Garden of Memories Park v.

NLRC FACTS: The case stemmed from the Respondent Cruz dismissal as a utility worker from August 1991 until her termination in February 199 due to a misunderstanding with a co!worker regarding the use of a garden water hose" Cruz argued that as a regular employee of the #arden of $emories% she could not be terminated without &ust or 'alid cause" (ence% complaint with the )epartment of *abor and +mployment for illegal dismissal" ,etitioner Re-ui.o stated that Cruz was not dismissed from her employment but that she abandoned her work" /n the other hand% petitioner #arden of $emories a'er that Re-ui.o is the employer of Cruz as Requio is a legitimate independent contractor pro'iding maintenance work in the memorial park such as sweeping% weeding and watering of the lawns" They insist that there was no employer!employee relationship between #arden of $emories and Cruz" They claim that there was a service contract between #arden of $emories and Re-ui.o for the latter to pro'ide maintenance work for the former and that the 0power of control%1 the most important element in determining the presence of such a relationship was missing" Furthermore% #arden of $emories alleges that it did not participate in the selection or dismissal of Re-ui.os employees" The *abor Arbiter ruled that Requio was not an independent contractor but a labor-only contractor and that her defense that Cruz abandoned her work was negated by the filing of the present case" The *A declared both #arden of $emories and Re-ui.o% jointly and severally% liable for the monetary claims of Cruz" The 2*RC agreed with the *abor Arbiter" ISSUE: 1. 3hether petitioner ,aulina Re-ui.o is engaged in *abor!only contracting" 2. 3hether there e4ists an employer!employee relationship between respondent Cruz and petitioner #arden of $emories" HELD: 1. ES. There is labor!only contracting where5 6a7 the person supplying workers to an employer does not have substantial capital or investment in the form of tools% e-uipment% machineries% work premises% among others8 and 6b7 the workers recruited and placed by such person are performing activities which are directly related to the principal business of the employer" #enerally% the presumption is that the contractor is a labor!only contracting unless such contractor o'ercomes the burden of pro'ing" 9n the present case% #arden of $emories% though not the contractor% ha'ing the burden of pro'ing that Re-ui.o is an independent contractor% failed to adduce e'idence purporting to show that Re-ui.o had sufficient capitalization" 2either did it show that she in'ested in the form of tools% e-uipment% machineries% work premises and other materials which are necessary in the completion of the ser'ice contract" Furthermore% Re!"i#o was not a licensed contractor% had no substantial capital% and failed to exercise the right to control the performance of the work of Cruz" 2. ES. There is no doubt that Re-ui.o is engaged in labor!only contracting% and is considered merely an agent of Garden of Memories As such% the workers she supplies should be considered as employees of #arden of $emories" Conse-uently% the latter% as principal employer% is responsible to the employees of the labor-only contractor as if such employees have been directly employed by it