GR L 52824; (March, 1988) (Digest)
G.R. No. L-52824, March 16, 1988
Reynaldo Bautista, petitioner, vs. Hon. Amado C. Inciong, in his capacity as Deputy Minister of Labor and Associated Labor Unions (ALU), respondents.
FACTS
Reynaldo Bautista was employed by respondent Associated Labor Unions (ALU) as an Organizer starting in 1972, with his salary and Social Security System (SSS) contributions being paid by the union. On March 16, 1979, after a ten-day sick leave supported by ALU’s physician, Bautista reported for work but was informed by ALU’s Area Vice-President that his services had been terminated effective the previous day, March 15, 1979. Bautista subsequently filed a complaint for illegal dismissal.
The National Capital Region Director of the Ministry of Labor ruled in Bautista’s favor, ordering his reinstatement with full backwages and other monetary benefits. On appeal, Deputy Minister Amado Inciong reversed this decision. He dismissed the complaint, holding that no employer-employee relationship existed. Inciong rationalized that ALU merely “accommodated” Bautista after a prior dismissal, that SSS payments were a “favor,” and that a labor union, being a non-profit entity, could not be an employer.
ISSUE
Whether or not the respondent Deputy Minister committed grave abuse of discretion in ruling that no employer-employee relationship existed between petitioner Bautista and respondent ALU.
RULING
Yes, the Supreme Court found grave abuse of discretion and reversed the Deputy Minister’s decision. The Court applied the established four-fold test to determine an employer-employee relationship: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the employer’s power to control the employee’s work. The control test is the most significant element.
All four elements were conclusively present. Bautista was hired, paid wages, and controlled by ALU as its organizer. Crucially, ALU itself demonstrated its employer status by filing a clearance application with the Ministry of Labor to terminate Bautista’s services, an act inconsistent with its claim of non-employment. The SSS records showing ALU’s remittances as employer further solidified the relationship. The Court emphatically rejected the Deputy Minister’s reasoning, stating that a labor union is not exempt from labor laws and can indeed be an employer of those who work for it.
However, due to the evident antagonism between the parties, which made reinstatement impractical, the Court modified the remedy. Following equitable principles, the Court ordered ALU to pay Bautista backwages for three years and appropriate separation pay in lieu of reinstatement. The Order of the Regional Director was thus reinstated but executed with this monetary modification.