Case Summary (G.R. No. 195466)
Petitioner
Ariel L. David, doing business under the name and style “Yiels Hog Dealer.”
Respondent
John G. Macasio, a butcher engaged by petitioner.
Key Dates
• January 6, 1995 – Macasio begins working as butcher.
• January 2009 – Macasio files complaint with the Labor Arbiter.
• April 30, 2009 – Labor Arbiter decision dismissing monetary claims.
• May 26, 2010 – NLRC decision affirming Labor Arbiter.
• November 22, 2010 – Court of Appeals decision granting certiorari in part.
• January 31, 2011 – CA resolution denying reconsideration.
• July 2, 2014 – Supreme Court decision on petition for review.
Applicable Law
• 1987 Philippine Constitution (post‐1990 decision).
• Labor Code of the Philippines: Articles 82 (coverage/exclusions), 94 (holiday pay), 95 (service incentive leave), 97(6) & 101 (wages/payment by results).
• Implementing Rules and Regulations on holiday pay and service incentive leave.
• Presidential Decree No. 851 (13th-month pay) and its Implementing Rules.
Factual Antecedents
Macasio claimed since January 1995 he worked daily as a butcher for David at a fixed fee of ₱700 per chopping engagement, performing approximately four hours of work (10 p.m. to 2 a.m.). He alleged David set his schedule, approved leaves, owned tools and premises, and controlled work methods. David maintained that he engaged Macasio on a pakyaw (task) basis beginning in 2005, paying a flat fee per engagement without supervising hours or guaranteeing daily work.
Labor Arbiter Ruling
The Labor Arbiter found that Macasio was paid on a pakyaw or task basis—receiving ₱700 per completed chopping task regardless of hours worked—and concluded he was excluded from overtime, holiday pay, service incentive leave, and 13th-month pay under the Labor Code and its IRR. The complaint was dismissed.
NLRC Ruling
Affirming the Labor Arbiter, the NLRC held that Macasio was paid by result, not time, and thus not covered by labor standards on overtime, holiday pay, service incentive leave, or 13th-month pay. A motion for reconsideration was denied.
Court of Appeals Ruling
The CA granted certiorari in part, ruling that although Macasio was engaged on a task basis, he was not “field personnel” under Article 82 and therefore entitled to holiday pay, service incentive leave, and 13th-month pay per the doctrine in Serrano v. Severino Santos Transit. The CA awarded three years of benefits and 10% attorney’s fees, but denied moral and exemplary damages. A motion for reconsideration was denied.
Petition Before the Supreme Court
David contended that a pakyaw arrangement negated any employer–employee relationship and excluded Macasio from statutory benefits. He urged deference to Labor Arbiter and NLRC factual findings and argued the CA committed factual appellate review beyond the scope of a Rule 45 petition for certiorari.
Scope of Review
Under Rule 45, the Supreme Court’s review of a CA decision in a Rule 65 proceeding is confined to questions of law, notably whether the CA correctly determined grave abuse of discretion by the NLRC. Factual issues—such as existence of employer–employee relationship—are generally not reopened.
Employer–Employee Relationship Analysis
Applying the four‐fold and control tests (selection/engagement, payment of wages, power of dismissal, right to control work methods), the Court confirmed an employment relationship: David selected and paid Macasio, set his schedule at the place of business, and retained the right to supervise and dismiss.
Nature of Engagement
All tribunals found Macasio was paid on a pakyaw (task) basis, characterized by fixed payment upon task completion, irrespective of time spent. This method alone does not negate employment status or automatically exempt statutory benefits.
Entitlement to Holiday and Service Incentive Leave
Under Article 82 and its IRR, holiday and service incentive leave provisions cover all employees except those expressly exempted. Jurisprudence (Cebu Institute, Autobus, Serrano) construes “employees on task or contract basis” as exempt only if they qualify as “field personnel”—workers whose duties are perf
...continue readingCase Syllabus (G.R. No. 195466)
Factual Antecedents
- In January 2009, John G. Macasio filed a complaint with the Labor Arbiter for non-payment of overtime pay, holiday pay, 13th month pay, service incentive leave (SIL), moral and exemplary damages, and attorney’s fees against Ariel L. David, doing business under the name and style “Yiels Hog Dealer.”
- Macasio alleged employment since January 6, 1995 as a butcher under David’s effective control: David set workday and reporting time, approved leaves, owned hogs, tools and workplace, and paid a fixed daily remuneration.
- Macasio’s daily pay was P700.00 (increased from P600 in 2007, P500 in 2006, and P400 in 2005), and he claimed David employed about twenty-five butchers and delivery drivers.
- David maintained he started business in 2005 with only ten employees, and that Macasio was hired on a pakyaw or task basis: working from 10:00 p.m. to about 2:00 a.m., paid P700 per engagement regardless of hours, and not entitled to statutory benefits when no hogs were delivered.
- Documentary submissions included Macasio’s Certificate of Employment (erroneously dated January 2000), payroll/time records (not presented by David), and a Pinagsamang Sinumpaang Salaysay by co-butchers Presbitero Solano and Christopher Antonio.
Labor Arbiter and NLRC Rulings
- April 30, 2009 Labor Arbiter (LA) dismissed Macasio’s complaint, finding that:
- Macasio was engaged on a pakyaw or task basis, receiving P700 per completed job without regard to hours or volume.
- He usually worked four hours per engagement (10:00 p.m. to 2:00 a.m.).
- The fixed wage exceeded the prevailing daily minimum of P382.
- Task-basis workers are excluded from overtime, holiday, SIL and 13th month pay.
- May 26, 2010 National Labor Relations Commission (NLRC) affirmed the LA, ruling Macasio was paid by results and thus not covered by Labor Standards laws on holiday, SIL and overtime pay, and 13th month pay.
- August 11, 2010 NLRC denied Macasio’s motion for reconsideration.
Court of Appeals Ruling
- November 22, 2010 Court of Appeals (CA) partly granted Macasio’s petition for certiorari under Rule 65 and found grave abuse of discreti