THIRD
DIVISION
PHILIPPINE
AIRLINES, INC.,
Petitioner,
G. R. No. 120506
October 28, 1996
-versus-
NATIONAL
LABOR RELATIONS COMMISSION,
HON. LABOR ARBITER CORNELIO LINSANGAN,
UNICORN SECURITY SERVICES, INC. and
FRED BAUTISTA, ET AL.,
Respondents.
D
E C I S I O N
DAVIDE, JR., J.:
This is a
Petition for Certiorari under Rule
65 of the Rules of Court to annul the Decision of the Labor Arbiter
dated
12 August 1991 in NLRC Case No. 00-11-06008-90 and the Resolutions of
public
respondent National Labor Relations Commission [NLRC] promulgated on 27
October 1994 and 31 May 1995 dismissing the appeal filed by the
petitioner
and denying the motion for reconsideration, respectively.
The dispute arose
from these antecedents:
On 23 December
1987, private respondent Unicorn
Security Services, Inc. [USSI] and petitioner Philippine Airlines, Inc.
[PAL] executed a security service agreement.[1]
USSI was designated therein as the CONTRACTOR. Among the pertinent
terms
and conditions of the agreement are as follows:
[4] The CONTRACTOR shall assign to PAL an
initial
force of EIGHTY ONE [81] bodies which may be decreased or increased by
agreement in writing. It is, of course, understood that the
CONTRACTOR
undertakes to pay the wages or salaries and cost of living allowance of
the guards in accordance with the provisions of the Labor Code, as
amended,
the different Presidential Decrees, Orders and with the rules and
regulations
promulgated by competent authorities implementing said acts, assuming
all
responsibilities therefor.
xxx xxx xxx
[6] Without any expense on the part of
PAL,
CONTRACTOR
shall see to it that the guards assigned to PAL are provided, at the
expense
of CONTRACTOR, with the necessary firearms, ammunitions and facilities
needed for the rendition of the security services as aforesaid;
[7] The CONTRACTOR shall select,
engage and
discharge
the guards, employees, or agents, and shall otherwise direct and
control
their services herein provided or heretofore to be set forth or
prescribed.
The determination of wages, salaries and compensation of the guards or
employees of the CONTRACTOR shall be within its full control but shall
in no way contravene existing laws on the matter. It is further
understood
that CONTRACTOR as the employer of the security guards agrees to comply
with all relevant laws and regulations, including compulsory coverage
under
the Social Security Act, Labor Code, as amended and the Medical Care
Act,
in its operations. Although it is understood agreed between parties
hereto
that CONTRACTOR in the performance of its obligations under this
Agreement,
is subject to the control and direction of PAL merely as to the result
as to be accomplished by the work or services herein specified, and not
as to the means and methods for accomplishing such result, CONTRACTOR
hereby
warrants that it will perform such work or services in such manner as
will
achieve the result herein desired by PAL.
[8] Discipline and administration of
the
security
guards shall be the sole responsibility of the CONTRACTOR to the end
that
CONTRACTOR shall be able to render the desired security service
requirements
of PAL. The CONTRACTOR, therefore, shall conform to such rules
and
regulations that may be issued by PAL. For this purpose, Annex "A",
which
forms part of this Agreement, contains such rules and regulations and
CONTRACTOR
is expected to comply with them. At its discretion, PAL may, however,
work
out with CONTRACTOR such rules and regulations before their
implementation.
[9] Should PAL at any time have any
justifiable
objection to the presence in its premises of any of CONTRACTOR's
officer,
guard or agent under this Agreement, it shall send such objection in
writing
to CONTRACTOR and the latter shall immediately take proper action.
[10] The security guards employed by
CONTRACTOR
in performing this Agreement shall be paid by the CONTRACTOR and it is
distinctly understood that there is no employee-employer relations
between
CONTRACTOR and/or his guards on the one hand, and PAL on the other.
CONTRACTOR
shall have entire charge, control and supervision of the work and
services
herein agreed upon, and PAL shall in no manner be answerable or
accountable
for any accident or injury of any kind which may occur to any guard or
guards of the CONTRACTOR in the course of, or as a consequence of,
their
performance of work and services under this Agreement, or for any
injury,
loss or damage arising from the negligence of or carelessness of the
guards
of the CONTRACTOR or of anyone of its employ to any person to persons
or
to its or their property whether in the premises of PAL or elsewhere;
and
the CONTRACTOR hereby covenants and agrees to assume, as it does hereby
assume, any and all liability or on account of any such injury, loss or
damage, and shall indemnify PAL for any liability or expense it may
incur
by reason thereof and to hold PAL free and harmless from any such
liability.
xxx xxx xxx
[13] For and in consideration of the
services
to be rendered by CONTRACTOR under these presents, PAL shall pay
CONTRACTOR
the amount of PESOS NINE & 40/100 CTVS (P9.40) PER HOUR multiplied
by 905 hours equivalent to PESOS TWO HUNDRED SEVENTY FIVE THOUSAND NINE
HUNDRED NINE & 58/100 CTVS, Philippine currency,
(P275,909.58)
the basis of eight (8) working hours per office/guard a day, Sundays
and
holidays included, the same to be payable on or before the 15th of each
month for services on the first half of the month and on or before the
end of the month for services for the 2nd half of the month.
Nothing herein contained shall prevent
the
parties
from meeting for a review of the rates should circumstances warrant.
xxx xxx xxx
[20] This Agreement shall take effect
on 06
December
1987 and shall be in force for a period of six [6] MONTHS 05 JUNE
1988 thereafter it shall continue indefinitely unless sooner terminated
upon thirty [30] days notice served upon by one party to the other,
except
as provided for in Articles 16, 17 & 18 hereof.
Sometime in
August of 1988, PAL requested 16 additional
security guards. USSI provided what was requested; however, PAL
insisted
that what USSI did was merely to pick out 16 guards from the 86 already
assigned by it and directed them to render overtime duty.
On 16 February
1990, PAL terminated the security
service agreement with USSI without giving the latter the 30-day prior
notice required in paragraph 20 thereof. Instead, PAL paid each of the
security guards actually assigned at the time of the termination of the
agreement an amount equivalent to their one-month salary to compensate
for the lack of notice.cralaw:red
In November 1990,
USSI, allegedly "in its capacity
as Trustee for Sixteen or on Security Guards," filed with the NLRC
Arbitration
Branch, National Capital Region, a complaint[2]
against PAL for the recovery of P75,600.00 representing termination pay
benefit due the alleged 16 additional security guards, which PAL failed
and refused to pay despite demands. It further asked for an award of
not
less than P15,000.00 for each of the 16 guards as damages for the delay
in the performance of PAL's obligation, and also for attorney's fees in
an amount equivalent to 10% of whatever might be recovered. Pertinent
portions
of the complaint read as follows:
3. By virtue of said contract and upon
its
effectivity,
respondent required eighty-six (86) security guards whom complaint USSI
supplied; on or sometime in August 1989, respondent asked sixteen (16)
security guards to render twelve (12) hours each.
4. In February 1990 and for reasons of
its
own,
respondent caused to terminate not only the contract but also the
services
of the security guards; in effecting such termination, said respondent
caused to pay the equivalent of one (1) month's notice unto all the
security
guards, except the 16 who, as aforementioned were rendering 12 hours
each
from date of assignment up to and until their termination.
5. As computed, the termination pay
benefits
due
the 16 security guards amount to P75,600.00, more or less, which,
despite
demands, respondent fails, neglects or refuses to pay, as it continue
refusing,
failing or neglecting to so do up to the present time.
6. Respondent has not only incurred in
delay
in
the performance of its obligation but also contravened the tenor
thereof;
hence, complainants are, by law, entitled to be indemnified with
damages
for no less than P15,000.00 each for all complainants though the
correct
amount is left solely to the sound discretion of the Honorable Labor
Arbiter.
7. Complainants are now compelled to
litigate
their plainly valid, just or demandable claim on account of which
services
of counsel have been required and thereby obligated themselves to pay,
for and as attorney's fees, the sum equivalent to ten percent (10%) of
whatever sums or sum may be recovered in the case.
The complaint
was docketed as NLRC-NCR Case No. 00-11-06008-90
and assigned to Labor Arbiter Cornelio L. Linsangan. PAL
filed
a Motion to Dismiss the complaint[3]
on the grounds that the Labor Arbiter had no jurisdiction over the
subject
matter or nature of the complaint and that USSI had no cause of action
against PAL. In amplification thereof, PAL argued that the case
involved
the interpretation of the security service agreement, which is purely
civil
in character and falls outside of the Labor Arbiter's jurisdiction. It
is clear from Article 217 of the Labor Code that for claims to be
within
the jurisdiction of Labor Arbiters, they must arise from an
employer-employee
relationship. PAL claimed that USSI did not allege the existence of an
employer-employee relationship between PAL and USSI or its guards, and
that in fact, paragraph 10 of the agreement provides that there is no
employer
- employee relationship between the CONTRACTOR and/or his guards on the
one hand and PAL on the other.
In its Opposition,[4]
USSI pointed out that PAL forgot or overlooked the fact that "insofar
as
labor standards, benefits, etc. have to be resolved or adjudicated,
liability
therefor is shifted to, or assumed by, respondent [herein petitioners]
which, in law, has been constituted as an indirect employer."
PAL filed a supplemental motion to dismiss[5]
wherein it cites the following reasons for the dismissal of the
complaint:
[1] the clear stipulations in the agreement [Paragraphs 4 and 10] that
there exists no employer-employee relationship between PAL, on the one
hand, and USSI and the guards, on the other; [2] there were no 16
additional
guards, as the 16 guards who were required to render 12-hour shifts
were
picked out from the original 86 guards already assigned and were
already
given a one-month salary in lieu of the 30-day notice of termination of
the agreement; [3] USSI had no legal personality to file the case as
alleged
trustee of the 16 security guards; and [4] the real parties in
interest
the 16 security guards never showed any interest in the case
either
by attending any hearing or conference, or by following up the status
of
the case.cralaw:red
Attached to the
Supplemental Motion to Dismiss
were, among other things, xerox copies of confirmation letters of USSI
to PAL to show that no additional guards were in fact provided.[6]
Labor Arbiter Linsangan did not resolve the
Motion
to Dismiss and the Supplemental Motion to Dismiss. On 12 August 1991,
he
handed down a decision[7]
ordering PAL to pay: [1] the sum of P75,600.00 representing the
equivalent
of one-month's separation pay due to the 16 individual security guards,
plus 10% interest from the date of filing of the case until the whole
obligation
shall have been fully settled; [2] the sum of P5,000.00 by way of
exemplary
damages due each of the 16 security guards; and [3] another sum
equivalent
to 10% of the total award for and as attorney's fees.cralaw:red
It was in that
decision that Labor Arbiter Linsangan
mentioned for the first time that the resolution of the Motion to
Dismiss
and Supplemental Motion to Dismiss "was deferred until [the] case is
decided
on the merits" considering "the ground not to be indubitable." In
holding
that he had jurisdiction over the case, he stated:
As heretofore and invariably held in
similar
cases, the issue of whether or not Labor Arbiters have jurisdiction
over
money claims affecting security guards assigned by security agencies
[like
complainant herein] to their client-companies such as PAL is, more or
less,
settled, especially since, as the law views such a peculiar
relationship,
such money claims insofar as they have to be paid, are the ultimate
responsibility
of the client-firms. In effect, the security guards have been
constituted
as indirect employees of the client just as the client becomes the
indirect
employer of the guards. Art. 107 and 109 of the Labor Code expressly
provide
that xxx
To justify the
awards, Labor Arbiter Linsangan opined:
Evidence adduced clearly show that
sometime in
December 1987, aforementioned security service contract was executed,
based
on which the required number of security guards were assigned to, or
posted
at, the various premises of respondent PAL. Said number of
security
guards may, as the contract provides, be increased or reduced at
respondent's
request, such that the original number of eighty-six [86] guards, an
additional
sixteen [16] were needed and, accordingly supplied who, pursuant to
PAL's
instructions, were required to render twelve [12] hours each, per day.
In February 1990, and for reasons of its
own,
PAL caused to terminate, as it did, the contract of security services.
Unequivocally, it caused to pay the separation pay benefits of the 86
security
guards for the equivalent amount of one [1] month's pay. As to the
additional
16, it failed and refused to grant similar equivalent, without any
valid
reasons therefor.
As earlier stated, respondent opted to
rely
solely
on the ground set forth in its Motion to Dismiss as well as Supplement
thereto. It failed to file, despite directive made thereon, its
position
paper. Neither did it submit, nor adduce, evidence (documentary or
otherwise)
to rebut or controvert complainant's claims especially since the money
equivalent of the one month separation pay due the 16 guards has been
duly
quantified as amounting to Seventy Five Thousand Six Hundred
(P75,600.00)
Pesos. Thus established, it is clear that there was absolutely no
legal/justifiable
reason why said 16 guards applied and who rendered 12 hours each per
day
had to be discriminated against.
Following PAL's failure or refusal to
pay,
demands
were made by complainant, asking at the same time why that was so.
Conceivably,
respondent has smarted itself on its mistaken belief that there was, as
between the guards and itself, no employer-employee relationship and,
hence,
there is no legal basis for it to pay. If that was so, why did it pay
separation
pay unto the 86 regular employed guards.
PAL being widely known as a
progressively-minded
employer, it should be the first to show good example for emulation. In
this instant case, it did not; in fact, its actuations were not
consistent
with good faith. It should, therefore, be held liable for exemplary
damages
and having required complainant to litigate a plainly valid, just or
demandable
claim, an award for attorney's fees must perforce be assessed.
On 3 September
1991, PAL filed its Appeal[8]
wherein it indicated that it received a copy of the decision on 26
August
1991. Attached thereto was a machine copy of the Notice of
Judgment/Final
Order with the date of its receipt, i.e., 26 August 1991,[9]
having been stamped on the upper right-hand corner by PAL's Legal
Department.
USSI countered
this appeal with a Motion for Execution
of Judgment[10]
on the ground that since PAL received a copy of the decision on the
23rd,
not on the 26th, of August 1991, it had until 2 September 1991 to
appeal;
hence, the appeal interposed on 3 September was late by one day. The
decision
had then become final and executory.cralaw:red
In its opposition[11]
to this motion, PAL insisted that it received a copy of the decision on
26 August 1991; thus, it had until 5 September 1991 to file its appeal.cralaw:red
On 30 September
1991, Labor Arbiter Linsangan
issued a writ of execution.[12]
On 1 October
1991, PAL filed a Motion to Quash[13]
the writ of execution. It tried to explain therein why it thought all
along
that it received a copy of the decision on 26 August 1991, thus:
4. Upon investigation, the undersigned
counsel
learned that on 23 August 1991 [Friday] a server-messenger went to PAL
Legal Department to serve said decision. The receiving clerks at that
time
were all out of the office so that the server persuaded a secretary,
Ms.
April Rose del Rosario to receive the same, notwithstanding the fact
that
Ms. Del Rosario told him [server] that she was not authorized to
receive
documents for and in behalf of PAL. Ms. Del Rosario then stamped the
date
of receipt on the service's copy without stamping [the date of receipt]
PAL's copy of the Decision which was left by the server. Thereafter,
Ms.
del Rosario placed PAL's copy of the Decision on the incoming documents
rack of the receiving clerk.
Attached herewith is the affidavit of
Ms.
Del
Rosario and as Annex "A" hereof.
5. On 26 August 1991 (Monday), the
receiving
clerk/messenger
Mr. Greg Soriano upon finding the Decision among the documents in the
incoming
documents rack, immediately stamped "Received 26 August 1991" thereon,
on the honest and sincere belief that the same just arrived that day
[26
August 1991]. He then forwarded the same to the secretary of the
undersigned
counsel.
Attached herewith is the affidavit of Mr.
Greg
Soriano marked as Annex "B" hereof.
6. The undersigned counsel, believing
that
the
said decision was received on 26 August 1991, reckoned/counted the ten
[10] day period for appeal from said date.
7. Considering the foregoing
circumstances,
the
undersigned counsel's innocent reliance on the date of receipt stamped
on the copy of the Decision furnished him was clearly due to an
innocent
mistake and/or excusable neglect. Hence, justice and equity dictates
that
respondent PAL should be considered to have filed its appeal within the
reglementary period for appeal.[14]
On 8 October
1991, Labor Arbiter Linsangan issued
an order[15]
denying the Motion to Quash.
On 10 October 1991, PAL appealed[16]
to the NLRC the aforesaid order of 8 October 1991 on the ground that it
was issued with grave abuse of discretion.
In its resolution
of 27 October 1994,[17]
the Second Division of the NLRC dismissed PAL's appeal for having been
filed out of time. It sustained the Labor Arbiter's finding that PAL
had
received a copy of the decision on 23 August 1991, and hence the last
day
to appeal was 2 September 1991. It ruled that whether or not the
decision
was received by an employee other than the receiving clerk or messenger
was of no moment, as the proper performance of employee's duties was
PAL's
concern.cralaw:red
On 31 May 1995,
the NLRC denied the motion for
reconsideration[18]
for the reason that it cannot accept PAL's excuse as it may "open the
floodgates
to abuse"; and that the lapse of the period to appeal had already
deprived
the Commission of jurisdiction over the case.[19]
PAL then filed
this Special Civil Action for Certiorari
under Rule 65 of the Rules of Court alleging that: [1] public
respondent
committed serious and patent error in failing to declare that the Labor
Arbiter had no jurisdiction over the instant case; [2] The Labor
Arbiter
gravely abused his discretion in ordering PAL to pay the separation pay
of the 16 security guards assigned at PAL's premises by USSI; and [3]
respondent
NLRC committed grave abuse of discretion in declaring PAL's appeal to
have
been filed out of time.cralaw:red
PAL argues that
since USSI's cause of action was
founded on the security service agreement, and that thereunder no
employer-employee
relationship existed between PAL and the security guards who were
USSI's
employees, the Labor Arbiter had no jurisdiction over the complaint.
Moreover,
assuming arguendo that the claims of the security guards were valid,
USSI
had no personality to file the complaint, for there is nothing
whatsoever
to show that it was expressly authorized by the security guards to act
as their "trustee."
As to the second
assigned error, PAL asserts that
it is not liable to pay separation pay because [1] it was not the
employer
of the security guards; [2] even as an indirect employer, as held by
the
Labor Arbiter, its liability was limited to violations of labor
standards
law, and non-payment of the separation pay is not a violation of the
said
law; [3] the security service agreement with USSI did not provide for
payment
of separation pay; [4] the payment made to the 86 security guards upon
the termination of the agreement without the prior 30-day notice was
not
for separation pay but a benefit in lieu of the 30-day notice required
under paragraph 20 of the agreement; and [5] since PAL was not employer
of the security guards, in no way could it terminate their services.cralaw:red
In its third
assigned error, PAL submits that
rules of procedure ought not to be applied in a very rigid technical
sense,
sense they are used only to help secure and not override substantial
justice,
especially in this case where the appeal was meritorious. Moreover, the
delay in the perfection of the appeal, reckoned from the finding of the
Labor Arbiter, was only one day; but if reckoned from what its counsel
innocently believed to be PAL's date of receipt of the decision, which
was 26 August 1991, the appeal could be said to have been seasonably
filed.cralaw:red
In its Comment,
USSI points out that the grounds
relied upon by PAL are based on factual a issue, namely, the
discrimination
made by PAL in paying the 86 and not the 16 security guards. It argues
that the case touched upon the rights of the 16 security guards as
employees;
thus, the same was within the jurisdiction of the Labor Arbiter. As
regards
PAL's plea for the relaxation of the rule on perfection of appeals,
USSI
contends that the negligence of PAL's counsel should not be deemed
"compelling
reason to warrant relaxation of the rule."
In its
Manifestation and Motion in Lieu of Comment,[20]
the Office of the Solicitor General agrees with PAL that the Labor
Arbiter
did not have jurisdiction over the complaint because there was no
employer-employee
relationship between PAL and the 16 security guards; that Articles 107
and 109 of the Labor Code which provide for joint and several liability
for payment of wages by the direct and indirect employer find no
application
in the present case because the 16 security guards employed by USSI
were
not after unpaid wages; and that in the interest of justice and
considering
that the appeal was filed only one day late, the rule on perfection of
appeals should have been relaxed to prevent a miscarriage of justice.cralaw:red
In view of the
stand of the Office of the Solicitor
General, We advised public respondents to file their own comment if
they
so desired.cralaw:red
In their Comment,
the NLRC and Labor Arbiter Linsangan
maintain that they had jurisdiction over the case because of Articles
107
and 109 of the Labor Code which constitute PAL as indirect employer of
the 16 security guards, there being a question involving separation pay
due the latter; that the 16 security guards were entitled to separation
pay, because PAL paid the other 86 security guards when the service
agreement
was terminated; and that for the NLRC to excuse the delay of one day in
filing the appeal would open the floodgates of abuse.cralaw:red
The instant
petition is impressed with merit.cralaw:red
We agree with
petitioner PAL that the Labor Arbiter
was without jurisdiction over the subject matter of NLRC-NCR Case No.
00-11-06008-90
because no employer-employee relationship existed between PAL and the
security
guards provided by USSI under the security service agreement, including
the alleged 16 additional security guards.cralaw:red
We have
pronounced in numerous cases[21]
that in determining the existence of an employer-employee relationship,
the following elements are generally considered: [1] the selection and
engagement of the employee; [2] the payment of wages; [3] the power to
dismiss; and [4] the power to control the employee's conduct.cralaw:red
In the instant
case, the security service agreement
between PAL and USSI provides the key to such consideration. A careful
perusal thereof, especially the terms and conditions embodied in
Paragraphs
4, 6, 7, 8, 9, 10, 13 and 20 quoted earlier in this ponencia,
demonstrates
beyond doubt that USSI and not PAL was the employer of the
security guards. It was USSI which [a] selected, engaged or hired and
discharged
the security guards; [b] assigned them to PAL according to the number
agreed
upon; [c] provided, at its own expense, the security guards with
firearms
and ammunitions; [d] disciplined and supervised them or controlled
their
conduct; and [e] determined their wages, salaries, and compensation;
and
(f) paid them salaries or wages. Even if We disregard the explicit
covenant
in said agreement that "there exists no employer-employee relationship
between CONTRACTOR and/or his guards on the one hand, and PAL on the
other"
all other considerations confirm the fact that PAL was not the security
guards' employer. Analogous to the instant case is Canlubang Security
Agency
Corp. vs. NLRC.[22]
Considering then
that no employer-employee relationship
existed between PAL and the security guards, the Labor Arbiter had no
jurisdiction
over the claim in NLRC-NCR Case No. 00-11-06008-90. Article 217 of the
Labor Code [P.D. No. 442], as amended, vests upon Labor Arbiters
exclusive
original jurisdiction only over the following:
1. Unfair labor practice cases;
2. Termination disputes;
3. If accompanied with a claim for
reinstatement,
those cases that workers may file involving wages, rates of pay,
hours of work and other terms and conditions of employment;
4. Claims for actual, moral, exemplary
and
other
forms of damages arising from employer-employee relations;
5. Cases arising from any violation of
Article
265 of this Code, including questions involving legality of strikes
and
lockouts; and
6. Except claims for Employees
Compensation,
Social
Security, Medicare and maternity benefits, all other claims,
arising
from employer-employee relations, including those of persons in
domestic
or household service, involving an amount exceeding five thousand
pesos (P5,000.00) regardless of whether accompanied with a claim
for reinstatement.
In all these
cases, an employer-employee relationship
is an indispensable jurisdictional requisite.
The Labor Arbiter
cannot avoid the jurisdictional
issue or justify his assumption of jurisdiction on the pretext that PAL
was the indirect employer of the security guards under Article 107 in
relation
to Articles 106 and 109 of the Labor Code and, therefore, it is
solidarily
liable with USSI. We agree with the Solicitor General that these
Articles
are inapplicable to PAL under the facts of this case. Article 107
provides:
Art. 107. Indirect Employer.-
The
provisions of the immediately preceding Article shall likewise apply to
any person, partnership, association or corporation which, not being an
employer, contracts with an independent contractor for the performance
of any work, task, job or project.
The preceding
Article referred to, which is Article
106, partly reads as follows:
Art. 106. Contractor or Subcontractor.
-
Whenever an employer enters into a contract with another person for the
performance of the former's work, the employees of the contractor and
of
the latter's subcontractor, if any, shall be paid in accordance with
the
provisions of this Code.
In the event that the contractor or
subcontractor
fails to pay the wages of his employees in accordance with this Code,
the
employer shall be jointly and severally liable with his contractor or
subcontractor
to such employees to the extent of the work performed under the
contract,
in the same manner and extent that he is liable to employees directly
employed
by him.
While USSI is
an independent contractor under the
security service agreement and PAL may be considered an indirect
employer,
that status did not make PAL the employer to the security guards in
every
respect. As correctly posited by the Office of the Solicitor General,
PAL
may be considered an indirect employer only for purposes of unpaid
wages
since Article 106, which is applicable to the situation contemplated in
Section 107, speaks of wages. The concept of indirect employer only
relates
or refers to the liability for unpaid wages. Read together, Articles
106
and 109 simply mean that the party with whom an independent contractor
deals is solidarily liable with the latter for unpaid wages, and only
to
that extent and for that purpose that the latter is considered a direct
employer. The term "wages" is defined in Article 97[f] of the Labor
Code
as "the remuneration or earnings, however designated, capable of being
expressed in terms of money, whether fixed or ascertained on a time,
task,
piece, or commission basis, or other method of calculating the
unwritten
contract of employment for work done or to be done, or for services
rendered
or to be rendered and includes the fair and reasonable value, as
determined
by the Secretary of Labor, of board, lodging, or other facilities
customarily
furnished by the employer to the employee."
No valid claim
for wages or separation pay can
arise from the security service agreement in question by reason of its
termination at the instance of PAL. The agreement contains no provision
for separation pay. A breach thereof could only give rise to damages
under
the Civil Code, which is cognizable by the appropriate regular court of
justice. Besides, there is no substantial proof that USSI in fact
provided
16 additional guards. On the contrary, PAL was able to prove in the
annexes
attached to its supplemental motion to dismiss that the 16 guards were
actually picked out from the original group and were just required to
render
overtime service.cralaw:red
The Labor
Arbiter's lack of jurisdiction was too
obvious from the allegations in the complaint and its annex (the
security
service agreement) in NLRC-NCR Case No. 00-11-06008-90. The Labor
Arbiter
then should have forthwith resolved the motion to dismiss and the
supplemental
motion to dismiss. As correctly pointed out by PAL, under Section 15 of
Rule V of the New Rules of Procedure of the NLRC, any motion to dismiss
on the ground of lack of jurisdiction, improper venue, res judicata, or
prescription shall be immediately resolved by the Labor Arbiter by a
written
order. Yet, the Labor Arbiter did not, and it was only in his decision
that he mentioned that the resolution of the motion to dismiss "was
deferred
until this case is decided on the merits" because the ground therefore
was not "indubitable." On this score the Labor Arbiter acted with grave
abuse of discretion for disregarding the rules he was bound to observe.cralaw:red
We shall now turn
to the issue of tardiness of
the appeal. The record does indeed show that on the original copy of
the
Notice of Judgment/Final Order,[23]
there is stamped by the PAL Legal Department the date of its receipt of
the decision, viz., "AUG. 23, 1991."
It is not also
denied by respondents that on the
right upper hand corner of PAL's copy of the Notice of Judgment/Final
Orders,[24]
there is stamped the date of receipt thereof by PAL Legal Department,
viz.,
"AUG. 26, 1991." PAL explained how this discrepancy occurred and how
its
counsel was misled into believing that PAL received a copy of the
decision
only on 26 August 1991. This belief in good faith rendered excusable
any
negligence it might have committed. Besides, the delay in the
perfection
of the appeal was only one day. Considering that the Labor Arbiter had
no jurisdiction over the subject matter of NLRC-NCR Case No.
00-11-06008-90
and that the 16 security guards are not in fact entitled to separation
pay under the security service agreement, the higher interest of
justice
favors a relaxation of the rule on perfection of appeals in labor cases.cralaw:red
While it is an
established rule that the perfection
of an appeal in the manner and within the period prescribed by law is
not
only mandatory but jurisdictional, and failure to perfect an appeal has
the effect of rendering the judgment final and executory, it is equally
settled that the NLRC may disregard the procedural lapse where there is
an acceptable reason to excuse tardiness in the taking of the appeal.[25]
Among the acceptable reasons recognized by this Court are [a] counsel's
reliance on the footnote of the notice of the decision of the Labor
Arbiter
that "the aggrieved party may appeal within ten [10] working days";[26]
[b] fundamental consideration of substantial justice;[27]
[c] prevention of miscarriage of justice or of unjust enrichment, as
where
the tardy appeal is from a decision granting separation pay which was
already
granted in an earlier final decision;[28]
and [d] special circumstances of the case combined with its legal merits[29]
or the amount and the issue involved.[30]
A one-day delay in the perfection of the appeal was excused in Pacific
Asia Overseas Shipping Corp. vs. NLRC,[31]
Insular life Assurance Co. vs. NLRC,[32]
and City Fair Corp. vs. NLRC.[33]
In the instant
case, the Labor Arbiter's lack
of jurisdiction so palpably clear on the face of the
complaint
and the perpetuation of unjust enrichment if the appeal is disallowed
are
enough combination of reasons that warrant a relaxation of the rules on
perfection of appeals in labor cases.cralaw:red
WHEREFORE, the
instant petition is hereby granted.
The questioned Decision of the Labor Arbiter dated 12 August 1991 and
the
Resolutions of the Second Division of the National Labor Relations
Commission
promulgated on 27 October 1994 and 31 May 1995 are hereby set aside and
NLRC-NCR Case No. 00-11-06008-90 is dismissed.cralaw:red
SO ORDERED.cralaw:red
Narvasa, C.J.,
Melo, Francisco and Panganiban,
JJ., concur.cralaw:red
__________________________________
Endnotes
[1]
Original Records (O.R.), 6-13; Rollo, 50-57.
[2]
O.R., 2-4; Rollo, 46-48.
[3]
O.R., 19-22; Rollo, 58-60.
[4]
O.R., 27-29.
[5]
Id., 48-58; Rollo, 64-74.6
[6]
Id., 59-65; Id., 75-76.
[7]
Id., 66-71; Id., 40-45.
[8]
O.R., 73-89; Rollo, 82-105.
[9]
Id., 93.
[10]
Id., 105-106; Id., 102-103.
[11]
Id., 108-109; Id., 104-105.
[12]
Id., 113-114; Id., 106-107.
[13]
Id., 116-117; Id., 109-110.
[14]
OR, 115-116.
[15]
Id., 125.
[16]
Id., 128-143.
[17]
Per Commissioner Calaycay, V., with Commissioners Aquino, R. and
Rayala,
R., Concurring; Rollo, 29-34.
[18]
Rollo, 177-185.
[19]
Id., 36-38.
[20]
Rollo, 202-216.
[21]
Among others, See: Viana vs. Al-Lagandan, 99 Phil. 408, 411-412 [1956];
Social Security System vs. Court of Appeals, 39 SCRA 629, 636 [1971];
American
President Lines vs. Clave, 114 SCRA 826, 832 [1982]; Besa vs. Trajano,
146 SCRA 501, 507 [1986]; "Brotherhood" Labor Unity Movement of the
Philippines
vs. Zamora 147 SCRA 49, 54 [1987]; Bautista vs. Inciong, 158 SCRA 665,
668 [1988]; Agro Commercial Security Service Agency, Inc. vs. NLRC, 175
SCRA 790, 795 [1989]; Ruga vs. NLRC, 181 SCRA 266, 273 [1990]; Singer
Sewing
Machine Co. vs. Drilon, 193 SCRA 270, 275 [1991]; Canlubang Security
Agency
Corp. vs. NLRC, 216 SCRA 280, 284 [1992]; Vallum Security Services vs.
NLRC, 224 SCRA 781, 785 [1993]; Air Material Wing Savings and Loan
Association
vs. NLRC, 233 SCRA 592, 594-595 [1994].
[22]
Supra, note 21.
[23]
O.R., 72.
[24]
O.R., 93.
[25]
Chong Guan Trading vs. NLRC, 172 SCRA 831, 839 [1989].
[26]
Id.; Firestone Tire and Rubber Co. vs. Lariosa, 148 SCRA 187, 190-191
[1987].
[27]
Insular Life Assurance Co. vs. NLRC, 156 SCRA 740, 746 [1987]; See also
the Resolution therein of July 1988; Ruga vs. NLRC, supra, Note 21, at
272; Benguet Electrical Coop. vs. NLRC, 209 SCRA 55, 61 [1992];
Blancaflor
vs. NLRC, 218 SCRA 366, 370-371 [1993].
[28]
Olacao vs. NLRC, 177 SCRA 38, 41 [1989].
[29]
Pacific Asia Overseas Shipping Corp. vs. NLRC, 161 SCRA 122, 130 [1988].
[30]
City Fair Corp. vs. NLRC, 243 SCRA 572, 576 [1995].
[31]
Supra, Note 29.
[32]
Supra, Note 27.
[33]
Supra, Note 30. |