Definition from Terms

EMPLOYER -An employer is one for whom employees work

in consideration of wages or salaries. May be a juridical or
natural person.
EMPLOYEE An employee is one who works for an
employer, a person working for salary or wages, any person
in the service of another under a contract for hire, express or
implied, oral or written. Always a natural person.
Labor (n) workers employed in an establishment;workers
available for employment; organizations representing groups
of workers; (v) physical or mental effort, to perfom work.

Employer-employee
relationship
contractual in character.

is

Their relationship is impressed with public

interest so it must yield to the common good.
It is in personam.
The presence or absence of ER-EE
relationship is itself a labor law question.

Four-Fold Test

Selection and engagement of the employees

Payment of wages

Power of dismissal

Employers power to control the employee

with respect to the means & methods by
which the work is to accomplished.

Power of Control
The power of control refers merely to the existence of
the power and not to the actual exercise.
The power of control does not exist if the rules merely
serves as guidelines towards the achievement of the
mutually desired result without dictating the means &
methods to be employed in attaining it.

Applicability- all workers - agricultural or nonagricultural.

Agricultural worker farm worker. One who is
employed in an agricultural field of farm enterprise.
Government employees - it is Congress that
determines their compensation. The terms &
condition of their employment are governed by the
Civil Service Commission.

Government Owned or Controlled Corporation

A government-owned or controlled corporation is a stock
or non-stock corporation whether performing government
or proprietary functions, which is directly chartered by
special law or if organized under the general corporation
law is owned or controlled by the government or
subsidiary corporation, to the extent of at least a majority
of its outstanding capital stock or of its outstanding voting
stock.

 A government corporation is normally created by

special law, referred to often as a charter.
A corporation is created by operation of law. It
acquires a judicial personality either by special law
or a general law. The general law under which a
private corporation may be formed or organized is
the Corporation Code, the requirements of which
must be complied with by those wishing to
incorporate. Only upon such compliance will the
corporation come into being and acquire a juridical
personality, thus giving rise to is right to exist and
act as a legal entity.

Questions
1. Why is it important to determine whether
there is an employer-employee relationship
between the parties?
2. What form of evidence is needed to prove
the existence of that relationship?

CASE ANALYSIS
1) Tailors, pressers and stitchers worked in the
tailoring department of Black Shop. They were paid
on a weekly basis & were required to report to work
from Mondays to Saturdays & to stay in the job for
no less than 8 hours a day unless there is no job
order in which case they are free to leave the
factory. Black Shop claims they are not employees
of the company because they are free to leave the
factory when there is no job order for the day.
DECIDE.

2) Mrs. L entered into a business contract with Tourist

World Services. She invested P500,000 and it was
agreed upon that she would act as Branch Manager
to ensure that they would be able to get as many
clients as possible & be entitled to profit sharing.
She decided on what was to be done and worked at
her own pleasure. Known for her temper, Tourist
World required that she should, at all times, deal
with clients in a good manner & act accordingly. Is
Mrs. L an employee of Tourist?

3) Under the contract, Pablo was authorized by Sunlife

to solicit clients for the latter. He would receive
compensation in the form of commission, was free
to exercise his own judgment, must observe &
conform to all rules & policies of the company, was
prohibited from giving rebates to clients, or from
committing any acts prohibited in the agent'
manual. Is there an employer-employee
relationship between the parties?

4) Balbastro was engaged by M&M Realty as pump

operator for Rancho Estates Subdivision. His work
was to open & close, on a daily basis, during certain
designated hours, the water supply in the
subdivision. He worked for only a maximum period
of 3 hours everyday. He made use of his free time
by offering plumbing services to the residents of the
subdivision. Is he an employee of M&M?

5) Anna was hired as a hair cutter by a beauty parlor.

She was paid on a per customer basis & was
required to be in the parlor for 5 hours a day,
particularly from 12-5, Mondays - Fridays. She is
not required to wear any uniform but would have to
come to work in the colored shirt prescribed by the
parlor. She was free to use whatever technique she
best deems in cutting hairs & her supervisor never
interfered with her work. Moreover, she is allowed
to practice elsewhere after 5 pm. Is she an
employee of the parlor?

6) Andrew worked as a volunteer reporter for ABSCBN. He did not receive any salary from the station
but was given an allowance when there is a
coverage. Unlike other reporters, he was not
required to adhere to a program schedule & the
station did not have editorial rights over his reports.
However, he has to be in the station office at least
once a week to submit his news report. Is he an
employee of ABS-CBN?

7) Mr. L was appointed by the Board of Directors of

SMC to do notarial and legal work for the latter. His
appointment was fixed for a period of 3 years. His
duties were prescribed by the board to wit, among
other, to act on all legal matters & to defend the
corporation from all suits. He was not required to
be in the office at all times but must be there when
the board calls for his presence. Is there an
employer-employee relationship?

8) UST entered into a contract with a security agency.

It was stipulated that the agency will supply the
school with guards for a period of 1 year. A lump
sum was paid by the school to the agency who in
turn paid the compensation of the guards. These
guards were required to be at the post during
school hours. All matters pertaining to the service of
the guards were dealt with by the agency. UST can
always ask the agency for a replacement of the
guard if the latter committed any unacceptable act
in the premises of the school. DECIDE.

9) Feliciano was hired by Pilipinas Shell to conduct a

hydro-pressure rest of the underground storage
tank of a Shell gasoline station. He was to be paid
a lump sum. He has his own tools and equipment
and was not suprvised by Pilipinas Shell as to how
he will conduct the hydro-pressure test. However,
Pilipinas Shell mandated that the project be
completed within 1 week.
Is Felciano an
employee of Pilipinas Shell?

10) A,B,C and D were jeepney drivers of Barney. It was

the wife of Barney who chose the drivers preferring
good looking ones. If the infamous Leila di Luna can
get away with a drayber sweet laber why can't she?
Under their arrangement with Barney, the drivers
were to take out the jeepney every other day on a 24
hour work schedule on a boundary system. The
drivers were free to work for other operators during
their off days. They were not given daily wages.
Are they employees of Barney?

11)Your group hired a famous painter to do your

portrait. Will your relationship be governed by
the Labor Code?