G.R. 200094, 10 June 2013
The petitioners work for the Philippine College of Criminology Inc. (PCCr) as janitors, janitress, and supervisor in its maintenance department. The petitioners were made to understand by the respondent PCCr that they are under the Metropolitan Building Services, Inc. (MBMSI) which is a corporation engaged in providing janitorial services. PCCr terminated the services of MBMSI on 2009 which resulted in the dismissal of the petitioners. An illegal dismissal complaint was then filed against PCCr by the petitioners contending that it is their real employer and not MBMSI. Subsequently, the PCCr submitted to the Labor Arbiter waivers, releases, and quitclaims that were executed by the petitioners in favor to MBMSI.
The Labor Arbiter and NLRC ruled in favor of the petitioner, however upon filing the petition for review on certiorari before the Court of Appeals, the CA ruled that the quitclaims, releases, and waivers executed by the petitioners in favor to MBMSI redounds to the benefit of PCCr by virtue of solidary liability under Article 1217 of the New Civil Code. The petitioners contend that under Article 106 of the Labor Code a labor-only contractor’s liability is not solidary as it is the employer who should be directly responsible to the supplied worker.
Whether or not the quitclaims, releases, and waivers executed by the petitioners in favor to MBMSI redounds to the benefit of PCCr?
Yes. The Supreme Court held that the basis of the solidary liability of the principal with those engaged in labor-only contracting is the last paragraph of Article 106 of the Labor Code that provides, “In such cases of labor-only contracting, the person or intermediary shall be considered merely as an agent of the employer who shall be responsible to the workers in the same manner and extent as if the latter were directly employed by him.”
It also pointed out D.O. No. 18-A, s. 2011 section 27 providing for the effects of labor-only contracting “where upon the finding by competent authority of labor-only contracting shall render the principal jointly and severally liable with the contractor to the latter’s employees, in the same manner and extent that the principal is liable to employees directly hired by him/her, as provided in Article 106 of the Labor Code.”
Hence, the PCCr’s solidary liability was already expunged by virtue of the releases, waivers and quitclaims executed by the petitioners in favor of MBMSI by virtue of Article 1217 of the Civil Code providing that “payment made by one of the solidary debtors extinguishes the obligation.”
* Case digest by Kristine Camille Gahuman, LLB-1, Andres Bonifacio Law School, SY 2017-2018