FACTS:

Manuel P. Esita worked for twenty years as a compressor operator at the Tiongson Ice Plant. In 1980, he was hired as a compressor operator-mechanic for the ice plants owned by Dr. Melchor Opulencia. Esita initially worked at the ice plant in Tanauan, Batangas where he was paid a daily wage of P35.00. In 1986, he was transferred to the ice plant in Calamba. On February 6, 1989, Esita was dismissed after demanding the correct amount of wages due to him. He then filed a complaint for illegal dismissal, underpayment, non-payment for overtime and other related claims against the petitioners. The petitioners denied that Esita was an employee and claimed that he was only a helper/peon of one of the contractors engaged to do major repairs and renovation at the ice plant. The petitioners also alleged that Esita rendered services as a helper/peon in the repair or remodeling of Dr. Opulencia's residence. Esita, on the other hand, claimed that he was indeed an employee and worked as a compressor operator-mechanic. The Labor Arbiter ruled in favor of Esita and the NLRC affirmed the decision with modifications. The petitioners then sought reversal of the ruling, claiming that there was no employer-employee relationship and that the labor authorities had no jurisdiction over the case.

ISSUES:

1. Whether there is an employer-employee relationship between the petitioners and Esita.

2. Whether the labor arbiters and NLRC have jurisdiction over the case.

RULING:

1. The court ruled that there is an employer-employee relationship between the petitioners and Esita. The court found that Esita was hired as a compressor operator-mechanic for the ice plants of petitioner Dr. Melchor Opulencia and was initially assigned at the ice plant in Tanauan. He later transferred to the ice plant in Calamba and also helped in the construction-remodeling of Dr. Opulencia's house. The court considered these circumstances as evidence of an employment relationship.

2. The court ruled that the labor arbiters and NLRC have jurisdiction over the case. The court rejected the argument of the petitioners that labor arbiters and NLRC do not have jurisdiction when the existence of an employer-employee relationship is questioned. The court emphasized that if such argument is allowed, unscrupulous employers could easily avoid the jurisdiction of labor arbiters and NLRC, and evade compliance with labor laws.

PRINCIPLES:

• The existence of an employer-employee relationship can be determined based on the facts and circumstances surrounding the parties' arrangement.

• Labor arbiters and NLRC have jurisdiction over cases involving labor disputes, including those that question the existence of an employer-employee relationship.