GR 120077; (October, 2000) (Digest)
G.R. No. 120077; October 13, 2000
THE MANILA HOTEL CORP. AND MANILA HOTEL INTL. LTD., petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, ARBITER CEFERINA J. DIOSANA AND MARCELO G. SANTOS, respondents.
FACTS
Private respondent Marcelo Santos, an overseas Filipino worker, was directly hired by the Palace Hotel in Beijing, China. Petitioners are Manila Hotel Corporation (MHC), a Philippine government-owned corporation, and its affiliate Manila Hotel International Co., Ltd. (MHICL), a Hong Kong-based entity. MHC owned 50% of MHICL, which had a management agreement to train personnel for the Palace Hotel. Santos signed an employment contract with the Palace Hotel, which was merely “noted” by an MHICL vice president. He worked in Beijing until his employment was terminated in September 1989 due to business reverses following the Tiananmen Square incident. Santos filed a complaint for illegal dismissal and monetary claims against the petitioners before the NLRC.
ISSUE
The primary issue is whether the NLRC correctly assumed jurisdiction over the complaint and held petitioners MHC and MHICL jointly and severally liable as Santos’s employers.
RULING
The Supreme Court ruled that the NLRC had jurisdiction but reversed its finding of liability. The Court held that jurisdiction over Santos’s money claim fell with the NLRC, not the POEA, because the claim was filed against a local entity (MHC) and involved a Filipino recruited for abroad but not deployed through the POEA’s processes. However, the NLRC committed grave abuse of discretion in holding petitioners solidarily liable as employers. The employer was unequivocally the Palace Hotel in Beijing. The employment contract was between Santos and the Palace Hotel; MHICL’s officer only “noted” the agreement, which did not constitute an assumption of employer status. There was no evidence that MHC and MHICL acted as a labor-only contractor, as they had substantial capital and their management services for training were distinct from the Palace Hotel’s role as direct employer. The nature of MHICL’s involvement was limited to technical assistance under its management contract. Consequently, petitioners could not be held jointly and severally liable for the claims of Santos arising from his dismissal by his foreign employer. The decision of the NLRC was annulled.