Employment Contract

Royale Homes Mktg. Corp. v.

Fidel P. Alcantara
Facts:
Fidel Alcantara worked as a Marketing Director for Royale homes, which
is a corporation engaged in marketing real estates.
On November 2003, the executive officers of Royale Homes told him
that they were wondering why he still had the gall to come to office
and sit at his table which to him amounted to a dismissal without just
cause.
Royale Homes:
o Alcantara is not an employee but an independent sales. He
didnt receive salary (commission basis only). Royale had no
control on how alcantara would accomplish his tasks (he was
free to solicit sales at any time and by any manner; even free to
recruit his own sales personnel)
o Alcantara decided to leave company to join his wife who formed
her own brokerage company that directly competed with its
business. Even threw a despedida party in his favor.
LA Alcantara is an employee
NLRC Alcantara is not an employee but an independent contractor so
LA has no jurisdiction
CA reversed NLRC
Issue: Whether Alcantara was an independent contractor or an employee of
Royale Homes?
Ruling:
While the existence of employer-employee relationship is a matter of
law, the characterization made by the parties in their contract as to the
nature of their juridical relationship cannot be simply ignored.
The contract, duly signed and not disputed by the parties
conspicuously provides that no employer-employee relationship exists
between Royale Homes and Alcantara. It is clear that they did not
want to be bound by employer-employee relationship at the time of the
signing of the contract.
o Contract states: It is understood, however that no employeremployee relationship exists between us, that of your sales
personnel/agents, and that you shall hold our company, its
officers and directors, free and harmless from any and all claims
of liability and damages arising from and/or incident to the
marketing of our real estate inventories
Since the terms of the contract are clear and leave no doubt upon the
intention of the contracting parties, the literal meaning of its
stipulations should control.

Control test also used to prove that no ER-EE relationship exists. The
rules, regulations, code of ethics, and periodic evaluation of Royale do
not involve control over the means and methods by which Acantara
was to perform his job (e.g. no working hours, no other tasks than
soliciting sales, he had full control of how to accomplish tasks)
Other grounds:
o Repeated hiring does not prove existence. Only signifies
renewal of contract and highlights satisfactory services
o Exclusivity clause does not necessarily result in ER-EE
relationship.
o Payment of wages Alcantara had no fixed monthly salary. On
commission basis only.

Conclusion: Alcantara is not an employee but a mere independent contractor.

LA has no jurisdiction over the case and the same is cognizable by the regular
courts.