4 fold test an employer employee relationship cases - Download as Word Doc . doc), PDF File relationship, case law has consistently applied the four-fold test, to wit: (a) the selection and Labor Relations Case Digests With Table. The issue of whether or not an employer-employee relationship exists in a given case is relationship jurisprudence has invariably adhered to the four-fold test, to wit: (1) the .. , April 18, , SCRA 38, an employer-employee relationship, the four-fold test shall apply, to wit: (1) the selection and "control test." The so-called "control test" is commonly regarded as the most crucial . , June 13, 15 Department of.
All other claims are dismissed for lack of merit. Royale Homes claimed that the Labor Arbiter grievously erred inruling that there exists an employer-employee relationship between the parties. It insisted that the contract between them expressly statesthat Alcantara is an independent contractor and not an ordinary employee.
Ithad no control over the means and methods by which he performed his work.
Tests of Employment Relations | Philippine Labor Laws
It was Alcantara who chose not to finish the contract. Alcantara, for his part, argued that the Labor Arbiter erred in ruling that his employment was for a fixed-term and that he is not entitled to backwages, reinstatement, unpaid commissions, and damages. It based its ruling mainly on the contract which does not require Alcantara to observe regular working hours. He was also free to adopt the selling methods he deemed most effective and can even recruit sales agents to assist him in marketing the inventories of Royale Homes.
The NLRC also considered the fact that Alcantara was not receiving monthly salary, but was being paid on commission basis as stipulated in the contract.
Alcantara thus filed a Petition for Certiorari 17 with the CA imputing grave abuse of discretion on the partof the NLRC in ruling that he is not an employee of Royale Homes and that it is the regular courts which have jurisdiction over the issue of whether the pre-termination of the contract is valid. Applying the four-fold and economic reality tests, it held thatAlcantara is an employee of Royale Homes. Royale Homes exercised some degree of control over Alcantara since his job, as observed by the CA, is subject to company rules, regulations, and periodic evaluations.
He was also bound by the company code of ethics.
Moreover, the exclusivity clause of the contract has made Alcantara economically dependent on Royale Homes, supporting the theory that he is anemployee of said company. Thus, the CA ruled that he isentitled to backwages and separation pay, in lieu of reinstatement. With regard to the corporate officers, the CA absolved them from any liability for want of clear proof that they assented to the patently unlawful acts or that they are guilty of bad faith orgross negligence.
Employer-Employee Relationship | Philippine Theo Law Gee
Issues Hence, this Petition where Royale Homes submits before this Court the following issues for resolution: Power to control the employee with respect to the means and methods by which the work is to be accomplished.
This is known as the right-of-control test. Right of control test is considered as the most important element in determining the existence of employment relation. Of the above-mentioned elements, the right of control test is considered as the most important element in determining the existence of employment relation.
Al-Lagadan and Piga, where the court held that there is an employer-employee relationship when the person for whom the services are performed reserves the right to control not only the end achieved but also the manner and means used to achieve that end.
In applying this test, it is the existence of the right, and not the actual exercise thereof, that is important.
The payer assigns specific tasks that define the real framework within which the work is to be done. The payer exercises control if he or she has the right to hire or fire, and decide where, when and how the work will be done. If such is the case, then the payer clearly exercises control over the worker, who may then be considered to be an employee for EHT purposes.
It is not necessary that control actually be exercised, only that it can be exercised. The control test may not be determinative when examining the employment of professionals who, because of their expertise and specialized training, may need less direction and supervision.
A professional who is subject to limited control and supervision may still be an employee based on other factors.
Indicators that the worker may be an employee: The payer has the right to: In considering the equipment and tools owned and supplied by the worker, what is relevant is the significance of the investment in the rental or purchase of tools and equipment along with the related costs of replacement, repair, and insurance.
Ownership of the tools, however, is not always a determining factor.
The employer also generally covers operating costs, which may include office expenses, employee wages and benefits, insurance premiums, and delivery and shipping costs. The employee assumes little or no financial risk and is entitled to his or her full salary or wages regardless of the financial position of the business. Integration The integration or organization test examines whether the tasks performed by an individual form an integral part of the business as opposed to merely being accessory to the business.
The test will also determine whether the individual is in business in his or her own right and provides services to other businesses as an independent contractor.