Case Summary (G.R. No. 108153)
Key Dates and Procedural Posture
Employment commencement: May 1996; Board appointment as Chief Pathologist: five‑year term until May 15, 2011; Board recall of appointment: June 13, 2007.
Labor Arbiter decision dismissing complaint for lack of jurisdiction: March 31, 2008.
NLRC resolution affirming Labor Arbiter: March 31, 2009.
Court of Appeals decision dismissing petition: August 3, 2012; CA resolution denying reconsideration: April 12, 2013.
Supreme Court decision reviewed here: June 3, 2019. Applicable constitution for the decision: 1987 Philippine Constitution.
Issue Presented
Whether the labor tribunals have jurisdiction to entertain petitioner’s complaint for illegal dismissal — i.e., whether petitioner was a corporate officer (placing the dispute within regular courts) or an employee entitled to labor‑law remedies before the labor tribunals.
Relevant Legal Provisions and Tests Applied
Governing authorities and analytical tools applied by the Court include: the Corporation Code provision identifying corporate officers (Section 25 as cited); the requirement that an officer designation be provided by statute or the corporation’s by‑laws; the four‑fold test for an employer‑employee relationship (selection/engagement, payment of wages, power of dismissal, and power to control the employee’s conduct); and the economic reality test emphasizing the worker’s economic dependence on the putative employer. The Court also referenced RA No. 8799 (Section 5.2) as the basis relied upon by lower tribunals for invoking RTC jurisdiction over intra‑corporate controversies.
Background Facts Material to the Jurisdictional Question
Petitioner was engaged originally by the late Dr. Jose N. Gaerlan and was thereafter appointed Chief Pathologist by CDMC’s Board for a five‑year term. Following a dispute arising from petitioner’s refusal to assist a third party in qualifying as a pathologist and an incident involving an inter‑office memorandum, the Board issued a memorandum recalling petitioner’s appointment. Respondents asserted petitioner merely assisted Dr. Gaerlan and concurrently practiced as pathologist in other hospitals.
Labor Arbiter and NLRC Findings
The Labor Arbiter dismissed petitioner’s illegal dismissal complaint for lack of jurisdiction on the ground that petitioner was a corporate officer by virtue of the Board’s appointment resolution, bringing the matter within the jurisdiction of the regular courts (RTC) under the cited provision. The NLRC affirmed, likewise treating the matter as an intra‑corporate controversy not cognizable before the labor tribunals.
Court of Appeals Disposition
The Court of Appeals dismissed petitioner’s certiorari petition, effectively affirming the conclusion that the matter was not within the jurisdiction of the labor tribunals as an intra‑corporate dispute.
Supreme Court’s Determination on Corporate Officer Status
The Supreme Court held that mere appointment by Board resolution does not ipso facto make the appointee a corporate officer. To qualify as a corporate officer the position must be recognized by the Corporation Code or by the corporation’s by‑laws. Because the by‑laws of CDMC were absent from the record, the Court found no basis to conclude that the position of Pathologist was one of the corporate officers created by law or the by‑laws. Accordingly, the Court partly granted the petition insofar as it declared that petitioner was not a corporate officer.
Supreme Court’s Application of the Four‑Fold Test and Economic Reality
Having concluded petitioner was not a corporate officer, the Court nevertheless examined whether an employer‑employee relationship existed between petitioner and CDMC under the four‑fold test. The Court found mixed results on the test: CDMC, through its Board, selected and engaged petitioner and compensated her (a 4% share of gross receipts of the Clinical Section), and the Board recalled her appointment (suggesting power of dismissal). However, the most critical factor — the power to control the employee’s manner and means of work — was absent. Petitioner worked concurrently for other hospitals, controlled her hours, and received compensation in the form of a percentage of gross receipts irrespective
...continue readingCase Syllabus (G.R. No. 108153)
Case Caption, Source and Court
- Reported in 852 Phil. 327, Second Division, G.R. No. 216635, decided June 03, 2019.
- Petition for Review on Certiorari filed before the Supreme Court assailing the Decision dated August 3, 2012 and Resolution dated April 12, 2013 of the Court of Appeals (CA) — Cagayan de Oro City, in CA-G.R. SP No. 03067-MIN, which affirmed the decision of the National Labor Relations Commission (NLRC).
- Decision authored by Justice J. Reyes, Jr.; CA decision penned by Associate Justice Renato C. Francisco with Associate Justices Edgardo A. Camello and Marilyn B. Lagura-Yap.
- Concurrence noted from Carpio (Chairperson), Perlas-Bernabe, and Lazaro-Javier, JJ.; Justice Caguioa on wellness leave.
Relevant Antecedents / Factual Background
- Petitioner Dr. Mary Jean P. Loreche-Amit began working with Cagayan De Oro Medical Center, Inc. (CDMC) in May 1996, engaged by the late Dr. Jose N. Gaerlan as Associate Pathologist in the Department of Laboratories.
- Upon Dr. Gaerlan’s death, CDMC’s Board of Directors formally appointed petitioner as Chief Pathologist for five years or until May 15, 2011.
- On June 13, 2007, the CDMC Board of Directors passed a resolution recalling petitioner’s appointment as Chief Pathologist.
- Petitioner alleged that Dr. Hernando Emano asked her to assist his daughter, Dr. Helga Emano-Bleza, to qualify as a pathologist; petitioner refused because Dr. Emano-Bleza failed to qualify in the clinical pathology examination, and petitioner contends this refusal sparked Dr. Emano’s attempt to oust her.
- Dr. Francisco Oh issued an Inter-Office Memorandum to laboratory personnel stating that working in and out of the building without permission is to be treated as absence without official leave, and that payment for printing duplicate copies not endorsed to the hospital is a form of stealing.
- Petitioner reacted by slamming the memorandum against the wall and calling Dr. Oh irrational; subsequently Dr. Oh issued an Inter-Office Memorandum alleging conduct unbecoming/insubordination and requesting an explanation why petitioner’s appointment should not be revoked.
- Thereafter a Memorandum recalling petitioner’s appointment as Chief Pathologist was issued.
Respondents’ Factual Assertions
- Respondents (CDMC, Dr. Francisco Oh, Dr. Hernando Emano) averred that petitioner was not hired by them but merely assisted Dr. Gaerlan in operating the hospital’s laboratory.
- Respondents maintained that petitioner concurrently worked as pathologist at Capitol College Hospital and J.R. Borja Memorial Hospital and that such concurrent practice was not prohibited.
Procedural History — Labor Arbiter
- Petitioner filed a complaint for illegal dismissal, contending dismissal without just cause and due process.
- The Labor Arbiter issued a Decision dated March 31, 2008 dismissing the complaint for lack of jurisdiction.
- The Labor Arbiter found petitioner to be a corporate officer of the hospital by virtue of appointment by the Board of Directors through a resolution, and held that matters relating to the propriety of her dismissal fall under the jurisdiction of the Regional Trial Court (RTC) pursuant to Section 5.2 of R.A. No. 8799 (Securities Regulation Code).
- Dispositive wording of the Labor Arbiter: "the above-entitled case is DISMISSED for lack of jurisdiction."
Procedural History — NLRC
- On appeal, the NLRC issued a Resolution dated March 31, 2009 affirming the Labor Arbiter’s ruling.
- The NLRC reiterated that petitioner was a corporate officer, that no employer-employee relationship existed between CDMC and petitioner, and that the issue constituted an intra-corporate matter properly within the regular courts’ jurisdiction.
- Dispositive NLRC language: the instant appeal is dismissed for lack of merit and the Labor Arbiter’s Decision is affirmed.
Procedural History — Court of Appeals
- Petitioner filed a Petition for Certiorari before the Court of Appeals.
- The CA, in a Decision dated August 3, 2012, dismissed the petition and echoed the rulings of the Labor Arbiter and the NLRC.
- Petitioner’s motion for reconsideration was dismissed by the CA in a Resolution dated April 12, 2013.