Title
ABS-CBN Corporation vs. Concepcion
Case
G.R. No. 230576
Decision Date
Oct 5, 2020
ABS-CBN driver Jaime Concepcion contested his classification as an independent contractor, seeking regularization. Courts ruled him a regular employee, affirming illegal dismissal and entitlement to reinstatement and backwages.
regular employee
dismissal
illegal
A

Case Summary (G.R. No. 230576)

Factual Background

Respondent alleged that he was hired by ABS-CBN Corporation in June 1999 as an OB van driver assigned to the Engineering Department and tasked primarily to oversee and operate the generator used during tapings and shootings. He was assigned to numerous ABS-CBN programs over the years and acted as property custodian for equipment, particularly generator sets. Respondent asserted that he worked under ABS-CBN supervision with prescribed schedules, assignments and reporting times, that he was required to comply with company rules and sanctions, and that he attended trainings and seminars provided by the network. In 2003, respondent received a memorandum from his supervisor concerning an alleged overheating of a generator. Respondent alleged that he joined the workers’ union and was placed in the Internal Job Market work pool. After the union pressed for regularization, respondent refused to sign an employment contract prepared by ABS-CBN and was dismissed on 01 September 2010. At dismissal he received Php558.16 per day, or Php69.77 per hour.

Labor Arbiter and NLRC Proceedings

The Labor Arbiter dismissed respondent’s complaint for lack of jurisdiction, finding no employer-employee relationship between respondent and ABS-CBN Corporation. On appeal, the NLRC Fifth Division reversed the Labor Arbiter in its Decision dated 29 December 2011, declaring respondent a regular employee, finding his dismissal illegal, ordering reinstatement, payment of backwages from dismissal until reinstatement, and attorney’s fees of ten percent. ABS-CBN filed a motion for reconsideration and sought inhibition of Commissioner Lacap. The NLRC Chair created a Special Division by Administrative Order to resolve the motion. The Special Division, in a Per Curiam Decision dated 29 May 2012, reversed Commissioner Lacap and reinstated the Labor Arbiter’s dismissal.

Proceedings Before the Court of Appeals and Supreme Court

Respondent filed a petition for certiorari under Rule 65, Rules of Court before the Court of Appeals. The CA annulled the NLRC Special Division’s Per Curiam Decision and reinstated the NLRC Fifth Division’s Decision in its 20 October 2016 ruling. ABS-CBN moved for reconsideration in the CA but the motion was denied. ABS-CBN then filed the present petition for review before the Supreme Court contesting, inter alia, respondent’s failure to file a motion for reconsideration before the Special Division and the CA’s finding that respondent was a regular employee.

Issue Presented

The principal issues were whether respondent’s failure to file a motion for reconsideration before the NLRC Special Division was fatal to his Rule 65 petition and whether respondent was an independent contractor or a regular employee of ABS-CBN Corporation whose dismissal was illegal.

Petitioner's Contentions

ABS-CBN Corporation contended that the Court of Appeals should have dismissed the Rule 65 petition because respondent did not file a motion for reconsideration before the NLRC Special Division. ABS-CBN further argued that respondent was a talent classified as an independent contractor and that prior CA authority in Jalog should have constrained the CA and the Supreme Court under the doctrine of stare decisis.

Respondent's Contentions

Respondent maintained that he was a regular employee performing duties essential or desirable to ABS-CBN’s business. He relied on his long tenure since 1999, payroll payments and payslips showing ABS-CBN as employer, statutory contributions withheld in ABS-CBN’s name, supervisory control and disciplinary measures by ABS-CBN, mandatory attendance at company trainings, and the provision by the network of tools and instruments of work such as the OB van and generator set.

Governing Law and Tests for Employment Status

The Court reiterated the four-fold test to determine employer-employee relationship: (1) selection and engagement of the employee; (2) payment of wages; (3) power of dismissal; and (4) power to control the employee’s conduct, the so-called control test. The Court also restated that the employer bears the burden to prove that a worker is an independent contractor rather than an employee. The Court applied Article 294 on regular employment and referenced Articles on termination, including Article 297 and Article 298 of the Labor Code, and procedural rules under Rule 65.

Court's Analysis: Motion for Reconsideration and Jurisprudential Exceptions

The Court observed that while a Rule 65 petition ordinarily requires the filing of a motion for reconsideration before the tribunal whose action is assailed, established exceptions exist. The Court identified the relevant exceptions in the record and concluded that exceptions (b) and (d) applied: the questions raised in the certiorari proceedings were the same as those raised and passed upon by the lower court, and under the circumstances a motion for reconsideration would have been useless. The Court found respondent’s explanation in his prefatory statement sufficient and emphasized that procedural rules in labor cases must not be applied in an unduly rigid manner because they exist to secure substantial justice. The Court therefore rejected ABS-CBN’s procedural objection.

Court's Analysis: Independent Contractor versus Employee

The Court analyzed whether respondent was an independent contractor in light of precedent including Fuji Television Network, Inc. v. Espiritu and Paragale v. GMA Network, Inc., which recognize a category of independent contractor composed of persons with unique skills or talents who are not subject to control over means and methods of work. The Court found on the facts that respondent was directly hired by ABS-CBN Corporation, received payslips in the company’s name and statutory deductions reflecting ABS-CBN as employer, was subject to supervision and discipline including a disciplinary memorandum, attended company-provided trainings, used instruments and tools furnished by ABS-CBN (the OB van and generator set), and lacked bargaining power to negotiate fees. The Court rejected ABS-CBN’s argument that classification as a “talent” rendered respondent an independent contractor. The Court held that driving an OB van equipped with specialized instruments did not render respondent a person of unique skill sufficient to displace an employer-employee relationship. The Court concluded that, under the four-fold test and the nature of ABS-CBN’s business as shown in its Amended Articles of Incorporation, respondent performed activities usually necessary or desirable in the usual business or trade of ABS-CBN and thus was a regular employee, including under the second category of Article 294 by virtue of at least one year of service.

Court's Ruling on Illegal Dismissal and Remedy

Having found respondent a regular employee, the Court held that his

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