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RAQUEL P. CONSULTA v. CA

FACTS:

Pamana Philippines, Inc. ("Pamana") is engaged in health care business. Raquel P. Consulta ("Consulta") was a Managing Associate of Pamana. Consulta's appointment dated 1 December 1987 states that she is tasked with organizing, developing, managing, and maintaining a sales division and a full complement of agencies and Health Consultants in Metro Manila. She is responsible for recruiting, training, and directing Supervising Associates and Health Consultants for the purpose of promoting the company's corporate Love Mission. Consulta is expected to uphold and promote the company's interests and good image. Her appointment also specifies her entitlement to compensation and participation in sales contests and incentives. Pamana issued Consulta a Certification on 23 November 1987, authorizing her to negotiate for and on behalf of Pamana with the Federation of Filipino Civilian Employees Association for a Health Care Plan. Consulta claimed that Pamana did not pay her commission for this account, prompting her to file a complaint for unpaid wages or commission against Pamana, its President, and its Executive Vice-President. The Labor Arbiter ruled in Consulta's favor, ordering Pamana to pay her unpaid commission. Pamana et al. appealed the decision to the NLRC, which affirmed the Labor Arbiter's decision. Pamana et al. then filed a petition for certiorari before the Supreme Court, which referred the case to the appellate court. The appellate court reversed the NLRC decision, ruling that Consulta was a commission agent, not an employee of Pamana. Consulta appealed to the Supreme Court. The issues before the Court are whether Consulta was an employee of Pamana and whether the Labor Arbiter had jurisdiction over Consulta's claim for unpaid commission.

ISSUES:

  1. Whether Consulta was an employee of Pamana.

  2. Whether the Labor Arbiter had jurisdiction over Consulta's claim for unpaid commission.

RULING:

  1. Consulta was an independent agent and not an employee of Pamana.

  2. The Labor Arbiter and the NLRC had no jurisdiction to entertain and rule on Consulta's money claim due to the lack of an employer-employee relationship between Pamana and Consulta.

PRINCIPLES:

  • Four-Fold Test for Employer-Employee Relationship:

    1. The power to hire.

    2. The payment of wages.

    3. The power to dismiss.

    4. The power to control, which is the most significant element.

  • Scope of Control for Employer-Employee Relationship:

    • Not every form of control establishes an employer-employee relationship.

    • Distinction between guidelines to promote results and control over means/methods of work.

  • Exclusivity Provision:

    • An exclusivity clause requiring an agent to work only for the company does not by itself establish control over the manner and means of work.

  • Jurisdiction of Labor Arbiter (Labor Code, Article 217):

    • Labor Arbiters have jurisdiction over claims arising from employer-employee relationships.

    • Without such a relationship, claims must be resolved through ordinary civil actions.