SECOND DIVISION

[G.R. No. 210961. January 24, 2018.]

LEO V. MAGO and LEILANIE E. COLOBONG , petitioners, vs . SUN

POWER MANUFACTURING LIMITED , respondent.

DECISION

REYES, JR. , J : p

This is a petition for review on certiorari 1 under Rule 45 of the Rules of Court,
seeking the review of the Decision 2 dated October 8, 2013 and Resolution 3 dated
January 13, 2014 of the Court of Appeals (CA) in CA-G.R. SP No. 131059. In these
assailed issuances, the CA reversed the decision 4 of the National Labor Relations
Commission (NLRC) declaring Leo V. Mago (Leo) and Leilanie E. Colobong (Leilanie)
(petitioners) as employees of Sunpower Philippines Manufacturing Limited (Sunpower)
and consequently, holding that Jobcrest Manufacturing, Incorporated (Jobcrest) was a
labor-only contractor. The NLRC in turn reversed the ruling 5 of the labor arbiter (LA)
dismissing the petitioners' complaint for illegal dismissal.

Factual Antecedents

The petitioners are former employees of Jobcrest, a corporation duly organized

under existing laws of the Philippines, engaged in the business of contracting
management consultancy and services. 6 Jobcrest was licensed by the Department of
Labor and Employment (DOLE) through Certi cate of Registration No. NCR-MUNTA-
64209-0910-087-R. 7 During the time material to this case, the petitioners co-habited
together. 8
On October 10, 2008, Jobcrest and Sunpower entered into a Service Contract
Agreement, in which Jobcrest undertook to provide business process services for
Sunpower, a corporation principally engaged in the business of manufacturing
automotive computer and other electronic parts. 9 Jobcrest then trained its employees,
including the petitioners, for purposes of their engagement in Sunpower. 1 0 After the
satisfactory completion of this training, the petitioners were assigned to Sunpower's
plant in Laguna Technopark. Leo was tasked as a Production Operator in the
Coinstacking Station on July 25, 2009, 1 1 while Leilanie was assigned as a Production
Operator, tasked with nal visual inspection in the Packaging Station on June 27, 2009.
1 2 Jobcrest's On-site Supervisor, Allan Dimayuga (Allan), supervised the petitioners
during their assignment with Sunpower. 1 3 HESIcT

It was alleged that sometime in October 2011, Sunpower conducted an

operational alignment, which affected some of the services supplied by Jobcrest.
Sunpower decided to terminate the Coinstacking/Material Handling segment and the
Visual Inspection segment. 1 4 Meanwhile, Leo and Leilanie were respectively on
paternity and maternity leave because Leilanie was due to give birth to their common
child. 1 5
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 When Leo reported for work to formally le his paternity leave, Allan purportedly
informed Leo that his employment was terminated due to his absences. Leo, however,
further alleged that he was asked to report to Jobcrest on December 14, 2011 for his
assignment to Sunpower. 1 6 In their defense, both Jobcrest and Allan denied
terminating Leo's employment from Jobcrest. 1 7
Leo complied with the directive to go to Jobcrest's office on December 14, 2011.
While he was there, Jobcrest's Human Resource Manager, Noel J. Pagtalunan (Noel),
served Leo with a "Notice of Admin Charge/Explanation Slip." 1 8 The notice stated that
Leo violated the Jobcrest policy against falsi cation or tampering because he failed to
disclose his relationship with Leilanie. Leo denied the charges and explained that he
already filed a complaint for illegal dismissal with the NLRC. 1 9
Leilanie, on the other hand, alleged that when she reported for work at Jobcrest
on November 29, 2011, she was informed by one of the Jobcrest personnel that she
will be transferred to another client company. She was likewise provided a referral slip
for a medical examination, pursuant to her new assignment. 2 0
Instead of complying with Jobcrest's directives, Leo and Leilanie led a
complaint for illegal dismissal and regularization on December 15, 2011, with the NLRC
Regional Arbitration Branch No. IV. Leo alleged that he was dismissed on October 30,
2011, while Leilanie alleged that she was dismissed from employment on December 4,
2011. 2 1 Despite the ling of the complaint, Leilanie returned to Jobcrest on December
16, 2011, where she was served with a similar "Notice of Admin Charge/Explanation
Slip," requiring her to explain why she failed to disclose her co-habitation status with
Leo. 2 2
During the mandatory conference, Jobcrest clari ed that the petitioners were not
dismissed from employment and offered to accept them when they report back to
work. The petitioners refused and insisted that they were regular employees of
Sunpower, not Jobcrest. 2 3
There being no amicable settlement of the matter among the parties, they
proceeded to file their respective position papers. 2 4

Ruling of the LA

In a Decision 2 5 dated July 3, 2012, the LA held that Jobcrest is a legitimate

independent contractor and the petitioners' statutory employer:
WHEREFORE, premises considered, the complaint for illegal dismissal
against [Sunpower] and Dwight Deato is DISMISSED for lack of employer-
employee relationship. [Jobcrest] is declared as the statutory employer and is
ordered to reinstate complainants sans backwages to substantially equivalent
positions within ten (10) days from receipt hereof.
SO ORDERED. 2 6
The LA found the capital of Jobcrest substantial enough to comply with the
requirements for an independent contractor, and that Jobcrest exercised control over
the petitioners' work. 2 7 The LA likewise rejected the petitioners' claim that they were
illegally dismissed, ruling that the petitioners failed to establish the fact of dismissal
itself. 2 8
Jobcrest partially appealed the LA's Decision dated July 3, 2012. Among its
arguments is the assertion that the petitioners refused to be reinstated. Hence, they
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 were considered constructively resigned from their employment with Jobcrest,
especially because they obtained a job somewhere else. As an alternative relief,
Jobcrest prayed that it be directed to pay the petitioners' separation pay instead of
reinstating them to their former positions. 2 9
The petitioners, on the other hand, attributed serious error on the LA for ruling
against their complaint. 3 0

Ruling of the NLRC

The NLRC reversed the LA's ndings in its Decision 31 dated April 24, 2013 and
ruled favorably for the petitioners, viz.:
WHEREFORE, the decision appealed from is hereby SET ASIDE and a
NEW ONE ENTERED declaring that [the petitioners] are regular employees of
respondent [Sunpower], respondent [Jobcrest] being a mere labor-only
contractor that [petitioners] were illegally dismissed; hence, respondent
[Sunpower] is hereby ordered to reinstate them to their former position with full
backwages, from the time they were refused to work on October 31, 2011 until
reinstated, within ten (10) days from notice plus 10% of the total monetary
awards as and for attorney's fees.
SO ORDERED. 3 2
According to the NLRC, the contract between Jobcrest and Sunpower was for
the sole supply of manpower. The tools and equipment for the performance of the
work were for the account of Sunpower, which supposedly contradicted the claim that
Jobcrest has the required capital for a legitimate contractor. 3 3 The NLRC also
disagreed that Jobcrest exercised control over the petitioners and likewise gave more
credence to the petitioners' sworn statements, which narrate that Sunpower employees
allegedly supervised their work. 3 4 Lastly, on the basis of the "Notice of Administrative
Charge/Explanation Slip" furnished to the petitioners, the NLRC reversed the LA's ruling
and held that the petitioners were illegally dismissed from employment. 3 5
Sunpower moved for the reconsideration of the NLRC's Decision dated April 24,
2013. 3 6 Unconvinced, the NLRC denied this motion in its Resolution 3 7 dated May 28,
2013 as follows:
WHEREFORE, the instant Motion for Reconsideration is hereby DENIED
for lack of merit.
No further motion of this nature shall be entertained.
SO ORDERED. 3 8
As a result of the NLRC's ruling, Sunpower led a petition for certiorari with the
CA, with a prayer for the issuance of an injunctive writ. 3 9 Sunpower attributed grave
abuse of discretion, amounting to lack or excess of jurisdiction, on the NLRC for holding
that the petitioners were regular employees of Sunpower despite evidence to the
contrary. 4 0 Sunpower also disagreed that Jobcrest is a labor-only contractor, and
further submitted that the NLRC misinterpreted its Service Contract Agreement with
Jobcrest. 4 1 caITAC

Ruling of the CA

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 In a Decision 4 2 dated October 8, 2013, the CA granted Sunpower's petition for
certiorari and enjoined the implementation of the assailed NLRC ruling:
WHEREFORE, premises considered, the Petition is GRANTED. The
Decision dated 24 April 2013 and Resolution dated 28 May 2013 of the [NLRC]
(Second Division) in NLRC-LAC No. 09-002582-12; NLRC RAB-IV-12-01978-11-B
are NULLIFIED. All the respondents and/or persons acting for and on their
behalf are ENJOINED from enforcing or implementing the same. The Decision
dated 03 July 2012 of LA Renell Joseph R. Dela Cruz is hereby REINSTATED. No
pronouncement as to costs.
SO ORDERED. 4 3
The CA ruled that Sunpower was able to overcome the presumption that
Jobcrest was a labor-only contractor, especially considering that the DOLE Certi cate
of Registration issued in favor of Jobcrest carries the presumption of regularity. In
contrast with the NLRC ruling, the CA found that the Service Contract Agreement
between Sunpower and Jobcrest speci cally stated the job or task contracted out by
stating that it was for the performance of various business process services. 4 4 The CA
also held that Jobcrest has substantial capital and as such, it was no longer necessary
to prove that it has investment in the form of tools, equipment, machinery, and work
premises. 4 5
Also, the CA found that there is an employer-employee relationship between
Jobcrest and the petitioners under the four-fold test. The CA appreciated the a davits
of Jobcrest employees, as well as the sworn statements of Sunpower employees who
the petitioners claim to supervise their work. In these statements, the Sunpower
employees categorically denied under oath that they supervised the manner of the
petitioners' work. Taken together with other pieces of evidence, the CA ruled that there
was no employer-employee relationship between Sunpower and the petitioners. Finally,
the CA held that any form of supervision, which Sunpower exercised over the results of
the petitioners' work, was necessary and allowable under the circumstances. 4 6
Consequently, the CA rejected the claim that the petitioners were illegally
dismissed from employment, especially in light of Jobcrest's earlier offer to accept the
petitioners' return to work. 4 7
Following their receipt of the CA's Decision dated October 8, 2013, the
petitioners led their Motions for Reconsideration and to Investigate the Reviewer Who
Recommended the Palpably Erroneous Decision. 4 8 The CA firmly denied these motions
in its Resolution 4 9 dated January 13, 2014 for failure to raise any substantial argument
that would warrant the reconsideration of its decision:
WHEREFORE, premises considered, the Motions for Reconsideration and
to Investigate the Reviewer Who Recommended the Palpably Erroneous
Decision are DENIED for sheer lack of merit.
SO ORDERED. 5 0
The petitioners are now before this Court, seeking to reverse and set aside the
CA's issuances, and to reinstate the NLRC's decision. 5 1 The petitioners insist that
Jobcrest is a labor-only contractor, and that the DOLE Certi cate of Registration is not
conclusive of Jobcrest's legitimate status as a contractor. 5 2 They further argue that,
aside from lacking substantial capital, Jobcrest only supplied manpower to Sunpower.
5 3 These services, the petitioners allege, are directly related and necessary to
Sunpower's business. 5 4
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 Furthermore, the petitioners submit that it was Sunpower that controlled their
work. They refute the evidentiary weight and value of the sworn statements of Jobcrest
and Sunpower employees. 5 5 The petitioners assert that the NLRC was correct in ruling
that Sunpower was their statutory employer, and in ordering their reinstatement with
payment of full backwages and attorney's fees. 5 6 The petitioners thus pray that this
Court reverse and set aside the Decision dated October 8, 2013 and Resolution dated
January 13, 2014 of the CA. 5 7

Ruling of the Court

The Court resolves to deny the petition.

Jobcrest is a legitimate and
independent contractor.

Article 106 of the Labor Code de nes labor-only contracting as a situation

"where the person supplying workers to an employer does not have substantial capital
or investment in the form of tools, equipment, machineries, work premises, among
others, and the workers recruited and placed by such person are performing activities
which are directly related to the principal business of such employer." 5 8
DOLE Department Order (DO) No. 18-02, the regulation in force at the time of the
petitioners' assignment to Sunpower, reiterated the language of the Labor Code:
Section 5. Prohibition against labor-only contracting . — x x x
[L]abor-only contracting shall refer to an arrangement where the contractor or
subcontractor merely recruits, supplies or places workers to perform a job, work
or service for a principal, and any of the following elements are present:
1) The contractor or subcontractor does not have substantial capital or
investment which relates to the job, work or service to be performed
and the employees recruited, supplied or placed by such contractor
or subcontractor are performing activities which are directly related
to the main business of the principal; or
ii) the contractor does not exercise the right to control over the
performance of the work of the contractual employee.
Thus, in order to become a legitimate contractor, the contractor must have
substantial capital or investment, and must carry a distinct and independent business
free from the control of the principal. In addition, the Court requires the agreement
between the principal and the contractor or subcontractor to assure the contractual
employees' entitlement to all labor and occupational safety and health standards, free
exercise of the right to self-organization, security of tenure, and social welfare bene ts.
59

Furthermore, the Court considers job contracting or subcontracting as

permissible when the principal agrees to farm out the performance of a speci c job,
work or service to the contractor, for a de nite or predetermined period of time,
regardless of whether such job, work, or service is to be performed or completed within
or outside the premises of the principal. 6 0 Ordinarily, a contractor is presumed to be a
labor-only contractor, unless the contractor is able to discharge the burden of
overcoming this presumption. In cases when it's the principal claiming the legitimacy of
the contractor, then the burden is borne by the principal. 6 1

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 Preliminarily, the Court nds that there is no such burden resting on either
Sunpower or Jobcrest in this case. It is true that Sunpower maintained its position that
Jobcrest is a legitimate and independent contractor. 6 2 But since the petitioners do not
dispute that Jobcrest was a duly-registered contractor under Section 11 of DOLE DO
No. 18-02, 6 3 there is no operative presumption that Jobcrest is a labor-only contractor.
64

Conversely, the fact of registration with DOLE does not necessarily create a
presumption that Jobcrest is a legitimate and independent contractor. The Court
emphasizes, however, that the DOLE Certi cate of Registration issued in
favor of Jobcrest is presumed to have been issued in the regular
performance of o cial duty . 6 5 In other words, the DOLE o cer who issued the
certi cate in favor of Jobcrest is presumed, unless proven otherwise, to have evaluated
the application for registration in accordance with the applicable rules and regulations.
6 6 The petitioners must overcome the presumption of regularity accorded to the
o cial act of DOLE, which is no less than the agency primarily tasked with the
regulation of job contracting. 6 7 ICHDca

For the reasons discussed below, the Court is constrained to give more weight to
the substantiated allegations of Sunpower, as opposed to the unfounded self-serving
accusations of the petitioners.
Jobcrest has substantial capital .

The law and the relevant regulatory rules require the contractor to have
substantial capital or investment, in order to be considered a legitimate and
independent contractor. Substantial capital or investment was de ned in DOLE DO No.
18-02 as "capital stocks and subscribed capitalization in the case of corporations,
tools, equipment, implements, machineries and work premises, actually and directly
used by the contractor or subcontractor in the performance or completion of the job,
work or service contracted out." DOLE initially did not provide a speci c amount as to
what constitutes substantial capital. It later on speci ed in its subsequent issuance,
DOLE DO No. 18-A, series of 2011, that substantial capital refers to paid-up capital
stocks/shares of at least Php3,000,000.00 in the case of corporations. 6 8 Despite
prescribing a threshold amount under DO No. 18-A, certi cates of registration issued
under DO No. 18-02, such as that of Jobcrest, remained valid until its expiration. 6 9
The records show that as early as the proceedings before the LA, Jobcrest
established that it had an authorized capital stock of Php8,000,000.00,
Php2,000,000.00 of which was subscribed, and a paid-up capital stock of
Php500,000.00, in full compliance with Section 13 of the Corporation Code. 7 0 For the
year ended December 31, 2011, the paid-up capital of Jobcrest increased to
Php8,000,000.00, 7 1 notably more than the required capital under DOLE DO
No. 18-A. 7 2
The balance sheet submitted by Jobcrest for the year ending on December 31,
2010 also reveals that its total assets for the year 2009 amounted to
Php11,280,597.94, and Php16,825,271.30 for the year 2010, which were
comprised of o ce furniture, xtures and equipment, land, building, and
motor vehicles, among others . 7 3 As of December 31, 2012, the total assets for the
years 2011 and 2012 also increased to Php35,631,498.58 and Php42,603,167.16,
respectively. 7 4
Evidently, Jobcrest had substantial capital to perform the business process
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 services it provided Sunpower. It has its own o ce, to which the petitioners admittedly
reported to, possessed numerous assets for the conduct of its business, and even
continuously earned pro t as a result. 7 5 The Court can therefore reasonably conclude
from Jobcrest's nancial statements that it carried its own business independent from
and distinctly outside the control of its principals.
The petitioners argue that the amount of substantial capital is irrelevant because
Sunpower provided the tools and owned the work premises. These supposedly negate
the claim that Jobcrest has substantial capital. 7 6
The Court does not agree with the petitioners.
DOLE DO No. 18-02 and DO No. 18-A, as well as Article 106 of the Labor Code
itself, all use the conjunctive term "or" in prescribing that the contractor should have
substantial capital or investment. Having established that Jobcrest had substantial
capital, it is unnecessary for this Court to determine whether it had su cient
investment in the form of tools, equipment, machinery and work premises.
I n Neri v. NLRC , 7 7 the Court rejected the same argument put forward by the
petitioners, and ruled that proof of either substantial capital or investment is su cient
for purposes of determining whether the rst element of labor-only contracting is
absent:
Based on the foregoing, BCC cannot be considered a "labor-only"
contractor because it has substantial capital. While there may be no evidence
that it has investment in the form of tools, equipment, machineries, work
premises, among others, it is enough that it has substantial capital, as was
established before the Labor Arbiter as well as the NLRC. In other words, the law
does not require both substantial capital and investment in the form of tools,
equipment, machineries, etc. This is clear from the use of the conjunction "or." If
the intention was to require the contractor to prove that he has both
capital and the requisite investment, then the conjunction "and"
should have been used . But, having established that it has substantial
capital, it was no longer necessary for BCC to further adduce evidence to prove
that it does not fall within the purview of "labor-only" contracting. There is even
no need for it to refute petitioners' contention that the activities they perform are
directly related to the principal business of respondent bank. 7 8 (Emphasis
Ours)
The agreement between Jobcrest and Sunpower also complied with the
statutory requirement of ensuring the observance of the contractual employees' rights
under the law. Speci cally, paragraph 7 of the Service Contract Agreement obligates
Jobcrest to observe all laws, rules and regulations pertaining to the employment of its
employees. 7 9
Suncrest does not control the
manner by which the petitioners
accomplished their work.

In most cases, despite proof of substantial capital, the Court declared a

contractor as a labor-only contractor whenever it is established that the principal-not
the alleged legitimate contractor-actually controls the manner of the employees' work.
8 0 The element of control was defined under DOLE DO No. 18-02 as:

The "right to control" shall refer to the right reserved to the person for
whom the services of the contractual workers are performed, to determine not
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 only the end to be achieved, but also the manner and means to be used in
reaching that end. 8 1
In other words, the contractor should undertake the performance of the services
under its contract according to its own manner and method, free from the control and
supervision of the principal. 8 2 Otherwise, the contractor is deemed an illegitimate or
labor-only contractor.
The control over the employees' performance of the work is, as the Court ruled in
some cases, usually manifested through the power to hire, re, and pay the contractor's
employees, 8 3 the power to discipline the employees and impose the corresponding
p enalt y, 8 4 and more importantly, the actual supervision of the employees'
performance. 8 5 On this point, the petitioners claim that Sunpower employees
supervised their work while in the premises of Sunpower's own plant. They also
disclaim the a davits of Sunpower employees, which denied exercising any form of
supervision over the petitioners, 8 6 by alleging that these are self-serving assertions.
The petitioners also refute the veracity of the sworn statements of Jobcrest's
employees. 8 7
Upon review of the records, the Court nds that the evidence clearly points to
Jobcrest as the entity that exercised control over the petitioners' work with Sunpower.
Upon the petitioners' assignment to Sunpower, Jobcrest conducted a training and
certi cation program, during which time, the petitioners reported directly to the
designated Jobcrest trainer. 8 8 The a davit of Jobcrest's Operations Manager, Kathy
T. Morales (Kathy), states that operational control over Jobcrest employees was
exercised to make sure that they conform to the quantity and time speci cations of the
service agreements with Jobcrest's clients. She narrated that manager and shift
supervisors were assigned to the premises of Sunpower, with the task to oversee the
accomplishment of the target volume of work. She also mentioned that there is
administrative control over Jobcrest employees because they monitor the employees'
attendance and punctuality, and the employees' observance of other rules and
regulations. 8 9
The a davit of Kathy was markedly corroborated by the sworn statement of
Jobcrest's On-site Supervisor, Allan, in which he a rmed that he directly supervised the
petitioners while they were stationed in Sunpower. He also con rmed that during this
period, he issued several memoranda to the petitioners for violating rules and
regulations, and provided their hourly output performance assessment, which
"determine[s] their fitness to continue their employment with Jobcrest." 9 0
The petitioners' very own sworn statements further establish this point .
In his statement, Leo averred that when he reported for work to le his application for
paternity leave, he reported to Allan, Jobcrest's supervisor, who then approved his leave
application. He likewise narrated that it was Jobcrest's Human Resource Manager,
Noel, who informed Leo about the disciplinary charge against him for allegedly violating
the Jobcrest Code of Conduct. 9 1
The same conclusion holds for Leilanie. In her statement, Leilanie narrated that
she reported for work to the Jobcrest o ce on November 29, 2011 after giving birth to
her second child. She also alleged in her a davit that similar to Leo, it was Noel who
informed her of the disciplinary action against her, through the service of a copy of the
"Notice of Admin Charge/Explanation Slip." 9 2 TCAScE

Notably, other documentary evidence plainly show that Leo's paternity leave
application was indeed led with Jobcrest, 9 3 and the respective notices of disciplinary
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 action against the petitioners were prepared and signed by the Jobcrest Human
Resource Manager. 9 4 These are clear indications that Jobcrest exercised control over
the petitioners' work.
The fact that the petitioners were working within the premises of Sunpower, by
itself, does not negate Jobcrest's control over the means, method, and result of the
petitioners' work. 9 5 Job contracting is permissible "whether such job, work, or service
is to be performed or completed within or outside the premises of the principal" 9 6 for
as long as the elements of a labor-only contractor are not present. Since Jobcrest was
a provider of business process services, its employees would necessarily work within
the premises of its client companies in order for Jobcrest to perform its contractual
undertaking. Mere physical presence in Sunpower's plant does not necessarily mean
that Sunpower controlled the means and method of the petitioners' work. The
petitioners, despite working in Sunpower's plant for most of the time, admit that
whenever they le their leave application, or whenever required by their supervisors in
Jobcrest, they report to the Jobcrest o ce. Designated on-site supervisors from
Jobcrest were the ones who oversaw the performance of the employees' work within
the premises of Sunpower.
Besides, while the Court repeatedly recognizes that there are employers who
abuse the system of subcontracting, we also acknowledge that contracts for
services does not necessarily provide "untrammeled freedom" to the
contractor in undertaking the engagement. 9 7 What is important, as
incontrovertibly established in this case, is that the principal's right to control is limited
to the results of the work of the contractor's employees.
The petitioners were regular
employees of Jobcrest.

The four-fold test is the established standard for determining the existence of an
employer-employee relationship: 9 8 (a) the selection and engagement of the employee;
(b) the payment of wages; (c) the power of dismissal; and (d) the power of control over
the employee's conduct. Of the four elements, the power of control is the most
important. 9 9 Having found that Jobcrest exercised control over the petitioners' work,
the Court is constrained to determine whether the petitioners were regular employees
of Jobcrest by virtue of the three other elements of the four-fold test.
The petitioners themselves admit that they were hired by Jobcrest. 1 0 0 In their
subsequent engagement to Sunpower, it was Jobcrest that selected and trained the
petitioners. 1 0 1 Despite their assignment to Sunpower, Jobcrest paid the petitioners'
wages, including their contributions to the Social Security System (SSS), Philippine
Health Insurance Corporation (Philhealth), and Home Development Mutual Fund (HDMF,
also known as Pag-IBIG). 1 0 2 The power to discipline the petitioners was also retained
by Jobcrest, as evidenced by the "Notice of Admin Charge/Explanation Slip" furnished
the petitioners through Jobcrest's Human Resource department. 1 0 3
The Court further notes that on December 27, 2010 and January 25, 2011,
Leilanie and Leo were respectively con rmed as regular employees of Jobcrest. 1 0 4
Jobcrest did not even deny that the petitioners were their regular employees.
Consequently, the petitioners cannot be terminated from employment without just or
authorized cause. 1 0 5
A review of the petitioners' repeated submissions reveals that while they claim to
have been illegally dismissed from employment, 1 0 6 Jobcrest actually intended to
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 assign Leo again to Sunpower, and provide Leilanie with another engagement with a
different client company. The petitioners all admitted to these facts in their sworn
statement, heavily quoted in their position paper filed with the LA: 1 0 7
41. Noong December 14, 2011, ako [Leo Mago] ay tinawagan sa aking
cellular phone ng nagpakilalang Julie at taga HR ng JOBCREST
at ang sabi sa akin ay magreport umano ako sa opisina upang
ipadala sa SUNPOWER ;
xxx xxx xxx
44. Noong November 29, 2011, ako [Leilani Colobong] ay nagreport sa
JOBCREST at aking nakausap ang isa sa staff ng JOBCREST na
hindi ko alam ang pangalan at ang sabi niya sa akin ay ililipat
umano ako sa kompanyang FIRST SUMIDEN dahil hindi na umano
ako pwedeng m[a]gtrabaho sa SUNPOWER na hindi niya sinabi kung anu
ang dahilan;
45. Noong December 1, 2011, ako ay bumalik sa JOBCREST at ako ay
binigyan nila ng referral para magpamedical para sa aking bagong
requirements diumano sa aking bagong trabaho sa FIRST SUMIDEN dahil
hindi na talaga umano ako tatanggapin sa SUNPOWER sa aking
pagbabalik trabaho ng December 4, 2011 na hindi naman niya sinabi kung
anu ang dahilan; Kalakip nito ang nas[a]bing referral slip bilang Exhibit "S"
1 0 8 (Emphasis Ours)

It was also uncontroverted that Jobcrest offered to accept the petitioners' return
to work, but they refused this offer during the mandatory conference. 1 0 9 Clearly, the
petitioners were not illegally dismissed, much less terminated from their employment.
There is nothing on record that established the dismissal of the petitioners in the rst
place.
I n MZR Industries, et al. v. Colambot , 1 1 0 the employee claimed to have been
illegally dismissed through a verbal directive. The employer denied this and alleged
waiting for the employee to report for work, only to later nd out that a complaint for
illegal dismissal was led against them. The Court recognized that while the employer
is generally required to establish the legality of the employee's termination, the
employee should rst establish the fact of dismissal from service. Failing such, as in
this case, the Court cannot rule that the employee was illegally dismissed.
The "Notice of Admin Charge/Explanation Slip" is also insu cient proof of the
petitioners' termination from employment. The notice merely required the petitioners to
explain whether they violated Jobcrest's Code of Conduct. No penalty was imposed on
the petitioners yet when they were furnished with a copy of the notices. 1 1 1 In fact,
Jobcrest was unable to take the appropriate action on the charge, considering that the
petitioners immediately led their complaint for illegal dismissal with the NLRC the
following day, or on December 15, 2011. 1 1 2
All things considered, Sunpower is not the statutory employer of the petitioners.
The circumstances obtaining in this case, as supported by the evidence on record,
establish that Jobcrest was a legitimate and independent contractor. There is no
reason for this Court to depart from the CA's findings.
WHEREFORE , premises considered, the present petition is hereby DENIED for
lack of merit. The Court of Appeals' Decision dated October 8, 2013 and Resolution
dated January 13, 2014 in CA-G.R. SP No. 131059 are AFFIRMED , which nulli ed the
National Labor Relations Commission's Decision dated April 24, 2013 and Resolution
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 dated May 28, 2013, and reinstated the Labor Arbiter's Decision dated July 3, 2012. No
costs. cTDaEH

SO ORDERED .
Carpio, Peralta, Perlas-Bernabe and Caguioa, JJ., concur.

Footnotes
1. Rollo, pp. 9-47.
2. Penned by Associate Justice Celia C. Librea-Leagogo, with Associate Justices Franchito N.
Diamante and Melchor Q. C. Sadang, concurring; id. at 385-412.
3. Id. at 439-442.
4. Id. at 229-252.
5. Id. at 164-190.

6. Id. at 145-151.
7. Id. at 139.
8. Id. at 13.
9. Id. at 140.

10. Id. at 404-405.

11. Id. at 88-94.

12. Id. at 96-102.

13. Id. at 404.

14. Id. at 445.

15. Id. at 14, 103.

16. Id. at 54.

17. Id. at 185.

18. Id. at 54, 107.

19. Id. at 107.

20. Id. at 69.

21. Id. at 109-110.

22. Id. at 55, 108.

23. Id. at 237, 535.

24. Id. at 44-154.

25. Issued by LA Renell Joseph R. Dela Cruz; id. at 164-190.

26. Id. at 190.
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 27. Id. at 187-189.

28. Id. at 189-190.

29. Id. at 237-238.

30. Id. at 191-225.

31. Penned by Commissioner Erlinda T. Agus, with Presiding Commissioner Raul T. Aquino and
Commissioner Teresita D. Castillon-Lora, concurring; id. at 229-252.

32. Id. at 252.

33. Id. at 241.

34. Id. at 242-246.

35. Id. at 249-251.

36. Id. at 271-283.

37. Id. at 287-289.

38. Id. at 288.

39. Id. at 290-322.

40. Id. at 300-308.

41. Id. at 296-300, 308-311.

42. Id. at 385-412.

43. Id. at 408.

44. Id. at 399-400, 406-407.

45. Id. at 401-402.

46. Id. at 402-405.

47. Id. at 406-407.

48. Id. at 413-437.

49. Id. at 439-442.

50. Id. at 442.

51. Id. at 9-43.

52. Id. at 21-22.

53. Id. at 26-34.

54. Id. at 34-35.

55. Id. at 35-37.

56. Id. at 38-42.

57. Id. at 43.

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 58. Emphasis Ours.
59. Babas, et al. v. Lorenzo Shipping Corp. , 653 Phil. 421,432 (2010); See Vinoya v. NLRC , 393
Phil. 441, 445 (2000).

60. Babas, et al. v. Lorenzo Shipping Corp., id.

61. Alilin, et al. v. Petron Corporation, 735 Phil. 509, 513 (2014).

62. Rollo, pp. 448-462.

63. Id. at 139, 166.

64. Cf. Rollo, p. 399; De Castro v. Court of Appeals , G.R. No. 204261, October 5, 2016, 805 SCRA
265.

65. Sasan, Sr., et al. v. NLRC 4th Division, et al., 590 Phil. 685, 707 (2008).
66. See DOLE DO No. 18-02, Section 12; Gallego v. Bayer Philippines, Inc., et al. , 612 Phil. 250,
263 (2009).

67. LABOR CODE OF THE PHILIPPINES, Article 106.

68. DOLE DO No. 18-A, Section 3 (1).

69. Id. at Section 38.

70. Rollo, pp. 148-149, 514.

71. Id. at 334.

72. Id. at 139, 166.

73. Id. at 152, 523.

74. Id. at 332.

75. Id. at 326-345, 522-525. See also Sasan, et al. v. NLRC 4th Division, et al., supra note 65, at
704-705; Gallego v. Bayer Philippines, Inc., et al. , supra note 66, at 263-264; Escario v.
NLRC, 388 Phil. 929, 938-939 (2000).
76. Rollo, pp. 29-34.
77. 296 Phil. 610 (1993).

78. Id. at 616.

79. Rollo, p. 142.

80. Vinoya v. NLRC, supra note 59, at 444-445.

81. See DOLE DO No. 18-A, Section 6; See also Locsin, et al. v. Philippine Long Distance
Telephone Company, 617 Phil. 955, 964 (2009), citing Francisco v. NLRC , 532 Phil. 399,
407 (2006).
82. Vinoya v. NLRC, supra note 59, at 445.

83. Coca-Cola Bottlers Phils., Inc. v. Agito, et al., 611 Phil. 327 (2009).
84. Manila Water Co., Inc. v. Pena, 478 Phil. 68, 81 (2004).

85. Philippine Airlines, Inc. v. Ligan, et al. , 570 Phil. 497, 508 (2008); Lakas sa Industriya ng
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 Kapatirang Haligi ng Alyansa-Pinagbuklod ng Manggagawang Promo ng Burlingarne v.
Burlingame Corporation, 552 Phil. 58, 61-62 (2007).
86. Rollo, pp. 247-248.

87. Id. at 35-40.

88. Id. at 403-404.

89. Id. at 404, 455-456.

90. Id. at 404-405, 455.

91. Id. at 54.

92. Id. at 54-55.

93. Id. at 103.

94. Id. at 107-108.

95. Escasinas, et al. v. Shangri-La's Mactan Island Resort, et al., 599 Phil. 746, 755 (2009).

96. Babas, et al. v. Lorenzo Shipping Corp., supra note 59, at 432.
97. Gallego v. Bayer Philippines, Inc., supra note 66, at 265.

98. Tongko v. The Manufacturers Life Insurance Co. (Phils.), Inc., et al. , 655 Phil. 384, 407
(2011).
99. Manila Water Co., Inc. v. Dalumpines, et al., 646 Phil. 383, 398-399 (2010).

100. Rollo, p. 51.

101. Id. at 88-102.

102. Id. at 95, 186-187, 492-504.

103. Id. at 107-108.

104. Id. at 94, 102.

105. LABOR CODE OF THE PHILIPPINES, Article 279.

106. Rollo, p. 109.

107. Id. at 54-55.

108. Id.
109. Id. at 237, 535.

110. 716 Phil. 617, 624 (2013).

111. Rollo, pp. 107-108.

112. Id. at 109-110.

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