G.R. No.

L-59229 August 22, 1991

HIJOS DE F. ESCAO INC., and PIER 8 ARRASTRE AND STEVEDORING SERVICES, INC., petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION, NATIONAL ORGANIZATION OF WORKINGMEN (NOWM) PSSLUTUCP and ROLANDO VILLALOBOS, respondents.
Facts: prior to the incorporation, Pier 8 Arrastre and Stevedoring Services, Inc. (Pier 8 A&S), two stevedoring
companies had been serving vessels docketing in pier 8. One of which was the Manila Integrated Services, Inc.
(MISI) which was serving Escao vessels that then was docking in pier 8. The other was the San Nicolas
Stevedoring and Arrastre Services, Inc. (SNSASI) which was serving Compania Maritama vessels. Pursuant to
Philippine Port Authoritys policy of one pier, one Arrastre and/or stevedoring company, MISI and SNSASI merged to
form Pier 8 Arrastre and Stevedoring Services, Inc.
But sometime in June 1978, Escao transferred to pier 16. Pier 8 A&S encountered problems; business was severely
reduced with only Compania Maritama to service. The continuance of service to Escao was not possible since there
was another company exclusive authorized to handle and render stevedoring in pier 16. Because of the surplus of
employees, Pier 8 A&S altered the work schedule by rotating them. The scheme was resisted by the stevedores
especially those formerly assigned to service of Escao vessels. The affected stevedores boycotted Pier 8 leading to
their severance from employment. They continued to refuse to go back to work even after they were served with a
return-to-work order.
On September 8, 1978, National Organization of Workingmen ("NOWM") PSSLU-TUCP,
the labor organization wherein majority of the laborers of petitioner Pier 8 A&S, filed a complaint for unfair labor
practice and illegal dismissal against Pier 8 A&S. On their amendment, they implead to include Escao as
respondent before the Ministry of Labor and Employment. The complaint for illegal dismissal was addressed in
compulsory arbitration wherein the labor arbiter found through position papers submitted by parties that Pier 8 A&S
and Escao guilty of committing acts guilty of unfair labor practice and were ordered to reinstate petitioners and pay
them jointly and severally of full backwages counted from the time they were illegal dismissed. The decision was
appealed by petitioners with NLRC but the same was affirmed. They filed petition with the Court contending that
NLRC committed grave abuse of discretion on upholding that the stevedores were not only employees of Pier 8 A&S
but also of Escao. The stevedores claimed that since they had long serving Escao vessels, they should also be
considered as employees of Escao.
Issue: Whether a shipping company engaged with inter-island business has an employee-employer relationship with
stevedores who had been long servicing them with the loading and unloading of cargo on or from the vessel on port
that would make the former liable for illegal dismissal?
Held: There was no employer-employee relationship between Escao and the stevedores. It was not alleged that
Escao or any other shipping company was also engaged in Arrastre and stevedoring services. Considering that a
shipping company is not customarily enagaged in stevedoring and arrastre activities, Escao and other shipping
companies contracts with other companies offering those services. In this light, stevedores should not be deemed
employees of the shipping company. Therefore, Escao cannot be held liable with Pier 8 A&S.