G.R. No. L-61323-24 - Hoey vs. Provincial Fiscal of Rizal

The controversy arose from a dispute over whether jockeys associated with the Manila Jockey Club, Inc. and the Philippine Racing Club, Inc. can be considered employees under the Social Security Act.
The petitioner, Social Security System, had issued a resolution on July 3, 1963, affirming the employer-employee relationship between the clubs and the jockeys, thereby extending Social Security Act coverage to jockeys.
The Court of Appeals reversed that resolution on February 4, 1966, holding that such a relationship did not exist, prompting the Social Security System to elevate the issue on certiorari.

There are only two recognized racing entities in the Philippines: the Manila Jockey Club, Inc. and the Philippine Racing Club, Inc.
Procedures for race events are strictly regulated:

Approximately 10 days prior to an event, the clubs accept the inscription of horses via entry forms, which include the names of the horses and their owners, certified by the latter.
A handicapper then prepares a list of entries to allow horse owners to decide on their participation.
Owners who choose to enter their horses must file a declaration that specifies both the horse’s name and the selected jockey’s name, the latter’s signature serving as evidence of his personal agreement.

The screening process ensures that ineligible jockeys or mounts that violate regulations are excluded before the final race program is printed and released.
Each race event allows a maximum of 14 participating horses, each with a qualified jockey.

A fraction of the total bets is allocated to the Games and Amusements Board and the club, with specific percentages designated as prize money and dividends to bettors.
Prize money distribution dictates that the horse owner shares a portion with the jockey (20%) and the trainer (10%) only if the mount attains first, second, or third place.

The clubs employ other personnel (e.g., janitors, guards) who are already under the coverage of the Social Security Act.
Jockeys must secure a license from the Games and Amusements Board and pay a nominal fee to gain access to training facilities and participate in racing events.

Although the stewards receive per diems from the clubs, their actions and decisions are independent since their authority derives from statutory provisions and the Board's regulations rather than from the clubs.

The Social Security Act defines “employee” as any person who is compensated for services rendered, where both mental and physical efforts are applied and an employer-employee relationship exists.
The factual matrix reveals:

The selection and engagement of jockeys is effectuated by the race horse owners, not the clubs.
Jockeys exercise autonomy in choosing the horse they will mount, based on mutual agreement with the owner.
The race clubs do not exercise the control necessary over the jockeys, as would be required to establish an employer-employee relationship.

Whether the jockeys associated with the Manila Jockey Club, Inc. and the Philippine Racing Club, Inc. are considered employees under the Social Security Act.

Does the relationship between the jockeys and the racing clubs meet the statutory definition of an employer-employee relationship?
Is the control exerted by the clubs over their jockeys sufficient to establish such a relationship, especially in light of the independent nature of jockey selection and the involvement of race stewards?