Final Exam
Final Exam
(a) selection of the employee, (b) payment of wages, (c) power of dismissal, and (d) the power to control
the conduct of the employee. If these are all present, then an employer-employee relationship exists.
There is no employer-employee relationship that exists between Alma Taray and Lugaw Insurance Co.
because the time, place and means of soliciting insurance policies were left to her own judgment. The
employer does not control the means and the end on how to do her job. The power to control the
conduct of the employee does not exist and thus, there is no employer-employee relationship between
Alma Taray and Lugaw Insurance Co.
(2) On the other hand, an employer-employee relationship exists between Lugaw Insurance Co. and
Emma Hilig because the employer controls both the means and the end. Emma Hilig is tasked to submit
regular weekly reports wherein poor performance would subject her to dismissal. Thus, employer-
employee relationship between Lugaw Insurance Co. and Emma Hilig exists.
The termination of the employment of the 250 workers is not valid and justified because the workers
held regular employment because the activities they performed are considered as usually necessary in
the business of the employer. In fact, when the contract of 200 workers expired, the company hired
another set of employees to do the same job and they even hired additional employees for the
Christmas season. This proves that the tasks they do is usually necessary and desirable in the business of
the employer. The act of the employer to hire new workers after the expiration of the contract of the
old workers is clearly to circumvent the right to security of tenure of the employees and their right to
other benefits. Thus, the termination is not valid and justified.
I would dismiss the complaint for regularization against Harry Pottery because the true employer of the
workers is Herman Yakis Employment Agency. In this case, Harry Pottery has no control over the manner
and method of doing the job as the employees work under the supervision of Herman Yakis. The agency
also has substantial capital of P6M. Here, there is a legitimate job contracting wherein the employees
remain as employees of the agency Herman Yakis. Thus, Herman Yakis is considered as the workers' true
employer and not Harry Pottery.
Harry Pottery is considered as the true employer of the janitors. This is because JOWA only supplies the
workers and these workers perform activities which are directly related to the main business of Harry
Pottery. Thus, the effect is that there is an employer-employee relationship between Harry Pottery and
the workers and JOWA is considered only as an agent of Harry Pottery. Thus, when Harry Pottery
terminated the janitors, it is considered as a valid dismissal because the true employer of the janitors is
Harry Pottery. Hence, the complaint for illegal dismissal and regularization must be dismissed.
Pasig River Bank's garnishment should not be annulled. While it is true that the workers' claim for
unpaid wages enjoys preference over the Pasig River Bank's claims, the Labor Code requires that there
must first be a formal declaration of bankruptcy of the employer's business. Since there was no formal
declaration of bankruptcy, there is no need to determine who would be paid first. Thus, Pasig River
Bank's garnishment should not be annulled.
Elma Labo is not entitled to disability benefits because it is necessary that the employee must be injured
at the place where his work requires him to be and that the employee must have been performing his
functions at the time the injury happened. In this case, while the injury happened during their work
hours, the injury is not work-related. To be entitled to disability benefits, the injury sustained must be
work-related. In this case, the injury sustained was because of a personal reason and not work-related.
Thus, Elma Labo is not entitled to disability benefits.
The Labor Arbiter is not correct in not ordering the reinstatement of Chiz Musa just because she is
already employed by another employer. The employee cannot be expected to be idle while waiting for
the decision on the complaint. Thus, the Labor Arbiter can still order the reinstatement of the employee
and if the employee refuses, that would mean that he forfeits the reinstatement. Thus, the employee
should have the option on whether to accept or refuse the reinstatement.
The Labor Arbiter however is correct in awarding nominal damages because to award nominal damages,
it is necessary that there is a valid and just cause for dismissal and that due process was not observed. In
this case, there is a valid cause for dismissal or the disruption caused by the quarrel. However, since
there was no due process, it is right for the employer to pay for nominal damages.
9) The Labor Arbiter is not correct in ordering Harry Pottery to pay nominal damages to Elma Labo
because nominal damages are awarded in favor of an employee when a valid cause for dismissal exists
but the dismissal is without due process. In this case, since the dismissal is valid and justified, nominal
damages should not be awarded.
10) The appeal of Harry Pottery is perfected because here, the appeal bond is not necessary. Appeal
bond is only required for the perfection of of an appeal of a decision by the Labor Arbiter which involves
a monetary award excluding damages and attorney's fees. This monetary award includes unpaid wages,
separation pay, etc. In this case, there was no monetary award to speak of and thus, appeal bond is not
necessary for the perfection of the appeal.