GR 151228; (August, 2002) (Digest)
G.R. No. 151228 August 15, 2002
ROLANDO Y. TAN, petitioner, vs. LEOVIGILDO LAGRAMA and THE HONORABLE COURT OF APPEALS, respondents.
FACTS
Petitioner Rolando Tan is the president of Supreme Theater Corporation and general manager of Crown and Empire Theaters in Butuan City. Private respondent Leovigildo Lagrama worked as a painter, creating ad billboards and murals for the Empress, Supreme, and Crown Theaters for over ten years, from September 1, 1988 to October 17, 1998. On October 17, 1998, Tan summoned Lagrama and accused him of urinating inside his work area, telling him, “Don’t say anything further. I don’t want you to draw anymore. From now on, no more drawing. Get out.” Lagrama denied the charge but was forced to leave after Tan repeatedly shouted “Get out.” Lagrama filed a complaint for illegal dismissal with the NLRC. Tan denied Lagrama was his employee, asserting he was an independent contractor paid on a fixed piece-work basis under a “no mural/billboard drawn, no pay” policy, and claimed Lagrama stopped working after being scolded. The Labor Arbiter found illegal dismissal and awarded Lagrama separation pay, backwages, and damages. The NLRC reversed, finding Lagrama to be an independent contractor. The Court of Appeals annulled the NLRC resolutions and reinstated the Labor Arbiter’s decision. Tan filed this petition for review.
ISSUE
The primary issues are: (1) Whether an employer-employee relationship existed between Tan and Lagrama; and (2) Whether Tan is guilty of illegally dismissing Lagrama.
RULING
The Supreme Court ruled in the affirmative on both issues. Applying the four-fold test for employer-employee relationship, the Court found: (1) Tan engaged Lagrama’s services directly; (2) Tan exercised control over Lagrama’s work by prescribing rules for the work area, dictating submission times, and supervising the means and methods of the work; (3) Tan admitted the right to fire Lagrama, acknowledging the employment relationship; and (4) Lagrama was paid wages, which can be on a piece-rate basis. The Court held Lagrama was a regular employee, not an independent contractor, as his work was usually necessary and desirable to Tan’s business. The dismissal was illegal as Tan failed to prove a just or authorized cause and to observe procedural due process. The Court affirmed the Court of Appeals decision with modification: backwages and benefits are to be computed from dismissal until the finality of the decision, and the award for service incentive leave pay was deleted.