SECOND DIVISION
ANGELITO L. LAZARO, G.R. No. 138254
Proprietor of Royal
Star
Marketing, Present:
Petitioner,
PUNO,
Chairman,
-
versus - AUSTRIA-MARTINEZ,
CALLEJO,
SR.,
TINGA, and
CHICO-NAZARIO,
SOCIAL SECURITY COMMISSION, Members.
ROSALINA LAUDATO, SOCIAL
SECURITY SYSTEM and THE
HONORABLE COURT OF
APPEALS,
Respondents. Promulgated:
July
30, 2004
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Tinga,
J.:
Before us is a Petition for Review
under Rule 45, assailing the Decision[1]
of the Court of Appeals Fifteenth Division[2]
in CA-G.R. Sp. No. 40956, promulgated on 20 November 1998, which affirmed two
rulings of the Social Security Commission (“SSC”) dated 8 November 1995 and 24
April 1996.
Private respondent Rosalina M. Laudato
(“Laudato”) filed a petition before the SSC for social security coverage and remittance
of unpaid monthly social security contributions against her three (3)
employers. Among the respondents was herein petitioner Angelito L. Lazaro
(“Lazaro”), proprietor of Royal Star Marketing (“Royal Star”), which is engaged
in the business of selling home appliances.[3]
Laudato alleged that despite her employment as sales supervisor of the sales
agents for Royal Star from April of 1979 to March of 1986, Lazaro had failed
during the said period, to report her to the SSC for compulsory coverage or remit
Laudato’s social security contributions.[4]
Lazaro denied that Laudato was a sales
supervisor of Royal Star, averring instead that she was a mere sales agent whom
he paid purely on commission basis.
Lazaro also maintained that
Laudato was not subjected to
definite hours and conditions of work. As such, Laudato could not be deemed an
employee of Royal Star.[5]
After the parties submitted their
respective position papers, the SSC promulgated a Resolution[6]
dated 8 November 1995 ruling in favor of Laudato.[7] Applying the “control test,” it held that
Laudato was an employee of Royal Star, and ordered Royal Star to pay the
unremitted social security contributions of Laudato in the amount of Five
Thousand Seven Pesos and Thirty Five Centavos (P5,007.35), together with
the penalties totaling Twenty Two Thousand Two Hundred Eighteen Pesos and Fifty
Four Centavos (P22,218.54). In
addition, Royal Star was made liable to pay damages to the SSC in the amount of
Fifteen Thousand Six Hundred Eighty Pesos and Seven Centavos (P15,680.07)
for not reporting Laudato for social security coverage, pursuant to Section 24
of the Social Security Law.[8]
After Lazaro’s Motion for
Reconsideration before the SSC was denied,[9]
Lazaro filed a Petition for Review with the Court of Appeals. Lazaro
reiterated that Laudato was merely a sales agent who was paid purely on
commission basis, not included in the company payroll, and who neither observed
regular working hours nor accomplished time cards.
In its assailed Decision, the
Court of Appeals noted that Lazaro’s arguments were a reprise of those already
presented before the SSC.[10] Moreover, Lazaro had not come forward with
particulars and specifics in his petition to show that the Commission’s ruling
is not supported by substantial evidence.[11] Thus, the appellate court affirmed the
finding that Laudato was an employee of Royal Star, and hence entitled to
coverage under the Social Security Law.
Before this Court, Lazaro again insists
that Laudato was not qualified for social security coverage, as she was not an
employee of Royal Star, her income dependent on a generation of sales and based
on commissions.[12] It is argued that Royal Star had no control
over Laudato’s activities, and that under the so-called “control test,” Laudato
could not be deemed an employee.[13]
It is an accepted
doctrine that for the purposes of coverage under the Social Security Act, the
determination of employer-employee relationship warrants the application of the
“control test,” that is, whether the employer controls or has reserved the
right to control the employee, not only as to the result of the work done, but
also as to the means and methods by which the same is accomplished.[14] The SSC, as sustained by the Court of
Appeals, applying the control test found that Laudato was an employee of Royal
Star. We find no reversible error.
Lazaro’s arguments are nothing more but
a mere reiteration of arguments unsuccessfully posed before two bodies: the SSC
and the Court of Appeals. They likewise
put to issue factual questions already passed upon twice below, rather than
questions of law appropriate for review under a Rule 45 petition. The determination of an employer-employee
relationship depends heavily on the particular factual circumstances attending
the professional interaction of the parties.
The Court is not a trier of facts[15]
and accords great weight to the factual
findings of lower courts or agencies whose function is to resolve factual
matters.[16]
Lazaro’s arguments may
be dispensed with by applying precedents.
Suffice it to say, the fact that Laudato was paid by way of commission
does not preclude the establishment of an employer-employee relationship. In Grepalife v. Judico,[17]
the Court upheld the existence of an employer-employee relationship between the
insurance company and its agents, despite the fact that the compensation that
the agents on commission received was not paid by the company but by the
investor or the person insured.[18] The relevant factor remains, as stated
earlier, whether the "employer" controls or has reserved the right to
control the "employee" not only as to the result of the work to be
done but also as to the means and methods by which the same is to be
accomplished.[19]
Neither does it follow that a person who
does not observe normal hours of work cannot be deemed an employee. In Cosmopolitan Funeral Homes, Inc. v.
Maalat,[20] the
employer similarly denied the existence of an employer-employee relationship,
as the claimant according to it, was a “supervisor on commission basis” who did
not observe normal hours of work. This Court declared that there was an
employer-employee relationship, noting that “[the] supervisor, although
compensated on commission basis, [is] exempt from the observance of normal
hours of work for his compensation is measured by the number of sales he
makes.”[21]
It should also be emphasized that the
SSC, also as upheld by the Court of Appeals, found that Laudato was a sales
supervisor and not a mere agent.[22] As such, Laudato oversaw and supervised the
sales agents of the company, and thus was subject to the control of management
as to how she implements its policies and its end results. We are disinclined to reverse this finding,
in the absence of countervailing evidence from Lazaro and also in light of the fact
that Laudato’s calling cards from Royal Star indicate that she is indeed a
sales supervisor.
The finding of the SSC
that Laudato was an employee of Royal
Star is supported
by substantial
evidence. The SSC examined the cash vouchers issued by
Royal Star to Laudato,[23]
calling cards of Royal Star denominating Laudato as a “Sales Supervisor” of the
company,[24] and
Certificates of Appreciation issued by Royal Star to Laudato in recognition of
her unselfish and loyal efforts in promoting the company.[25] On the other hand, Lazaro has failed to
present any convincing contrary evidence, relying instead on his bare
assertions. The Court of Appeals correctly ruled that petitioner has not
sufficiently shown that the SSC’s ruling was not supported by substantial
evidence.
A piece of documentary
evidence appreciated by the SSC is Memorandum dated 3 May 1980 of Teresita
Lazaro, General Manager of Royal Star, directing that no commissions were to be
given on all “main office” sales from walk-in customers and enjoining salesmen
and sales supervisors to observe this new policy.[26]
The Memorandum evinces the fact that, contrary to Lazaro’s claim, Royal Star
exercised control over its sales supervisors or agents such as Laudato as to
the means and methods through which these personnel performed their work.
Finally, Lazaro
invokes our ruling in the 1987 case of Social Security System v. Court of
Appeals[27]
that a person who works for another at his own pleasure, subject to definite
hours or conditions of work, and is compensated according to the result of his
effort is not an employee.[28] The citation is odd for Lazaro to rely
upon, considering that in the cited case, the Court affirmed the
employee-employer relationship between a sales agent and the cigarette firm whose
products he sold.[29]
Perhaps Lazaro meant instead to cite our 1969 ruling in the similarly-titled
case of Social Security System v. Court of Appeals,[30]
also cited in the later eponymous ruling, whose disposition is more in accord
with Lazaro’s argument.
Yet, the circumstances
in the 1969 case are very different from those at bar. Ruling on the question
whether jockeys were considered employees of the Manila Jockey Club, the Court
noted that the jockeys were actually subjected to the control of the racing steward,
whose authority in turn was defined by the Games and Amusements Board.[31] Moreover, the jockey’s choice as to which
horse to mount was subject to mutual agreement between the horse owner and the
jockey, and beyond the control of the race club.[32] In the case at bar, there is no showing that
Royal Star was similarly precluded from exerting control or interference over
the manner by which Laudato performed her duties. On the contrary, substantial
evidence as found by the SSC and the Court of Appeals have established the
element of control determinative of an employer-employee relationship. We
affirm without hesitation.
WHEREFORE, the Petition
is DENIED and the assailed Decision of the Court of Appeals dated 20
November 1998 is AFFIRMED. Costs
against petitioner.
SO ORDERED.
DANTE
O. TINGA
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Associate Justice
MA. ALICIA
AUSTRIA-MARTINEZ ROMEO J. CALLEJO,
SR.
Associate Justice
Associate Justice
MINITA V. CHICO-NAZARIO
I attest that the
conclusions in the above Decision were reached in consultation before the case
was assigned to the writer of the opinion of the Court’s Division
REYNATO S. PUNO
Associate Justice
Chairman, Second Division
CERTIFICATION
Pursuant to Article VIII, Section 13 of
the Constitution, and the Division Chairman’s Attestation, it is hereby
certified that the conclusions in the above Decision were reached in
consultation before the case was assigned to the writer of the opinion of the
Court.
HILARIO
G. DAVIDE, JR.
Chief
Justice
[2]Penned by Justice B. Guerrero,
concurred in by Justices Portia Aliño-Hormachuelos and Presbitero J. Velasco,
Jr.
[6]Written by Commissioner C. Seno, and
adopted by the Social Security Commission en banc, composed of Chairman
J. Tan, Vice-Chairman R. Valencia, and Commissioners R. Inocentes, B.
Hernandez, O. Amorin, and A. Arnaez.
[7]Co-respondents B&E Marketing Co.,
and Buncayo Enterprises did not appeal the adverse decision against them by the
SSC. Rollo, p. 20.
[11]Ibid.
[12]Id. at 13.
[14]Investment Planning Corp. v. Social
Security System, G.R. No. L-19124, 18 November 1967, 21 SCRA 924, 928-929.
[15]See e.g., Naguiat v. Court of
Appeals, G.R. No. 118375, 30 September 2003; W-Red Construction and Dev’t.
Corp. v. CA, G.R. No.
122648, 17 August 2000, 338 SCRA 341, 345.
[16]See, e.g., Cebu
Shipyard and Eng’g Works, Inc. v. William Lines, Inc., 366 Phil. 439, 451
(1999); Engreso v. De La Cruz, G.R. No. 148727, 9 April 2003, 401 SCRA 217,
220.
[19]Ibid. See also Social Security System v. Court of Appeals,
G.R. No. L-46058, 14 December 1987; 156 SCRA 383, 388; Investment Planning
Corp. v. SSS, supra note 14.