G.R. No. 202015 - Valeroso vs. Skycable Corp.

Petitioners Antonio Valeroso and Allan Legatona began working for respondent Skycable Corporation in 1998 as account executives tasked with soliciting cable subscriptions.
Their employment was evidenced by certifications issued by Michael T. De la Cuesta, the Sales Territory Manager, and by their payslips showing commissions and allowances from 2001 to 2006.
Initially engaged as direct hires, they were later transferred on January 1, 2007, to Skill Plus Manpower Services (later known as Armada Resources & Marketing Solutions, Inc.) without any separate transfer agreement, thereby altering the nature of their work arrangement.

On February 25, 2009, petitioners filed a Complaint before the Labor Arbiter for illegal dismissal, non-payment of 13th month pay, separation pay, and alleged illegal deductions.
The Complaint was amended to include claims for regularization and the payment of moral and exemplary damages.
Petitioners alleged that after being informed in February 2009 of a reduction in commissions due to the introduction of prepaid cards, they expressed their intention to file a case with the NLRC and were subsequently dropped from the roster of account executives—a move they contended was an unfair labor practice.

Skycable argued that there was never an employer-employee relationship with the petitioners, contending they were engaged as independent contractors under a Sales Agency Agreement when first hired in 1998.
In 2007, as part of an operational streamlining, petitioners’ contracts were terminated and they were referred to Armada, another independent contractor engaged to provide marketing services for respondent.
Evidence supporting independent contractorship included:

The Sales Agency Agreement, which explicitly stated the independent contractor status of the petitioners.
Affidavits from De la Cuesta and Armada’s President Francisco Navasa, clarifying that petitioners were not direct employees of Skycable and that Armada exercised control over their engagement and compensation arrangements.
A Release and Quitclaim signed by petitioner Legatona acknowledging his role as a sales agent/independent contractor.

The Labor Arbiter dismissed the Complaint on the ground that petitioners failed to produce substantial evidence of an employer-employee relationship.
Key observations included the lack of clear evidence identifying a representative of Skycable with the authority to hire, pay, and control the petitioners.

The NLRC reversed the Labor Arbiter’s ruling by holding that petitioners, having performed their duties as account executives for over one year, were regular employees of respondent.
The NLRC found that the certifications and payslips (even if submitted from an earlier period) were substantial evidence establishing employer-employee relations.
Accordingly, the NLRC declared that the termination of petitioners’ services amounted to an illegal dismissal, ordering their immediate reinstatement and payment of full backwages plus appropriate benefits.

Skycable filed a Petition for Certiorari before the Court of Appeals, contesting the NLRC decision on the ground of grave abuse of discretion.
The Court of Appeals, in its decision on November 11, 2011, sided with Skycable by reversing the NLRC ruling, upholding that there was insufficient evidence to prove an employer-employee relationship.
A subsequent motion for reconsideration by petitioners was denied by the CA in its Resolution dated May 18, 2012.

Whether the Court of Appeals gravely erred in rendering its decision dated November 11, 2011 and subsequently denying petitioners' motion for reconsideration.
Whether petitioners were, in fact, the regular employees of Skycable Corporation whose dismissal constituted illegal termination, or if they were merely independent contractors as evidenced by the contractual arrangements and the overall conduct of the parties.