE PHIL. v. DIARANGAN DANSAL

  • G.R. No. 108634 July 17, 1997 - ANTONIO P. TAN v. COURT OF APPEALS, ET AL.

  • G.R. No. 111165 July 17, 1997 - PEOPLE OF THE PHIL. v. ROGELIO MERCADO, ET AL.

  • G.R. No. 113257 July 17, 1997 - PEOPLE OF THE PHIL. v. JOHNNY LASCOTA

  • G.R. No. 114742 July 17, 1997 - CARLITOS E. SILVA v. COURT OF APPEALS, ET AL.

  • G.R. No. 118860 July 17, 1997 - ROLINDA B. PONO v. NLRC, ET AL.

  • G.R. No. 120262 July 17, 1997 - PAL, INC. v. COURT OF APPEALS, ET AL.

  • G.R. No. 125195 July 17, 1997 - SAMAHAN NG MGA MANGGAGAWA SA BANDOLINO, ET AL. v. NLRC, ET AL.

  • Adm. Matter No. RTJ-96-1362 July 18, 1997 - DSWD, ET AL. v. ANTONIO M. BELEN, ET AL.

  • Adm. Matter No. RTJ-95-1283 July 21, 1997 - DAVID C. NAVAL, ET AL. v. JOSE R. PANDAY, ET AL.

  • G.R. No. 108488 July 21, 1997 - PEOPLE OF THE PHIL. v. RODENCIO NARCA, ET AL.

  • G.R. No. 111002 July 21, 1997 - PACIFIC MARITIME SERVICES, INC., ET AL. v. NICANOR RANAY, ET AL.

  • G.R. No. 117402 July 21, 1997 - PEOPLE OF THE PHIL. v. ROLLIE L. ALVARADO

  • G.R. No. 119184 July 21, 1997 - HEIRS OF FELICIDAD CANQUE v. COURT OF APPEALS, ET AL.

  • G.R. No. 121768 July 21, 1997 - PEOPLE OF THE PHIL. v. DOMINGO CASTILLO, JR.

  • G.R. Nos. 122250 & 122258 July 21, 1997 - EDGARDO C. NOLASCO v. COMELEC, ET AL.

  • G.R. No. 124347 July 21, 1997 - CMS STOCK BROKERAGE, INC. v. COURT OF APPEALS, ET AL.

  • G.R. No. 125510 July 21, 1997 - PEOPLE OF THE PHIL. v. RENATO LISING

  • G.R. No. 111933 July 23, 1997 - PLDT v. NLRC, ET AL.

  • G.R. Nos. 112429-30 July 23, 1997 - PEOPLE OF THE PHIL. v. RODOLFO P. CAYETANO

  • G.R. Nos. 118736-37 July 23, 1997 - PEOPLE OF THE PHIL. v. TANG WAI LAN

  • Adm. Matter No. P-96-1205 July 24, 1997 - OSCAR P. DE LOS REYES v. ESTEBAN H. ERISPE, JR.

  • Adm. Matter No. RTJ-97-1383 July 24, 1997 - JOSE LAGATIC v. JOSE PEÑAS, JR., ET AL.

  • G.R. No. 104663 July 24, 1997 - PEOPLE OF THE PHIL. v. DAVID SALVATIERRA

  • G.R. No. 105004 July 24, 1997 - PEOPLE OF THE PHIL. v. DIONISIO MAROLLANO

  • G.R. No. 107723 July 24, 1997 - EMS MANPOWER & PLACEMENT SERVICES v. NLRC, ET AL.

  • G.R. No. 111211 July 24, 1997 - ABS-CBN EMPLOYEES UNION, ET AL., v. NLRC, ET AL.

  • G.R. No. 113235 July 24, 1997 - VICTORINA MEDINA, ET AL. v. CITY SHERIFF, MANILA, ET AL.

  • G.R. Nos. 113366-68 July 24, 1997 - GREGORIO ISABELO, ET AL. v. NLRC, ET AL.

  • G.R. No. 116635 July 24, 1997 - CONCHITA NOOL, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 116736 July 24, 1997 - PEOPLE OF THE PHIL. v. BENJAMIN ORTEGA, ET AL.

  • G.R. No. 118458 July 24, 1997 - PEOPLE OF THE PHIL. v. RICKY DELA CRUZ

  • G.R. No. 120276 July 24, 1997 - SINGA SHIP MANAGEMENT PHILS., INC. v. NLRC, ET AL.

  • G.R. No. 121075 July 24, 1997 - DELTA MOTORS CORP. v. COURT OF APPEALS, ET AL.

  • G.R. No. 121867 July 24, 1997 - SMITH KLINE & FRENCH LAB., LTD. v. COURT OF APPEALS, ET AL.

  • G.R. No. 127262 July 24, 1997 - HUBERT WEBB, ET AL. v. PEOPLE OF THE PHIL., ET AL.

  • Adm. Matter Nos. 95-6-55-MTC & P-96-1173 July 28, 1997 - REPORT ON AUDIT IN THE MTC OF PEÑARANDA, NUEVA ECIJA

  • G.R. No. 102858 July 28, 1997 - DIRECTOR OF LANDS v. COURT OF APPEALS, ET AL.

  • G.R. No. 103209 July 28, 1997 - APOLONIO BONDOC, ET AL. v. NLRC, ET AL.

  • G.R. No. 110823 July 28, 1997 - PEOPLE OF THE PHIL. v. ROCHEL TRAVERO

  • G.R. No. 112323 July 28, 1997 - HELPMATE, INC. v. NLRC, ET AL.

  • G.R. No. 113344 July 28, 1997 - PEOPLE OF THE PHIL. v. ATANACIO LUTO

  • G.R. No. 116668 July 28, 1997 - ERLINDA A. AGAPAY v. CARLINA V. PALANG, ET AL.

  • G.R. No. 116726 July 28, 1997 - PEOPLE OF THE PHIL. v. LEONARDO P. DE LA CRUZ

  • G.R. No. 118822 July 28, 1997 - G.O.A.L., INC. v. COURT OF APPEALS, ET AL.

  • G.R. No. 119000 July 28, 1997 - ROSA UY v. COURT OF APPEALS, ET AL.

  • G.R. No. 119649 July 28, 1997 - RICKY GALICIA, ET AL. v. NLRC, ET AL.

  • G.R. No. 119868 July 28, 1997 - PAL, INC. v. NLRC, ET AL.

  • G.R. No. 120072 July 28, 1997 - PEOPLE OF THE PHIL. v. FLORENTINO I. MESA

  • G.R. No. 123361 July 28, 1997 - TEOFILO CACHO v. COURT OF APPEALS, ET AL.

  • G.R. No. 126556 July 28, 1997 - NELSON C. DAVID v. COURT OF APPEALS, ET AL.

  • G.R. No. 117742 July 29, 1997 - GEORGE M. TABERRAH v. NLRC, ET AL.

  • SBC Case No. 519 July 31, 1997 - PATRICIA FIGUEROA v. SIMEON BARRANCO, JR.

  • G.R. No. 97369 July 31, 1997 - P.I. MANPOWER PLACEMENTS, INC. v. NLRC, ET AL.

  • G.R. No. 99030 July 31, 1997 - PLDT v. NLRC, ET AL.

  • G.R. No. 106582 July 31, 1997 - PEOPLE OF THE PHIL. v. RUPERTO BALDERAS

  • G.R. No. 107802 July 31, 1997 - PEOPLE OF THE PHIL. v. JASON NAREDO

  • G.R. No. 108399 July 31, 1997 - RAFAEL M. ALUNAN III, ET AL. v. ROBERT MIRASOL, ET AL.

  • G.R. No. 108619 July 31, 1997 - EPIFANIO LALICAN v. FILOMENO A. VERGARA, ET AL.

  • G.R. No. 113689 July 31, 1997 - PEOPLE OF THE PHIL. v. FELIPE SANGIL, SR.

  • G.R. No. 113958 July 31, 1997 - BANANA GROWERS COLLECTIVE, ET AL. v. NLRC, ET AL.

  • G.R. No. 116060 July 31, 1997 - PEOPLE OF THE PHIL. v. CLEMENTE DE LA PEÑA

  • G.R. No. 116292 July 31, 1997 - PEOPLE OF THE PHIL. v. JIMMY PEÑERO

  • G.R. No. 119068 July 31, 1997 - PEOPLE OF THE PHIL. v. DANTE CASTRO, ET AL.

  • G.R. No. 121027 July 31, 1997 - CORAZON DEZOLLER TISON, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 121157 July 31, 1997 - HEIRS OF SEGUNDA MANINGDING, ET AL. v. COURT OF APPEALS, ET AL.

  • G.R. No. 123561 July 31, 1997 - DELIA R. NERVES v. CSC, ET AL.

  • G.R. No. 124678 July 31, 1997 - DELIA BANGALISAN, ET AL. v. COURT OF APPEALS, ET AL.

  •  





     
     

    G.R. No. 112323   July 28, 1997 - HELPMATE, INC. v. NLRC, ET AL.

     
    PHILIPPINE SUPREME COURT DECISIONS

    SECOND DIVISION

    [G.R. No. 112323. July 28, 1997.]

    HELPMATE, INC., Petitioner, v. NATIONAL LABOR RELATIONS COMMISSION (Fourth Division), FELIPE CABARON, EMILIANO M. BELEÑA, JR., RAYMUNDO CAÑAZARES, HONORIO VIRTUCIO, EMMA ESPINA, ROSARIO TIZON, JR., RENATO DABUAYAN, ROMULO MATILOS, RONELO BELEÑA, RENO GUALEN, HOMER DATANAGAN, ROMMEL ENCENZO, GERONIMO ONDONG, HORACE ANGANA, TEOFILO EMNACEN, ALFREDO PACAÑA, DOMINGO MARAÑAN, NERIO C. ONDONG and MARIO NUÑEZ, Respondents.

    Roberto R. Palmares for Petitioner.

    M.B. Mahinay & Associates for Private Respondents.

    SYNOPSIS


    Petitioner is a corporation which renders janitorial and similar services to clients among which was the Bureau of Internal Revenue. Private respondent filed a complaint against the petitioner for illegal dismissal and payment of service incentive leave, separation pay, unpaid 13th month pay, salary and ECOLA differential, attorney’s fees and damages. The Labor Arbiter rendered a decision ordering petitioner to pay private respondent’s money claims. On appeal, the decision was set aside and the case was remanded to the Labor Arbiter for further proceedings in view of certain factual matters to be determined.

    Petitioner moved to implead the BIR as third-party respondent alleging that sin cases of contracts for janitorial and security services, payment of minimum wage and allowances was to be borne by the principal or client of the service contractor; that the BIR was the principal; and that it was an indispensable party in this case. The Labor Arbiter granted petitioners’ motion. In its answer, the BIR pointed out that the third-party complaint never mentioned the names of the employees assigned to the BIR during the existence of the contract; that it was only a client of petitioner, and as such it was not duty bound to answer for the claims of employees against their direct employer, petitioner herein. Petitioner also alleged that under the wage orders, the BIR was liable for payment of increases in the minimum wage and living allowances, while under the Labor Code, the BIR, as principal or client, was liable to the employees being a direct employer.

    In a decision, the Labor Arbiter ordered petitioner to pay the money claims of two employees while it was solidarily liable with petitioner for the claims of other private respondents. The NLRC affirmed this decision.

    The Supreme Court ruled as without basis in law petitioner’s claim that the BIR is solely liable to the employees of petitioner. In Eagle Security Agency, Inc. v. NLRC (173 SCRA 481-489), it was held that therein petitioners’ solidary liability for the amounts due the security guards finds support in Articles 106, 197 and 109 of the Labor Code; that the joint and several liabilities of the contractor and the principal is mandated by the Labor Code to assure compliance of the provisions therein; that the contractor is made liable by virtue of his status as direct employer; that the principal, on the other hand, is made the indirect employer of the contractor s employees for purposes of paying the employees their wages should the contractor be unable to pay them.


    SYLLABUS


    1. ADMINISTRATIVE LAW; ADMINISTRATIVE PROCEEDINGS; DUE PROCESS, CONSTRUED. — The essence of due process is that a party be afforded reasonable opportunity to be heard and to submit any evidence he may have in support of his defense. In administrative proceedings such as the one at bench, due process simply means the opportunity to explain one’s side or the opportunity to seek a reconsideration of the action or ruling complained of.

    2. ID.; ID.; ID.; CASE AT BAR. — Petitioner was given reasonable opportunity to be heard and submit evidence in support of his defense. It submitted position papers and documentary evidence to prove BIR’s liability. It had the similar opportunity to submit evidence to support its defense with respect to the question of illegal dismissal, but petitioner did not do so.

    3. LABOR AND SOCIAL LEGISLATION; LABOR CODE; LABOR DISPUTES; PRAYER FOR "SUCH OTHER RELIEFS AS MAY BE JUST AND EQUITABLE IN THE PREMISES" ENTITLES CLAIMANTS TO WHAT IS DUE IN THEIR FAVOR. — Petitioner’s third and fourth contentions are likewise untenable. The labor arbiter found the private respondents to be entitled to more than the amount stated in their position paper. This finding, together with the prayer in private respondents’ position paper asking for "such other reliefs as may be just and equitable in the premises," justifies the award given to private respondents. As stated by the NLRC in its decision: We likewise sustain the award of claims more than what was asked in the complainants position paper. The point raised by the respondent basically, is that the Labor Arbiter should have confined or limited the award to the amount stated in the complainants’ position paper. . . It goes beyond the realm of the law. It is unfair and unjust to deny the complainants what is justly due in their favor as mandated by law simply because what is computed and asked by them is much lesser. . .

    4. ID.; ID.; EMPLOYMENT; CONTRACTOR AND PRINCIPAL ARE JOINTLY AND SEVERALLY LIABLE FOR MONEY CLAIMS OF EMPLOYEES. — Petitioner’s final contention, that the BIR is solely liable to the employees of Helpmate, Inc., has no basis in law. The case cited by petitioner itself supports the ruling of the NLRC that the principal (BIR) and the contractor (Helpmate) are jointly and severally liable to the private respondents (Eagle Security Agency, Inc. v. NLRC, 173 SCRA 479). We affirm this rule today, as we hold that the NLRC correctly found the BIR and Helpmate Inc. solidarily liable to private respondents for their money claims. While it is true that payment of the increases are "to be borne" by the principal or client (in this case, the BIR), we made it clear in that case that: . . . "To be borne," however, does not mean that the principal, PTSI in this case, would directly pay the security guards the wage and allowance increases because there is no privity of contract between them. The security guards’ contractual relationship is with their immediate employer, EAGLE. As an employer, EAGLE is tasked, among others, with the payment of their wages [See Article VII Sec. 3 of the Contract for Security Services, supra and Bautista v. Inciong, G.R. No. 52824, March 16, 1988, 158 SCRA 665]. The security guards’ immediate recourse for the payment of the increases is with their direct employer, EAGLE. However, in order for the security agency to comply with the new wage and allowance rates it has to pay the security guards, the Wage Orders made specific provision to amend existing contracts for security services by allowing the adjustment of the consideration paid by the principal to the security agency concerned. What the Wage Orders require, therefore, is the amendment of the contract as to the consideration to cover the service contractor’s payment of the increases mandated. In the end, therefore, ultimate liability for the payment of the increase rests with the principal. In view of the foregoing the security guards should claim the amount of the increases from EAGLE. Under the Labor Code, in case the agency fails to pay them the amounts claimed, PTSI should be held solidarily liable with EAGLE [Articles 106, 107 and 109]. Should EAGLE pay, it can claim an adjustment from PTSI for an increase in consideration to cover the increases payable to the security guards.


    D E C I S I O N


    MENDOZA, J.:


    This is a petition for certiorari to annul the decision of the National Labor Relations Commission (NLRC) dated September 30, 1993, insofar as it affirms the decision of the labor arbiter and grants private respondents’ claims for separation pay, wage and ECOLA differential, 13th month pay and service incentive leave pay.

    The facts are as follows: Petitioner Helpmate, Inc. is a corporation rendering janitorial and similar services to clients, among which was the Bureau of Internal Revenue. Private respondents are some of the janitors and messengers employed by it.

    On March 24, 1986, private respondents, led by Felipe Cabaron, filed an amended complaint with the Regional Arbitration Branch of the NLRC in Cebu City against petitioner for illegal dismissal and payment of service incentive leave, separation pay, unpaid 13th - month pay since the start of employment, salary and ECOLA differential, attorney’s fees and damages. 1

    The parties submitted their position papers, after which the case was heard. On January 10, 1990, Labor Arbiter Jose G. Gutierrez rendered a decision ordering petitioner corporation to pay private respondents’ money claims. The dispositive portion of his decision reads: 2

    WHEREFORE, consistent with law, justice and equity and in accordance with the findings above stated, judgment is hereby rendered ordering the respondent to pay the following complainants their money claims:chanrob1es virtual 1aw library

    (A) Felipe C. Cabaron — Emergency allowance, 13th month pay, separation pay, and service incentive leave;

    (B) Mario Nuñez — Emergency allowance, salary differential, 13th month pay, and service incentive leave;

    (C) Emiliano Beleña, Jr. — Emergency allowance, salary differential, 13th month pay, and service incentive leave;

    (D) Emma Espina — Emergency allowance, salary differential, 13th month pay and service incentive leave;

    (E) Rosario Tizon, Jr. — Emergency allowance, salary differential, 13th month pay, and service incentive leave;

    (F) Renato Dabuayan — Emergency allowance, salary differential, 13th month pay, service incentive leave;

    (G) Romulo Matilos — Emergency allowance, and salary differentials;

    (H) Romelo Beleña — Emergency allowance, salary differentials, 13th month pay, and service incentive leave;

    (I) Reno Gualen — Emergency allowance, salary differential and 13th month pay

    and 10% of the total monetary awards as attorney’s fees.

    All other claims are denied for lack of merit.

    The Corporate Auditing Examiner is directed to compute the foregoing monetary awards which form part of this decision.

    On appeal to the NLRC, however, the decision was set aside and the case was remanded to the labor arbiter for further proceedings in view of certain factual matters which had to be determined, to wit: 3

    We discovered that aside from being mere machine copies the said documents while appearing to be indeed executed or signed after the filing of this case (except that of Nerio Ondong, Rec. p. 70) the same are not duly authenticated before any Labor Arbiter or Notary Public; the complainants-appellees also failed to comment on these documents despite their manifestation and the directive by the Arbiter (Rec. p. 70) to submit additional documents; this therefore needs clarification, on the circumstances surrounding its execution in order that full faith and credence may be given the said documents and in order that a fair and just resolution can be rendered on the matter raised on appeal.

    As regards the alternative defense that if ever any award be adjudged in favor of the complainants-appellees then it should be the principal employer, the Bureau of Internal Revenue that should be held liable in accordance with the Rules Implementing the various wage orders as cited by the appellants in their position paper (Rec. p. 47), the records do not contain any evidence to support this allegation like the contract of janitorial services or any other document.

    In this very case vital issues of fact like the due execution of the release and quitclaims and the determination as to whether the BIR is liable as principal need to be clarified.

    Petitioner corporation moved to implead the BIR as third-party respondent, alleging that in cases of contracts for janitorial and security services, the payment of the minimum wage and allowances was to be borne by the principal or client of the service contractor; that the BIR was the principal in this case; and that it was an indispensable party, which should be joined as a party in the action to avoid multiplicity of suits. 4

    The Regional Arbitration Branch of the NLRC granted petitioner’s motion. In its answer, the BIR pointed out that the third-party complaint never mentioned the names of the employees who were assigned to the BIR during the existence of the contract for services, and that it was only a client of petitioner and, as such, it was not duty bound to answer for the claims of employees against their direct employer, Helpmate, Inc. 5 The BIR also filed a motion to dismiss the third-party complaint which was opposed by the petitioner.

    In its supplemental position paper filed on October 1, 1992, petitioner maintained that under Wage Orders, 3, 5 and 6, the BIR was liable for the payment of the increases in the minimum wage and living allowances, and under Arts. 106, 107 and 109 of the Labor Code, the BIR as principal or client, was liable to the employees because it is considered the direct employer. Petitioner cited our ruling in the case of Eagle Security Agency, Inc. v. NLRC 6 in support of its contention. 7

    On October 22, 1992, Labor Arbiter Ernesto F. Carreon rendered a decision ordering petitioner to pay the money claims of Felipe Cabaron and Homer Datanagan. In addition, petitioner was ordered to pay solidarily with the BIR the claims of the following private respondents:chanrob1es virtual 1aw library

    1. Rino Gualen

    Wage differential P4,992.00

    ECOLA 3,536.00

    13th-Month Pay 702.00

    Service Incentive Leave Pay —

    ————

    P9,230.00

    2. Romulo Matelos

    Wage differential P11,280.00

    ECOLA 5,729.30

    13th-Month Pay 1,482.00

    Service Incentive Leave Pay 180.00

    ————

    P18,671.30

    3. Renato Debuayan

    Wage differential P14,646.00

    ECOLA 8,365.70

    13th-Month Pay 2,227.33

    Service Incentive Leave Pay 360.00

    ————

    P25,599.03

    4. Rosario Tizon

    Wage differential P14,646.00

    ECOLA 4,456.14

    13th-Month Pay 2,227.33

    Service Incentive Leave Pay 360.00

    ————

    P21,689.47

    5. Ronilo Beleña

    Wage differential P12,341.50

    ECOLA 7,015.92

    13th-Month Pay 2,629.89

    Service Incentive Leave Pay 460.00

    ————

    P22,447.31

    6. Emiliano Beleña

    Wage differential P4,200.00

    ECOLA 1,873.20

    13th-Month Pay 630.00

    Service Incentive Leave Pay

    ————

    P6,703.20

    7. Emma Espina

    Wage differential P3,196.00

    ECOLA 2,312.00

    13th-Month Pay 408.00

    Service Incentive Leave Pay

    ————

    P5,916.00

    Total Award of Complainants P150,724.48

    Add: 10% Attorney’s Fees 15,072.45

    ————

    P165,796.93

    The case against the president of petitioner corporation, Renato Y. Kintanar, was dismissed for lack of merit. 8

    On appeal, the NLRC affirmed the decision in toto. Hence, this petition. Petitioner contends that the NLRC committed grave abuse of discretion: 9

    1. by granting the claim for money of respondent Homer Datanagan even if in the decision of Labor Arbiter Jose Gutierrez no award was made in his favor.

    2. by disregarding petitioner’s right to procedural due process.

    3. by granting separation pay to Cabaron and compounding its error by fixing it at one month per year of service.

    4. by awarding amounts more than were sought by private respondents in their position paper and decision of Labor Arbiter Gutierrez.

    5. by holding the BIR only solidarily liable with petitioner when, under the law, as principal of the service contractor, the BIR should be solely liable.

    We find the petition without merit.

    First, petitioner draws attention to the fact that no award was made in favor of Homer Datanagan in the decision of Labor Arbiter Jose Gutierrez and contends that, although on appeal that decision was set aside by the NLRC, the fact is that Datanagan himself did not appeal. It was petitioner which appealed the decision of the labor arbiter and it was solely for its benefit that the case was remanded to the Arbitration Branch for the purpose of giving petitioner the opportunity to be heard on its defenses.

    This contention is without basis. The decision was set aside including the denial, if such it was, of Datanagan’s claim. It is not correct for petitioner to claim that on remand, it alone was entitled to be heard. The fact that the case was remanded for determination of many factual issues affecting all the parties meant that other issue could be considered. As the NLRC pointed out, "the decision of Labor Arbiter Gutierrez was set aside by this Commission, this being so there is no point anymore referring to the said decision." 10

    Petitioner complains that it was denied due process when the labor arbiter admitted private respondents’ position paper and joint affidavit without affording it the right to cross-examine and when the matters taken up at the re-hearing was confined to those which the NLRC considered as vital issues of fact not extending to other disputed issues of fact, such as those regarding the amount of living allowances received by private respondent Cabaron and the reason for his dismissal. Petitioner contends that this should have been the subject of a full-blown hearing.cralawnad

    The contention has no merit. "The essence of due process is that a party be afforded reasonable opportunity to be heard and to submit any evidence he may have in support of his defense. In administrative proceedings such as the one at bench, due process simply means the opportunity to explain one’s side or the opportunity to seek a reconsideration of the action or ruling complained of." 11

    Petitioner was given reasonable opportunity to be heard and submit evidence in support of his defense. It submitted position papers and documentary evidence to prove BIR’s liability. It had the similar opportunity to submit evidence to support its defense with respect to the question of illegal dismissal, but petitioner did not do so. For this reason the labor arbiter held:chanrob1es virtual 1aw library

    This charge of the complainant was never controverted by the respondents [Helpmate] by presenting proof showing the justification of the suspension and/or dismissal.

    It has been stressed often enough that in termination cases a dismissed employee is not required to prove his innocence of the charges levelled against him by his employer. The burden of proving the just cause of dismissing the employee rests on the employer and his failure to do so would result in the finding that the dismissal is unjustified. 12

    His finding was affirmed by the NLRC which stated:chanrob1es virtual 1aw library

    On the alleged failure by the Labor Arbiter to allow it to fully cross-examine the complainants, more specifically on Cabaron’s claim for cost of living allowance and the reason for his dismissal, We find no sufficient basis to disturb or alter these findings of the Labor Arbiter. With respect to the claim for cost of living allowance, cross-examination of the complainant claimant is not even necessary as this could so easily be refuted by the presentation of respondents’ payroll, voucher or any other form of receipt evidencing compliance with this obligation. Under the rules and applicable jurisprudence, employers are under obligation to keep employment records of their employees in the workplace. As to its opportunity to amplify on the reasons for Cabaron’s dismissal, the Labor Arbiter correctly declared that it behooves on the respondent to establish the existence of a valid or just cause for terminating an employee, thus it can not use as justification for its failure to substantiate its defenses, the lack of opportunity to cross-examine the complainants. Well settled is the rule that in cases of illegal dismissal, "the burden of proof rests upon the employer to show that the dismissal of the employee was for a just cause, and failure to do so would necessarily mean that the dismissal is not justified. 13

    Petitioner’s third and fourth contentions are likewise untenable. The labor arbiter found the private respondents to be entitled to more than the amount stated in their position paper. This finding, together with the prayer in private respondents’ position paper asking for "such other reliefs as may be just and equitable in the premises," 14 justifies the award given to private respondents. As stated by the NLRC in its decision: 15

    We likewise sustain the award of claims more than what was asked in the complainants’ position paper. The point raised by the respondent basically, is that the Labor Arbiter should have confined or limited the award to the amount stated in the complainants’ position paper.

    . . . It goes beyond the realm of the law. It is unfair and unjust to deny the complainants what is justly due in their favor as mandated by law simply because what is computed and asked by them is much lesser. . .

    Petitioner’s final contention, that the BIR is solely liable to the employees of Helpmate, Inc., has no basis in law. The case cited by petitioner itself supports the ruling of the NLRC that the principal (BIR) and the contractor (Helpmate) are jointly and severally liable to the private respondents. In the leading case of Eagle Security Agency, Inc. v. NLRC., this Court through Mme. Justice Cortes held:chanrob1es virtual 1aw library

    The Court finds that the NLRC acted correctly in ordering the two petitioners to jointly and severally pay the wage and allowance increases to the security guards.

    Petitioners’ solidary liability for the amounts due the security guards finds support in Articles 106, 107 and 109 of the Labor Code which state that:chanrob1es virtual 1aw library

    ART. 106. Contractor or subcontractor. — Whenever an employer enters into a contract with another person for the performance of the former’s work, the employees of the contractor and of the latter’s subcontractor, if any, shall be paid in accordance with the provisions of this Code.

    In the event that the contractor or subcontractor fails to pay the wages of his employees in accordance with this Code, the employer shall be jointly and severally liable with his contractor or subcontractor to such employees to the extent that he is liable to employees directly employed by him.

    ART. 107. Indirect employer. — The provisions of the immediately proceeding Article shall likewise apply to any person, partnership, association or corporation which, not being an employer, contracts with an independent contractor for the performance of any work, task, job or project.

    ART. 109. Solidary liability. — The provisions of existing laws to the contrary notwithstanding, every employer or indirect employer shall be held responsible with his contractor or subcontractor for any violation of this Code. For purposes of determining the extent of the civil liability under this Chapter, they shall be considered as direct employers.

    This joint and several liability of the contractor and the principal is mandated by the Labor Code to assure compliance of the provisions therein including the statutory minimum wage [Article 99, Labor Code]. The contractor is made liable by virtue of his status as direct employer. The principal, on the other hand, is made the indirect employer of the contractor’s employees for purposes of paying the employees their wages should the contractor be unable to pay them. This joint and several liability facilites, if not guarantees, payment of the workers performance of any work, task, job or project, thus giving the workers ample protection as mandated by the 1987 Constitution [See Article II Sec. 18 and Article XIII Sec. 3]." 16

    We affirm this rule today, as we hold that the NLRC correctly found the BIR and Helpmate, Inc. solidarily liable to private respondents for their money claims. While it is true that payment of the increases are "to be borne" by the principal or client (in this case, the BIR), we made it clear in that case that :chanrob1es virtual 1aw library

    . . . "To be borne", however, does not mean that the principal, PTSI in this case, would directly pay the security guards the wage and allowance increases because there is no privity of contract between them. The security guards’ contractual relationship is with their immediate employer, EAGLE. As an employer, EAGLE is tasked, among others, with the payment of their wages [See Article VII Sec. 3 of the Contract for Security Services, supra and Bautista v. Inciong, G.R No. 52824, March 16, 1988, 158 SCRA 665].

    On the other hand, there existed a contractual agreement between PTSI and EAGLE wherein the former availed of the security services provided by the latter. In return, the security agency collects from its client payment for its security services. This payment covers the wages for the security guards and also expenses for their supervision and training, the guards bonds, firearms with ammunitions, uniforms and other equipments, accessories, tools, materials and supplies necessary for the maintenance of a security force.

    Premises considered, the security guards’ immediate recourse for the payment of the increases is with their direct employer, EAGLE. However, in order for the security agency to comply with the new wage and allowance rates it has to pay the security guards, the Wage Orders made specific provision to amend existing contracts for security services by allowing the adjustment of the consideration paid by the principal to the security agency concerned. What the wage Orders require, therefore, is the amendment of the contract as to the consideration to cover the service contractor’s payment of the increases mandated. In the end, therefore, ultimate liability for the payment of the increases rests with the principal.

    In view of the foregoing, the security guards should claim the amount of the increases from EAGLE. Under the Labor Code, in case the agency fails to pay them the amounts claimed, PTSI should be held solidarily liable with EAGLE [Articles 106, 107 and 109]. Should EAGLE pay, it can claim an adjustment from PTSI for an increase in consideration to cover the increases payable to the security guards.

    However, in the instant case, the contract for security services had already expired without being amended consonant with the Wage Orders. It is also apparent from a reading of a record that EAGLE does not now demand from PTSI any adjustment in the contract price and its main concern is freeing itself from liability. Given these peculiar circumstances, if PTSI pays the security guards, it cannot claim reimbursement from EAGLE. But in case it is EAGLE that pays them, the latter can claim reimbursement from PTSI in lieu of an adjustment, considering that the contract, had expired and had not been renewed. 17

    WHEREFORE, petition is hereby DISMISSED and the decision of the National Labor Relations Commission is AFFIRMED.

    SO ORDERED.

    Regalado, Romero, and Puno, JJ., concur.

    Torres, Jr., J, is on leave.

    Endnotes:



    1. Rollo, p. 21.

    2. Id., pp. 40-41.

    3. Id., pp. 45-46.

    4. Id., pp. 48-50.

    5. Id., p. 56.

    6. 173 SCRA 481-489.

    7. Rollo, pp. 58-62.

    8. Id., pp. 86-88.

    9. Id., pp. 1-19.

    10. Id., pp. 97-98.

    11. M. Ramirez Industries and/or Manny Ramirez v. Secretary of Labor, Et Al., G.R. No. 89894. January 3, 1997.

    12. Rollo, p. 72.

    13. Id., pp. 98-99.

    14. Id., p. 30.

    15. Id., pp. 99-100.

    16. 173 SCRA 479, 484-485.

    17. Ibid., pp. 486-487.

    G.R. No. 112323   July 28, 1997 - HELPMATE, INC. v. NLRC, ET AL.


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