G.R. No. 171814; May 8, 2009
SOUTH DAVAO DEVELOPMENT COMPANY, INC. (NOW SODACO AGRICULTURAL CORPORATION) AND/OR MALONE PACQUIAO AND VICTOR A. CONSUNJI, Petitioners, vs. SERGIO L. GAMO, ET AL., and TRADE UNION OF THE PHILIPPINES AND ALLIED SERVICES (TUPAS), Respondents.

FACTS

Petitioner South Davao Development Company operated coconut and mango farms. Respondent Sergio Gamo was initially hired as a foreman in 1963 but was later appointed as a copra maker contractor in 1987. The other individual respondents, copra workers, were transferred to work under Gamo. From 1987 to 1999, Gamo and petitioner operated under a profit-sharing agreement (70%-30%), with Gamo paying the workers from his share. In October 1999, petitioner proposed a new, standardized payment scheme. Gamo submitted a counter-proposal, which petitioner rejected. After a final harvest under the old terms, their contractual relationship ended due to the failed negotiations. Separately, respondent Eleonor Cosep, a mango classifier, stopped reporting for work in October 1999 to pursue pig farming.

ISSUE

The core issues were: (1) whether an employer-employee relationship existed between petitioner and the copra worker respondents; and (2) whether Eleonor Cosep was illegally dismissed or had abandoned her work.

RULING

The Supreme Court affirmed the Court of Appeals, ruling that an employer-employee relationship existed. The Court rejected petitioner’s plea to take judicial notice of an alleged industry practice treating copraceros as independent contractors, as such a fact is not one of common and general knowledge capable of unquestionable demonstration. Applying the four-fold test, the Court found that petitioner exercised control over the respondents. Petitioner owned the farms, provided the tools and equipment, and the work of copra making was directly related to petitioner’s main business. The arrangement with Gamo was deemed labor-only contracting, making petitioner the direct employer. The respondents were thus regular seasonal employees. Their dismissal at the end of a season was permissible, but the failure to re-hire them for the next season without just cause and due process constituted illegal dismissal. Regarding Eleonor Cosep, the Court found she did not abandon her work. Abandonment requires a clear, deliberate, and unjustified refusal to resume employment, coupled with an intent to sever the relationship. Her expressed desire to raise pigs did not conclusively prove such intent, especially since petitioner attempted to convince her to return, negating any perception of abandonment. The case was remanded to compute the respondents’ monetary awards.