G.R. No. L-12214-17; May 28, 1958
Maligaya Ship Watchmen Agency, Marine Security Agency, and City Watchmen Agency, petitioners, vs. Associated Watchmen and Security Union (PTWO), respondent.

FACTS

Several steamship companies (United States Lines, American President Lines, and Macondray and Co., Inc.) contracted with watchmen agencies (Maligaya Ship Watchmen Agency, Marine Security Agency, and City Watchmen Agency, among others) to furnish watchmen to guard vessels and cargo at the port of Manila. These agencies were registered business names, licensed by the City of Manila and the Collector of Customs, and employed numerous watchmen. The agencies contended they were independent contractors who made profits from their contracts with the shipping firms, posted bonds, and reimbursed the firms for any losses of property. The operators of these agencies (e.g., Tomas Caraveo, Bernard Bradbury, Fernando Derupe) also held positions such as headwatchman, supervisor, or headchecker with the respective shipping companies and were paid directly by them. Supervision over the watchmen while on duty was exercised by the shipping companies’ supervisors, ship officers, port captains, and managers. The shipping companies also, for a time, deducted and withheld income taxes from the watchmen’s wages.

ISSUE

1. Whether the watchmen agencies are independent contractors.
2. Whether the watchmen or security guards supplied by these agencies are employees of the shipping firms or steamship agencies.
3. Whether the certification procedure by the Court of Industrial Relations was proper.

RULING

1. On the first issue: The watchmen agencies are not independent contractors with respect to the guarding of the ships and cargo. While they may be considered independent contractors insofar as the recruitment of watchmen is concerned, they did not contract to perform the duty of guarding itself for a lump sum. The contracts were for the recruitment and supply of labor, not for the specific piece of work of guarding. The agencies did not undertake the guarding for a specified sum without reference to the number of watchmen or their individual wages.
2. On the second issue: The watchmen supplied by the agencies are employees of the shipping lines or their agents, but only when they are actually employed and paid as watchmen. The operators of the agencies acted as agents of the shipping companies in recruiting, computing and paying wages, and supervising the watchmen, with significant control exercised by the shipping companies (e.g., approval of application forms and identification cards). Mere membership in a watchmen agency does not establish an employer-employee relationship with the shipping lines; such a relationship exists only when a member is actually working and receiving pay as a watchman for a specific shipping company.
3. On the third issue: The certification procedure was proper. Only those watchmen who were actually employed and paid by the shipping lines or their agents are considered their laborers or employees and have the right to participate in the certification elections. Members of the watchmen agencies who were not actually working and paid as watchmen must be excluded from the elections.
The petition for review was denied, and the decision of the Court of Industrial Relations was affirmed in toto.