G.R. No. 252720 - Conjusta vs. PPI Holdings, Inc.

On October 2, 2002, PPI Holdings, Inc. (PPI), the sole franchisee of Pizza Hut in the Philippines, hired petitioner Rico Palic Conjusta as a messenger initially for its human resources department and later for its accounting department.
Conjusta’s employment was subsequently transferred from PPI to a manpower agency, Human Resources, Inc., and later to Consolidated Buildings Maintenance, Inc. (CBMI), which is now Atalian Global Services.

Despite the transfer of employment, Conjusta continued to render services as a messenger at PPI’s accounting department.
On August 1, 2016, CBMI, alongside other co-employees, sent a termination letter to Conjusta, effectively ending his service with PPI.
Conjusta filed an illegal dismissal case with monetary claims against PPI, CBMI, and their respective owners, contending that he was a regular employee of PPI for 14 years and that his dismissal lacked just cause.

PPI denied an employer-employee relationship with Conjusta, arguing that he was assigned to PPI by CBMI—a contractor providing janitorial, sanitation, warehousing, and allied services.
PPI maintained that CBMI was responsible for relaying company rules/conditions and handling salary and benefit payments as per their service agreement.

CBMI acknowledged Conjusta as its employee placed at PPI but denied that it terminated his services.
It claimed that Conjusta and other employees were merely placed on “floating status” when financial disagreements led to the termination of the service contract with PPI effective September 1, 2016.
CBMI argued that the complaint against it was premature, given that the termination was due to the expiration of their contract or related disagreements.

The LA found sufficient evidence (SEC registration, company profile, contracts of services, DOLE registration certificates, and financial statements) to prove that CBMI was a legitimate job contractor.
Despite the evidence concerning CBMI’s independent status, the LA ruled that there was no proof of an employer-employee relationship between CBMI and Conjusta.
Conjusta’s 14 years of service with PPI, performing essential tasks as a messenger, led the LA to declare him PPI’s regular employee.
The LA ordered PPI to pay full backwages, separation pay, 13th month pay, and attorney’s fees.

The NLRC found CBMI to be a labor-only contractor as, despite showing evidence of substantial capitalization, it failed to conduct its service contracts in an independent manner free of PPI’s control.
The contracts between PPI and CBMI indicated that CBMI merely supplied manpower.
Conjusta’s long-term work as a messenger—integral to PPI’s core business—further vindicated his status as PPI’s employee.
The NLRC modified the LA ruling by declaring CBMI as labor-only, ordering PPI to reinstate Conjusta without loss of his seniority, and holding PPI and CBMI jointly liable for backwages, 13th month pay, and attorney’s fees.

PPI partially appealed the LA ruling and the NLRC decision.
The CA, in its October 30, 2019 Decision, reverted to the LA’s finding that CBMI was a legitimate job contractor, relying on the precedents in Asprec and Cayetano.
The CA maintained the ruling of illegal dismissal but declared CBMI as the direct employer of Conjusta.
The CA also held that PPI and CBMI were jointly liable.
On March 6, 2020, the CA denied the motions for reconsideration from Conjusta, CBMI, and PPI on various issues, leaving intact the administrative determinations on the employment relationship.

Conjusta petitioned for review challenging the CA’s ruling that CBMI is a legitimate job contractor and thereby his direct employer.
Conjusta argued that CBMI was engaged in labor-only contracting and that he was, in fact, PPI’s regular employee for 14 years.
CBMI submitted a comment maintaining that PPI should not be held liable jointly for Conjusta’s claims.
PPI and CBMI did not dispute the findings on illegal dismissal, reinstatement orders, and monetary awards.

Whether the Court of Appeals erred in ruling that CBMI was a legitimate job contractor and, as a result, Conjusta’s direct employer.

The issue centers on the characterization of CBMI’s status as a job contractor versus a labor-only contractor.
It questions if the application of prior cases (Asprec and Cayetano) was appropriate without independently assessing the totality of facts in Conjusta’s case.

Whether the CA erred in holding PPI and CBMI jointly and severally liable for the monetary awards arising from Conjusta’s illegal dismissal.

This addresses the determination of solidarity liability under labor-only contracting provisions.
The issue involves examining if the employer-employee relationship, as evidenced by the control over Conjusta’s work, justifies joint liability.