G.R.No.160506.March9,2010.

JOEB M. ALIVIADO, ARTHUR CORPUZ, ERIC ALIVIADO,

MONCHITO AMPELOQUIO, ABRAHAM BASMAYOR,
JONATHAN MATEO, LORENZO PLATON, JOSE FERNANDO
GUTIERREZ, ESTANISLAO BUENAVENTURA, LOPE
SALONGA, FRANZ DAVID, NESTOR IGNACIO, JULIO REY,
RUBEN MARQUEZ, JR., MAXIMINO PASCUAL, ERNESTO
CALANAO, ROLANDO ROMASANTA, RHUEL AGOO,
BONIFACIO ORTEGA, ARSENIO SORIANO, JR., ARNEL
ENDAYA, ROBERTO ENRIQUEZ, NESTOR BAQUILA,
EDGARDO QUIAMBAO, SANTOS BACALSO, SAMSON
BASCO, ALADINO GREGORO, JR., EDWIN GARCIA,
ARMANDO VILLAR, EMIL TAWAT, MARIO P. LIONGSON,
CRESENTEJ.GARCIA,FERNANDOMACABENTE,MELECIO
CASAPAO, REYNALDO JACABAN, FERDINAND SALVO,
ALSTANDO MONTOS, RAINER N. SALVADOR, RAMIL
REYES,PEDROG.ROY,LEONARDOP.TALLEDO,ENRIQUE
F. TALLEDO, WILLIE ORTIZ, ERNESTO SOYOSA, ROMEO
VASQUEZ, JOEL BILLONES, ALLAN BALTAZAR, NOLI
GABUYO, EMMANUEL E. LABAN, RAMIR E. PIAT, RAUL
DULAY, TADEO DURAN, JOSEPH BANICO, ALBERT
LEYNES, ANTONIO DACUNA, RENATO DELA CRUZ,
ROMEO VIERNES, JR., ELAIS BASEO, WILFREDO TORRES,
MELCHOR CARDANO, MARIANO NARANIAN, JOHN
SUMERGIDO, ROBERTO ROSALES, GERRY C. GATPO,
GERMANN.GUEVARRA,GILBERTY.MIRANDA,RODOLFO
C. TOLEDO, ARNOLD D. LASTONA, PHILIP M. LOZA,
MARIO N. CULDAYON, ORLANDO P. JIMENEZ, FRED P.
JIMENEZ,RESTITUTOC.PAMINTUAN,JR.,ROLANDOJ.DE
ANDRES, ARTUZ BUSTENERA, ROBERTO B. CRUZ,
ROSEDY O. YORDAN, DENNIS DACASIN, ALEJANDRINO
ABATON, and ORLANDO S. BALANGUE, petitioners, vs.
PROCTER & GAMBLE PHILS., INC., and PROMMGEM INC.,
respondents.
_______________

*SECONDDIVISION.
564

564

SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter###GamblePhils.,Inc.

Labor Law LaborOnly Contracting The Law and its implementing

rules allow contracting arrangements for the performance of specific jobs,
works of services The current labor rules expressly prohibit laboronly
contractingWherethereislaboronlycontractingElementsofLaborOnly
Contracting.The law and its implementing rules allow contracting
arrangements for the performance of specific jobs, works or services.
Indeed, it is management prerogative to farm out any of its activities,
regardlessofwhethersuchactivityisperipheralorcoreinnature.However,
inorderforsuchoutsourcingtobevalid,itmustbemadetoanindependent
contractor because the current labor rules expressly prohibit laboronly
contracting. To emphasize, there is laboronly contracting when the
contractor or subcontractor merely recruits, supplies or places workers to
perform a job, work or service for a principal and any of the following
elements are present: i) The contractor or subcontractor does not have
substantialcapitalorinvestmentwhichrelatestothejob,workorserviceto
be performed and the employees recruited, supplied or placed by such
contractor or subcontractor are performing activities which are directly
related to the main business of the principal or ii) The contractor does not
exercise the right to control over the performance of the work of the
contractualemployee.
Same Same Independent Contractors PrommGem cannot be
considered as a laboronly contractor It is a legitimate independent
contractor.Underthecircumstances,PrommGemcannotbeconsideredas
a laboronly contractor. We find that it is a legitimate independent
contractor.
Same Same Where laboronly contracting exists, the Labor Code
itself establishes an employeremployee relationship between the employer
and the employees of the laboronly contractor The contractor is
considered merely an agent of the principal employer and the latter is
responsible to the employees of the laboronly contractor as if such
employees had been directly employed by the principal employer.Where
laboronly contracting exists, the Labor Code itself establishes an
employeremployeerelationshipbetweentheemployerandtheemployeesof
the laboronly contractor. The statute establishes this relationship for a
comprehensive purpose: to prevent a circumvention of labor laws. The
contractor is considered merely an agent of the principal employer and the
latterisresponsi

565

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Alviadovs.Procter&GamblePhils.,Inc.

ble to the employees of the laboronly contractor as if such employees had

beendirectlyemployedbytheprincipalemployer.
Same Termination of Employment Misconduct Grave Misconduct
Definition of Misconduct Elements for Misconduct to be a Just Cause for
Dismissal.Misconducthasbeendefinedasimproperorwrongconductthe
transgressionofsomeestablishedanddefiniteruleofaction,aforbiddenact,
aderelictionofduty,unlawfulincharacterimplyingwrongfulintentandnot
mereerrorofjudgment.Themisconducttobeseriousmustbeofsuchgrave
andaggravatedcharacterandnotmerelytrivialandunimportant.Tobeajust
causefordismissal,suchmisconduct(a)mustbeserious(b)mustrelateto
the performance of the employees duties and (c) must show that the
employeehasbecomeunfittocontinueworkingfortheemployer.
SameSameSameSameAmisconductwhichisnotseriousorgrave,
asthatexistingintheinstantcase,cannotbeavalidbasisfordismissingan
employee.In the instant case, petitionersemployees of PrommGem may
have committed an error of judgment in claiming to be employees of P&G,
but it cannot be said that they were motivated by any wrongful intent in
doing so. As such, we find them guilty of only simple misconduct for
assailing the integrity of PrommGem as a legitimate and independent
promotionfirm.Amisconductwhichisnotseriousorgrave,asthatexisting
intheinstantcase,cannotbeavalidbasisfordismissinganemployee.
Same Same Loss of Trust and Confidence Loss of trust and
confidence, as a ground for dismissal, must be based on the willful breach
of the trust reposed in the employee by his employer.Loss of trust and
confidence,asagroundfordismissal,mustbebasedonthewillfulbreachof
thetrustreposedintheemployeebyhisemployer.Ordinarybreachwillnot
suffice.Abreachoftrustiswillfulifitisdoneintentionally,knowinglyand
purposely, without justifiable excuse, as distinguished from an act done
carelessly,thoughtlessly,heedlesslyorinadvertently.
Same Same Same In order to constitute a just cause for dismissal,
theactcomplainedofmustbeworkrelatedandmustshowthattheemployee
isunfittocontinuetoworkfortheemployer.Lossoftrustandconfidence,
as a cause for termination of employment, is premised on the fact that the
employee concerned holds a position of responsibility or of trust and
confidence.Assuch,hemustbein

566

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SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter&GamblePhils.,Inc.

vestedwithconfidenceondelicatematters,suchascustody,handlingorcare
and protection of the property and assets of the employer. And, in order to
constitute a just cause for dismissal, the act complained of must be work
relatedandmustshowthattheemployeeisunfittocontinuetoworkforthe
employer.Intheinstantcase,thepetitionersemployeesofPrommGemhave
not been shown to be occupying positions of responsibility or of trust and
confidence. Neither is there any evidence to show that they are unfit to
continuetoworkasmerchandisersforPrommGem.
Same Same In termination cases, the burden of proof rests upon the
employertoshowthatthedismissalisforjustandvalidcause.Goingback
tothematterofdismissal,itmustbeemphasizedthattheonusprobandito
provethelawfulnessofthedismissalrestswiththeemployer.Intermination
cases, the burden of proof rests upon the employer to show that the
dismissal is for just and valid cause. In the instant case, P&G failed to
dischargetheburdenofprovingthelegalityandvalidityofthedismissalsof
those petitioners who are considered its employees. Hence, the dismissals
necessarilywerenotjustifiedandarethereforeillegal.

PETITIONforreviewoncertiorariofthedecisionandresolutionof
theCourtofAppeals.
ThefactsarestatedintheopinionoftheCourt.
NenitaC.Mahinayforpetitioners.
Angara, Abello, Concepcion, Regala and Cruz for respondent
Procter&GamblePhilippines,Inc.
DELCASTILLO,J.:
Labor laws expressly prohibit laboronly contracting. To
preventitscircumvention,theLaborCodeestablishesanemployer
employee relationship between the employer and the employees of
thelaboronlycontractor.
567

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Alviadovs.Procter&GamblePhils.,Inc.

The instant petition for review assails the March 21, 2003

Decision1oftheCourtofAppeals(CA)inCAG.R.SPNo.52082
and its October 20, 2003 Resolution2 denying the motions for
reconsideration separately filed by petitioners and respondent
Procter & Gamble Phils. Inc. (P&G). The appellate court affirmed
the July 27, 1998 Decision of the National Labor Relations
Commission (NLRC), which in turn affirmed the November 29,
1996 Decision3 of the Labor Arbiter. All these decisions found
PrommGem, Inc. (PrommGem) and Sales and Promotions
Services (SAPS) to be legitimate independent contractors and the
employersofthepetitioners.
FactualAntecedents
PetitionersworkedasmerchandisersofP&Gfromvariousdates,
allegedlystartingasearlyas1982oraslateasJune1991,toeither
May5,1992orMarch11,1993,morespecificallyasfollows:
Name
1.JoebM.Aliviado
2.ArthurCorpuz
3.EricAliviado
4.MonchitoAmpeloquio
5.AbrahamBasmayor[,Jr.]
6.JonathanMateo
7.LorenzoPlaton
8.JoseFernandoGutierrez
9.EstanislaoBuenaventura
10.LopeSalonga
11.FranzDavid
12.NestorIgnacio
13.JulioRey

DateEmployed

DateDismissed

November,1985
May5,1992
1988
March11,1993
1985 March11,1993
September,1988
March11,1993
1987
March11,1993
May,1988
March11,1993
1985
March11,1993
1988
May5,1992
June,1988
March11,1993
1982
March11,1993
1989
March11,1993
1982
March11,1993
1989
May5,1992

_______________
1Rollo,pp.8695pennedbyAssociateJusticeEdgardoP.Cruzandconcurredin
byAssociateJusticesSalvadorJ.Valdez,Jr.andMarioL.GuariaIII.
2Id.,atpp.9798.
3Id.,atpp.298312.
568

568

SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter&GamblePhils.,Inc.

14.Ruben[Vasquez],Jr.
15.MaximinoPascua
16.ErnestoCalanao[,Jr.]
17.RolandoRomasanta

1985
l990
1987
1983

May5,1992
May5,1992
May5,1992
March11,1993

18.[Roehl]Agoo
19.BonifacioOrtega
20.ArsenioSoriano,Jr.
21.ArnelEndaya
22.RobertoEnriquez
23.Nestor[Es]quila
24.Ed[g]ardoQuiambao
25.SantosBacalso
26.SamsonBasco
27.AladinoGregor[e],Jr.
28.EdwinGarcia
29.ArmandoVillar
30.EmilTawat
31.MarioP.Liongson
32.CresenteJ.Garcia
33.FernandoMacabent[a]
34.MelecioCasapao
35.ReynaldoJacaban
36.FerdinandSalvo
37.AlstandoMontos
38.RainerN.Salvador
39.RamilReyes
40.PedroG.Roy
41.Leonardo[F].Talledo
42.Enrique[F].Talledo
43.WillieOrtiz
44.ErnestoSoyosa
45.RomeoVasquez
46.JoelBillones
47.AllanBaltazar
48.NoliGabuyo
49.EmmanuelE.Laban
50.Ramir[o]E.[Pita]
51.RaulDulay

1988
March11,1993
1988
March11,1993
1985
March11,1993
1983
March11,1993
December,1988
March11,1993
1983
May5,1992
1989
March11,1993
1990
March11,1993
1984
March11,1993
1980
May5,1992
1987
May5,1992
1990
May5,1992
1988
March11,1993
1991
May5,1992
1984
March11,1993
1990
May5,1992
1987
March11,1993
1990
May5,1992
1985
May5,1992
1984
March11,1993
1984
May5,1992
1984
March11,1993
1987

1985 March11,1993
1988
March11,1993
1987
May5,1992
1988
May5,1992
1985
March11,1993
1987
March11,1993
1989
March11,1993
1991
March11,1993
1987
May5,1992
1990
May5,1992
1988
May5,1992

52.TadeoDuran[o]
53.JosephBanico

1988
1988

May5,1992
March11,1993

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Alviadovs.Procter&GamblePhils.,Inc.
54.AlbertLeynes
55.AntonioDacu[m]a
56.RenatodelaCruz
57.RomeoViernes,Jr.
58.El[ia]sBas[c]o
59.WilfredoTorres
60.MelchorCarda[]o

1990
1990
1982
1986
1989
1986
1991

May5,1992
May5,1992

May5,1992
May5,1992

61.[Marino][Maranion]
62.JohnSumergido
63.RobertoRosales
65.GermanN.Guevara
66.GilbertY.Miranda
67.RodolfoC.Toledo[,Jr.]
68.ArnoldD.[Laspoa]
69.PhilipM.Loza
70.MarioN.C[o]ldayon
71.OrlandoP.Jimenez
72.FredP.Jimenez
73.RestitutoC.Pamintuan,Jr.
74.RolandoJ.deAndres
75.ArtuzBustenera[,Jr.]
76.RobertoB.Cruz
77.RosedyO.Yordan
78.DennisDacasin
79.AlejandrinoAbaton
80.OrlandoS.Balangue

1989
1987
May,1987
May,1990
June,1991
May14,1991
June1991
March5,1992
May14,1991
November6,1992
September,1991
March5,1992
June,1991
December,1989
May4,1990
June,1991
May,1990
1988

May5,1992
May5,1992
May5,1992
March11,1993
March11,1993
March11,1993
March11,1993
March11,1993
March11,1993
March11,1993
March11,1993
March11,1993
March11,1993
March11,1993
March11,1993
May5,1992
May5,1992
May5,1992
March11,19934

March,1989

They all individually signed employment contracts with either

PrommGemorSAPSforperiodsofmoreorlessfivemonthsata
time.5 They were assigned at different outlets, supermarkets and
stores where they handled all the products of P&G. They received
theirwagesfromPrommGemorSAPS.6
_______________
4Id.,atpp.3031.
5Id.,atpp.434435.
6Id.,atpp.438440.
570

570

SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter###GamblePhils.,Inc.

SAPSandPrommGemimposeddisciplinarymeasuresonerring
merchandisersforreasonssuchashabitualabsenteeism,dishonesty
orchangingdayoffwithoutpriornotice.7
P&Gisprincipallyengagedinthemanufactureandproductionof
different consumer and health products, which it sells on a
wholesale basis to various supermarkets and distributors.8 To
enhanceconsumerawarenessandacceptanceoftheproducts,P&G
entered into contracts with PrommGem and SAPS for the
promotion and merchandising of its products.9In December 1991,
petitioners filed a complaint10 against P&G for regularization,

service incentive leave pay and other benefits with damages. The
complaint was later amended11 to include the matter of their
subsequentdismissal.
RulingoftheLaborArbiter
On November 29, 1996, the Labor Arbiter dismissed the
complaint for lack of merit and ruled that there was no employer
employeerelationshipbetweenpetitionersandP&G.Hefoundthat
theselectionandengagementofthepetitioners,thepaymentoftheir
wages,thepowerofdismissalandcontrolwithrespecttothemeans
andmethodsbywhichtheirworkwasaccomplished,werealldone
andexercisedbyPrommGem/SAPS.HefurtherfoundthatPromm
Gem and SAPS were legitimate independent job contractors. The
dispositiveportionofhisDecisionreads:
_______________
7Id.,atpp.441442.
8Id.,atp.105.
9Id.,atpp.406414.
10Id.,atpp.158164.
11Records,Vol.I,pp.345346,373392Records,Vol.II,pp.396412.
571

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Alviadovs.Procter&GamblePhils.,Inc.
WHEREFORE, premises considered, judgment is hereby rendered
Dismissing the aboveentitled cases against respondent Procter & Gamble
(Phils.),Inc.forlackofmerit.
SOORDERED.12

RulingoftheNLRC
AppealingtotheNLRC,petitionersdisputedtheLaborArbiters
findings. On July 27, 1998, the NLRC rendered a Decision13
disposingasfollows:
WHEREFORE, premises considered, the appeal of complainants is
herebyDISMISSEDandthedecisionappealedfromAFFIRMED.
SOORDERED.14

Petitionersfiledamotionforreconsiderationbutthemotionwas
deniedintheNovember19,1998Resolution.15
RulingoftheCourtofAppeals
Petitioners then filed a petition for certiorari with the CA,
alleging grave abuse of discretion amounting to lack or excess of

jurisdiction on the part of the Labor Arbiter and the NLRC.

However,saidpetitionwasalsodeniedbytheCAwhichdisposedas
follows:
WHEREFORE, the decision of the National Labor Relations
CommissiondatedJuly27,1998isAFFIRMEDwiththeMODIFICATION
that respondent Procter & Gamble Phils., Inc. is ordered to pay service
incentiveleavepaytopetitioners.
SOORDERED.16
_______________
12Rollo,pp.112113.
13Id.,atpp.115135.
14Id.,atp.135.
15Id.,atpp.137157.
16Id.,atpp.9495.
572

572

SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter###GamblePhils.,Inc.

Petitionersfiledamotionforreconsiderationbutthemotionwas
alsodenied.Hence,thispetition.
Issues
Petitionersnowcomebeforeusraisingthefollowingissues:

I.
WHETHER X X X THE HONORABLE COURT OF APPEALS HAS
COMMITTED [A] REVERSIBLE ERROR WHEN IT DID NOT FIND
THE PUBLIC RESPONDENTS TO HAVE ACTED WITH GRAVE
ABUSEOFDISCRETIONAMOUNTINGTOLACKOFORINEXCESS
OF JURISDICTION IN RENDERING THE QUESTIONED JUDGMENT
WHEN, OBVIOUSLY, THE PETITIONERS WERE ABLE TO PROVE
AND ESTABLISH THAT RESPONDENT PROCTER & GAMBLE
PHILS., INC. IS THEIR EMPLOYER AND THAT THEY WERE
ILLEGALLYDISMISSEDBYTHEFORMER.
II.
WHETHER X X X THE HONORABLE COURT OF APPEALS HAS
COMMITTED [A] REVERSIBLE ERROR WHEN IT DID NOT
DECLARE THAT THE PUBLIC RESPONDENTS HAD ACTED WITH
GRAVE ABUSE OF DISCRETION WHEN THE LATTER DID NOT
FINDTHEPRIVATERESPONDENTSLIABLETOTHEPETITIONERS

FOR PAYMENT OF ACTUAL, MORAL AND EXEMPLARY

DAMAGES AS WELL AS LITIGATION COSTS AND ATTORNEYS
FEES.17

Simplystated,theissuesare:(1)whetherP&Gistheemployerof
petitioners(2)whetherpetitionerswereillegallydismissedand(3)
whether petitioners are entitled for payment of actual, moral and
exemplarydamagesaswellaslitigationcostsandattorneysfees.
PetitionersArguments
Petitioners insist that they are employees of P&G. They claim
thattheywererecruitedbythesalesmenofP&Gand
_______________
17Id.,atp.668.
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Alviadovs.Procter###GamblePhils.,Inc.

were engaged to undertake merchandising chores for P&G long

before the existence of PrommGem and/or SAPS. They further
claim that when the latter had its socalled realignment program,
petitionerswereinstructedtofillupapplicationformsandreportto
theagencieswhichP&Gcreated.18
PetitionersfurtherclaimthatP&Ginstigatedtheirdismissalfrom
workascanbegleanedfromitsletter19toSAPSdatedFebruary24,
1993, informing the latter that their Merchandising Services
Contract will no longer be renewed.Petitioners further assert that
PrommGem and SAPS are laboronly contractors providing
servicesofmanpowertotheirclient.Theyclaimthatthecontractors
haveneithersubstantialcapitalnortoolsandequipmenttoundertake
independent labor contracting. Petitioners insist that since they had
beenengagedtoperformactivitieswhicharenecessaryordesirable
in the usual business or trade of P&G, then they are its regular
employees.20
RespondentsArguments
Ontheotherhand,P&Gpointsoutthattheinstantpetitionraises
onlyquestionsoffactandshouldthusbethrownoutastheCourtis
not a trier of facts. It argues that findings of facts of the NLRC,
particularly where the NLRC and the Labor Arbiter are in
agreement, are deemed binding and conclusive on the Supreme
Court.
P&G further argues that there is no employment relationship

between it and petitioners. It was PrommGem or SAPS that (1)

selected petitioners and engaged their services (2) paid their
salaries(3)wieldedthepowerofdismissaland(4)hadthepower
ofcontrolovertheirconductofwork.
_______________
18Id.,atp.679.
19Id.,atp.192.
20Id.,atpp.693697.
574

574

SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter&GamblePhils.,Inc.

P&GalsocontendsthattheLaborCodeneitherdefinesnorlimits
which services or activities may be validly outsourced. Thus, an
employer can farm out any of its activities to an independent
contractor,regardlessofwhethersuchactivityisperipheralorcore
innature.Itinsiststhatthedeterminationofwhethertoengagethe
servicesofajobcontractorortoengageindirecthiringiswithinthe
ambitofmanagementprerogative.
Atthisjuncture,itisworthmentioningthatonJanuary29,2007,
wedeemedaswaivedthefilingoftheCommentofPrommGemon
thepetition.21Also,althoughSAPSwasimpleadedasapartyinthe
proceedings before the Labor Arbiter and the NLRC, it was no
longer impleaded as a party in the proceedings before the CA.22
Hence, our pronouncements with regard to SAPS are only for the
purposeofdeterminingtheobligationsofP&G,ifany.
OurRuling
Thepetitionhasmerit.
Asarule,theCourtrefrainsfromreviewingfactualassessments
oflowercourtsandagenciesexercisingadjudicativefunctions,such
as the NLRC. Occasionally, however, the Court is constrained to
wadeintofactualmatterswhenthereisinsufficientorinsubstantial
evidence on record to support those factual findings or when too
muchisconcluded,inferredordeducedfromthebareorincomplete
factsappearingonrecord.23Inthepresentcase,wefindtheneedto
reviewtherecordstoascertainthefacts.
_______________

21Id.,atp.652.
22Id.,atp.89.
23Pascuav.NationalLaborRelationsCommission(ThirdDivision),351Phil.48,
61,287SCRA554,567(1998).
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Laboronlycontractingandjobcontracting
InordertoresolvetheissueofwhetherP&Gistheemployerof
petitioners, it is necessary to first determine whether PrommGem
andSAPSarelaboronlycontractorsorlegitimatejobcontractors.
ThepertinentLaborCodeprovisiononthematterstates:
ART.106.Contractor or subcontractor.Whenever an employer
enters into a contract with another person for the performance of the
formers work, the employees of the contractor and of the latters
subcontractor,ifany,shallbepaidinaccordancewiththeprovisionsofthis
Code.
Intheeventthatthecontractororsubcontractorfailstopaythewagesof
his employees in accordance with this Code, the employer shall be jointly
andseverallyliablewithhiscontractororsubcontractortosuchemployeesto
theextentoftheworkperformedunderthecontract,inthesamemannerand
extentthatheisliabletoemployeesdirectlyemployedbyhim.
The Secretary of Labor may, by appropriate regulations, restrict or
prohibit the contracting out of labor to protect the rights of workers
established under this Code. In so prohibiting or restricting, he may make
appropriatedistinctionsbetweenlaboronlycontractingandjobcontracting
as well as differentiations within these types of contracting and determine
who among the parties involved shall be considered the employer for
purposes of this Code, to prevent any violation or circumvention of any
provisionofthisCode.
Thereislaboronlycontractingwherethepersonsupplyingworkersto
an employer does not have substantial capital or investment in the form of
tools, equipment, machineries, work premises, among others, and the
workersrecruitedandplacedbysuchpersonareperformingactivitieswhich
aredirectlyrelatedtotheprincipalbusinessofsuchemployer.Insuchcases,
the person or intermediary shall be considered merely as an agent of the
employer who shall be responsible to the workers in the same manner and
extent as if the latter were directly employed by him. (Emphasis and
underscoringsupplied.)
576

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Alviadovs.Procter###GamblePhils.,Inc.

Rule VIIIA, Book III of the Omnibus Rules Implementing the

Labor Code, as amended by Department Order No. 1802,24
distinguishesbetweenlegitimateandlaboronlycontracting:
xxxx
Section3.Trilateral Relationship in Contracting Arrangements.In
legitimatecontracting,thereexistsatrilateralrelationshipunderwhichthere
isacontractforaspecificjob,workorservicebetweentheprincipalandthe
contractor or subcontractor, and a contract of employment between the
contractor or subcontractor and its workers. Hence, there are three parties
involvedinthesearrangements,theprincipalwhichdecidestofarmoutajob
or service to a contractor or subcontractor, the contractor or subcontractor
which has the capacity to independently undertake the performance of the
job,workorservice,andthecontractualworkersengaged by the contractor
orsubcontractortoaccomplishthejob[,]workorservice.
xxxx
Section5.Prohibition against laboronly contracting.Laboronly
contracting is hereby declared prohibited. For this purpose, laboronly
contracting shall refer to an arrangement where the contractor or
subcontractor merely recruits, supplies or places workers to perform a job,
work or service for a principal, and any of the following elements are
present:
i)The contractor or subcontractor does not have substantial capital or
investmentwhichrelatestothejob,workorservicetobeperformedandthe
employeesrecruited,supplied or placed by such contractor or subcontractor
are performing activities which are directly related to the main business of
theprincipalor
ii)[T]he contractor does not exercise the right to control over the
performanceoftheworkofthecontractualemployee.
Theforegoingprovisionsshallbewithoutprejudicetotheapplicationof
Article248(c)oftheLaborCode,asamended.
_______________
24RulesImplementing Articles 106 to 109 of the Labor Code, As Amended, approved
February21,2002.
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Substantialcapitalorinvestmentreferstocapitalstocksandsubscribed
capitalization in the case of corporations, tools, equipment, implements,
machineriesandworkpremises,actuallyanddirectlyusedbythecontractor
or subcontractor in the performance or completion of the job, work or
servicecontractedout.
The right to control shall refer to the right reserved to the person for
whom the services of the contractual workers are performed, to determine
notonlytheendtobeachieved,butalsothemannerandmeanstobeusedin
reachingthatend.
xxxx(Underscoringsupplied.)

Clearly, the law and its implementing rules allow contracting

arrangements for the performance of specific jobs, works or
services.Indeed,itismanagementprerogativetofarmoutanyofits
activities,regardlessofwhethersuchactivityisperipheralorcorein
nature. However, in order for such outsourcing to be valid, it must
be made to an independent contractor because the current labor
rulesexpresslyprohibitlaboronlycontracting.
To emphasize, there is laboronly contracting when the
contractor or subcontractor merely recruits, supplies or places
workerstoperformajob,workorserviceforaprincipal25andany
ofthefollowingelementsarepresent:
i)The contractor or subcontractor does not have substantial capital or
investmentwhichrelatestothejob,workorservicetobeperformedandthe
employees recruited, supplied or placed by such contractor or subcontractor
are performing activities which are directly related to the main business of
theprincipalor
ii)The contractor does not exercise the right to control over the
performance of the work of the contractual employee. (Underscoring
supplied)
_______________
25Escariov.NationalLaborRelationsCommission,388Phil.929,938333SCRA
257,263264(2000).
578

578

SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter###GamblePhils.,Inc.

In the instant case, the financial statements26 of PrommGem

showthatithasauthorizedcapitalstockofP1millionandapaidin
capital, or capital available for operations, of P500,000.00 as of

1990.27ItalsohaslongtermassetsworthP432,895.28andcurrent
assets of P719,042.32. PrommGem has also proven that it
maintaineditsownwarehouseandofficespacewithafloorareaof
870 square meters.28 It also had under its name three registered
vehicles which were used for its promotional/merchandising
business.29PrommGemalsohasotherclients30asidefromP&G.31
Under the circumstances, we find that PrommGem has substantial
investmentwhichrelatestotheworktobeperformed.Thesefactors
negate the existence of the element specified in Section 5(i) of
DOLEDepartmentOrderNo.1802.
The records also show that PrommGem supplied its
complainantworkers with the relevant materials, such as markers,
tapes, liners and cutters, necessary for themtoperformtheirwork.
PrommGem also issued uniforms to them. It is also relevant to
mention that PrommGem already considered the complainants
working under it as its regular, not merely contractual or project,
employees.32Thiscircumstancenegatestheexistenceofelement(ii)
asstatedinSection5ofDOLE
_______________
26Records,Vol.I,p.208.
27Id.,atp.211.
28Rollo,p.453TSN,February22,1994,p.9.
29Rollo,pp580582.
30 a. Adidas Division, Rubberworld Phil., Inc. b. CFC Corporation c. Focus
Enterprise, Inc., d. Procter & Gamble Phil., Inc., e. Roche Phil., Inc. f. Sterling
ProductsIntl.,Inc.g.SoutheastAsiaFoods,Inc.h.PepsiCo.,Inc.i.KraftGeneral
FoodsPhil.,Inc.j.UniversalRobinaCorp.k.WrigleyPhil.,Inc.l.AsiaBrewery,
Inc.m.AyalaLand,Inc.n.Citibank,N.A.o.S.C.Johnson,Inc.p.GlaxoPhil.,Inc.
q.Bankofthe Phil. IslandLoyola Branch r. Republic Chemical, Inc. s. Metrolab,
Inc.and,t.FirstPacificMetroCorp.Records,Vol.I,p.192.
31Id.
32Records,Vol.II,pp.599623.
579

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Alviadovs.Procter###GamblePhils.,Inc.

Department Order No. 1802, which speaks of contractual

employees.This,furthermore,negatesonthepartofPrommGem
badfaithandintenttocircumventlaborlawswhichfactorshave
often been tipping points that lead the Court to strike down the
employment practice or agreement concerned as contrary to public

policy,morals,goodcustomsorpublicorder.33
Underthecircumstances,PrommGemcannotbeconsideredasa
laboronly contractor. We find that it is a legitimate independent
contractor.
Ontheotherhand,theArticlesofIncorporationofSAPSshows
that it has a paidin capital of only P31,250.00. There is no other
evidencepresentedtoshowhowmuchitsworkingcapitalandassets
are. Furthermore, there is no showing of substantial investment in
tools,equipmentorotherassets.
InVinoya v. National Labor Relations Commission,34theCourt
held that [w]ith the current economic atmosphere in the country,
thepaidincapitalizationofPMCIamountingtoP75,000.00cannot
be considered as substantial capital and, as such, PMCI cannot
qualifyasanindependentcontractor.35Applyingthesamerationale
tothepresentcase,itisclearthatSAPShavingapaidincapitalof
onlyP31,250hasnosubstantialcapital.SAPSlackofsubstantial
capitalisunderlinedbytherecords36whichshowthatitspayrollfor
itsmer
_______________
33Theactofhiringandrehiringworkersoveraperiodoftimewithoutconsidering
themasregularemployeesevincesbadfaithonthepartoftheemployer.SanMiguel
Corporationv.NationalLaborRelationsCommission,G.R.No.147566,December6,
2006,510SCRA181,189Bustamantev.NationalLaborRelationsCommission,G.R.
No.111651,March15,1996,255SCRA145,150.
34381Phil.460324SCRA469(2000).Thiscaseinvolvedanemployeewhowas
dismissedandfiledalaborcasein1991,aboutthesametimeframeasthatinvolved
inthiscaseforpurposesoftakingjudicialnoticeoftheeconomicatmosphere in the
country.
35Id.,atp.476p.481.
36Records,Vol.I,p.556.
580

580

SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter###GamblePhils.,Inc.

chandisers alone for one month would already total P44,561.00. It

had6monthcontractswithP&G.37YetSAPSfailedtoshowthatit
could complete the 6month contracts using its own capital and
investment.Itscapitalisnotevensufficientforonemonthspayroll.
SAPS failed to show that its paidin capital of P31,250.00 is
sufficient for the period required for it to generate its needed
revenue to sustain its operations independently. Substantial capital

referstocapitalizationusedintheperformanceorcompletionofthe
job, work or service contracted out. In the present case, SAPS has
failedtoshowsubstantialcapital.
Furthermore, the petitioners have been charged with the
merchandising and promotion of the products of P&G, an activity
thathasalreadybeenconsideredbytheCourtasdoubtlesslydirectly
related to the manufacturing business,38 which is the principal
businessofP&G.ConsideringthatSAPShasnosubstantialcapital
orinvestmentandtheworkersitrecruitedareperformingactivities
whicharedirectlyrelatedtotheprincipalbusinessofP&G,wefind
thattheformerisengagedinlaboronlycontracting.
Where laboronly contracting exists, the Labor Code itself
establishes an employeremployee relationship between the
employer and the employees of the laboronly contractor.39 The
statuteestablishesthisrelationshipforacomprehensivepurpose:to
preventacircumventionoflaborlaws.Thecontractorisconsidered
merely an agent of the principal employer and the latter is
responsibletotheemployeesofthe
_______________
37Rollo,p.412.
38Tabasv.CaliforniaManufacturingCo.,Inc.,251Phil.448,454169SCRA497,
502(1989).
39 Neri v. National Labor Relations Commission, G.R. Nos. 9700809, July 23,
1993, 224 SCRA 717, 720, citing Philippine Bank of Communications v. National
LaborRelationsCommission,230Phil.430,440146SCRA347,356(1986).
581

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Alviadovs.Procter###GamblePhils.,Inc.

laboronly contractor as if such employees had been directly

employedbytheprincipalemployer.40
Consequently, the following petitioners, having been recruited
andsuppliedbySAPS41whichengagedinlaboronlycontracting
are considered as the employees of P&G: Arthur Corpuz, Eric
Aliviado,MonchitoAmpeloquio,AbrahamBasmayor,Jr.,Jonathan
Mateo, Lorenzo Platon, Estanislao Buenaventura, Lope Salonga,
FranzDavid,NestorIgnacio,Jr.,RolandoRomasanta,RoehlAgoo,
Bonifacio Ortega, Arsenio Soriano, Jr., Arnel Endaya, Roberto
Enriquez, Edgardo Quiambao, Santos Bacalso, Samson Basco,
Alstando Montos, Rainer N. Salvador, Pedro G. Roy, Leonardo F.
Talledo, Enrique F. Talledo, Joel Billones, Allan Baltazar, Noli

Gabuyo, Gerry Gatpo, German Guevara, Gilbert V. Miranda,

RodolfoC.Toledo,Jr.,ArnoldD.Laspoa,PhilipM.Loza,Mario
N. Coldayon, Orlando P. Jimenez, Fred P. Jimenez, Restituto C.
Pamintuan,Jr.,RolandoJ.DeAndres,ArtuzBustenera,Jr.,Roberto
B. Cruz, Rosedy O. Yordan, Orlando S. Balangue, Emil Tawat,
CresenteJ.Garcia,MelencioCasapao,RomeoVasquez,Renatodela
Cruz,RomeoViernes,Jr.,EliasBascoandDennisDacasin.
The following petitioners, having worked under, and been
dismissedbyPrommGem,areconsideredtheemployeesofPromm
Gem,notofP&G:WilfredoTorres,JohnSumergido,EdwinGarcia,
Mario P. Liongson, Jr., Ferdinand Salvo, Alejandrino Abaton,
Emmanuel A. Laban, Ernesto Soyosa, Aladino Gregore, Jr., Ramil
Reyes, Ruben Vasquez, Jr., Maximino Pascual, Willie Ortiz,
Armando Villar, Jose Fernando Gutierrez, Ramiro Pita, Fernando
Macabenta, Nestor Esquila, Julio Rey, Albert Leynes, Ernesto
Calanao, Roberto Rosales, Antonio Dacuma, Tadeo Durano, Raul
Dulay,Marino
_______________
40SanMiguelCorporationv.Aballa,G.R.No.149011,June28,2005,461SCRA
392,422.
41Records, Vol. I, p. 340. SAPS has admitted that the complainants are its
employees.
582

582

SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter###GamblePhils.,Inc.

Maranion,JosephBanico,MelchorCardano,ReynaldoJacaban,and
JoebAliviado.42
Terminationofservices
We now discuss the issue of whether petitioners were illegally
dismissed. In cases of regular employment, the employer shall not
terminate the services of an employee except for a just43 or
authorized44cause.
42Records,Vol.I,p.193Vol.II,pp.666692.
43LaborCodeofthePhilippines,
ART.282.Termination by employer.An employer may terminate an
employmentforanyofthefollowingcauses:
(a)Serious misconduct or willful disobedience by the employee of the
lawfulordersofhisemployerorrepresentativeinconnectionwithhiswork

(b)Grossandhabitualneglectbytheemployeeofhisduties
(c)Fraudorwillfulbreachbytheemployeeofthetrustreposedinhimby
hisemployerordulyauthorizedrepresentative
(d)Commissionofacrimeoroffensebytheemployeeagainsttheperson
ofhisemployeroranyimmediatememberofhisfamilyorhisdulyauthorized
representativeand
(e)Othercausesanalogoustotheforegoing.
44 ART.283. Closure of establishment and reduction of personnel.The
employermayalsoterminatetheemploymentofanyemployeeduetotheinstallation
oflaborsavingdevices,redundancy,retrenchmenttopreventlossesortheclosingor
cessationofoperationoftheestablishmentorundertakingunlesstheclosingisforthe
purposeofcircumventingtheprovisionsofthisTitle,byservingawrittennoticeon
theworkersandtheMinistryofLaborandEmploymentatleastone(1)monthbefore
theintendeddatethereofxxx
ART.284.Disease as ground for termination.Anemployer may terminate
theservicesofanemployeewhohasbeenfoundtobesufferingfromanydiseaseand
whosecontinuedem
583

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583

Alviadovs.Procter&GamblePhils.,Inc.

Intheinstantcase,theterminationlettersgivenbyPrommGem
toitsemployeesuniformlyspecifiedthecauseofdismissalasgrave
misconductandbreachoftrust,asfollows:
xxxx
ThisinformsyouthateffectiveMay5,1992,youremploymentwithour
company, PrommGem, Inc. has been terminated. We find your expressed
admission, that you considered yourself as an employee of Procter &
Gamble Phils., Inc. and assailing the integrity of the Company as
legitimateandindependentpromotionfirm,isdeemedasanactofdisloyalty
prejudicial to the interests of our Company: serious misconduct and breach
of trust reposed upon you as employee of our Company which [co]nstitute
justcausefortheterminationofyouremployment.
xxxx45

Misconducthasbeendefinedasimproperorwrongconductthe
transgression of some established and definite rule of action, a
forbiddenact,aderelictionofduty,unlawfulincharacterimplying
wrongfulintentandnotmereerrorofjudgment.Themisconductto
beseriousmustbeofsuchgraveandaggravatedcharacterandnot
merely trivial and unimportant.46 To be a just cause for dismissal,
such misconduct (a) must be serious (b) must relate to the

performance of the employees duties and (c) must show that the
employeehasbecomeunfittocontinueworkingfortheemployer.47
_______________
ploymentisprohibitedbylaworisprejudicialtohishealthaswellastothehealthof
hiscoemployees:xxx
45Records,Vol.II,p.447.
46NationalLaborRelationsCommissionv.Salgarino, G.R. No. 164376, July 31,
2006,497SCRA361,375Molinav.PacificPlans,Inc.,G.R.No.165476,March 10,
2006,484SCRA498,518Samsonv.NationalLaborRelationsCommission,386Phil.
669,682330SCRA460,471(2000).
47 Baez v. De La Salle University, G.R. No. 167177, September 27, 2006, 503
SCRA691,700Phil. Aeolus Automotive United Corp. v. National Labor Relations
Commission,387Phil.250,261331SCRA237,245246(2000).
584

584

SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter###GamblePhils.,Inc.

In other words, in order to constitute serious misconduct which

will warrant the dismissal of an employee under paragraph (a) of
Article 282 of the Labor Code, it is not sufficient that the act or
conduct complained of has violated some established rules or
policies.Itisequallyimportantandrequiredthattheactorconduct
must have been performed with wrongful intent.48 In the instant
case,petitionersemployeesofPrommGemmayhavecommittedan
errorofjudgmentinclaimingtobeemployeesofP&G,butitcannot
besaidthattheyweremotivatedbyanywrongfulintentindoingso.
Assuch,wefindthemguiltyofonlysimplemisconductforassailing
the integrity of PrommGem as a legitimate and independent
promotionfirm.Amisconductwhichisnotseriousorgrave,asthat
existingintheinstantcase,cannotbeavalidbasisfordismissingan
employee.
Meanwhile, loss of trust and confidence, as a ground for
dismissal,mustbebasedonthewillfulbreachofthetrustreposedin
the employee by his employer.Ordinary breachwillnotsuffice. A
breach of trust is willful if it is done intentionally, knowingly and
purposely, without justifiable excuse, as distinguished from an act
donecarelessly,thoughtlessly,heedlesslyorinadvertently.49
Loss of trust and confidence, as a cause for termination of
employment, is premised on the fact that the employee concerned
holdsapositionofresponsibilityoroftrustandconfidence.Assuch,
he must be invested with confidence on delicate matters, such as

custody, handling or care and protectionofthe property andassets

of the employer. And, in order to constitute a just cause for
dismissal, the act complained of must be workrelated and must
show that the employee is unfit to continue to work for the
employer.50Intheinstant
_______________
48NationalLaborRelationsCommissionv.Salgarino,supraat376.
49Velezv.ShangriLasEdsaPlazaHotel,G.R.No.148261,October9,2006,504
SCRA13,25.
50Id.,atp.26.
585

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case, the petitionersemployees of PrommGem have not been

shown to be occupying positions of responsibility or of trust and
confidence.Neitheristhereanyevidencetoshowthattheyareunfit
tocontinuetoworkasmerchandisersforPrommGem.
Alltold,wefindnovalidcauseforthedismissalofpetitioners
employeesofPrommGem.
While PrommGem had complied with the procedural aspect of
due process in terminating the employment of petitioners
employees,i.e.,givingtwonoticesandinbetweensuchnotices,an
opportunity for the employees to answer and rebut the charges
againstthem,itfailedtocomplywiththesubstantiveaspectofdue
process as the acts complained of neither constitute serious
misconductnorbreachoftrust.Hence,thedismissalisillegal.
With regard to the petitioners placed with P&G by SAPS, they
were given no written notice of dismissal. The records show that
upon receipt by SAPS of P&Gs letter terminating their
Merchandising Services Contract effective March 11, 1993, they
inturnverballyinformedtheconcernedpetitionersnottoreportfor
work anymore. The concerned petitioners related their dismissal as
follows:
xxxx
5.OnMarch11,1993,wewerecalledtoameetingatSAPSoffice.We
were told by Mr. Saturnino A. Ponce that we should already stop working
immediatelybecausethatwastheorderofProcterandGamble.Accordingto
him he could not do otherwise because Procter and Gamble was the one
payingus.ToprovethatProcterandGamblewastheoneresponsibleinour

dismissal,heshowedtoustheletter51datedFebruary24,1993,xxx
February24,1993
SalesandPromotionsServices
ArmonsBldg.,142KamiasRoad,
_______________
51Rollo,p.192.
586

586

SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter&GamblePhils.,Inc.
QuezonCity
Attention:Mr.SaturninoA.Ponce

President&GeneralManager
Gentlemen:
Based on our discussions last 5 and 19 February 1993, this
formally informs you that we will not be renewing our
MerchandisingServicesContractwithyouragency.
Pleaseimmediatelyundertakeeffortstoensurethatyourservices
totheCompanywillterminateeffectivecloseofbusinesshoursof11
March1993.
Thisiswithoutprejudicetowhateverobligationsyoumayhave
tothecompanyundertheabovementionedcontract.
Verytrulyyours,
(Sgd.)
EMMANUELM.NON
SalesMerchandisingIII

6.On March 12, 1993, we reported to our respective outlet

assignments.But,wewerenolongerallowedtowork and we were refused
entrancebythesecurityguardsposted.Accordingtothesecurityguards,all
merchandisersofProcterandGambleunderS[APS]whofiledacaseinthe
Dept. of Labor are already dismissed as per letter of Procter and Gamble
datedFebruary25,1993.xxx52

Neither SAPS nor P&G dispute the existence of these

circumstances.Parenthetically,unlikePrommGemwhichdismissed
its employees for grave misconduct and breach of trust due to
disloyalty, SAPS dismissed its employees upon the initiation of
P&G. It is evident that SAPS does not carry on its own business
because the termination of its contract with P&G automatically
meant for it also the termination of its employees services. It is

obvious from its act that SAPS had no other clients and had no
intention of seeking other clients in order to further its
merchandisingbusiness.FromallindicationsSAPS,existedtocater
solelytotheneedofP&Gfor
_______________
52Records,Vol.II,p.413.
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Alviadovs.Procter###GamblePhils.,Inc.

thesupplyofemployeesinthelattersmerchandisingconcernsonly.
Under the circumstances prevailing in the instant case, we cannot
considerSAPSasanindependentcontractor.
Goingbacktothematterofdismissal,itmustbeemphasizedthat
theonusprobanditoprovethelawfulnessofthedismissalrestswith
theemployer.53Interminationcases,theburdenofproofrestsupon
theemployertoshowthatthedismissalisforjustandvalidcause.54
In the instant case, P&G failed to discharge the burden of proving
the legality and validity of the dismissals of those petitioners who
areconsidereditsemployees.Hence,thedismissalsnecessarilywere
notjustifiedandarethereforeillegal.
Damages
We now go to the issue of whether petitioners are entitled to
damages.Moralandexemplarydamagesarerecoverablewherethe
dismissal of an employee was attended by bad faith or fraud or
constituted an act oppressive to labor or was done in a manner
contrarytomorals,goodcustomsorpublicpolicy.55
_______________
53NationalLaborRelationsCommissionv.Salgarino,supranote46at383.
54RoyalCrownInternationalev.NationalLaborRelationsCommission,G.R.No.
78085,October16,1989,178SCRA569,578.
LaborCodeofthePhilippines,
ART.279.SecurityofTenure.Incasesofregularemployment,theemployer
shall not terminate the services of an employee except for a just cause or when
authorizedbythisTitle.Anemployeewhoisunjustlydismissedfromworkshallbe
entitledtoreinstatementwithoutlossofseniorityrightsandotherprivilegesandtohis
full backwages, inclusive of allowances, and to his other benefits or their monetary
equivalentcomputedfromthetimehiscompensationwaswithheldfromhimuptothe
timeofhisactualreinstatement.

55Pascuav.NationalLaborRelationsCommission(ThirdDivision),supranote23
at72p.578Acuav.CourtofAppeals,G.R.
588

588

SUPREMECOURTREPORTSANNOTATED
Alviadovs.Procter###GamblePhils.,Inc.

With regard to the employees of PrommGem, there being no

evidenceofbadfaith,fraudoranyoppressiveactonthepartofthe
latter,wefindnosupportfortheawardofdamages.
As for P&G, the records show that it dismissed its employees
through SAPS in a manner oppressive to labor. The sudden and
peremptory barring of the concerned petitioners from work, and
fromadmissiontotheworkplace,afterjustaonedayverbalnotice,
andfornovalidcausebellowsoppressionandutterdisregardofthe
righttodueprocessoftheconcernedpetitioners.Hence,anawardof
moraldamagesiscalledfor.
Attorneys fees may likewise be awarded to the concerned
petitioners who were illegally dismissed in bad faith and were
compelled to litigate or incur expenses to protect their rights by
reasonoftheoppressiveacts56ofP&G.
Lastly,underArticle279oftheLaborCode,anemployeewhois
unjustly dismissed from work shall be entitled to reinstatement
without loss of seniority rights and other privileges, inclusive of
allowances,andotherbenefitsortheirmonetaryequivalentfromthe
time the compensation was with
held up to the time of actual
57
reinstatement. Hence, all the petitioners, having been illegally
dismissed are entitled to reinstatement without loss of seniority
rightsandwithfull
_______________
No.159832,May5,2006,489SCRA658,668Quadrav.CourtofAppeals, G.R. No.
147593,July31,2006,497SCRA221,227.
56See Pascua v. National Labor Relations Commission (Third Division), supra
note 23 at 74. In the instant case, P&Gs act of taking an unconscionable and
unscrupulous advantage of the utter powerlessness of the individual concerned
petitionerstopreventthetramplingoftheirrightstodueprocessandsecurityoftenure
constitutesbadfaith.
57PremierDevelopmentBankv.Mantal, G.R. No. 167716, March 23, 2006, 485
SCRA234,242243PhilippineAmusementandGamingCorporationv.Angara,G.R.
No.142937,July25,2006,496SCRA453,457.
589

VOL.614,March9,2010

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Alviadovs.Procter###GamblePhils.,Inc.

back wages and other benefits from the time of their illegal
dismissaluptothetimeoftheiractualreinstatement.
WHEREFORE, the petition is GRANTED. The Decision dated
March21,2003oftheCourtofAppealsinCAG.R.SPNo.52082
and the Resolution dated October 20, 2003 are REVERSED and
SET ASIDE. Procter & Gamble Phils., Inc. and PrommGem, Inc.
areORDEREDtoreinstatetheirrespectiveemployeesimmediately
without loss of seniority rights and with full backwages and other
benefits from the time of their illegal dismissal up to the time of
their actual reinstatement. Procter & Gamble Phils., Inc. is further
ORDERED to pay each of those petitioners considered as its
employees, namely Arthur Corpuz, Eric Aliviado, Monchito
Ampeloquio, Abraham Basmayor, Jr., Jonathan Mateo, Lorenzo
Platon, Estanislao Buenaventura, Lope Salonga, Franz David,
NestorIgnacio,RolandoRomasanta,RoehlAgoo,BonifacioOrtega,
Arsenio Soriano, Jr., Arnel Endaya, Roberto Enriquez, Edgardo
Quiambao, Santos Bacalso, Samson Basco, Alstando Montos,
RainerN.Salvador,PedroG.Roy,LeonardoF.Talledo,EnriqueF.
Talledo, Joel Billones, Allan Baltazar, Noli Gabuyo, Gerry Gatpo,
German Guevara, Gilbert Y. Miranda, Rodolfo C. Toledo, Jr.,
ArnoldD.Las
poa,PhilipM.Loza,MarioN.Coldayon,OrlandoP.
Jimenez, Fred P. Jimenez, Restituto C. Pamintuan, Jr., Rolando J.
De Andres, Artuz Bustenera, Jr., Roberto B. Cruz, Rosedy O.
Yordan, Orlando S. Balangue, Emil Tawat, Cresente J. Garcia,
Melencio Casapao, Romeo Vasquez, Renato dela Cruz, Romeo
Viernes,Jr.,EliasBascoandDennisDacasin,P25,000.00asmoral
damagesplustenpercentofthetotalsumasandforattorneysfees.
Let this case be REMANDED to the Labor Arbiter for the
computation, within 30 days from receipt of this Decision, of
petitioners backwages and other benefits and ten percent of the
total sum as and for attorneys fees as stated above and for
immediateexecution.

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