SUPREME COURT DECISIONS

Search for www.chanrobles.com

PLEASE CLICK HERE FOR THE LATEST ➔ SUPREME COURT DECISIONS

FIRST DIVISION

G.R. No. Nos. 74193-94 June 9, 1992

SAN MIGUEL CORPORATION, Petitioner, vs. THE NATIONAL LABOR RELATIONS COMMISSION, LABOR ARBITER PELAGIO, LUSITO DE OCAMPO, DEMETRIO ABANES, ARTURO ABELLA DANNY ABUY, RODEL ADATO, HENRY AGUILAR, EFREN ARCIETE, AROMIN ATILANO, RODOLFO ASINA, EDDIE BAAC, PRUDENCIO BAGAOISAN, RICARDO BAGAOISAN, DOMINGO BAGTING, ROMERICO BALBUENA, ALEJANDRO BALLON, GENEROSO BAUTISTA, JOSE BEJENANO, ANTONIO BERMEJO, MANUEL BIGCAS, WILFREDO BRUNO, MAXIMO BUAN, REYNALDO CABIGTING, JUANITO CABRERA, ROGELIO CAHIMAT, RICARDO CAMILAN, FEDERICO CALLERO, RICARDO CAPULONG, GILBERT CARAGAY, CLAUDIO CARANTO, ALFREDO CASTILLO, EDUARDO CASTILLO, GERARDO CARDENO, ARTEMIO CASTRO, ROGELIO CASTRO, FERNANDO CODILLO, EFREN CORPUZ, MARIILITO CORONEL, EMILIANO CRUZ, ROSAURO CRUZ, MARCELINO DELA CRUZ, EDUARDO DELA PAZ, FEDERICO DELA ROSA, CESAR DE MARTIN, RAMON DE VERA, FERNANDO DEL MORAL, FLORENCIO DARIA, EDUARDO DISPO, ANDRES DOMINADOR, GREGORIO DIMAPILIS, LORENZO ELLI, MARIO DELVO, ARNELIO ERANG, ROGER ESPAÑOL, RUBEN ESPIRITU, AVELINO ESTEBAN, JOSELITO ESTEBAN, FILEMON GLINOGA, ROGELIO GOFREDO, EDUARDO GOFREDO, NILO GRAFIL, DOMINADOR GRAVILLO, ROMEO GRUTA, ALFREDO GUNTANG, MONCHITO HERNANDEZ, HENRY JORNACIO, ROLANDO LACORTE, RAMON LAGAYO, RIZALDY LAYSON, LORETO LAYSON, GREGORIO, LOBRII, ALFONSO LIMOS, ROBERTO LUNA, HECTOR MAGCULANG, RUBEN MANAWAG, TEODORO MANANKIL, ANTONIO MANGONON, LEONARDO MATEO, DANIEL MEMES, VICTOR MEMES, DOMINGO MENDOZA, JOVENCIO MERCADO, DANILO METIAM, ERNESTO METIAM, ELLI MILLARES, DOMINADOR MUENA, NORERTO NAZA, NONITO NEBRAO, VICTOR NICOLAS, JOSELITO NUNGA, JOSE NUNGA JR., RICARDO OCBINA, VICENTE OLIBAR, JR., FERMIN PALACIO, INOCENCIO PAGUNSAN, ARLAN PANDAKILA, BERNARDO PANGYARIHAN, DOMINGO PAREDES, CARLIO PINEDA, FERNANDO QUILANG, ROGELIO RADIN, CAMILO RAMOS, ROGELIO RAMOS, LAURO RIVERA, ALFREDO RODRIGORO, MANOLO ROQUE, MANUEL ROSIA, FREDERIC RUSGAL, SAMUEL SAMBROSO, DANILO SALONGA, REYNALDO SAN PEDRO, RAM RAMIK SANTOS, RANDIL SANTOS, RAMON SARRA, RODOLFO SARRA, NARCISO SOLETA, JOVENCIO SUMALIGNOG, FELINO TALAVERA, RODRIGO TAPAOAN, ABELARDO TENTATIVA, BASILIO TERRADO, ELPIDIO TERRADO, HORACIO TING, RAMON TOLLEDO, FELIPE TORRES, JIMMY VALENCIANO, MONCHITO VALDEVIESO, REYNALDO VILLAFANSA, GRACIANO VILLARALBO, MELCHOR VILLARICO, MORENO VICENTE, RUBEN VISCONDE, ROLANDO ZULUETA, RODOLFO CARILLO, MANUEL REYES, and ODILO DAYAG, Respondents.chanrobles virtual law library

GRIÑO-AQUINO, J.:

A complaint dated February 8, 1983 was filed by respondent Luisito de Ocampo, and one hundred and thirty three (133) co-employees against their employer. Reliable Contractor, and the San Miguel Corporation for underpayment of wages, and non-payment of their 13th month pay for 1980 to 1982. They alleged that they are the regular and permanent employees of Reliable Labor Contractor (Reliable for brevity), which entered into a contract of service to undertake the loading and unloading of various materials and to repair shells and pellets for the petitioner, San Miguel Corporation, on a task (or piece work) basis until December, 1982. During that period, the private respondents were not paid their 13th month pay and were only receiving a daily wage of P17.00 per day:chanrobles virtual law library

San Miguel Corporation answered that under P.D. No. 851 and implementing rules and regulations, it is not jointly and severally liable with the contractor (Reliable) for the payment of the 13th month pay of the latter's employees, and that it has regularly and conscientiously paid Reliable the agreed contractor's fees which included the basic daily wage, emergency allowance and the 13th month pay of Reliable's employees.chanroblesvirtualawlibrarychanrobles virtual law library

Reliable, for its part, alleged that as it hired the complainants on a task basis up to December, 1982, it was exempted from the coverage of P.D. No. 851 during that period.chanroblesvirtualawlibrarychanrobles virtual law library

On October 30, 1984, Labor Arbiter Pelagio A. Carpio rendered a decision dismissing the complaint for underpayment of wages but directed San Miguel Corporation and Reliable to pay the private respondents their 13th month pay for 1980 to 1982.chanroblesvirtualawlibrarychanrobles virtual law library

On December 13, 1984, both parties appealed the decision of the Labor Arbiter.chanroblesvirtualawlibrarychanrobles virtual law library

On January 29, 1986, the National Labor Relations Commission (NLRC) affirmed the Labor Arbiter's decision.chanroblesvirtualawlibrarychanrobles virtual law library

Hence, this petition for certiorari raising the issue of whether or not San Miguel may be held jointly and severally liable with the labor contractor for the payment of the workers' 13th month pay.chanroblesvirtualawlibrarychanrobles virtual law library

The petitioner alleges that the NLRC committed a grave abuse of discretion in directing it (petitioner) to pay solidarily with Reliable, the 13th month pay of the latter's employees for 1980 to 1982, despite the fact that P.D. No. 851 does not provide for solidary liability of the principal and the independent contractor to pay the 13th month pay of the latter's employees.chanroblesvirtualawlibrarychanrobles virtual law library

The petition is bereft of merit.chanroblesvirtualawlibrarychanrobles virtual law library

In holding petitioner solidarily liable with Reliable for the payment of the 13th month pay of the private respondents, the NLRC found that:

. . . we are one with the Arbiter a quo in finding for the solidary liability of both respondents. This is in line with the constitutional mandate of affording protection to labor. Although P.D. No. 851 do (sic) not provide for solidary liability of appellant San Miguel Corporation in the payment of 13th month pay to the workers when the independent contractor fails to do so, there are analogous provisions of the Labor Code as amended which are directly applicable in this case, to wit:chanrobles virtual law library

Art. 106. Contractor or subcontractor. - . . . .chanroblesvirtualawlibrarychanrobles virtual law library

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 of the work performed under the contract, in the same manner and extent that he is liable to employees directly employed by him.

xxx xxx xxxchanrobles virtual law library

Art. 107. Indirect employer. - The provisions of the immediately preceding 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.chanroblesvirtualawlibrarychanrobles virtual law library

Art. 108. Posting of Bond. - An employer or indirect employer may require the contractor or subcontractor to furnish a bond equal to the cost of labor under the contract, on condition that the bond will answer for the wages due the employees should the contractor or subcontractor, as the case may be, fail to pay the same.chanroblesvirtualawlibrarychanrobles virtual law library

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 any provision of this Code. For purposes of determining the extent of their civil liability under this Chapter, they shall be considered as direct employers. (pp. 50-51, Rollo.)

We agree with the NLRC's ruling that San Miguel is solidarily liable with Reliable for the employees' 13th month pay by virtue of the express provision of Art. 107 of the Labor Code that the solidary liability of an employer and his contractor or subcontractor under Art. 106 shall apply to an indirect employer and his contractor.chanroblesvirtualawlibrarychanrobles virtual law library

The petitioner as indirect employer of the private respondents (employees of the labor-only-contractor [Reliable]) is solidarily liable with the latter for the payment of the 13th month pay which the latter's workers are legally entitled to receive in addition to their wages because nonpayment thereof constitutes a violation of the Code for which "every employer or indirect employer shall be held responsible with his contractor or subcontractor." (Art. 109, Labor Code.)chanrobles virtual law library

WHEREFORE, finding no grave abuse of discretion in the decision of the NLRC holding the petitioner solidarily liable with its labor contractor for the 13th month pay of the latter's employees, the petition for certiorari is DISMISSED. Costs against the petitioner.chanroblesvirtualawlibrarychanrobles virtual law library

SO ORDERED.