GR L 18460; (August, 1962) (Digest)
G.R. No. L-18460; August 24, 1962
DY PAC & COMPANY, INC., petitioner, vs. COURT OF INDUSTRIAL RELATIONS and DY PAC PAKIAO WORKERS’ UNION, respondents.
FACTS
Dy Pac & Company, Inc. (the Company) operated two sawing machines (“carros”) for its lumber business. One carro, operated at night by about 19 laborers, was under the supervision of A. Santos Soriano. The Company claimed Soriano was an independent contractor. On November 14, 1956, these laborers organized the Dy Pac Pakiao Workers’ Union (the Union) and notified the Company. In January 1957, the Union wrote to the Company requesting a wage increase, citing violations of the Minimum Wage Law. Shortly after this demand, work on the old carro stopped.
The Company informed the laborers that Santos Soriano had terminated his contract and was unavailable. The laborers only then learned of the alleged contract. The carro resumed operation months later under Alfonso Soriano (Santos’s son) with a new set of workers. The Union members, who sought readmission, were not rehired on the ground they were “troublesome.”
ISSUE
The primary issue was whether the Company committed unfair labor practice by dismissing the Union members due to their union activities, and whether Santos Soriano was a legitimate independent contractor or merely an agent of the Company.
RULING
The Supreme Court affirmed the Court of Industrial Relations’ decision, ruling that the Company engaged in unfair labor practice. The legal logic centered on the true nature of the employment relationship. The Court found Santos Soriano was not an independent contractor but a mere “dummy” or agent of the Company. This conclusion was based on evidence that the Company paid the laborers’ wages, their hiring was subject to Company approval, and they were eventually required to sign the Company’s payroll. Following established precedent, such control indicated an employer-employee relationship, not an independent contracting arrangement.
Consequently, the stoppage of work and the refusal to rehire the Union members after their wage demands were directly linked to their union activities, constituting unfair labor practice under the law. The Court also rejected the Company’s plea for a new trial to present Santos Soriano’s testimony, noting the failure to exercise due diligence in locating him and the absence of an affidavit detailing his proposed testimony. Therefore, the award of backwages to the dismissed workers was upheld.