PETITIONER Marites R. Cusap and 27 other employees filed a complaint for illegal dismissal against the respondents Adidas Philippines, Inc., (Adidas), Promotion Resources & Inter-Marketing Exponents, Inc. (Prime), and later amended to include JC Athletes, Inc. (JCA). They alleged that they were regular employees of Adidas after having worked as promo girls and stockmen at the company’s various rented outlets for years, ranging from one year to seven years. After its contract with its former distributor, World Sports, Inc. (WOSI) expired, Adidas allegedly contracted JCA to be its exclusive distributor. In turn, JCA entered into a promotional contract with PRIME.
Petitioners claimed that they were dismissed from employment when the service contract between PRIME and JCA was terminated. They argued that Adidas was their real employer, not PRIME, which was merely a recruitment agency supplying Adidas with human resources. They pointed out that for years that they were employed, they worked for Adidas, under its supervision and control and that of JCA personnel. Their work being related to and in pursuit of Adidas’ principal business activity, they claimed they are its regular employees. Can their action prosper?
Ruling: Yes.
Again, in the absence of evidence that JCA had the wherewithal to undertake its distribution agreement with Adidas, except to enter into a promotions contract with PRIME, we find merit in the petitioner’s contention that Adidas and JCA, at a time, held office in the same address; and that Adidas provided the storage places and the outlets for the distribution of its products, not PRIME or JCA. As the petitioner points out, formerly it was WOSI and later JCA which acted as agent of Adidas. The record bears out her observations.
Thus, the petitioner and the complainants (who withdrew from the case) were performing activities that were necessary to market the products that Adidas itself manufactured. They sold these products for several years, starting in June 1995 until Dec. 9, 2000. While Adidas explains that it amended its articles of incorporation in October 2002 to engage in retail, it cannot be denied that in 1995, it was already in the retail business through its agents WOSI and JCA and labor-only contractor PRIME. Thus, the petitioner had become an Adidas regular employee a long time before she was supposedly made a “contractual employee” of PRIME.
In the absence of evidence showing how or in what manner PRIME carried out its promotion work under its contract with JCA and how it provided the necessary requirements for such undertaking (such as the maintenance of storage areas and engagement of sales outlets), we likewise find merit in the petitioner’s submission that it was Adidas who exercised control and supervision over the petitioner’s work performance, through its sales manager Sonny Niebres, its president Philip Go, and even Cornelia Indon, head of the WOSI concession.
In sum, we hold that PRIME failed to satisfy the four-fold employer-employee relationship test, making it a labor-only contractor under the law and the rules. Like JCA, it was merely an agent of Adidas, notwithstanding the quitclaims of some of the complainants in its favor. Adidas, therefore, is petitioner’s real employer who shall be responsible to her in the same manner and extent as if she were directly employed by the company (Brion, J., SC Second Division, Marites R. Cusap, v. Adidas Philippines, Inc., (Adidas), Promotion Resources & Inter-Marketing Exponents, Inc. (PRIME) and JC Athletes, Inc. (JCA), G.R. No. 201494, July 29, 2015).