Case Digest (G.R. No. 141464)
Facts:
Grandspan Development Corporation v. Ricardo Bernardo, Antonino Cenidoza and Edgardo Del Prado, G.R. No. 141464, September 21, 2005, Supreme Court Third Division, Sandoval‑Gutierrez, J., writing for the Court.Respondents Ricardo Bernardo, Antonino Cenidoza and Edgar Del Prado (substituted by his surviving parent Edgardo Del Prado after his death) filed a complaint for illegal dismissal and nonpayment of benefits with the Labor Arbiter, docketed as NLRC Case No. RAB‑IV‑11‑4605‑92‑RI, against petitioner Grandspan Development Corporation (and/or its warehouse manager Manuel G. Lee). They alleged they were hired in 1990 as truck scale monitors at a daily rate of P104.00, worked in Grandspan’s Truck Scale/Materials Department, received company identification cards signed by personnel manager Bonifacio Selmo, and were dismissed by a notice dated October 28, 1992 effective October 29, 1992 for alleged use of profane/offensive language in violation of company rules.
Petitioner denied direct employment, asserting respondents were employees of J. Narag Construction, a subcontractor engaged for fabrication work on the HCMG (Sogo) project; alternatively, petitioner claimed respondents were project employees whose services ended upon project completion in September 1992. Petitioner also relied on a memorandum to J. Narag terminating the respondents for misconduct.
The Labor Arbiter, after pleadings and position papers, dismissed respondents’ complaint by decision dated June 30, 1994, concluding they were project employees. The National Labor Relations Commission (NLRC), however, issued a Resolution on March 7, 1995 remanding the case to the Labor Arbiter to determine existence of an employer‑employee relationship; motions for reconsideration were denied on April 28 and May 31, 1995. Respondents filed a petition with the Court, which this Court referred to the Court of Appeals pursuant to our decision in St. Martin’s Funeral Home v. NLRC.
The Court of Appeals (CA) in CA‑G.R. SP No. 50610 rendered a Decision dated September 17, 1999 setting aside the NLRC resolutions and holding that: (1) respondents were employees of Grandspan (J. Narag being a labor‑only contractor), (2) respondents were non‑project (regular) employees, (3) their dismissal was without substantial evidence and without observance of due process; the CA ordered reinstatement of Bernardo and Cenidoza with backwages and other benefits (Grandspan and J. Narag jointly and severally liable) and separation pay for Del Prado. The CA denied Grandspan’s motion for reconsideration but, by Resolution dated January 6, 2000, modified its Decision to award Del Prado both separatio...(Pro-only)
Issues:
- Whether the Court of Appeals erred in holding that respondents had an employer‑employee relationship with Grandspan.
- Whether J. Narag Construction was a labor‑only contractor and therefore not the true employer.
- Whether respondents were project employees whose services terminated upon project completion.
- Whether respondents’ dismissal was illegal for lack of just cause and denial of due process.
- What reliefs are proper (...(Pro-only)
Ruling:
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Ratio:
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Doctrine:
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