Title
Supreme Court
Salabe vs. Social Security Commission
Case
G.R. No. 223018
Decision Date
Aug 27, 2020
Leonarda Salabe, a carinderia helper, was denied SSS retirement benefits after 22 years due to alleged lack of employer-employee proof. The Supreme Court ruled in her favor, citing due process violations, credible evidence, and liberal interpretation of social laws, reinstating her pension and validating contributions.

Case Summary (G.R. No. 223018)

Petitioner’s Allegations and Administrative Petition

Leonarda worked as a helper in Ana Macas’s carinderia from August 1978 to February 1979. Ana registered her with SSS (SSS No. 06-0618084-5), and Leonarda later paid 137 voluntary contributions. Upon turning 60 in 1993, she applied for and received retirement pension until July 2001, when SSS terminated her benefits without explanation. In March 2008 she learned her membership was cancelled for lack of employer-employee relationship with Ana. She then petitioned the SSC to declare her a bona fide employee, validate her contributions, and restore her pension.

SSS Investigation and Defense

SSS records showed Leonarda’s pension ceased in July 2001. A 1989 Memorandum Report by Provincial Officer Lamberto C. Miel recommended cancellation of Ana’s membership and that of her reported employees because Ana could not present proof of any actual employees. SSS maintained that, absent an employer-employee relationship, Leonarda’s contributions—both during alleged employment and as a voluntary member—were ineffective, and the cancellation of her pension was proper. The burden, it asserted, lay on Leonarda to prove her employment by clear and convincing evidence.

Clarificatory Hearing and SSC Resolution

At an SSC clarificatory hearing, Leonarda testified on her daily duties, wage (₱30/day), work schedule (six days a week), and carinderia capacity. Witnesses Ceferino Macas (Ana’s son) and Ricardo Vinalon corroborated her employment, describing Ana’s restaurant as small (3–6 tables, 4–6 workers) and identifying Leonarda as a helper. Despite this, by Resolution dated June 6, 2012, the SSC dismissed her petition for lack of merit, citing (1) inconsistent records on Leonarda’s identity, (2) the alleged disproportion between Ana’s table capacity and number of reported employees, and (3) absence of a valid employer-employee relationship, thus ordering refund of pension benefits. Reconsideration was denied on June 10, 2013.

Review by the Court of Appeals

Leonarda appealed to the Court of Appeals, arguing (1) violation of due process in the unilateral 1989 investigation, (2) misapplication of the presumption of regularity, (3) improper shifting of the burden of proof, and (4) estoppel against SSS for having approved her pension despite knowledge of Miel’s report. The CA, in a Decision dated December 1, 2014 (and Resolution of January 28, 2016 denying reconsideration), affirmed the SSC. It gave deference to the agency’s factual findings, held that Leonarda failed to present documentary proof (timesheets, payslips), found no due process violation in routine investigations, and rejected the estoppel argument.

Due Process and Binding Effect of Findings

The Supreme Court held that Leonarda was deprived of due process under the 1987 Constitution: she was not impleaded in the investigation that led to Ana’s membership cancellation; no final and executory SSC decision bound her; and she received no timely notice of the grounds for pension termination. The 2008 letter advising her to file a petition could not cure these fundamental defects.

Exceptions to Finality of Administrative Findings

Although factual findings of an expert agency are ordinarily conclusive, the Court recognized exceptions where findings are based on speculation, manifestly mistaken inferences, or lack citation of specific evidence. SSC’s conclusion that Ana accommodated fictitious employees rested on conjecture (table capacity vs. reported employees) and did not specifically address Leonarda’s case.

Application of the Four-Fold Test and Substantial Evidence

The Court applied the four-fold employer-employee test (selection/engagement, payment of wages, power of dismissal, control over work). Leonarda and

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