DY KEH BENG v.

INTERNATIONAL LABOR1 Control test: an employer-employee relationship exists where the person for whom
No. L-32245 / MAY 25, 1979 / DE CASTRO, J./ LABOR 1 - Control test/RLAurellano
NATURE Petition for certiorari to review of the decision of the CIR
PETITIONERS Dy Keh Beng
RESPONDENTS International Labor and Marine Union of the Philippines et al.
SUMMARY. Petitioner Dy is the owner of a basket factory. He was adjudged guilty of unfair
labor practice by the CIR for dismissing private respondents Solano and Tudla allegedly for
union activities. Dy contends that they are not his employees because he does not exercise
control over them. SC is not convinced.
DOCTRINE. Control test: an employer-employee relationship exists where the person for
whom the services are performed reserves a right to control not only the end to be achieved
but also the means to be used in reaching such end,
FACTS.
Petitioner Dy (Keh?? Beng?? Lets call him Dy) is the proprietor of a basket factory. He was
charged with unfair labor practice for discriminatory acts as per Sec. 4(a) (1) and (4), RA
8752 for dismissing private respondents Solano and Tudla, allegedly for their union activi-
ties.
Dy contends that he did not know that Solano and Tudla are his employees because they
only woked in a pakiaw pasis.
Hearing examiner: Employee-employer relationship exists.
o Private respondents work for Dy was continuous, even though they were compensated
on a per piece basis
CIR: Hearing examiners findings adopted. Dy guilty of unfair labor practices
Before the SC, Dy argues:
o Solano is not his employee because he doesnt stay in his establishment for long, and
he could leave as soon as he was through with the orders that were given him
o Solano only works when Dys regular workers cant come in
o Solanos work with Dy is not continuous
o No evidence to show that Dy has the right to direct the manner and method of Solano
and Tudlas work3
the services are performed reserves a right to control not only the end to be achieved
but also the means to be used in reaching such end.
In this case, the Court noted that Dy was engaged in the manufacture of baskets (kaing).
Therefore, it is only natural that he would exercise control in dictating the specifications
of the baskets.
The work was also done in Dys establishment, so he could easily exercise control over
his employees.
The pakiaw system used in this case is only a method of compensation
The Court concurred with the Hearing Examiner that time and work done are only
measures by which compensation would be based in Dys factory
CJ Paras, in Sunripe Coconut v. CIR: judicial notice taken of the fact that the pakiaw sys-
tem is a labor contract between ERs and EEs
DECISION.
Petition denied. But award of backwages modified
NOTES.
Factual findings of the CIR are conclusive as long as they are supported by substantial evi-
dence, which they are, in this case
Backwages modified bc its been 18 mos since Solano and Tudla were dismissed. J Tee-
hankees formula applied: 3 yrs backwages without qualification. Subject sana to mitigating
circumstances, but no mitigating circumstances in this case.

ISSUES & RATIO.

1. WON an EE-ER relationship between Dy and Solano+Tudla exists YES.
The control test avails

1
Intl Labor filed this case on behalf of their members, Solano and Tudla, who were dismissed by
Dy
2
(1) To interfere with, restrain or coerce employees in the exercise of their rights guaranteed in
section three;
xxx
(4) To discriminate in regard to hire or tenure of employment or any term orcondition of employ-
ment to encourage or discourage membership in any labor organization: x x x
3
Here, Dy cites Madrigal Shipping v. del Rosario: The test . . . of the existence of employee and
employer relationship is whether there is an understanding between the parties that one is to
render personal services to or for the benefit of the other and recognition by them of the right of
one to order and control the other in the performance of the work and to direct the manner and
method of its performance