Petitioners were registered nurses engaged by respondent Dr. Pepito to work in her clinic at respondent Shangri-la Resort in Cebu of which she was a retained physician. Later, petitioners filed for payment of their labor standard benefits and regularization claiming they are regular employees of Shangri-la. Respondent contends that petitioners were not its employees but of Dr. Pepito, while the latter claims that petitioners were already working for the previous retained physicians of Shangri-la. The Labor Arbiter found for petitioners but was reversed on appeal by the NLRC tribunal stating no employer-employee relationship existed between petitioners and Shangri-la. CA affirmed. Petitioner further contends that Dr. Pepito cannot be a legitimate job contractor but a mere agent of Shangri-la.
Whether or not petitioner nurses are employees of Shangri-la.
The existence of an independent and permissible contractor relationship is generally established by considering the following determinants: whether the contractor is carrying on an independent business; the nature and extent of the work; the skill required; the term and duration of the relationship; the right to assign the performance of a specified piece of work; the control and supervision of the work to another; the employer’s power with respect to the hiring, firing and payment of the contractor’s workers; the control of the premises; the duty to supply the premises, tools, appliances, materials and labor; and the mode, manner and terms of payment. On the other hand, existence of an employer- employee relationship is established by the presence of the following determinants: (1) the selection and engagement of the workers; (2) power of dismissal; (3) the payment of wages by whatever means; and (4) the power to control the worker’s conduct, with the latter assuming primacy in the overall consideration.
Against the above-listed determinants, the Court holds that respondent doctor is a legitimate independent contractor. That Shangri-la provides the clinic premises and medical supplies for use of its employees and guests does not necessarily prove that respondent doctor lacks substantial capital and investment. As to payment of wages, respondent doctor is the one who underwrites the salaries, SSS contributions and other benefits of the staff as well as value added taxes and withholding taxes. It is unlikely that respondent doctor would report petitioners as workers, pay their SSS premium as well as their wages if they were not indeed her employees. With respect to the supervision and control of the nurses and clinic staff, it is not disputed that manual prepared by respondent doctor and not the employee manual being followed by Shangri-la‘s regular workers, governs how they perform their respective tasks and responsibilities.
In fine, as Shangri-la does not control how the work should be performed by petitioners, it is not petitioners‘employer.