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[EUFROCIO BERMISO v. HUOS DE F. ESCAÑO](https://www.lawyerly.ph/juris/view/c2d5d?user=fbGU2WFpmaitMVEVGZ2lBVW5xZ2RVdz09)
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[ GR No. L-11606, Feb 28, 1959 ]

EUFROCIO BERMISO v. HUOS DE F. ESCAÑO +

DECISION

105 Phil. 231

[ G. R. No. L-11606, February 28, 1959 ]

EUFROCIO BERMISO, ET AL., PETITIONERS, VS. HUOS DE F. ESCAÑO, INC., ET AL., RESPONDENTS.

D E C I S I O N

LABRADOR, J.:

Petitioners originally  numbering  45 and formerly composing  the Democratic Labor Association and the Katubsanan  sa Mamumuo  instituted  this  action  before  the Court of  Industrial Relations on August 5, 1952, praying for  reinstatement with  back  wages, direct  payment  of wages to the laborers instead  of  through the  union,  payment of  accrued  overtime  pay  and  wage  differentials, prohibition from  carrying  load  in  excess  of  50  kilos, minimum daily wage of P5.00, vacation and sick leave, free hospitalization,  accident insurance,  free choice of  labor union  and grievance  committee.   Of the  original petitioners  only five continued to take  interest in the action, the others having desisted therefrom.   After hearing the Court  of Industrial Relations ordered  the reinstatement of the  said  five  laborers to  their former work  and positions in  the Sabay group,  but  without back wages,  but dismissed the other claims.   Not satisfied with  this decision the  five remaining petitioners  have  filed this appeal by a petition for certiorari.

The  Court of Industrial  Relations made  the  following findings as to the manner in  which  the union or group to which  the petitioners  belong operate;
"The Hijos  de F. Escaño, Inc., hereafter referred to  as  Escaño or Company, is a domestic corporation engaged in  the  business of carrying or transporting  passengers and  goods  by  water for  compensation within the Philippines * *  *.

"The Katubsanan sa Mamumuo, hereafter  called the Union or simply  Katubsanan, is a  labor organization  duly  registered  with the Department of  Labor and with office  address in Cebu City it is composed mainly of laborers  from the Visayas and Mindanao and has  respondent Jose Muana and Vitaliano Sabay as its general president and  general treasurer, respectively.   Its members in Cebu are  numerous  and divided into  several  groups, sometimes called chapters.  One of them is  headed  by respondent Sabay as its foreman or "Cabo" and known as the Sabay group.  To this group, in which  there are no less than  150  men,  formerly belonged some or all  of the  45  petitioners.

"The  Sabay  group was organized in 1947. Its members generally perform  work  similar to that done by laborers of stevedoring  and arrastre  firms.   They load and unload vessels in the  port of Cebu and haul or transport discharged cargo from the waterfront to the consignees'  warehouses as well as  cargo to be shipped out of

"One  of  the  carriers  for whom the Sabay  men  regularly serve as stevedores is the Escano.  Their relation  had  its inception  in 1947 when,  through the  representations made by  Muana and  Sabay, Salvador Sala, general  manager  of said carrier, permitted   the Sabay group to do  the  work of loading and unloading  its vessels to the exclusion  of all  other  persons.  From the beginning  the Company has not  directly paid  Muana,  Sabay or  the group  any compensation  for  the loading or unloading  services rendered  by Sabay men.  Neither has it received any payment for the exclusive privilege  enjoyed  by  the group.  The  practice which they  have continuously  followed is that the group collects from the shippers and  consignees the  charges  for the handling  of the  cargo based on a schedule of rates  which  appears to have  been  previously approved by all the parties affected by the work, while the Company receives  or  collects  from  the  shippers or  consignees  only  the freightage for the cargo.

"Aside  from Sabay,  the group has a collector,  a timekeeper, a paymaster, and several  capataces and subcapataces.  The first three assist  Sabay in  the  collection  of the handling  fees  from  the shippers  and consignees, the  recording of names of members taking part in the  work and their working hours, and  the payment to them of their respective shares in the earnings of  the group.  The capataces and sub-capataces  help  him  in supervising the  men. During the loading  and  unloading  of  the  Escaño  boats, however, the  shipping  manager  of the Company, who  is  usually  present, calls their  attention  to  their  work.  Furthermore,  its  checkers aid  the  men  in  determining which  cargo to  load  or unload. And  whenever expedient or necessary to finish the work immediately, they are  allowed  to  use  the different  modern  apparatuses  of the vessels for the raising and  loading of cargo.  In  the  hauling of the cargo, checkers  or agents of the shippers  and  consignees accompany them and  look  over  their work.

"Generally,  only Sabay men are  permitted to take part  in this work.  But when it is voluminous, the group, to avoid delay, enlists the services of non-members.   These recruits are treated as casual laborers  and paid on  daily  basis.

"The amount collected from the shippers and consignees  is considered as the gross income of the group.   From  this  income are deducted' its expenses if any, for  gasoline and spare parts  of trucks used, damage to, loss or destruction of, cargo not imputable to any particular  individual or  individuals, meals,  recreation,  wages  of casual workers, and an amount  equivalent  to  two per centum for the Katubsanan for  the maintenance of the union clinic and newspaper. The net income is then divided  into equal shares in accordance with  the sharing plan  under  which each  common  laborer is entitled to one  share  and  the  rest,  including the sub-capataces, capataces, Sabay and the other  officers of  the group, to one and one-fourth, one and  one-half, one and three-fourths, two,  three, or more each, depending on  the length of  membership  and importance of the position held in the group.  This  division  of the group's income is done every Saturday  and the shares received by  the participating members constitute  their wages for the week.

"Before the  Minimum Wage Law  (R. A. No.  602)  went into effect, the number of hours each laborer worked was not taken into account by the group. Even members who did not actually render any service were given shares  if their failure to work was  found to have  been  due to a  reasonable cause.  Certain  records were made  of  the disposition  of the group's income but they, together with some payrolls, were destroyed by water1 when Cebu was visited by a strong typhoon in 1951.  After August 4, 1951, the share was given  a fixed value:  P0.39, at first, P0.40, later, and, finally, P0.50 per hour  of work or service. Under this modified plan,  if  the computation  would  result in  wages falling  short  of the legal minimum because there were many laborers who worked, the group collected  additional charges from the shippers and consignees.  If further  payment was refused for the reason that the work was delayed  by the workers,  the  group  covered the  deficit from its so-called  sinking  fund  which  was accumulated  from the  small undivided  or indivisible amounts  remaining after each  distribution of net income.  At times  the  laborers were rotated to obviate  the possibility of wage shortage.  As  regards the expenses, whether or not they were  deductible from the  gross earnings  was looked into by the auditor-bookkeeper employed by the Katubsanan.  Since the modification  of  the  sharing plan was made, the  group has been using  payrolls  printed in the name of the union."
The  court held  that insofar as the  stevedores loading and unloading its vessels  are concerned, the Hijos  de F. Escaño  is an employer of the petitioners.   With respect, however, to the arrastre  service, it held that the question is beyond  the scope  of the  relationship  between  it and the petitioners.

After a review of the testimonies given by the petitioners and those given on  behalf of  the respondents, the court below also found that the claimants failed to  establish any reasonable basis for all  their claims  except that for their reinstatement and, therefore,  denied them for lack of  merit.  Claims for overtime pay, wage differentials, maximum load of  50 kilos, minimum wage of P5.00 a day were  dismissed.   So  were the  claims for  vacation  and sick  leave,  free  hospitalization, accident insurance,  and free choice of labor  union and  grievance committee,  as the latter were not touched upon by the petitioners in the presentation of their  evidence, and that  at any rate they should be  the  subject of collective  bargaining under the Industrial  Peace  Act.  As to the  reinstatement of the 5  petitioners,  namely,  of Eufrocio Bermiso, Fortunato Geteso, Constancio Olaco, Laureano  Amistoso  and Vicente Tuyogan, to their former work and positions in the Sabay group; their claims  for back  wages were denied.  With respect to  the direct payment of wages  to the  laborers, the court  found that there was no  reason for changing the practice of  apportioning  the wages for their  joint labor and  sharing therein, because  of the  150 members only 5 were dissatisfied.

Petitioners argue  before us that  the  decision  violates the law on direct payment  of wages.  The law relied  upon by  them is Section 10, par. (b)  of Republic Act No. 602, which provides as follows:
"Sec. 10.  (b) Wages, including wages which may be paid retroactively for whatever reason, shall be paid directly to the employee to whom they are due, except:

(1)  In  cases where the employee is insured with  his consent by the  employer, the latter shall be entitled  to deduct from the wage of the employee the amount paid  by the employer  for premiums on the insurance;

(2)  In  cases of force  majeure rendering such payments  impossible;  and

(3)  In  cases where the right of the employee or his  union to check-off  has been recognized  by the employer or  authorized in writing by  the individual  employees  concerned."
There is no question that the work of stevedoring was undertaken by the laborers, not in their individual capacities, but as a group.   The  contract to perform the service was made  by the leader of the group, for and  on behalf of the latter, not for each and  every one of them individually.   For  the sake of convenience it was necessary that the group must be large enough to be able to  perform the task of loading and unloading in as short time as possible.

As the group undertook to render service for vessels other than those of the Hijos de F. Escaño,  it was  absolutely necessary that some  sort of  leadership be instituted in the  group to determine which of the members  will work for  one vessel and which for another.   Leadership is also essential to obtain work for the group as employers naturally prefer to deal with a leader of a group than with each member individually.  Leadership was, therefore, essential not  only to secure work for the group but to arrange the laborers who are to perform the service.  The leadership must be  paid for and it was not shown that the  head of the  groups got the lion's share of the cost of the  services rendered.  Under  the circumstances we are not prepared to say that the provision of law on direct payment of wages has  been violated.  The lower court did not find sufficient evidence  to show that racketeering was employed by the leaders.  If  any existed the remedy can not be found in this court; it is for the  group to  organize  into a closely knitted union which would secure the privileges that the members desire thru the selection of officers among themselves who would  not  exploit them.

Lastly, the respondent Hijos de  F.  Escaño did  not pay for the stevedoring charges.  These were collected by the group from the shippers themselves, without the intervention of the respondent  Escaño.   How can the court order the latter to  pay the charges to the group or its members, when the  charges  were collected by the latter  from  the shippers, in  accordance with  the  practice  of  the group itself?

We  also find no ground for requiring the respondent Hijos  de F.  Escano to  pay back wages. The latter respondent did not  deal with  the petitioners individually, entering into a contract of employment with them.  Said respondent dealt with  the group thru its leaders.  If the group, thru  its leaders, did not allow  the  petitioners to work and share  in the price  paid  therefor, the  one  responsible is not the respondent Escaño but the leader thru whom the group  itself made the  contract for work  and apportioned the time of work for each member and the pay therefor.   Again  as stated  above, the remedy  must be sought not in  the tribunals of the country but  in the laborers themselves who should organized and thru such organization as they may  establish,  as envisioned  by the Industrial Peace Act, secure the privileges demanded.

The third  error attributed to the  court  below  is  its denial of the other claims,  such as  vacation and sick leave, accident,  insurance, free  hospitalization,  etc.  We agree with  the court below  that  these  matters  must also be sought for thru  labor organizations,  which  should take them up  with their employers  thru  collective bargaining.

The  decision subject of  review is  hereby  affirmed. Without costs.

Paras,  C. J., Bengzon, Padilla, Montemayor, Reyes, A., Bautista Angela, Concepcion, Reyes, J. B. L., and Endencia, JJ., concur.

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