G.R. No. L-20088 January 22, 1966
LUZON STEVEDORING CORPORATION, petitioner-appellant, vs. SOCIAL SECURITY SYSTEM, respondent-appellee.

FACTS

Luzon Stevedoring Corporation (Lusteveco) is a domestic corporation engaged in stevedoring, lightering, and towing. In 1959, it employed three categories of temporary employees: (1) 4,304 stevedores in Iloilo and Bacolod hired on a daily, rotational, vessel-by-vessel basis, averaging 14 working days per year; (2) drydock workers hired daily during peak seasons, averaging 20 working days per year; and (3) relief sailors and crew members hired to replace absent regulars, averaging 36 working days per year. Labor unions controlled the rotation of employment for these workers. On October 19, 1960, Lusteveco requested the Social Security Commission to exempt these temporary employees from compulsory coverage under the Social Security Act (R.A. 1161), arguing they worked intermittently and could not maintain membership long enough to be entitled to full benefits. The Social Security Commission denied the request on April 16, 1962, ordering Lusteveco to pay all back premiums. Lusteveco’s motion for reconsideration was denied, prompting this appeal.

ISSUE

Do the temporary and casual employees of Luzon Stevedoring Corporation come within the compulsory coverage of the Social Security Act, as amended?

RULING

Yes. The Supreme Court affirmed the resolutions of the Social Security Commission, holding that the temporary employees are compulsorily covered. The Court noted that Republic Act 2658, effective June 18, 1960, amended the Social Security Act by eliminating the previous six-month service requirement for compulsory coverage. Under the amended law, compulsory coverage extends to all employees between ages sixteen and sixty and their employers, effective from the date of employment, regardless of tenure. The Court rejected Lusteveco’s argument that exemption should be granted under Section 8(j), which allows the Social Security Commission to exclude services performed by temporary employees by regulation, as no such regulation was cited to support the exemption. The Court also dismissed the contention that these employees could not accumulate sufficient monthly contributions to qualify for benefits, explaining that death and disability benefits are available from the moment of membership, with the number of contributions merely affecting the amount. For sickness and retirement benefits, while minimum contributions are required, the law does not mandate consecutive contributions or employment with the same employer, and employees receive a lump sum not less than total contributions paid by them and their employer. The Court emphasized that covering these temporary employees aligns with the congressional policy of establishing a social security system to protect laborers against hazards, noting that such workers are often more exposed to these risks.