G.R. No. 205524 . January 18, 2023
GERARDO G. SERMONA, ET AL./NATIONAL FEDERATION OF SUGAR WORKERS-FOOD AND GENERAL TRADES, PETITIONERS, VS. HACIENDA LUMBOY/MANUEL L. UY, RESPONDENTS.

FACTS

Petitioners, a group of individuals and a labor federation, claimed to be laborers at Hacienda Lumboy, a sugarcane farm owned by respondent Manuel L. Uy. They alleged they were hired on different dates, worked during cultivation and milling seasons, and were paid either on a pakyaw (piece-rate) basis or a daily wage. They asserted that Uy did not maintain payrolls or payslips. They contended that after clamoring for increased wages and benefits, they were told to find other jobs and were no longer given work. They sought help from the National Federation of Sugar Workers and later filed a case for illegal dismissal and money claims in 2005.
Respondent Uy denied an employer-employee relationship existed. He claimed he was a small planter who only took possession of the approximately 10-hectare hacienda in 2004, had limited capitalization, and employed only about 10 workers. He presented payrolls and a joint affidavit from individuals he recognized as his only employees to support his claim. He alleged that a labor organizer convinced residents to file a case against him and used signatures from a meeting attendance sheet to fabricate the complaint.
The Labor Arbiter ruled in favor of the petitioners, finding they were illegally dismissed based on their testimonial evidence and ordering the payment of separation pay. The National Labor Relations Commission (NLRC) reversed this decision, giving credence to Uy’s payrolls and finding no employer-employee relationship. The Court of Appeals affirmed the NLRC’s ruling. Petitioners filed a Motion for Reconsideration before the Court of Appeals, attaching new evidence in the form of affidavits from two of Uy’s alleged long-time workers (Roberto Paculares and Herman Paculares). These affidavits retracted their earlier joint affidavit supporting Uy, claimed the payrolls were fabricated, and asserted that petitioners were indeed co-workers at the hacienda, which was larger than Uy claimed. The Court of Appeals denied the motion, refusing to consider the new evidence.

ISSUE

Whether the Court of Appeals committed reversible error in not considering the newly discovered evidence (the retraction affidavits of Roberto and Herman Paculares) presented in the Motion for Reconsideration, which tended to disprove the findings of the NLRC and the Court of Appeals regarding the existence of an employer-employee relationship.

RULING

Yes. The Supreme Court granted the petition, reversed the Court of Appeals’ rulings, and reinstated the Labor Arbiter’s decision with modification. The Court held that the Court of Appeals should have considered the new evidence. The affidavits constituted newly discovered evidence that could not have been discovered and produced during the trial with reasonable diligence, as the affiants were previously presented by the opposing party as witnesses. The evidence was material and of such weight that it would alter the result of the case, as it directly impeached the credibility of Uy’s key evidence (the Paculares Joint Affidavit and the payrolls) and supported the petitioners’ claim of employment. The Court found that the four-fold test for an employer-employee relationship (selection and engagement of employees, payment of wages, power of dismissal, and power of control) was satisfied based on the totality of evidence, including the new affidavits. The case was remanded to the Labor Arbiter for recomputation of the monetary awards.