Case Summary (G.R. No. 159890)
Employment Background
Empermaco B. Abante, Jr. started working for Lamadrid Bearing & Parts Corporation as a salesman in June 1985, earning a commission of 3% on total paid-up sales for the Mindanao region. His income ranged from approximately P16,000 to P20,269.50 monthly. In addition to selling, he handled the collection of payments from customers. The president, Jose Lamadrid, exercised significant control over Abante's work assignments and activity planning.
Issue of Bad Accounts
In 1998, the petitioner faced issues with five customers who had accumulated bad accounts totaling P687,166.62. Respondent Lamadrid demanded that Abante issue personal checks to cover these bad accounts, threatening non-payment of his commissions and potential job loss if he did not comply. Despite his reservations, Abante issued the checks under the condition that they not be deposited and that their amounts be deducted from his commissions.
Execution of Promissory Note and Mortgage
The petitioner later signed additional documents, namely a Promissory Note and a Deed of Real Estate Mortgage, under conditions he later argued were coercive and misleading. Although initially assured that the checks would not be deposited, the respondents ultimately deposited them, leading to dishonor due to an "Account Closed" status.
Legal Action and Claims
Following a demand letter from the respondents for payment of the dishonored checks, Abante filed a complaint for illegal dismissal with money claims against Lamadrid and the corporation. The respondents defended against his claims by asserting that he was merely a freelance salesman and therefore not entitled to the protections granted to employees under the Labor Code.
Findings of the Labor Arbiter
The Labor Arbiter ruled in favor of Abante, awarding him a substantial amount for separation pay, back wages, unpaid commissions, and damages. The ruling was based on the determination of an employer-employee relationship, emphasizing the need for appropriate compensation and benefits due to Abante's long tenure.
Appeal to NLRC
The National Labor Relations Commission (NLRC) overturned the Labor Arbiter’s decision, dismissing the complaint on the grounds of lack of cause of action, asserting that no employer-employee relationship existed between Abante and the respondents. The NLRC considered the nature of the commission-based relationship and the absence of control by the respondents over Abante's work.
Court of Appeals Decision
Abante's appeal to the Court of Appeals was also denied. The appellate court reiterated that the control test was absent, concluding that Abante was not an employee but rather acted as a commission-based freelance salesman. The court found that although Abante brought in substantial sales, he was free to enga
...continue readingCase Syllabus (G.R. No. 159890)
Background of the Case
- The case involves a petition for review under Rule 45 of the 1997 Revised Rules of Civil Procedure.
- The petitioner, Empermaco B. Abante, Jr., was employed by Lamadrid Bearing and Parts Corporation as a salesman starting June 1985.
- His commission was set at 3% of total paid-up sales, with an average monthly income that increased from approximately P16,000.00 to P20,269.50.
Employment Details
- Abante was tasked with selling and collecting payments from customers throughout Mindanao.
- The company, represented by its president Jose Lamadrid, exerted complete control over Abante's work, including directing him to specific areas for sales and collection.
- Abante occasionally traveled to Manila for conferences related to market strategies.
Bad Accounts Issue
- In 1998, Abante faced issues with five customers whose accounts became bad debts, totaling P687,166.62.
- Lamadrid confronted Abante and demanded he issue personal checks to cover these bad debts, threatening to withhold his commissions and job.
- Under duress, Abante issued personal checks with the condition that they would not be deposited and that their value would be offset against his commissions.
Coercion and Agreements
- Abante was tricked into signing a Promissory Note and a Deed of Real Estate Mortgage.
- Despite prior agreements, the company deposited the checks, leading to them being dishonored d