Case Digest: Atienza vs. Saluta, GR No. 233413, June 17, 2019

Evidence | Rule 130

Reyes J. Jr., J.

Petitioner: Celia R. Atienza 

Respondent: Noel Sacramento Saluta 

Facts:

• Respondent Noel Sacramento Saluta claimed he was hired as a company driver by CRV Corporation and was assigned to drive for the petitioner Celia R. Atienza, receiving a monthly salary of ₱9,000.

• On December 11, 2014, a vehicular accident occurred and the respondent was required to pay ₱15,000.00 for the damages. His driver's license was confiscated, and he was issued a Temporary Operator's Permit (TOP).

• On December 23, 2014, the respondent requested time off to renew his expired license, but the petitioner allegedly refused, leading to a misunderstanding. The respondent believed he had been verbally terminated when the petitioner said that "kung hindi ka makakapag-drive ngayon, mabuti pa maghiwalay na tayo." 

• Respondent filed a complaint against CRV Corporation and the petitioner, claiming illegal dismissal and other labor-related issues.

• The petitioner argued that the respondent abandoned his job and was not an employee of CRV Corporation but her personal/family driver. She contended that he left work without notice.

Labor Arbiter: Ruled that the respondent, a personal driver, was considered an employee of the petitioner since the employer-employee relationship with CRV Corporation was not established. The Labor Arbiter dismissed the complaint for illegal dismissal, stating that the respondent left employment without justifiable reason and forfeited unpaid salary.

NLRC: Reversed the decision, finding that the petitioner failed to prove the absence of an employer-employee relationship and ordered payment of various benefits to the respondent.

CA: Ruled that the respondent failed to prove he was a company driver but found insufficient evidence from the petitioner to disprove the employment relationship.

Issue:

Held:

The Court's Ruling

Respondent is the personal/family

driver of the petitioner

Settled is the tenet that allegations in the complaint must be duly proven by competent evidence and the burden of proof is on the party making the allegation. In an illegal dismissal case, the onus probandi rests on the employer to prove that its dismissal of an employee was for a valid cause. However, before a case for illegal dismissal can prosper, an employer-employee relationship must first be established. Thus, in filing a complaint before the Labor Arbiter for illegal dismissal, based on the premise that he was an employee of CRV Corporation, it is incumbent upon the respondent to prove the employer-employee relationship by substantial evidence Stated otherwise, the burden of proof rests upon the party who asserts the affirmative of an issue. Since it is the respondent who is claiming to be an employee of CRV Corporation, it is, thus, incumbent upon him to proffer evidence to prove the existence of employer-employee relationship between them. He needs to show by substantial evidence that he was indeed an employee of the company against which he claims illegal dismissal. Corollary, the burden to prove the elements of an employer-employee relationship, viz.: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power of control, lies upon the respondent.

It must be pointed out that the issue of whether or not an employer-employee relationship exists in a given case is essentially a question of fact. As a rule, this Court is not a trier of facts and this applies with greater force in labor cases. Only errors of law are generally reviewed by this Court. However, this rule is not absolute and admits of exceptions like in labor cases where the Court may look into factual issues when the factual findings of the Labor Arbiter, the NLRC, and the CA are conflicting. In this case, the findings of the Labor Arbiter differed from those of the NLRC and the CA necessitating this Court to review and to reevaluate the factual issues and to look into the records of the case and reexamine the questioned findings. 

To ascertain the existence of an employer-employee relationship, jurisprudence has invariably adhered to the four-fold test, to wit: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control the employee's conduct, or the so-called "control test." Although no particular form of evidence is required to prove the existence of an employer-employee relationship, and any competent and relevant evidence to prove the relationship may be admitted, a finding that the relationship exists must nonetheless rest on substantial evidence, or such amount of relevant evidence which a reasonable mind might accept as adequate to justify a conclusion.  In this case, a scrutiny of the records will bear out that the respondent failed to substantiate his claim that he was a company driver of CRV Corporation.

Apart from his staunch insistence that he was a company driver of CRV Corporation, respondent did not proffer any competent evidence, documentary or otherwise, as would prove his claimed employment with the company. In the case at bench, the respondent did not present his employment contract, company identification card, company pay slip or such other document showing his inclusion in the company payroll that would show that his services had been engaged by CRV Corporation. His contention that he received his salaries through the ATM like the other employees of the company, even if true, does not sufficiently show that his salaries were paid by the company as its employee. Respondent also failed to present any proof showing how the company wielded the power of dismissal and control over him. Evidence is wanting that the company monitored the respondent in his work.  It had not been shown that respondent was required by the company to clock in to enable it to check his work hours and keep track of his absences. On the other hand, the records showed that petitioner had a say on how he performed his work. It is the petitioner who decides when she needed the services of the respondent. As a matter of fact, the respondent had to secure permission from the petitioner before he can take a leave of absence from work. That petitioner also enjoyed the power of dismissal is beyond question given that respondent himself believed that the petitioner verbally terminated him Because the respondent failed to establish his employment with CRV Corporation, the Court must necessarily agree with the Labor Arbiter that respondent was the personal/family driver of the petitioner.

Both the NLRC and the CA made it the petitioner's obligation to prove that respondent was under her employ and not a company driver of CRV Corporation. The Court does not agree. It must be emphasized that the rule of thumb remains: the onus probandi falls on the respondent to establish or substantiate his claim by the requisite quantum of evidence given that it is axiomatic that whoever claims entitlement to the benefits provided by law should establish his or her right thereto. Unfortunately, respondent failed to hurdle the required burden of proof as would give ground for this Court to agree with him.

Respondent was not dismissed

from employment

It is axiomatic that in illegal dismissal cases, the employer bears the burden of proving that the termination was for a valid or authorized cause. However, there are cases wherein the facts and the evidence do not establish prima facie that the employee was dismissed from employment. Before the employer is obliged to prove that the dismissal was legal, the employee must first establish by substantial evidence the fact of his dismissal from service. If there is no dismissal, then there can be no question as to the legality or illegality thereof. 

Here, respondent alleged that when he failed to report for work on December 24, 2014, he was verbally terminated by the petitioner. Respondent claimed that Reyes confirmed his termination. On the other hand, petitioner contended that the respondent just stopped reporting for work after he left his work on December 23, 2014.

Respondent's bare claim of having been dismissed from employment by the petitioner, unsubstantiated by impartial and independent evidence, is insufficient to establish such fact of dismissal. Bare and unsubstantiated allegations do not constitute substantial evidence and have no probative value.  It must be emphasized that aside from the allegation that he was verbally terminated from his work, respondent failed to present any competent evidence showing that he was prevented from returning to his work. Reyes did not issue any statement to corroborate the claimed termination of the respondent. That he was refused to be given his salary covering the period from December 15, 2014 to December 22, 2014 did not at all prove the fact of his termination. It must be taken into account that salaries of employees may not be released for myriad of reasons. Termination may only be one of them. The Court reiterates the basic rule of evidence that each party must prove his affirmative allegation, that mere allegation is not evidence. The Court must also stress that the evidence presented to show the employee's termination from employment must be clear, positive, and convincing. Absent any showing of an overt or positive act proving that petitioner had dismissed the respondent, the latter's claim of illegal dismissal cannot be sustained — as the same would be self-serving, conjectural, and of no probative value. 

Respondent did not abandon

his work

Abandonment is a matter of intention and cannot lightly be inferred or legally presumed from certain equivocal acts.  In Protective Maximum Security Agency, Inc. v. Fuentes, this Court held:

Abandonment is the deliberate and unjustified refusal of an employee to resume his employment. It is a form of neglect of duty, hence, a just cause for termination of employment by the employer. For a valid finding of abandonment, these two factors should be present: (1) the failure to report for work or absence without valid or justifiable reason; and (2) a clear intention to sever employer-employee relationship, with the second as the more determinative factor which is manifested by overt acts from which it may be deduced that the [employee] has no more intention to work. The intent to discontinue the employment must be shown by clear proof that it was deliberate and unjustified.

The burden of proving abandonment is upon the employer who, whether pleading the same as a ground for dismissing an employee or as a mere defense, additionally has the legal duty to observe due process. 

The Court finds that there is no abandonment in this case. Aside from his absence from work, petitioner failed to present any proof of respondent's overt conduct which clearly manifested his desire to end his employment.  Settled is the rule that mere absence or failure to report for work is not tantamount to abandonment of work.  This is especially so in light of his having filed a case for illegal dismissal which is inconsistent with abandonment of employment. An employee who takes steps to protest his dismissal cannot logically be said to have abandoned his work. The filing of such complaint is proof enough of his desire to return to work, thus, negating any suggestion of abandonment. 

The Civil Code shall govern the

rights of family drivers

Article 141, Chapter III, Book III on Employment of Househelpers of the Labor Code provides that family drivers are covered in the term domestic or household service. It states:

ART.  141. Coverage. — This Chapter shall apply to all persons rendering services in household for compensation.

"Domestic or household service" shall mean service in the employer's home which is usually necessary or desirable for the maintenance and enjoyment thereof and includes ministering to the personal comfort and convenience of the members of the employer's household, including services of family drivers. 

Thus, under the Labor Code, the rules for indemnity in case a family driver is terminated from the service shall be governed by Article 149 thereof which provides:

ART. 149. Indemnity for unjust termination of services. — If the period of household service is fixed, neither the employer nor the househelper may terminate the contract before the expiration of the term, except for a just cause. If the househelper is unjustly dismissed, he or she shall be paid the compensation already earned plus that for fifteen (15) days by way of indemnity.

If the househelper leaves without justifiable reason, he or she shall forfeit any unpaid salary due him or her not exceeding fifteen (15) days.

However, Section 44 of Republic Act No. 10361, otherwise known as the "Domestic Workers Act" or "Batas Kasambahay" (Kasambahay Law), expressly repealed Chapter III (Employment of Househelpers) of the Labor Code, which includes Articles 141 and 149 mentioned above.

The Kasambahay Law, on the other hand, made no mention of family drivers in the enumeration of those workers who are covered by the law. This is unlike Article 141 of the Labor Code. Section 4(d) of the Kasambahay Law states:

SEC. 4. Definition of Terms - As used in this Act, the term: xxxx

(d) Domestic worker or "Kasambahay" refers to any person engaged in domestic work within an employment relationship such as, but not limited to, the following: general househelp, nursemaid or "yaya", cook, gardener, or laundry person, but shall exclude any person who performs domestic work only occasionally or sporadically and not on an occupational basis.

The term shall not include children who are under foster family arrangement, and are provided access to education and given an allowance incidental to education, i.e.[,] "baon", transportation, school projects and school activities.

Thus, Section 4(d) of the Kasambahay Law pertaining to who are included in the enumeration of domestic or household help cannot also be interpreted to include family drivers because the latter category of worker is clearly not included. It is a settled rule of statutory construction that the express mention of one person, thing, or consequence implies the exclusion of all others — this is expressed in the familiar maxim, expressio unius est exclusio alterius.

Moreover, Section 2 of the Implementing Rules and Regulations of the Kasambahay Law provides:

SEC. 2. Coverage. - This x x x [IRR] shall apply to all parties to an employment contract for the services of the following Kasambahay, whether on a live-in or live-out arrangement, such as but not limited to:

(a)   General househelp;

(b)   Yaya;

(c)   Cook;

(d)   Gardener;

(e)   Laundry person; or

(f)   Any person who regularly performs domestic work in one household on an occupational basis.

The following are not covered:

(a)   Service providers;

(b)   Family drivers;

(c)   Children under foster family arrangement; and

(d)   Any other person who performs work occasionally or sporadically and not on an occupational basis. 

The aforecited administrative rule clarified the status of family drivers as among those not covered by the definition of domestic or household help as contemplated in Section 4(d) of the Kasambahay Law. Such provision should be respected by the courts, as the interpretation of an administrative government agency, which is tasked to implement the statute, is accorded great respect and ordinarily controls the construction of the courts. Moreover, the statutory validity of the same administrative rule was never challenged. This Court has ruled time and again that the constitutionality or validity of laws, orders, or such other rules with the force of law cannot be attacked collaterally. There is a legal presumption of validity of these laws and rules. Unless a law or rule is annulled in a direct proceeding, the legal presumption of its validity stands. And while it is true that constitutional provisions on social justice demand that doubts be resolved in favor of labor, it is only applicable when there is doubt. Social justice principles cannot be used to expand the coverage of the law to subjects not intended by the Congress to be included.

Due to the express repeal of the Labor Code provisions pertaining to househelpers, which includes family drivers, by the Kasambahay Law; and the non-applicability of the Kasambahay Law to family drivers, there is a need to revert back to the Civil Code provisions, particularly Articles 1689, 1697 and 1699, Section 1, Chapter 3, Title VIII, Book IV thereof. The Articles provide:

SEC. 1 — Household Service.

ART. 1689. Household service shall always be reasonably compensated. Any stipulation that household service is without compensation shall be void. Such compensation shall be in addition to the [househelper's] lodging, food, and medical attendance.

x x x x

ART. 1697. If the period for household service is fixed neither the head of the family nor the [househelper] may terminate the contract before the expiration of the term, except for a just cause. If the [househelper] is unjustly dismissed, he shall be paid the compensation already earned plus that for fifteen days by way of indemnity. If the [househelper] leaves without justifiable reason, he shall forfeit any salary due him and unpaid, for not exceeding fifteen days.

x x x x

ART. 1699. Upon the extinguishment of the service relation, the [househelper] may demand from the head of the family a written statement on the nature and duration of the service and the efficiency and conduct of the [househelper].

The reason for reverting back to the Civil Code provisions on household service is because, as discussed earlier, Section 44 of the Kasambahay Law expressly repealed Articles 141 to 152 of the Labor Code which deals with the rights of family drivers. Obviously, an expressly repealed statute is not anymore binding for it has no more force and effect.

On the other hand, Article 302 of the Labor Code, its repealing clause, which provides:

ART. 302. Repealing clause. - All labor laws not adopted as part of this Code either directly or by reference are hereby repealed. All provisions of existing laws, orders, decrees, rules and regulations inconsistent herewith are likewise repealed.

did not repeal the said Civil Code provisions since they are not inconsistent with the Labor Code. Besides, repeals by implication are not favored as laws are presumed to be passed with deliberation and full knowledge of all laws existing on the subject, the congruent application of which the courts must generally presume.

Since what were expressly repealed by the Kasambahay Law were only Articles 141 to 152, Chapter III of the Labor Code on Employment of Househelpers; and the Labor Code did not repeal the Civil Code provisions concerning household service which impliedly includes family drivers as they minister to the needs of a household, the said Civil Code provisions stand. To rule otherwise would leave family drivers without even a modicum of protection. Certainly, that could not have been the intent of the lawmakers.

Pursuant to Article 1697 of the Civil Code, respondent shall be paid the compensation he had already earned plus that for 15 days by way of indemnity if he was unjustly dismissed. However, if respondent left his employment without justifiable reason, he shall forfeit any salary due him and unpaid for not exceeding 15 days. Given that there is neither dismissal nor abandonment in this case, none of the party is entitled to claim any indemnity from the other. Verily, in a case where the employee's failure to work was occasioned neither by his abandonment nor by a termination, the burden of economic loss is not rightfully shifted to the employer; each party must bear his own loss.  Otherwise stated, the respondent's act of not reporting to work after a verbal miscommunication cannot justify the payment of any form of remuneration.

Petitioner is not liable for wage differentials,

holiday pay, 13th month pay and service

incentive leave pay

As found by the Labor Arbiter, the P9,000.00 salary respondent receives a month is reasonable and in accordance with Article 1689 of the Civil Code. Hence, petitioner may not be made to pay the respondent wage differentials.

Petitioner is not also liable to the respondent for the payment of holiday pay, 13th month pay and service incentive leave pay because persons in the personal service of another, such as family drivers, are exempted from the coverage of such benefits pursuant to Articles 82, 94 and 95of the Labor Code, and Section 3(d) of the implementing rules of Presidential Decree No. 851.

The reversal of the judgment rendered by the

appellate court will not inure to the benefit

of CR V Corporation

It is not lost on this Court that only the petitioner appealed the CA Decision which found the respondent to have been illegally dismissed and ordered both the CRV Corporation and the petitioner liable to the respondent for the payment of backwages, separation pay, wage differentials, holiday pay, 13th month pay and service incentive leave pay. Considering that CRV Corporation did not appeal the decision of the appellate court, the same stands insofar as the corporation is concerned.

At this juncture, this Court takes this opportune time to emphasize that a reversal of a judgment on appeal is binding on the parties to the suit, but shall not benefit the parties against whom the judgment was rendered in the court a quo, but who did not join in the appeal, unless their rights and liabilities and those of the parties appealing are so interwoven and dependent as to be inseparable, in which case a reversal as to one operates as a reversal as to all. 

It is basic that under the general doctrine of separate juridical personality* stockholders of a corporation enjoy the principle of limited liability: the corporate debt is not the debt of the stockholder. This is because a corporation has a separate and distinct personality from those who represent it. 

Here, it was not disputed that CRV Corporation had been impleaded, duly notified of the suit, and properly served with legal processes, but it never participated in the case by sending an authorized representative or filing a single pleading. The Securities and Exchange Commission i-Report  dated May 14, 2015 which showed that the company status of CRV Corporation as revoked can hardly mean that the NLRC did not acquire jurisdiction over it inasmuch as the i-Report did not indicate when the CRV Corporation ceased to exist. Besides, the complaint had already been filed on April 7, 2015. Moreover, under Section 122 of Batas Pambansa Bilang 68 or "The Corporation Code of the Philippines," a corporation whose registration had been revoked has three years from dissolution to continue to be a body corporate for purposes of winding up its affairs which includes prosecuting and defending suits by or against it.

Although a reversal of the judgment as to one would operate as a reversal as to all where the rights and liabilities of those who did not appeal and those of the party appealing are so interwoven and dependent on each other as to be inseparable,[46] CRV Corporation and petitioner have no commonality of interest because each bears the injury of an adverse judgment. CRV Corporation will not be harmed had petitioner been held liable to pay the respondent his unpaid wages. Conversely, petitioner did not suffer any monetary injury when CRV Corporation was made liable to pay the respondent his unpaid wages.

Even if petitioner is allegedly one of CRV Corporation's top officials, such hypothetical fact does not translate, or even imply that she will be financially injured by an adverse money-claim judgment against the latter. Much like stockholders, corporate officers and employees only have an inchoate right (only to the extent of their valid collectibles in the form of salaries and benefits) to the assets of the corporation which, in turn, is the real owner of the assets by virtue of its separate juridical personality. 

Moreover, no evidence was offered by both parties that petitioner was equipped with a board resolution (even if belatedly submitted) or, at least, authorized by corporate by-laws[49] to represent CRV Corporation in the instant suit. Therefore, petitioner's appeal cannot benefit CRV Corporation.

WHEREFORE, premises considered, the petition is GRANTED. The April 21, 2017 Decision and the August 9, 2017 Resolution of the Court of Appeals in CA-G.R. SP No. 147356 are REVERSED and SET ASIDE and the October 29, 2015 Decision of the Labor Arbiter in NLRC NCR Case No. 04-04089-15 is AFFIRMED only insofar as petitioner Celia R. Atienza is concerned.

SO ORDERED.

Carpio, (Chairperson), Perlas-Bernabe, Caguioa, and Lazaro-Javier, JJ., concur.