GR 159469; (June, 2005) (Digest)
G.R. No. 159469; June 8, 2005
ZALDY G. ABELLA and the Members of the PLDT SECURITY PERSONNEL UNION, Petitioners, vs. PHILIPPINE LONG DISTANCE TELEPHONE COMPANY (PLDT CO.) and PEOPLE’S SECURITY INC. (PSI), Respondents.
FACTS
Petitioners, security guards deployed by respondent People’s Security Inc. (PSI) to the premises of respondent Philippine Long Distance Telephone Company (PLDT), filed a complaint for regularization against PLDT before the Labor Arbiter. They alleged they were under the direct control and supervision of PLDT’s Security Department, served the company for years, and performed functions integral to its business. They contended that PSI acted merely as a payroll conduit, and thus, an employer-employee relationship existed with PLDT, entitling them to regular employee status and corresponding benefits. Following the complaint’s filing, the guards formed a union, after which PLDT allegedly instructed PSI to terminate about 25 union members who participated in a protest picket.
The Labor Arbiter dismissed the complaint, a decision affirmed by the NLRC and subsequently by the Court of Appeals. The appellate court found that the power of selection and payment of wages resided with PSI, not PLDT. Petitioners’ initial appeal to the Supreme Court was denied on procedural grounds, but the Court later granted their motion for reconsideration to resolve the case on its merits.
ISSUE
Whether an employer-employee relationship exists between petitioner security guards and respondent PLDT.
RULING
No. The Supreme Court ruled that no employer-employee relationship existed between the security guards and PLDT. The Court applied the four-fold test, emphasizing the “control test” as the most determinative indicator. The security service agreement between PSI and PLDT explicitly stipulated that PSI retained full control, supervision, and discipline over the guards, with exclusive authority to select, engage, discharge, and determine their wages. While PLDT prescribed certain qualifications (like height requirements) and the guards performed their duties at PLDT premises, these factors pertained merely to the desired result of the contracted security service and did not equate to the control over the means and methods by which the guards accomplished their work.
The payment of wages was made by PSI, and the power to dismiss ultimately rested with PSI. The arrangement was a legitimate job contracting, not a labor-only contracting scheme, as PSI was a licensed security agency with substantial capital and carried the employer’s responsibilities. The Court held that the security guards were employees of PSI alone. The fact that their work was necessary for PLDT’s business did not automatically make them PLDT’s employees, as the law permits the farming out of auxiliary services like security to independent contractors. Therefore, the dismissal of the complaint for regularization was proper.