LABREL | CASE DIGEST | ART 281

1
TAMSON'S ENTERPRISES, INC., NELSON LEE, LILIBETH ONG
and JOHNSON NG, Petitioners,
vs.
COURT OF APPEALS and ROSEMARIE L. SY, Respondents.
G.R. No. 192881; November 16, 2011
Case Doctrines:

Article 281 of the Labor Code (Probationary employment)
Probationary employment shall not exceed six months from the date
the employee started working, unless it is covered by an
apprenticeship agreement stipulating a longer period. The services of
an employee who has been engaged in a probationary basis may be
terminated for a just cause or when he fails to qualify as a regular
employee in accordance with reasonable standards made known by
the employer to the employee at the time of his engagement. An
employee who is allowed to work after a probationary period shall be
considered a regular employee.

Section 2, Rule I, Book VI of the Implementing Rules (Security of
tenure)
(a) In cases of regular employment, the employer shall not terminate
the services of an employee except for just or authorized causes as
provided by law, and subject to the requirements of due process.

(b) The foregoing shall also apply in cases of probationary
employment; Provided however, that in such cases, termination of
employment due to failure of the employee to qualify in accordance
with the standards of the employer made known to the former at the
time of engagement may also be a ground for termination of
employment.

xxx

(d) In all cases of termination of employment, the following standards
of due process shall be substantially observed:

xxx

If the termination is brought about by the completion of a contract or
phase thereof, or by failure of an employee to meet the standards of
the employer in the case of probationary employment, it shall be
sufficient that a written notice is served the employee, within a
reasonable time from the effective date of termination.

Keyword: Dismissal - four days prior to the completion of the 6-
month probationary period.


FACTS: Respondent Rosemarie Sy was hired by petitioner Tamsons
as Assistant to the Company President Nelson Lee. Despite the title,
she did not act as such because, per instruction of petitioner Lee, she
was directed to act as payroll officer, though she actually worked as a
payroll clerk.
Four days before she completed her sixth month of working in
petitioner Tamsons, petitioner Johnson Ng, the Sales Project
Manager, called her to a meeting with him and petitioner Lee. During
the meeting, they informed respondent Sy that her services would be
terminated due to inefficiency.
Respondent Sy claimed that the remarks of her superiors about her
alleged inefficiency were ill-motivated and made without any basis.
Her dismissal was highly suspicious as it took place barely four days
prior to the completion of her six-month probationary period. The
petitioners did not show her any evaluation or appraisal report
regarding her alleged inefficient performance. As she was terminated
without an evaluation on her performance, she was deprived of the
opportunity to be regularly part of the company and to be entitled to
the benefits and privileges of a regular employee.
Respondent Sy then filed a case for illegal dismissal.
The ELA rendered a decision in favor of respondent Sy.

The NLRC reversed the ELAs decision.
The CA, however, reversed the NLRC's decision. It explained that at
the time respondent Sy was engaged as a probationary employee
she was not informed of the standards that she should meet to
become a regular employee. Citing the ruling in Clarion Printing
House, Inc v. NLRC,
9
the CA stated that where an employee hired on
probationary basis was not informed of the standards that would
qualify her as a regular employee, she was deemed to have been
hired from day one as a regular employee. As a regular employee,
she was entitled to security of tenure and could be dismissed only for
a just cause and after due compliance with procedural due process.
The CA added that the petitioners did not observe due process in
dismissing respondent Sy.
Petitioners insist that they substantially complied with the
requirements of the law having apprised respondent Sy of her status
as probationary employee. The standard, though not written, was
clear that her continued employment would depend on her over-all
performance of the assigned tasks, and that the same was made
known to her since day one of her employment. According to the
petitioners, reasonable standard of employment does not require
written evaluation of respondent Sys function. It is enough that she
was informed of her duties and that her performance was later rated
below satisfactory by the Management.
Respondent Sy counters that she was illegally terminated from
service and insists that the petitioners cannot invoke her failure to
qualify as she was not informed of the standards or criteria which she
should have met for regular employment. Moreover, no proof was
shown as to her alleged poor work performance. She was
unceremoniously terminated to prevent her from becoming a regular
employee and be entitled to the benefits as such.

ISSUE: Whether or not the termination of respondent Sy, a
probationary employee, was valid.

RULING: No. Article 281 of the Labor Code (Probationary
employment) which provides that probationary employment shall not
exceed six months from the date the employee started working,
unless it is covered by an apprenticeship agreement stipulating a
longer period. The services of an employee who has been engaged
in a probationary basis may be terminated for a just cause or when
he fails to qualify as a regular employee in accordance with
reasonable standards made known by the employer to the employee
at the time of his engagement. An employee who is allowed to work
after a probationary period shall be considered a regular employee.

Furthermore, Section 2, Rule I, Book VI of the Implementing Rules
(Security of tenure) provides: (a) In cases of regular employment,
the employer shall not terminate the services of an employee except
for just or authorized causes as provided by law, and subject to the
requirements of due process.
(b) The foregoing shall also apply in cases of probationary
employment; Provided however, that in such cases, termination of
employment due to failure of the employee to qualify in accordance
with the standards of the employer made known to the former at the
time of engagement may also be a ground for termination of
employment.
xxx
(d) In all cases of termination of employment, the following standards
of due process shall be substantially observed:
xxx
If the termination is brought about by the completion of a contract or
phase thereof, or by failure of an employee to meet the standards of
the employer in the case of probationary employment, it shall be
sufficient that a written notice is served the employee, within a
reasonable time from the effective date of termination.
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2

There is probationary employment where the employee upon his
engagement is made to undergo a trial period during which the
employer determines his fitness to qualify for regular employment
based on reasonable standards made known to him at the time of
engagement. While the employer observes the fitness, propriety and
efficiency of a probationer to ascertain whether he is qualified for
permanent employment, the probationer, on the other hand, seeks to
prove to the employer that he has the qualifications to meet the
reasonable standards for permanent employment. Thus, the word
probationary, as used to describe the period of employment, implies
the purpose of the term or period, not its length.

It is settled that even if probationary employees do not enjoy
permanent status, they are accorded the constitutional protection of
security of tenure. This means they may only be terminated for a just
cause or when they otherwise fail to qualify as regular employees in
accordance with reasonable standards made known to them by the
employer at the time of their engagement.
As Article 281 clearly states, a probationary employee can be legally
terminated either: (1) for a just cause; or (2) when the employee fails
to qualify as a regular employee in accordance with the reasonable
standards made known to him by the employer at the start of the
employment. Nonetheless, the power of the employer to terminate an
employee on probation is not without limitations. First, this power
must be exercised in accordance with the specific requirements of the
contract. Second, the dissatisfaction on the part of the employer
must be real and in good faith, not feigned so as to circumvent the
contract or the law; and third, there must be no unlawful
discrimination in the dismissal. In termination cases, the burden of
proving just or valid cause for dismissing an employee rests on the
employer.
In the case at bar, petitioners failed to convey to
respondent Sy the standards upon which she should measure up to
be considered for regularization and how the standards had been
applied in her case. Petitioners could not also present concrete and
competent evidence establishing her alleged incompetence.
Therefore, the standards under which respondent Sy would qualify as
a regular employee not having been communicated to her at the start
of her probationary period, she is then qualified as a regular
employee.
Even on the assumption that respondent Sy indeed failed to meet the
standards set by them and made known to the former at the time of
her engagement, still, the termination was flawed for failure to give
the required notice to respondent Sy. In this case, the petitioners
failed to comply with the requirement of a written notice. Notably,
respondent Sy was merely verbally informed that her employment
would be terminated on February 28, 2007, as admitted by the
petitioners.
Considering that the petitioners failed to observe due process in
dismissing her, the dismissal had no legal sanction.
ART. 281
2. HACIENDA PRIMERA DEVELOPMENT CORPORATION and
ANNA KATRINA E. HERNANDEZ v. MICHAEL S. VILLEGAS
G.R. No. 186243 April 11, 2011
Nachura, J.

Case Doctrine: In all cases of probationary employment, the
employer shall make known to the employee the standards under
which he will qualify as a regular employee at the time of his
engagement. Where no standards are made known to the employee
at that time, he shall be deemed a regular employee.

Probationary employment - standards shall be made known to
the employee
FACTS: Petitioner Hacienda Primera Development Corporation
(Hacienda) hired respondent Michael S. Villegas (Villegas) as
General Manager of Amorita Resort. He was hired as a probationary
employee for three (3) months.
Less than 3 months after Villegas started working for the
Hacienda, Villegas received a call and learned that his services were
terminated. He asked for a written notice of termination but did not
receive any. Hence, the complaint for illegal dismissal.

Petitioners contention: Petitioner Hacienda stated that respondent
was hired as probationary employee. It explained that respondents
services were terminated because he failed to qualify for regular
employment. Specifically, it claimed that respondent failed to
conceptualize and complete financial budgets, sales projection, room
rates, website development, and marketing plan in coordination with
the Sales and Marketing Manager.

LAs decision: LA rendered decision in favor of respondent, finding
Villegas illegally dismissed.
NLRC: Dismissed the charge of illegal dismissal.
CA: Reinstated the decision of LA, finding illegal dismissal.

ISSUE: Was Respondent Villegas illegally dismissed?

RULING: YES, respondent Villegas was illegally dismissed by the
petitioner Hacienda.
Labor Code, Implementing Rules of Book VI, Rule I,
Section 6 provides:

Sec. 6. Probationary employment. There is probationary
employment where the employee, upon his engagement, is
made to undergo a trial period during which the employer
determines his fitness to qualify for regular employment, based
on reasonable standards made known to him at the time of
engagement.

Probationary employment shall be governed by the
following rules:
xxx x
(c) The services of an employee who has been engaged
on probationary basis may be terminated only for a just or
authorized cause, when he fails to qualify as a regular
employee in accordance with the reasonable standards
prescribed by the employer.
(d) In all cases of probationary employment, the employer
shall make known to the employee the standards under which
he will qualify as a regular employee at the time of his
engagement. Where no standards are made known to the
employee at that time, he shall be deemed a regular employee.

It can be gleaned from the foregoing provisions of law and
jurisprudential pronouncement that there are two grounds to legally
terminate a probationary employee. It may be done either: a) for a
just cause; or b) when the employee fails to qualify as a regular
employee in accordance with reasonable standards made known by
the employer to the employee at the start of the employment.
In this case, petitioner Hacienda fails to specify the
reasonable standards by which respondents alleged poor
performance was evaluated, much less to prove that such standards
were made known to him at the start of his employment. Thus, he is
deemed to have been hired from day one as a regular employee. Due
process dictates that an employee be apprised beforehand of the
condition of his employment and of the terms of advancement
therein.

ABBOTT LABORATORIES VS. ALCARAZ
G.R. No. 192571 July 23, 2011
KEYWORD/S: probationary basis; regularization standards; company
policy.
DOCTRINE: The employer is made to comply with two (2)
requirements when dealing with a probationary employee: first, the
employer must communicate the regularization standards to the
probationary employee; and second, the employer must make such
communication at the time of the probationary employees
engagement. If the employer fails to comply with either, the employee
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is deemed as a regular and not a probationary employee. WITH
EXCEPTION! READ RULING.
FACTS:
On December 7, 2004, Abbott Laboratories Philippines (Abbott)
formally offered Alcaraz a Regulatory Affairs Manager position
which was an item under the companys Hospira Affiliate Local
Surveillance Unit (ALSU) department. In Abbotts offer sheet, it was
stated that Alcaraz was to be employed on a probationary basis. On
February 12, 2005, Alcaraz signed an employment contract which
stated, inter alia, that she was to be placed on probation for a period
of six (6) months beginning February 15, 2005 to August 14, 2005.
The said contract was also signed by Abbotts General Manager,
petitioner Edwin Feist (Feist).
On April 20, 2005, Alcaraz had a meeting with petitioner Cecille
Terrible (Terrible), Abbotts former HR Director, to discuss certain
issues regarding staff performance standards. In the course thereof,
Alcaraz accidentally saw a printed copy of an e-mail sent by Walsh to
some staff members which essentially contained queries regarding
the formers job performance. Alcaraz asked if Walshs action was the
normal process of evaluation. Terrible said that it was not.
On May 16, 2005, Alcaraz was called to a meeting with Walsh and
Terrible where she was informed that she failed to meet the
regularization standards for the position of Regulatory Affairs
Manager.18 Thereafter, Walsh and Terrible requested Alcaraz to
tender her resignation, else they be forced to terminate her
services. She was also told that, regardless of her choice, she
should no longer report for work and was asked to surrender her
office identification cards. She requested to be given one week
to decide on the same, but to no avail.
On May 17, 2005, Alcaraz told her administrative assistant, Claude
Gonzales (Gonzales), that she would be on leave for that day.
However, Gonzales told her that Walsh and Terrible already
announced to the whole Hospira ALSU staff that Alcaraz already
resigned due to health reasons.

On May 23, 2005, Walsh (immediate supervisor of Alcaraz), Almazar
(Hospiras Country Transition Manager), and Bernardo (Abbotts
recruitment officer) personally handed to Alcaraz a letter stating
that her services had been terminated effective May 19, 2005. The
letter detailed the reasons for Alcarazs termination particularly, that
Alcaraz: (a) did not manage her time effectively; (b) failed to gain the
trust of her staff and to build an effective rapport with them; (c) failed
to train her staff effectively; and (d) was not able to obtain the
knowledge and ability to make sound judgments on case processing
and article review which were necessary for the proper performance
of her duties. On May 27, 2005, Alcaraz received another copy of
the said termination letter via registered mail.

Alcaraz felt that she was unjustly terminated from her employment
and thus, filed a complaint for illegal dismissal and damages
against Abbott and its officers, namely, Misa, Bernardo, Almazar,
Walsh, Terrible, and Feist. She claimed that she should have already
been considered as a regular and not a probationary employee given
Abbotts failure to inform her of the reasonable standards for her
regularization upon her engagement as required under Article 295 of
the Labor Code. In this relation, she contended that while her
employment contract stated that she was to be engaged on a
probationary status, the same did not indicate the standards on which
her regularization would be based.26 She further averred that the
individual petitioners maliciously connived to illegally dismiss her
when: (a) they threatened her with termination; (b) she was ordered
not to enter company premises even if she was still an employee
thereof; and (c) they publicly announced that she already resigned in
order to humiliate her.

On the contrary, petitioners maintained that Alcaraz was validly
terminated from her probationary employment given her failure to
satisfy the prescribed standards for her regularization which were
made known to her at the time of her engagement.

The LA dismissed Alcarazs complaint for lack of merit. The LA
rejected Alcarazs argument that she was not informed of the
reasonable standards to qualify as a regular employee considering
her admissions that she was briefed by Almazar on her work during
her pre employment orientation meeting and that she received copies
of Abbotts Code of Conduct and Performance Modules which were
used for evaluating all types of Abbott employees.

The NLRC reversed the findings of the LA and ruled that
Alcarazs receipt of her job description and Abbotts Code of
Conduct and Performance Modules was not equivalent to her
being actually informed of the performance standards upon
which she should have been evaluated on. It further observed that
Abbott did not comply with its own standard operating procedure in
evaluating probationary employees. The NLRC was also not
convinced that Alcaraz was terminated for a valid cause given that
petitioners allegation of Alcarazs poor performance remained
unsubstantiated.

Petitioners filed with the CA a Petition for Certiorari with Prayer for
Issuance of a Temporary Restraining Order and/or Writ of Preliminary
Injunction. The CA observed that Alcaraz was not apprised at the
start of her employment of the reasonable standards under
which she could qualify as a regular employee. This was based
on its examination of the employment contract which showed
that the same did not contain any standard of performance or
any stipulation that Alcaraz shall undergo a performance
evaluation before she could qualify as a regular employee. It
also found that Abbott was unable to prove that there was any
reasonable ground to terminate Alcarazs employment.

ISSUES:
1.) Whether Alcaraz was sufficiently informed of the reasonable
standards to qualify her as a regular employee; and
2.) Whether Alcaraz was validly terminated from her employment.
RULING:
Probationary employment; grounds for termination.
The employer is made to comply with two (2) requirements when
dealing with a probationary employee: first, the employer must
communicate the regularization standards to the probationary
employee; and second, the employer must make such
communication at the time of the probationary employees
engagement. If the employer fails to comply with either, the employee
is deemed as a regular and not a probationary employee.
The EXCEPTION to the foregoing is when the job is self-
descriptive in nature, for instance, in the case of maids, cooks,
drivers, or messengers.
A punctilious examination of the records reveals that Abbott had
indeed complied with the above-stated requirements. This
conclusion is largely impelled by the fact that Abbott clearly conveyed
to Alcaraz her duties and responsibilities as Regulatory Affairs
Manager prior to, during the time of her engagement, and the
incipient stages of her employment. On this score, the Court finds it
apt to detail not only the incidents which point out to the efforts made
by Abbott but also those circumstances which would show that
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Alcaraz was well-apprised of her employers expectations that would,
in turn, determine her regularization:
(a) On June 27, 2004, Abbott caused the publication in a major
broadsheet newspaper of its need for a Regulatory Affairs Manager,
indicating therein the job description for as well as the duties and
responsibilities attendant to the aforesaid position; this prompted
Alcaraz to submit her application to Abbott on October 4, 2004;

(b) In Abbotts December 7, 2004 offer sheet, it was stated that
Alcaraz was to be employed on a probationary status;

(c) On February 12, 2005, Alcaraz signed an employment contract
which specifically stated, inter alia, that she was to be placed on
probation for a period of six (6) months beginning February 15, 2005
to August 14,
2005;

(d) On the day Alcaraz accepted Abbotts employment offer,
Bernardo sent her copies of Abbotts organizational structure and
her job description through e-mail;

(e) Alcaraz was made to undergo a pre-employment orientation
where Almazar informed her that she had to implement Abbotts
Code of Conduct and office policies on human resources and finance
and that she would be reporting directly to Walsh;

(f) Alcaraz was also required to undergo a training program as part
of her orientation;

(g) Alcaraz received copies of Abbotts Code of Conduct and
Performance Modules from Misa who explained to her the
procedure for evaluating the performance of probationary employees;
she was further notified that Abbott had only one evaluation system
for all of its employees; and

(h) Moreover, Alcaraz had previously worked for another
pharmaceutical company and had admitted to have an extensive
training and background to acquire the necessary skills for her job.

Considering the totality of the above-stated circumstances, it cannot,
therefore, be doubted that Alcaraz was well-aware that her
regularization would depend on her ability and capacity to fulfill
the requirements of her position as Regulatory Affairs Manager
and that her failure to perform such would give Abbott a valid cause
to terminate her probationary employment.

It must be observed that the assessment of adequate duty
performance is in the nature of a management prerogative which
when reasonably exercised as Abbott did in this case should be
respected.
Probationary employment; termination procedure.
A different procedure is applied when terminating a probationary
employee; the usual two-notice rule does not govern. Section 2, Rule
I, Book VI of the Implementing Rules of the Labor Code states that
[i]f the termination is brought about by the x x x failure of an
employee to meet the standards of the employer in case of
probationary employment, it shall be sufficient that a written
notice is served the employee, within a reasonable time from the
effective date of termination.
As the records show, Alcaraz's dismissal was effected through a
letter dated May 19, 2005 which she received on May 23, 2005 and
again on May 27, 2005. Stated therein were the reasons for her
termination, i.e., that after proper evaluation, Abbott determined that
she failed to meet the reasonable standards for her regularization
considering her lack of time and people management and decision-
making skills, which are necessary in the performance of her
functions as Regulatory Affairs Manager. Undeniably, this written
notice sufficiently meets the criteria set forth above, thereby
legitimizing the cause and manner of Alcarazs dismissal as a
probationary employee under the parameters set by the Labor Code.
Employers violation of company policy and procedure.
Nonetheless, despite the existence of a sufficient ground to terminate
Alcarazs employment and Abbotts compliance with the Labor Code
termination procedure, it is readily apparent that Abbott breached
its contractual obligation to Alcaraz when it failed to abide by its
own procedure in evaluating the performance of a probationary
employee. Veritably, a company policy partakes of the nature of
an implied contract between the employer and employee.
Records show that Abbotts PPSE procedure mandates, inter alia,
that the job performance of a probationary employee should be
formally reviewed and discussed with the employee at least twice:
first on the third month and second on the fifth month from the date of
employment. Abbott is also required to come up with a Performance
Improvement Plan during the third month review to bridge the gap
between the employees performance and the standards set, if
any.69 In addition, a signed copy of the PPSE form should be
submitted to Abbotts HRD as the same would serve as basis for
recommending the confirmation or termination of the probationary
employment.
In this case, it is apparent that Abbott failed to follow the above-stated
procedure in evaluating Alcaraz. For one, there lies a hiatus of
evidence that a signed copy of Alcarazs PPSE form was submitted to
the HRD. It was not even shown that a PPSE form was completed to
formally assess her performance. Neither was the performance
evaluation discussed with her during the third and fifth months of her
employment. Nor did Abbott come up with the necessary
Performance Improvement Plan to properly gauge Alcarazs
performance with the set company standards.
While there lies due cause to terminate Alcarazs probationary
employment for her failure to meet the standards required for her
regularization, and while it must be further pointed out that Abbott had
satisfied its statutory duty to serve a written notice of termination, the
fact that it violated its own company procedure renders the
termination of Alcarazs employment procedurally infirm,
warranting the payment of nominal damages.
COLEGIO DEL SANTISIMO ROSARIO AND SR. ZENAIDA S.
MOFADA, O
vs.
EMMANUEL ROJO
FACTS:
Petitioner Colegio del Santisimo Rosario (CSR) hired respondent as
a high school teacher on probationary basis for the school years
1992-1993, 1993-1994 and 1994-1995.
On April 5, 1995, CSR, through petitioner Sr. Zenaida S. Mofada, OP
(Mofada), decided not to renew respondents services.
Thus, on July 13, 1995, respondent filed a Complaint for illegal
dismissal. He alleged that since he had served three consecutive
school years which is the maximum number of terms allowed for
probationary employment, he should be extended permanent
employment.
On the other hand, petitioners argued that respondent knew that his
Teachers Contract for school year 1994-1995 with CSR would expire
on March 31, 1995. Accordingly, respondent was not dismissed but
his probationary contract merely expired and was not renewed.
Petitioners also claimed that the "three years" mentioned in
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5
paragraph 75 of the 1970 Manual refer to "36 months," not three
school years.
LA: The The LA ruled that "three school years" means three years of
10 months, not 12 months. Considering that respondent had already
served for three consecutive school years, then he has already
attained regular employment status. Thus, the non-renewal of his
contract for school year 1995-1996 constitutes illegal dismissal.
NLRC: On appeal, the NLRC affirmed the LAs Decision with
modification. It held that after serving three school years, respondent
had attained the status of regular employment
21
especially because
CSR did not make known to respondent the reasonable standards he
should meet. The NLRC also agreed with the LA that respondents
termination was done in bad faith.
CA: According to the CA, respondent has attained the status of a
regular employee after he was employed for three consecutive school
years as a full-time teacher and had served CSR satisfactorily. Aside
from being a high school teacher, he was also the Prefect of
Discipline, a task entailing much responsibility.
ISSUE:
WON the respondent is NOT a regular employee, in effect, the
petitioner has authority to renew or not to renew the respondent.
RULING:
No.
In this case, petitioners teachers who were on probationary
employment were made to enter into a contract effective for one
school year. Thereafter, it may be renewed for another school year,
and the probationary employment continues. At the end of the second
fixed period of probationary employment, the contract may again be
renewed for the last time.
Such employment for fixed terms during the teachers probationary
period is an accepted practice in the teaching profession.
However, this scheme "of fixed-term contract is a system that
operates during the probationary period and for this reason is subject
to Article 281 of the Labor Code. Teachers on probationary
employment also enjoy the protection afforded by Article 281.
When fixed-term employment is brought into play under the above
probationary period rules, the situation as in the present case
may at first blush look muddled as fixed-term employment is in itself a
valid employment mode under Philippine law and jurisprudence.
The fixed-term character of employment essentially refers to the
period agreed upon between the employer and the employee;
employment exists only for the duration of the term and ends on its
own when the term expires. In a sense, employment on probationary
status also refers to a period because of the technical meaning
"probation" carries in Philippine labor law a maximum period of six
months, or in the academe, a period of three years for those engaged
in teaching jobs. Their similarity ends there, however, because of the
overriding meaning that being "on probation" connotes, i.e., a
process of testing and observing the character or abilities of a
person who is new to a role or job.
For teachers on probationary employment, in which case a fixed term
contract is not specifically used for the fixed term it offers, it is
incumbent upon the school to have not only set reasonable standards
to be followed by said teachers in determining qualification for regular
employment, the same must have also been communicated to the
teachers at the start of the probationary period, or at the very least, at
the start of the period when they were to be applied. These terms, in
addition to those expressly provided by the Labor Code, would serve
as the just cause for the termination of the probationary
contract.1wphi1 The specific details of this finding of just cause must
be communicated to the affected teachers as a matter of due
process. Corollarily, should the teachers not have been apprised
of such reasonable standards at the time specified above, they
shall be deemed regular employees.
In this case, glaringly absent from petitioners evidence are the
reasonable standards that respondent was expected to meet that
could have served as proper guidelines for purposes of evaluating his
performance. Nowhere in the Teachers Contract could such
standards be found. Neither was it mentioned that the same were
ever conveyed to respondent. Even assuming that respondent failed
to meet the standards set forth by CSR and made known to the
former at the time he was engaged as a teacher on probationary
status, still, the termination was flawed for failure to give the required
notice to respondent.
ARMANDO ALILING, Petitioner,
vs.
JOSE B. FELICIANO, MANUEL F. SAN MATEO III, JOSEPH R.
LARIOSA, and WIDE WIDE WORLD EXPRESS CORPORATION,
Respondents.
G.R. No. 185829; April 25, 2012
Ponente: VELASCO, JR., J.
Case Doctrines:

Article 281 of the Labor Code (Probationary employment) -
Probationary employment shall not exceed six (6) months from the
date the employee started working, unless it is covered by an
apprenticeship agreement stipulating a longer period. The services of
an employee who has been engaged on a probationary basis may be
terminated for a just cause or when he fails to qualify as a regular
employee in accordance with reasonable standards made known by
the employer to the employee at the time of his engagement. An
employee who is allowed to work after a probationary period shall be
considered a regular employee.

Section 6(d) of the Implementing Rules of Book VI, Rule VIII-A of
the Labor Code -
In all cases of probationary employment, the employer shall make
known to the employee the standards under which he will qualify as a
regular employee at the time of his engagement. Where no standards
are made known to the employee at that time, he shall be deemed a
regular employee.

Keyword: Seafreight Sales to Ground Express


FACTS: On June 2, 2004, respondent Wide Wide World Express
Corporation (WWWEC) offered to employ petitioner Armando Aliling
as Account Executive (Seafreight Sales). The offer came with a 6 -
month probation period condition.
Training then started. However, instead of a Seafreight Sale
assignment, respondent WWWEC asked petitioner Aliling to handle
Ground Express (GX).
Barely a month after, respondent Manuel F. San Mateo III, WWWEC
Sales and Director, emailed
Alilinghttp://www.lawphil.net/judjuris/juri2012/apr2012/gr_185829_201
2.html - fnt9 to express dissatisfaction with the latters performance,
In a separate letter dated September 27, 2004, petitioner Aliling wrote
respondent San Mateo stating: "Pursuant to your instruction on
September 20, 2004, I hereby tender my resignation effective
October 15, 2004." While respondent WWWEC took no action on his
LABREL | CASE DIGEST | ART 281

6
tender, petitioner Aliling nonetheless demanded reinstatement and a
written apology, claiming in a subsequent letter dated October 1,
2004 to management that respondent Mateo had forced him to
resign.
Respondent Joseph Lariosas response-letter of October 1, 2004,
informed petitioner Aliling that his case was still in the process of
being evaluated. On October 6, 2004, respondent Lariosa again
wrote, this time to advise petitioner Aliling of the termination of his
services effective as of that date owing to his "non-satisfactory
performance" during his probationary period.
Earlier, however, or on October 4, 2004, petitioner Aliling filed a
Complaint for illegal dismissal against respondent WWWEC.
Appended to the complaint was Alilings Affidavit, in which he stated:
"5. At the time of my engagement, respondents did not make known
to me the standards under which I will qualify as a regular employee."
The labor arbiter and the NLRC considered petitioner Aliling a
probationary employee despite finding that he was not informed of
the reasonable standards by which his probationary employment was
to be judged.
The CA, on the other hand, ruled that petitioner Aliling was a regular
employee from the outset inasmuch as he was not informed of the
standards by which his probationary employment would be
measured.

Respondent WWWEC further alleges that respondent San Mateos
email dated July 16, 2004 shows that the standards for his
regularization were made known to petitioner Aliling at the time of his
engagement.

ISSUE: Whether or not petitioner Aliling is a probationary employee.

RULING: No. Article 281 of the Labor Code (Probationary
employment) states that probationary employment shall not exceed
six (6) months from the date the employee started working, unless it
is covered by an apprenticeship agreement stipulating a longer
period. The services of an employee who has been engaged on a
probationary basis may be terminated for a just cause or when he
fails to qualify as a regular employee in accordance with reasonable
standards made known by the employer to the employee at the
time of his engagement. An employee who is allowed to work after
a probationary period shall be considered a regular employee.
Furthermore, Section 6(d) of the Implementing Rules of Book VI, Rule
VIII-A of the Labor Code provides:
Sec. 6. Probationary employment. There is probationary
employment where the employee, upon his engagement, is made to
undergo a trial period where the employee determines his fitness to
qualify for regular employment, based on reasonable standards made
known to him at the time of engagement.
Probationary employment shall be governed by the following rules:
x x x x
(d) In all cases of probationary employment, the employer shall
make known to the employee the standards under which he will
qualify as a regular employee at the time of his engagement.
Where no standards are made known to the employee at that
time, he shall be deemed a regular employee.

In the case at bar, the June 2, 2004 letter-offer itself
states that the regularization standards or the performance norms to
be used are still to be agreed upon by Aliling and his supervisor.
Respondent WWWEC has failed to prove that an agreement as
regards thereto has been reached. Clearly then, there were actually
no performance standards to speak of. And lest it be overlooked,
Aliling was assigned to GX trucking sales, an activity entirely different
to the Seafreight Sales he was originally hired and trained for. Thus,
at the time of his engagement, the standards relative to his
assignment with GX sales could not have plausibly been
communicated to him as he was under Seafreight Sales.

Furthermore, to recall, in that email message, respondent San Mateo
reminded petitioner Aliling of the sales quota he ought to meet as a
condition for his continued employment, i.e., that the GX trucks
should already be 80% full by August 5, 2004. Contrary to
respondents contention, respondent San Mateos email cannot
support their allegation on petitioner Aliling being informed of the
standards for his continued employment, such as the sales quota, at
the time of his engagement. As it were, the email message was sent
to Aliling more than a month after he signed his employment contract
with respondent WWWEC. The aforequoted Section 6 of the
Implementing Rules of Book VI, Rule VIII-A of the Code specifically
requires the employer to inform the probationary employee of such
reasonable standards at the time of his engagement, not at any time
later; else, the latter shall be considered a regular employee.

Thus, pursuant to Article 281 of the Labor Code, Section 6(d) of the
Implementing Rules of Book VI, Rule VIII-A of the Labor Code and
settled jurisprudence, petitioner Aliling is deemed a regular
employee as of June 11, 2004, the date of his employment contract.


PHILIPPINE DAILY INQUIRER, INC., - versus - LEON M.
MAGTIBAY, JR. and PHILIPPINE DAILY INQUIRER
EMPLOYEES UNION (PDIEU)
G.R. No. 164532. July 24, 2007

CASE DOCTRINE:
Management and labor, or the employer and the employee are more
often not situated on the same level playing field, so to speak.
Recognizing this reality, the State has seen fit to adopt measures
envisaged to give those who have less in life more in law. Article 279
of the Labor Code which gives employees the security of tenure is
one playing field leveling measure:

Art. 279. Security of Tenure. In
cases of regular employment, the employer
shall not terminate the services of an
employee except for a just cause or when
authorized by this Title. x x x.

But hand in hand with the restraining effect of Section 279, the same
Labor Code also gives the employer a period within which to
determine whether a particular employee is fit to work for him or not.
This employers prerogative is spelled out in the following provision:

Art. 281. Probationary
employment. Probationary employment
shall not exceed six (6) months from the date
the employee started working, unless it is
covered by an apprenticeship agreement
stipulating a longer period. The services of an
employee who has been engaged on a
probationary basis may be terminated for a
just cause or when he fails to qualify as a
regular employee in accordance with
reasonable standards made known by the
employer to the employee at the time of his
engagement. An employee who is allowed to
work after a probationary period shall be
considered a regular employee.

Within the limited legal six-month probationary period,
probationary employees are still entitled
to security of tenure. It is expressly provided in the afore-
quoted Article 281 that a probationary employee may be
terminated only on two grounds: (a) for just cause, or (b)
when he fails to qualify as a regular employee in
accordance with reasonable standards made known by
the employer to the employee at the time of his
engagement.

Unlike under the first ground for the valid termination of
probationary employment which is for just cause, the
second ground does not require notice and hearing. Due
LABREL | CASE DIGEST | ART 281

7
process of law for this second ground consists of making
the reasonable standards expected of the employee
during his probationary period known to him at the time of
his probationary employment. By the very nature of a
probationary employment, the employee knows from the
very start that he will be under close observation and his
performance of his assigned duties and functions would
be under continuous scrutiny by his superiors. It is
in apprising him of the standards against which his
performance shall be continuously assessed where due
process regarding the second ground lies, and not in
notice and hearing as in the case of the first ground.

KEYWORDS: Probationary Employee failed to qualify as a
regular employee made known to him before the expiration of the six-
month probationary period.

FACTS:
Philippine Daily Inquirer (PDI) hired Leon Magtibay (Magtibay) as a
contractual worker for 5 months. After the expiration of the said
contract, PDI hired him again with a probationary period of 6 months.
A week before the end of the second contract, PDI handed him his
termination letter due to failure in meeting company standards.

RESPONDENT - THE COMPLAINT
Magtibay then filed a complaint for illegal dismissal before the Labor
Arbiter stating that he has now become a regular employee by
working for more than 6 months. PDIEU (union) supported him
stating unfair labor practice. Saying that he did not know he was
supposed to follow company standards and that he was not given
due process in his termination.

PETITIONER
PDI explained that his 5-month contract should not be included with
his 6-month contract allowing him to be considered a regular
employee, and that he was in fact given an orientation on what the
company standards were.

LA
The Labor Arbiter agreed with PDI and dismissed his complaint and
acquitted PDI of illegal dismissal and unfair labor practice.

NLRC and CA
When the case was brought to the NLRC, it reversed the Arbiters
decision and charged PDI with illegal dismissal due to the fact that
Magtibay was now considered a regular employee. Also, Magtibay
was not told that he must abide by company standards. The Court of
Appeals agreed with the NLRC. PDI filed a motion for reconsideration
to no avail.

Issue:
Whether or not a probationary employees failure to follow an
employers rules and regulations cannot be deemed failure by said
employee to meet the standards of his employer thus emasculating
petitioners right to choose its employees.

Ruling:
The NLRC and CAs decisions were reversed and set aside thereby
reinstating the Labor Arbiters decision to acquit PDI of illegal
dismissal and unfair labor practice. The SC ruled that company
standards are meant to be followed even if an employee is not made
aware of them. It is inherent that company standards are always in
effect and employees, probationary or regular, are expected to meet
them.

Also, PDI did not violate procedural process due to the fact the
Magtibay was on a probationary period and was not up to company
standards. Reason is that a probationary has the duty to prove his
worth to the employer to become a permanent employee. The due
process here is in the constant observance and evaluation of
Magtibays performance, in which he failed by violating certain
company rules and regulations.

PDI was only exercising its statutory hiring prerogative when it
refused to hire Magtibay on a permanent basis upon the expiration of
the six-month probationary period. This was established during the
proceedings before the labor arbiter and borne out by the records and
the pleadings before the Court. When the NLRC disregarded the
substantial evidence establishing the legal termination of Magtibays
probationary employment and rendered judgment grossly and directly
contradicting such clear evidence, the NLRC commits grave abuse
of discretion amounting to lack or excess of jurisdiction. It was,
therefore, reversible error on the part of the appellate court not to
annul and set aside such void judgment of the NLRC. #DIOLA


RADIN C. ALCIRA vs. NATIONAL LABOR RELATIONS
COMMISSION, MIDDLEBY PHILIPPINES CORPORATION/FRANK
THOMAS, XAVIER G. PEA and TRIFONA F. MAMARADLO
G.R. No. 14985 | June 9, 2004 | KEYWORD: 180th day
DOCTRINES:
- The computation of the 6-month probationary period is reckoned
from the date of appointment up to the same calendar date of the 6th
month following.
- Am employer is deemed to substantially comply with the rule on
notification of standards if he apprises the employee that he will be
subjected to a performance evaluation on a particular date after his
hiring.
- While probationary employees enjoy security of tenure, such that
they cannot be removed except for just cause as provided by law or
for failure to qualify as regular employees in accordance with
reasonable standards made known to them by the employer at the
time of their engagement, this constitutional protection ends on the
expiration of the probationary period. On that date, the parties are
free to either renew or terminate their contract of employment.
FACTS:
Alcira was hired as engineering support services supervisor on a
probationary basis for six months by Middleby Corp. Unhappy with
petitioners performance, Middleby terminated his services.
Consequently, Alcira filed a complaint for illegal dismissal.
Petitioner alleged that, on November 20, 1996, a senior officer of
Middleby in bad faith, withheld his time card and did not allow him to
work. Petitioner considered this as a dismissal after the lapse of
his probationary employment" since the copy of his appointment
paper which he presented before the LA stated that his starting date
of employment is May 20, 1996. In short, petitioner contends that he
had already become a regular employee as of the date he was
illegally dismissed.

In their defense, respondents presented their own copy of Alcira's
appointment paper which states the starting date of Alcira's
appointment is May 27, 2007. They further claimed that during
petitioners probationary employment, he showed poor
performance in his assigned tasks, incurred ten absences, was late
several times and violated company rules on the wearing of uniform.
Since he failed to meet company standards, they disapproved Alcira's
application to become a regular employee and terminated his
employment.
LA dismissed the complaint held that petitioner was apprised of the
standards for becoming a regular employee and since he did not
comply with such standards he was dismissed before he became a
regular employee considering that counting from May 20, 1996, the
six-month probationary period ended on November 20, 1996.
NLRC affirmed LA.
LABREL | CASE DIGEST | ART 281

8
CA affirmed NLRC.
Hence, this petition for review.
Petitioner claims that under the terms of his contract, his probationary
employment was only for five months as indicated by the remark
Please be informed that after five months, your performance shall
be evaluated and any adjustment in salary shall depend on your work
performance."
Petitoner further claims that he already attained the status of a
regular employee when he was dismissed on November 20, 1996. He
argued this point by saying that since his appointment paper did not
provide for a specific date of termination and under the Civil Code a
month consists of 30 days, the 180th day (6 mo*30days) from his
starting date May 20, 1996, that is, November 16, 1996, should be
considered as his date of termination.

ISSUES:
1. WON Alcira's period of probationary employment was only for 5
months.
2. WON the 180th day from May, 20, 1996 is November 16, 1996 for
purposes of determining whether Alcira was terminated before he
was regularized.
3. WON Middleby informed petitioner of the standards for
regularization at the start of his employment.
4. WON Alcira was illegally dismissed when Middleby opted not to
renew his contract on the last day of his probationary employment.
RULING:
1. NO. As correctly held by the labor arbiter, the appointment contract
also stated in another part thereof that petitioners employment
status was probationary (6mos.). The five-month period
referred to the evaluation of his work.
2. NO. The computation of the 6-month probationary period is
reckoned from the date of appointment up to the same calendar date
of the 6th month following. In short, since the number of days in each
particular month was irrelevant, petitioner was still a probationary
employee when respondent Middleby opted not to regularize
him on November 20, 1996.
3. YES. Section 6 (d) of Rule 1 of the Implementing Rules of Book VI
of the Labor Code (Department Order No. 10, Series of 1997)
provides that: (d) In all cases of probationary employment, the
employer shall make known to the employee the standards under
which he will qualify as a regular employee at the time of his
engagement. Where no standards are made known to the employee
at that time, he shall be deemed a regular employee.
Am employer is deemed to substantially comply with the rule on
notification of standards if he apprises the employee that he will be
subjected to a performance evaluation on a particular date after his
hiring. Thus, Middleby substantially notified petitioner of the
standards to qualify as a regular employee when it apprised him, at
the start of his employment, that it would evaluate his supervisory
skills after five months.
4. NO. While probationary employees enjoy security of tenure, such
that they cannot be removed except for just cause as provided by law
or for failure to qualify as regular employees in accordance with
reasonable standards made known to them by the employer at the
time of their engagement, this constitutional protection ends on the
expiration of the probationary period. On that date, the parties are
free to either renew or terminate their contract of employment.
Here, Middleby exercised its option not to renew the contract when it
informed petitioner on the last day of his probationary employment
that it did not intend to grant him a regular status. Although we can
regard petitioners severance from work as dismissal, the same
cannot be deemed illegal. As found by the labor arbiter, the NLRC
and the Court of Appeals, petitioner (1) incurred ten absences (2)
was tardy several times (3) failed to wear the proper uniform many
times and (4) showed inferior supervisory skills. Petitioner failed to
satisfactorily refute these substantiated allegations. Taking all this in
its entirety, respondent Middleby was clearly justified to end its
employment relationship with petitioner. #FALLER
YOLANDA MERCADO. VS. AMA COMPUTER COLLEGE-
PARANAQUE CITY, INC.
G. R. No. 183572, April 13, 2010

DOCTRINE: A system of fixed-term contract is a system that
operates during the probationary period and for this reason, it is
subject to the terms of Article 281 of the Labor Code, which requires
that the services of an employee who has been engaged on a
probationary basis may be terminated for a just cause or when he
fails to qualify as a regular employee
KEYWORDS: Probationary status and fixed-term employment of
teachers


FACTS:

Yolanda Mercado, Charito de Leon, Diana Lachica, Margarito
Alba and Felix Tonog (petitioners) were faculty members who
started teaching at AMACC on May 1998. They executed individual
Teachers Contracts for each of the trimesters that they were
engaged to teach, with the following common stipulation:

POSITION. The TEACHER has
agreed to accept a non-tenured
appointment to work in the College of
xxx effective xxx to xxx or for the
duration of the last term that the
TEACHER is given a teaching load
based on the assignment duly
approved by the DEAN/SAVP-COO.

For the school year 2000-2001, AMACC implemented new faculty
screening guidelines wherein teachers were to be hired or maintained
based on extensive teaching experience, capability, potential, high
academic qualifications and research background. The performance
standards under the new screening guidelines were also used to
determine the present faculty members entitlement to salary
increases.

Petitioners failed to obtain a passing rating based on the
performance standards; hence AMACC did not give them any
salary increase.

Because of AMACCs action on the salary increases, the petitioners-
teachers filed a complaint with the Arbitration Branch of the National
Labor Relations Commission (NLRC) on July 2000 for underpayment
of wages, non-payment of overtime and overload compensation, 13th
month pay, and for discriminatory practices.

On September 2000, the petitioners-teachers individually received a
memorandum from AMACC informing them that with the expiration of
their contract to teach, their contract would no longer be renewed.

Petitioners amended their labor arbitration complaint to include the
charge of illegal dismissal against AMACC. Petitioners-teachers
claimed that their dismissal was illegal because it was made in
retaliation for their complaint for monetary benefits and discriminatory
practices against AMACC.

LABREL | CASE DIGEST | ART 281

9
In response, AMACC contended that the petitioners-teachers worked
under a contracted term under a non-tenured appointment and were
still within the three-year probationary period for teachers. Their
contracts were not renewed for the following term because they failed
to pass the Performance Appraisal System for Teachers (PAST). This
move was justified according to AMACC since the school has to
maintain its high academic standards.

Labor Arbiter: Petitioners had been illegally dismissed and ordered
AMACC to reinstate them to their former positions without loss of
seniority rights and to pay them full backwages, attorneys fees and
13th month pay.

NLRC: denied AMACCs appeal for lack of merit and affirmed the
Labor Arbiters ruling.

CA:
Upon appeal of AMACC before the CA, the CA granted AMACCs
petition and dismissed petitioners complaint for illegal
dismissal.

The CA ruled that under the Manual for Regulation for Private
Schools, the petitioners were still within their probationary period
since their teaching stints only covered a period of two (2) years and
three (3) months when AMACC decided not to renew their contracts
on September 2000. To the CA, the petitioners were not actually
dismissed; their respective contracts merely expired and were no
longer renewed by AMACC because they failed to satisfy the schools
standards for the school year 2000-2001 that measured their fitness
and aptitude.

Petitioners filed a petition before the Supreme Court questioning the
decision of the CA.

ISSUE:
Whether or not the the termination of employment of employees on
probationary status was valid.

HELD: NO.

The existence of the term-to-term contracts covering the petitioners-
teachers employment is not disputed, nor it is disputed that they
were on probationary status from the time they were employed on
May 1998 and until the expiration of their teaching contracts on
September 2000

This case, however, brings to the fore the essential question, should
the teachers probationary status be disregarded simply because the
contracts were fixed-term?

The school apparently utilizes its fixed-term contracts as a convenient
arrangement dictated by the trimestral system and not because the
parties really intended to limit the period of their relationship to any
fixed term and to finish this relationship at the end of that term. While
nothing is illegitimate in defining the school-teacher relationship in
this manner, the school, however, cannot forget that its system of
fixed-term contract is a system that operates during the probationary
period and for this reason, it is subject to the terms of Article 281 of
the Labor Code, which requires that the services of an employee who
has been engaged on a probationary basis may be terminated for a
just cause or when he fails to qualify as a regular employee. Unless
this reconciliation is made, the requirement of Article of 281 of the
Labor Code on probationary status would be fully negated as the
school may freely choose not to renew contracts simply because their
terms have expired.

If the school were to apply the probationary standards (as in fact it
says it did in the present case), these standards must not only be
reasonable but must have also been communicated to the teachers
at the start of the probationary period, or at the very least, at the start
of the period when they were to be applied. While AMACC claimed
that the petitioners-teachers failed to pass the PAST and other
requirements for regularization, the exact terms of the standards were
never introduced as evidence; neither does the evidence show how
these standards were applied to petitioners-teachers

Inevitably, the termination of employment of employees on
probationary status lacks the supporting finding of just cause that the
law requires and, hence, illegal. #FERNANDO