LEONEN, J.:
WHEREFORE, the Decision dated September 28, 2010 is hereby SET ASIDE. Let the records of the case be REMANDED to the Executive Labor Arbiter a quo for appropriate action and to dispose of the case on the merits.Wahing et al. then moved for the reconsideration of the August 24, 2011 Resolution, but were denied relief. Thus, they filed a Petition for Certiorari before the Court of Appeals, arguing that: (1) the National Labor Relations Commission had no jurisdiction to render the assailed Resolution because the Daguio Spouses failed to perfect their appeal; and (2) that contrary to the assailed Resolution, the Labor Arbiter respected the Daguio Spouses' right of due process by giving them adequate time and notice to submit their evidence, which they allegedly disregarded.[13]
SO ORDERED.[12]
WHEREFORE, premises considered, the assailed Resolution dated August 24, 2011 of the National Labor Relations Commission, Eighth Division, Cagayan De Oro City is hereby REVERSED and SET ASIDE. Petitioner's Complaint for illegal dismissal, reinstatement or separation pay, underpayment of wages, premium pay for holiday, holiday pay, rest day pay, service inventive leave pay, vacation/sick leave pay, 13th month pay, moral and exemplary damages and attorney's fees is hereby DISMISSED for lack of basis.Wahing et al. then moved for the reconsideration of the Court of Appeals' Decision but were again denied relief.[16]
SO ORDERED.[15]
As a general rule, only matters assigned as errors in the appeal may be resolved. Rule 51, Section 8 of the Rules of Court provides:Thus, while petitioners here are correct that the Court of Appeals should generally review only the issues raised in the parties' pleadings, the Court of Appeals may review the case "in its entire context" to ensure its effective resolution, and to ensure the least cost to the judiciary and to the party litigants.[29]SECTION 8. Questions that May Be Decided. — No error which does not affect the jurisdiction over the subject matter or the validity of the judgment appealed from or the proceedings therein will be considered unless stated in the assignment of errors, or closely related to or dependent on an assigned error and properly argued in the brief, save as the court may pass upon plain errors and clerical errors.This provision likewise states that the Court of Appeals may review errors that are not assigned but are closely related to or dependent on an assigned error. The Court of Appeals is allowed discretion if it "finds that their consideration is necessary in arriving at a complete and just resolution of the case."
Jurisprudence has established several exceptions to this rule. These exceptions are enumerated in Catholic Bishop of Balanga v. Court of Appeals:True, the appealing party is legally required to indicate in his brief an assignment of errors, and only those assigned shall be considered by the appellate court in deciding the case. However, equally settled in jurisprudence is the exception to this general rule.Thus, the Court of Appeals has the discretion to consider the issue and address the matter where its ruling is necessary (a) to arrive at a just and complete resolution of the case; (b) to serve the interest of justice; or (c) to avoid dispensing piecemeal justice. This is consistent with its authority to review the totality of the controversy brought on appeal.[28] (Emphasis in the original, citations omitted)". . . Roscoe Pound states that 'according to Ulpian in Justinian's Digest, appeals are necessary to correct the unfairness or unskillfulness of whose who judge.['] Pound comments that 'the purpose of review is prevention quite as much as correction of mistakes. The possibility of review by another tribunal, especially a bench of judges . . . is an important check upon tribunals of first instance. It is a preventive of unfairness. It is also a stimulus to care and thoroughness as not to make mistakes.['] Pound adds that 'review involves matters of concern both to the parties to the case and to the public. . . . It is of public concern that full justice be done to [e]very one.['] This judicial injunction would best be fulfilled and the interest of full justice would best be served if it should be maintained that. . . appeal brings before the reviewing court the totality of the controversy resolved in the questioned judgment and order apart from the fact that such full-scale review by appeal is expressly granted as a matter of right and therefore of due process by the Rules of Court."Guided by the foregoing precepts, we have ruled in a number of cases that the appellate court is accorded a broad discretionary power to waive the lack of proper assignment of errors and to consider errors not assigned. It is clothed with ample authority to review rulings even if they are not assigned as errors in the appeal. Inasmuch as the Court of Appeals may consider grounds other than those touched upon in the decision of the trial court and uphold the same on the basis of such other grounds, the Court of Appeals may, with no less authority, reverse the decision of the trial court on the basis of grounds other than those raised as errors on appeal. We have applied this rule, as a matter of exception, in the following instances:(1) Grounds not assigned as errors but affecting jurisdiction over the subject matter;
(2) Matters not assigned as errors on appeal but are evidently plain or clerical errors within contemplation of law;
(3) Matters not assigned as errors on appeal but consideration of which is necessary in arriving at a just decision and complete resolution of the case or to serve the interest of justice or to avoid dispensing piecemeal justice;
(4) Matters not specifically assigned as errors on appeal but raised in the trial court and are matters of record having some bearing on the issue submitted which the parties failed to reuse or which the lower court ignored;
(5) Matters not assigned as errors on appeal but closely related to an error assigned; and
(6) Matters not assigned as errors on appeal but upon which the determination of a question properly assigned, is dependent.
In labor cases, rules of procedure should not be applied in a very rigid and technical sense. They are merely tools designed to facilitate the attainment of justice, and where their strict application would result in the frustration rather than promotion of substantial justice, technicalities must be avoided. Technicalities should not be permitted to stand in the way of equitably and completely resolving the rights and obligations of the parties. Where the ends of substantial justice shall be better served, the application of technical rules of procedure may be relaxed.[31] (Emphasis supplied, citations omitted)In view of the case's prolonged litigation, which stood to take even longer with the Commission's order of a second remand to the Labor Arbiter, the Court of Appeals properly took notice of both parties' evidence in order to resolve the case on the merits.
"It is clear from both the Labor Code and the NLRC Rules of Procedure that there is legislative and administrative intent to strictly apply the appeal bond requirement, and the Court should give utmost regard to this intention." The posting of cash or surety bond is therefore mandatory and jurisdictional; failure to comply with this requirement renders the decision of the Labor Arbiter final and executory. This indispensable requisite for the perfection of an appeal "is to assure the workers that if they finally prevail in the case[,] the monetary award will be given to them upon the dismissal of the employer's appeal [and] is further meant to discourage employers from using the appeal to delay or evade payment of their obligations to the employees."Petitioners themselves recognize that the National Labor Relations Commission granted respondents' Motion to Reduce Appeal Bond,[35] and that respondents "submitted their compliance . . . by posting an additional bond of Php 50,000.00."[36] We find no issue with respondents' compliance with the statutory requirement.
However, the Court, in special and justified circumstances, has relaxed the requirement of posting a supersedeas bond for the perfection of an appeal on technical considerations to give way to equity and justice. Thus, under Section 6 of Rule VI of the 2005 NLRC Revised Rules of Procedure, the reduction of the appeal bond is allowed, subject to the following conditions: (1) the motion to reduce the bond shall be based on meritorious grounds; and (2) a reasonable amount in relation to the monetary award is posted by the appellant. Compliance with these two conditions will stop the running of the period to perfect an appeal.[34] (Emphasis supplied, citations omitted)
In Viaña v. Al-Lagadan, the Court first laid down the four-fold test to determine the existence of an employer-employee relationship. The four elements of an employer-employee relationship, which have since been adopted in subsequent jurisprudence, are (1) the power to hire; (2) the payment of wages; (3) the power to dismiss; and (4) the power to control. The power to control is the most important of the four elements.[41] (Emphasis supplied, citations omitted)Respondents consistently argued before the labor tribunals that petitioners were not their employees because the latter "only share[d] in the proceeds"[42] of rubber sales from their tapping activities instead of earning wages. Respondents also deny exercising control over the means and methods of petitioners' work as rubber tappers. De Los Reyes v. Espineli[43] discusses that such a relationship may be classified as agricultural tenancy instead of agricultural employment:
We are here primarily interested in the basic differences between a farm employer-farm worker relationship and an agricultural sharehold tenancy relationship. Both, of course, are leases, but there the similarity ends. In the former, the lease is one of labor, with the agricultural laborer as the lessor of his services, and the farm employer as the lessee thereof. In the latter, it is the landowner who is the lessor, and the sharehold tenant is the lessee of agricultural land. As lessee he has possession of the leased premises. But the relationship is more than a mere lease. It is a special kind of lease, the law referring to it as a "joint undertaking." For this reason, not only the tenancy laws are applicable, but also, in a suppletory way, the law on leases, the customs of the place and the civil code provisions on partnership. The share tenant works for that joint venture. The agricultural laborer works for the farm employer, and for his labor he receives a salary or wage, regardless of whether the employer makes a profit. On the other hand, the share tenant participates in the agricultural produce. His share is necessarily dependent on the amount of the harvest.[44] (Emphasis supplied, citations omitted)De Los Reyes then teaches that the existence of agricultural employment may be determined by the same four elements of: "(1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the employer's power to control the employee's conduct."[45] Thus, De Los Reyes examined the following circumstances in determining the existence of an employment relationship:
Since the relationship between farm employer and agricultural laborer is that of employer and employee, the decisive factor is the control exercised by the former over the latter. On the other hand, the landholder has the "right to require the tenant, to follow those proven farm practices which have been found to contribute towards increased agricultural production and to use fertilizer of the kind or kinds shown by proven farm practices to be adapted to the requirements of the land." This is but the right of a partner to protect his interest, not the control exercised by an employer. If landholder and tenant disagree as to farm practices, the former may not dismiss the latter. It is the court that shall settle the conflict according to the best interests of both parties.Both parties submitted testimonial evidence in support of their respective positions on the existence of the employer-employee relationship. Petitioners submitted testimonies from their co-workers detailing: (1) their daily wages for their required hours of work; (2) respondents' constant supervision of their workers during work hours; and (3) the possibility of dismissal from work for failing to serve three consecutive work days.[47] On the other hand, respondents submitted the testimonies of their "former caretaker," a local rubber merchant, and several local government officials, who all testified that petitioners "only share[d] in the proceeds" of rubber sales and were not engaged as agricultural employees.[48]
The record is devoid of evidentiary support for the notion that the respondents are farm laborers. They do not observe set hours of work. The petitioner has not laid down regulations under which they are supposed to do their work. The argument tendered is that they are guards. However, it does not appear that they are under obligation to report for duty to the petitioner or his agent. They do not work in shifts. Nor has the petitioner prescribed the manner by which the respondents were and are to perform their duties as guards. We do not find here that degree of control and supervision evincive of an employer-employee relationship.[46] (Emphasis supplied, citations omitted)
There are instances when, aside from the employer's power to control the employee with respect to the means and methods by which the work is to be accomplished, economic realities of the employment relations help provide a comprehensive analysis of the true classification of the individual, whether as employee, independent contractor, corporate officer or some other capacity.The "economic reality" test discussed in Francisco requires proof of the "the totality of economic circumstances of the worker[,]"[53] in order to determine the existence of an employer-employee relationship:
The better approach would therefore be to adopt a two-tiered test involving: (1) the putative employer's power to control the employee with respect to the means and methods by which the work is to be accomplished; and (2) the underlying economic realities of the activity or relationship.
This two-tiered test would provide us with a framework of analysis, which would take into consideration the totality of circumstances surrounding the true nature of the relationship between the parties. This is especially appropriate in this case where there is no written agreement or terms of reference to base the relationship on; and due to the complexity of the relationship based on the various positions and responsibilities given to the worker over the period of the latter's employment.[52] (Emphasis supplied)
Thus, the determination of the relationship between employer and employee depends upon the circumstances of the whole economic activity, such as: (1) the extent to which the services performed are an integral part of the employer's business; (2) the extent of the worker's investment in equipment and facilities; (3) the nature and degree of control exercised by the employer; (4) the worker's opportunity for profit and loss; (5) the amount of initiative, skill, judgment or foresight required for the success of the claimed independent enterprise; (6) the permanency and duration of the relationship between the worker and the employer; and (7) the degree of dependency of the worker upon the employer for his continued employment in that line of business.Here, the testimonies submitted by petitioners establish the totality of economic circumstances required by Francisco's economic reality test. Petitioners perform services integral to respondents' business of running a rubber plantation. While there was no proof on record of petitioners' investment in their own work tools and facilities, the simplicity of the physical labor involved in their work renders this element inconclusive.
The proper standard of economic dependence is whether the worker is dependent on the alleged employer for his continued employment in that line of business. In the United States, the touchstone of economic reality in analyzing possible employment relationships for purposes of the Federal Labor Standards Act is dependency. By analogy, the benchmark of economic reality in analyzing possible employment relationships for purposes of the Labor Code ought to be the economic dependence of the worker on his employer.[54] (Emphasis supplied, citations omitted)
Moreover, jurisprudence states that "[w]hen the evidence of the employer and the employee are in equipoise, doubts are resolved in favor of labor. This is in line with the policy of the State to afford greater protection to labor."[57] (Citation omitted)Affording protection to labor and construing doubt in favor of the laborer are not only statutorily required under the Labor Code,[58] but are also consistent with the "social justice suppositions underlying labor laws[.]"[59]:
Our laws on labor, foremost of which is the Labor Code, are pieces of social legislation. They have been adopted pursuant to the constitutional recognition of "labor as a primary social economic force" and to the constitutional mandates for the state to "protect the rights of workers and promote their welfare" and for Congress to "give highest priority to the enactment of measures that protect and enhance the right of all the people to human dignity, [and] reduce social, economic, and political inequalities."Social justice requires consideration for labor due to their disadvantaged position. The Court of Appeals should not have placed such an onerous evidentiary burden on petitioners given the evidence already on record. Both parties submitted competing testimonial evidence, giving sufficient basis to apply the principle of equipoise and rule in favor of labor.
They are means for effecting social justice, i.e., the "humanization of laws and the equalization of social and economic forces by the State so that justice in the rational and objectively secular conception may at least be approximated."
Article XIII, Section 3 of the 1987 Constitution guarantees the right of workers to security of tenure. "One's employment, profession, trade or calling is a "'property right," of which a worker may be deprived only upon compliance with due process requirements:It is the policy of the state to assure the right of workers to "security of tenure" (Article XIII, Sec. 3 of the New Constitution, Section 9, Article II of the 1973 Constitution). The guarantee is an act of social justice. When a person has no property, his job may possibly be his only possession or means of livelihood. Therefore, he should be protected against any arbitrary deprivation of his job. Article 280 of the Labor Code has construed security of tenure as meaning that "the employer shall not terminate the services of an employee except for a just cause or when authorized by" the code. Dismissal is not justified for being arbitrary where the workers were denied due process and a clear denial of due process, or constitutional right must be safeguarded against at all times.Conformably, liberal construction of Labor Code provisions in favor of workers is stipulated by Article 4 of the Labor Code:Art. 4. Construction in favor of labor. All doubts in the implementation and interpretation of the provisions of this Code, including its implementing rules and regulations, shall be resolved in favor of labor.[60] (Citations omitted)