SECURITY OF TENURE

KINDS OF EMPLOYEES

27. ROWELL INDUSTRIAL CORP. vs CA

G.R. No. 167714, March 7, 2007

FACTS: Petitioner RIC is a corporation engaged in manufacturing tin cans for use in packaging of consumer
products, e.g., foods, paints, among other things. Respondent Taripe was employed by petitioner RIC on 8
November 1999 as a “rectangular power press machine operator” with a salary of P223.50 per day, until he
was allegedly dismissed from his employment by the petitioner on 6 April 2000.

On 17 February 2000, respondent Taripe filed a complaint against petitioner RIC for regularization and
payment of holiday pay, as well as indemnity for severed finger, which was amended on 7 April 2000 to
include illegal dismissal. Respondent Taripe alleges that RIC employed him starting 8 November 1999 as power
press machine operator, such position of which was occupied by RIC’s regular employees and the functions of
which were necessary to the latter’s business. Respondent Taripe adds that upon employment, he was made
to sign a document, which was not explained to him but which was made a condition for him to be taken in
and for which he was not furnished a copy. Respondent Taripe states that he was not extended full benefits
granted under the law and the CBA and that on 6 April 2000, while the case for regularization was pending, he
was summarily dismissed from his job although he never violated any of the RIC’s company rules and
regulations.

Petitioner RIC, for its part, claims that Taripe was a contractual employee, whose services were required due
to the increase in the demand in packaging requirement of its clients for Christmas season and to build up
stock levels during the early part of the following year; that on 6 March 2000, Taripe’s employment contract
expired.

Petitioner RIC emphasizes that while an employee’s status of employment is vested by law pursuant to Article
280 of the Labor Code, as amended, said provision of law admits of two exceptions, to wit: (1) those
employments which have been fixed for a specific project or undertaking, the completion or termination of
which has been determined at the time of the engagement of the employment; and (2) when the work or
services to be performed are seasonal; hence, the employment is for the duration of the season. Thus, there
are certain forms of employment which entail the performance of usual and desirable functions and which
exceed one year but do not necessarily qualify as regular employment under Article 280 of the Labor Code, as
amended.

ISSUE: Is respondent considered a regular employee?

RULING: YES. Article 280 of the Labor Code, as amended, classifies employees into three categories, namely:
(1) regular employees or those whose work is necessary or desirable to the usual business of the employer; (2)
project employees or those whose employment has been fixed for a specific project or undertaking, the
completion or termination of which has been determined at the time of the engagement of the employee or
where the work or services to be performed is seasonal in nature and the employment is for the duration of
the season; and (3) casual employees or those who are neither regular nor project employees.

Under Art 280 regular employees are classified into:

(1) regular employees by nature of work - those employees who perform a particular activity which is
necessary or desirable in the usual business or trade of the employer, regardless of their length of service;
(2) regular employees by years of service - those employees who have been performing the job, regardless of
the nature thereof, for at least a year.

Article 280 of the Labor Code, as amended, however, does not proscribe or prohibit an employment contract
with a fixed period. It does not necessarily follow that where the duties of the employee consist of activities
usually necessary or desirable in the usual business of the employer, the parties are forbidden from agreeing
on a period of time for the performance of such activities. There is nothing essentially contradictory between
a definite period of employment and the nature of the employee’s duties.

In the case at bar, Taripe signed a contract of employment good only for a period of five months unless the
said contract is renewed by mutual consent. Along with other contractual employees, he was hired only to
meet the increase in demand for packaging materials for the Christmas season and to build up stock levels for
the early part of the year.
Standards for valid fixed term employment:
(1) the fixed period of employment was knowingly and voluntarily agreed upon by the parties, without any
force, duress or improper pressure being brought to bear upon the employee and absent any other
circumstances vitiating his consent; or

(2) it satisfactorily appears that the employer and employee dealt with each other on more or less equal terms
with no moral dominance whatever being exercised by the former on the latter.

Application of these standards to this case:

1) The employment contract signed by respondent Taripe did not mention that he was hired only for a specific
undertaking, the completion of which had been determined at the time of his engagement. The said
employment contract neither mentioned that respondent Taripe’s services were seasonal in nature and that
his employment was only for the duration of the Christmas season as purposely claimed by petitioner RIC.
What was stipulated in the said contract was that Taripe’s employment was contractual for the period of five
months.

2) Also RIC failed to controvert the claim that Taripe was made to sign the contract of employment, prepared
by RIC, as a condition for his hiring. Such contract in which the terms are prepared by only one party and the
other party merely affixes his signature signifying his adhesion thereto is called contract of adhesion.It is an
agreement in which the parties bargaining are not on equal footing, the weaker party’s participation being
reduced to the alternative “to take it or leave it.” In the present case, respondent Taripe, in need of a job, was
compelled to agree to the contract, including the five-month period of employment, just so he could be hired.

3) 2) As a power press operator, a rank and file employee, he can hardly be on equal terms with petitioner RIC.
As the Court of Appeals said, “almost always, employees agree to any terms of an employment contract just to
get employed considering that it is difficult to find work given their ordinary qualifications.” He was a regular
employee As a rectangular power press machine operator, in charge of manufacturing covers for “four liters
rectangular tin cans,” was holding a position which is necessary and desirable in the usual business or trade of
petitioner RIC, which was the manufacture of tin cans. Thus, he was a regular employee.

28. BRENT SCHOOL vs ZAMORA

G.R. 48494. February 5, 1990

FACTS: Doroteo R. Alegre was engaged as athletic director by Brent School, Inc. The contract fixed a specific
term for its existence which is 5 years. Some three months before the expiration of the stipulated period,
Alegre was given a copy of the report filed by Brent School with the Department of Labor advising of the
termination of his services. The stated ground for the termination was completion of contract, expiration of
the definite period of employment. A month or so later, Alegre accepted the amount of P3,177.71, and signed
a receipt therefor containing the phrase “in full payment of services for the period May 16, to July 17, 1976 as
full payment of contract.” However, at the investigation conducted by a Labor Conciliator of said report of
termination of his services, Alegre protested the announced termination of his employment. He argued that
although his contract did stipulate that the same would terminate on July 17, 1976, since his services were
necessary and desirable in the usual business of his employer, and his employment had lasted for five years,
he had acquired the status of a regular employee and could not be removed except for valid cause The
Regional Director considered Brent School’s report as an application for clearance to terminate employment
(not a report of termination), and accepting the recommendation of the Labor Conciliator, refused to give
such clearance and instead required the reinstatement of Alegre, as a permanent employee, to his former
position without loss of seniority rights and with full back wages. The Director pronounced the ground relied
upon by Brent in terminating the services of Alegre as not sanctioned by P.D. 442, and, quite oddly, as
prohibited by Circular No. 8, series of 1969, of the Bureau of Private Schools.

ISSUE: Whether or not the provisions of the Labor Code, as amended, have anathematized "fixed period
employment" or employment for a term

RULING: Respondent Alegre's contract of employment with Brent School having lawfully terminated with and
by reason of the expiration of the agreed term of period thereof, he is declared not entitled to reinstatement.
The employment contract between Brent School and Alegre was executed on July 18, 1971, at a time when
the Labor Code of the Philippines (P.D. 442) had not yet been promulgated. At that time, the validity of term
employment was impliedly recognized by the Termination Pay Law, R.A. 1052, as amended by R.A. 1787. Prior,
thereto, it was the Code of Commerce (Article 302) which governed employment without a fixed period, and
also implicitly acknowledged the propriety of employment with a fixed period. The Civil Code of the
Philippines, which was approved on June 18, 1949 and became effective on August 30,1950, itself deals with
obligations with a period. No prohibition against term-or fixed-period employment is contained in any of its
articles or is otherwise deducible therefrom.
It is plain then that when the employment contract was signed between Brent School and Alegre, it was
perfectly legitimate for them to include in it a stipulation fixing the duration thereof Stipulations for a term
were explicitly recognized as valid by this Court. The status of legitimacy continued to be enjoyed by fixed-
period employment contracts under the Labor Code (PD 442), which went into effect on November 1, 1974.
The Code contained explicit references to fixed period employment, or employment with a fixed or definite
period. Nevertheless, obscuration of the principle of licitness of term employment began to take place at
about this time.

Article 320 originally stated that the "termination of employment of probationary employees and those
employed WITH A FIXED PERIOD shall be subject to such regulations as the Secretary of Labor may prescribe."
Article 321 prescribed the just causes for which an employer could terminate "an employment without a
definite period." And Article 319 undertook to define "employment without a fixed period" in the following
manner: …where the employee has been engaged to perform activities which are usually necessary or
desirable in the usual business or trade of the employer, except where the employment has been fixed for a
specific project or undertaking the completion or termination of which has been determined at the time of the
engagement of the employee or where the work or service to be performed is seasonal in nature and the
employment is for the duration of the season.
Subsequently, the foregoing articles regarding employment with "a definite period" and "regular"
employment were amended by Presidential Decree No. 850, effective December 16, 1975. Article 320, dealing
with "Probationary and fixed period employment," was altered by eliminating the reference to persons
"employed with a fixed period," and was renumbered (becoming Article 271). As it is evident that Article 280
of the Labor Code, under a narrow and literal interpretation, not only fails to exhaust the gamut of
employment contracts to which the lack of a fixed period would be an anomaly, but would also appear to
restrict, without reasonable distinctions, the right of an employee to freely stipulate with his employer the
duration of his engagement, it logically follows that such a literal interpretation should be eschewed or
avoided. The law must be given a reasonable interpretation, to preclude absurdity in its application. Outlawing
the whole concept of term employment and subverting to boot the principle of freedom of contract to remedy
the evil of employer's using it as a means to prevent their employees from obtaining security of tenure is like
cutting off the nose to spite the face or, more relevantly, curing a headache by lopping off the head. Such
interpretation puts the seal on Bibiso upon the effect of the expiry of an agreed period of employment as still
good rule—a rule reaffirmed in the recent case of Escudero vs. Office of the President where, in the fairly
analogous case of a teacher being served by her school a notice of termination following the expiration of the
last of three successive fixed-term employment contracts, the Court held:
Reyes (the teacher's) argument is not persuasive. It loses sight of the fact that her employment was
probationary, contractual in nature, and one with a definitive period. At the expiration of the period stipulated
in the contract, her appointment was deemed terminated and the letter informing her of the non-renewal of
her contract is not a condition sine qua non before Reyes may be deemed to have ceased in the employ of
petitioner UST. The notice is a mere reminder that Reyes' contract of employment was due to expire and that
the contract would no longer be renewed. It is not a letter of termination.
Paraphrasing Escudero, respondent Alegre's employment was terminated upon the expiration of his last
contract with Brent School on July 16, 1976 without the necessity of any notice. The advance written advice
given the Department of Labor with copy to said petitioner was a mere reminder of the impending expiration
of his contract, not a letter of termination, nor an application for clearance to terminate which needed the
approval of the Department of Labor to make the termination of his services effective. In any case, such
clearance should properly have been given, not denied.

29. Jamias vs. National Labor Relations Commission (Second Division)

FACTS: Respondent Innodata Philippines, Inc. (Innodata), a domestic corporation engaged in the business of
data processing and conversion for foreign clients,2 hired 5 individuals on various dates. After their respective
contracts expired, the forenamed individuals filed a complaint for illegal dismissal claiming that Innodata had
made it appear that they had been hired as project employees in order to prevent them from becoming
regular employees. Labor Arbiter dismissed the complaint for lack of merit. He found and held that the
petitioners had knowingly signed their respective contracts in which the durations of their engagements were
clearly stated; and that their fixed term contracts, being exceptions to Article 280 of the Labor Code,
precluded their claiming regularization. This was affirmed by both the NLRC and CA.

ISSUE: Are the petitioners project employees?

RULING: YES. The provision under Article 280 of LC contemplates three kinds of employees, namely: (a)
regular employees; (b) project employees; and (c) casuals who are neither regular nor project employees.
Obviously, Article 280 does not preclude an agreement providing for a fixed term of employment knowingly
and voluntarily executed by the parties. A fixed term agreement, to be valid, must strictly conform with the
requirements and conditions provided in Article 280 of the Labor Code. The test to determine whether a
particular employee is engaged as a project or regular employee is whether or not the employee is assigned to
carry out a specific project or undertaking, the duration or scope of which was specified at the time of his
engagement. There must be a determination of, or a clear agreement on, the completion or termination of the
project at the time the employee is engaged. Otherwise put, the fixed period of employment must be
knowingly and voluntarily agreed upon by the parties, without any force, duress or improper pressure being
brought to bear upon the employee and absent any other circumstances vitiating his consent, or it must
satisfactorily appear that the employer and employee dealt with each other on more or less equal terms with
no moral dominance whatsoever being exercised by the former on the latter.
The contracts of the petitioners indicated the one-year duration of their engagement as well as their
respective project assignments. There is no indication that the petitioners were made to sign the contracts
against their will. Neither did they refute Innodata`s assertion that it did not employ force, intimidate or
fraudulently manipulate the petitioners into signing their contracts, and that the terms thereof had been
explained and made known to them. Hence, the petitioners knowingly agreed to the terms of and voluntarily
signed their respective contracts. That Innodata drafted the contracts with its business interest as the
overriding consideration did not necessarily warrant the holding that the contracts were prejudicial against
the petitioners. The fixing by Innodata of the period specified in the contracts of employment did not also
indicate its ill motive to circumvent the petitioners` security of tenure. Indeed, the petitioners could not
presume that the fixing of the one-year term was intended to evade or avoid the protection to tenure under
Article 280 of the Labor Code in the absence of other evidence establishing such intention.

30. Pacquing vs. Coca-Cola Philippines, Inc.

G.R. No. 157966. January 31, 2008.
FACTS: Eddie Pacquing, Roderick Centeno, Juanito M. Guerra, Claro Dupilad, Jr., Louie Centeno, David Reblora,
Raymundo Andrade (petitioners) were sales route helpers or cargadorespahinantes of Coca-Cola Bottlers
Philippines, Inc., (respondent), with the length of employment:
Name Date Hired Date Dismissed
Eddie P. Pacquing June 14, 1987 January 30, 1988
Roderick Centeno November 15, 1985 January 15, 1995
Juanito M. Guerra June 16, 1980 February 20, 1995
Claro Dupilad, Jr. March 1, 1992 June 30, 1995
David R. Reblora September 15, 1988 December 15, 1995
Louie Centeno September 15, 1988 March 15, 1996
Raymundo Andrade January 15, 1988 October 15, 1995
Petitioners were part of a complement of three personnel comprised of a driver, a salesman and a regular
route helper, for every delivery truck. They worked exclusively at respondent's plants, sales offices, and
company premises.
Petitioners filed a Complaint against respondent for unfair labor practice and illegal dismissal with claims for
regularization, recovery of benefits under the Collective Bargaining Agreement (CBA), moral and exemplary
damages, and attorney's fees. They alleged that they should be declared regular employees of respondent
since the nature of their work as cargadores-pahinantes was necessary or desirable to respondent's usual
business and was directly related to respondent's business and trade.
Respondent denied liability to petitioners and countered that petitioners were temporary workers who were
engaged for a five-month period to act as substitutes for an absent regular employee.
Labor Arbiter Babiano rendered a Decision dismissing the complaint; that petitioners were temporary workers
hired through an independent contractor and acted as substitutes for the company's regular work force; that
petitioner cannot be considered regular employees because, as cargadores-pahinantes, their work was not
necessary or desirable in respondent's business - the manufacture of softdrinks.

Petitioners filed a Memorandum of Appeal with the National Labor Relations Commission (NLRC). NLRC issued
a Resolution dismissing the appeal and affirming the Decision of the Labor Arbiter.
The CA rendered a Decision dismissing the petition for petitioner's failure to comply with the verification
requirement in the petition and the appeal memorandum. And affirmed the NLRC's finding that petitioners'
functions were not related to respondent's main business.

ISSUE: WHETHER OR NOT PETITIONERS SHOULD BE DECLARED REGULAR EMPLOYEES OF COCA-COLA AND
THUS ENTITLED TO BE REINSTATED WITH BACKWAGES FROM THE DATE OF THEIR DISMISSAL UP TO THE DATE
OF THEIR ACTUAL REINSTATEMENT, DAMAGES AND ATTORNEY'S FEES.
RULING: Yes, they are regular employees.
Generally, the existence of an employer-employee relationship is a factual matter that will not be delved into
by this Court, since only questions of law may be raised in petitions for review. Needless to stress, the
established rule is that in the exercise of the Supreme Courts power of review, the Court not being a trier of
facts, does not normally embark on a re-examination of the evidence presented by the contending parties
during the trial of the case considering that the findings of facts of the CA are conclusive and binding on the
Court. This rule, however, has several well-recognized exceptions, to wit: (1) when the findings are grounded
entirely on speculation, surmises or conjectures; (2) when the inference made is manifestly mistaken, absurd
or impossible; (3) when there is grave abuse of discretion; (4) when the judgment is based on a
misapprehension of facts; (5) when the findings of fact are conflicting; (6) when in making its findings the
Court of Appeals went beyond the issues of the case, or its findings are contrary to the admissions of both the
appellant and the appellee; (7) when the findings are contrary to the trial court; (8) when the findings are
conclusions without citation of specific evidence on which they are based; (9) when the facts set forth in the
petition as well as in the petitioners main and reply briefs are not disputed by the respondent; (10) when the
findings of fact are premised on the supposed absence of evidence and contradicted by the evidence on
record; and (11) when the Court of Appeals manifestly overlooked certain relevant facts not disputed by the
parties, which, if properly considered, would justify a different conclusion. Exceptions (2) and (4) are present
in the instant case.
The pivotal question of whether respondent's sales route helpers or cargadores or pahinantes are regular
workers of respondent has already been resolved in Magsalin v. National Organization of Working Men, thus:
The basic law on the case is Article 280 of the Labor Code read:

Art. 280. Regular and Casual Employment. The provisions of written agreement to the contrary
notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be
regular where the employee has been engaged to perform activities which are usually necessary or desirable
in the usual business or trade of the employer, except where the employment has been fixed for a specific
project or undertaking the completion or termination of which has been determined at the time of the
engagement of the employee or where the work or services to be performed is seasonal in nature and the
employment is for the duration of the season.
An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided, That,
any employee who has rendered at least one year of service, whether such service is continuous or broken,
shall be considered a regular employee with respect to the activity in which he is employed and his
employment shall continue while such activity exists.
The argument of petitioner that its usual business or trade is softdrink manufacturing and that the work
assigned to respondent workers as sales route helpers so involves merely post production activities, one which
is not indispensable in the manufacture of its products, scarcely can be persuasive. If, as so argued by
petitioner company, only those whose work are directly involved in the production of softdrinks may be held
performing functions necessary and desirable in its usual business or trade, there would have then been no
need for it to even maintain regular truck sales route helpers. The nature of the work performed must be
viewed from a perspective of the business or trade in its entirety and not on a confined scope.
The repeated rehiring of respondent workers and the continuing need for their services clearly attest to the
necessity or desirability of their services in the regular conduct of the business or trade of petitioner company.
The CA has found each of respondents to have worked for at least one year with petitioner company. While
this Court, in Brent School, Inc. vs. Zamora,has upheld the legality of a fixed-term employment, it has done so,
however, with a stern admonition that where from the circumstances it is apparent that the period has been
imposed to preclude the acquisition of tenurial security by the employee, then it should be struck down as
being contrary to law, morals, good customs, public order and public policy. The pernicious practice of having
employees, workers and laborers, engaged for a fixed period of few months, short of the normal six-month
probationary period of employment, and, thereafter, to be hired on a day-to-day basis, mocks the law. Any
obvious circumvention of the law cannot be countenanced. The fact that respondent workers have agreed to
be employed on such basis and to forego the protection given to them on their security of tenure,
demonstrate nothing more than the serious problem of impoverishment of so many of our people and the
resulting unevenness between labor and capital. A contract of employment is impressed with public interest.
The provisions of applicable statutes are deemed written into the contract, and the parties are not at liberty to
insulate themselves and their relationships from the impact of labor laws and regulations by simply
contracting with each other.
Under the principle of stare decisis et non quieta movere (follow past precedents and do not disturb what has
been settled), it is the Court's duty to apply the previous ruling in Magsalin to the instant case. Once a case has
been decided one way, any other case involving exactly the same point at issue, as in the case at bar, should
be decided in the same manner. Else, the ideal of a stable jurisprudential system can never be achieved.
Being regular employees of respondent, petitioners are entitled to security of tenure, as provided in Article
279 of the Labor Code, and may only be terminated from employment due to just or authorized causes.
Because respondent failed to show such cause, the petitioners are deemed illegally dismissed and therefore
entitled to back wages and reinstatement without loss of seniority rights and other privileges.
On the claim for moral and exemplary damages, there is no basis to award the same. Moral and exemplary
damages are recoverable only where the dismissal of an employee was attended by bad faith or fraud, or
constituted an act oppressive to labor, or was done in a manner contrary to morals, good customs or public
policy. The person claiming moral damages must prove the existence of bad faith by clear and convincing
evidence, for the law always presumes good faith. Petitioners failed to prove bad faith, fraud or ill motive on
the part of respondent. Moral damages cannot be awarded. Without the award of moral damages, there can
be no award of exemplary damages, nor attorneys fees.

31. LU vs ENOPIA
G.R. No. 197899. March 6, 2017
FACTS: Petitioners (now herein respondents) were hired from as crew members of the fishing mother boat
owned by respondent Joaquin Lu (herein petitioner Lu) who is the sole proprietor of Mommy Gina Tuna
Resources. Petitioners and Lu had an income-sharing arrangement wherein 55% goes to Lu, 45% to the crew
members, with an additional 4% as backing incentive. They also equally share the expenses for the
maintenance and repair of the mother boat, and for the purchase of nets, ropes and payaos. Sometime in
August 1997, Lu proposed the signing of a Joint Venture Fishing Agreement between them, but petitioners
refused to sign the same as they opposed the one-year term provided in the agreement. According to
petitioners, during their dialogue, Lu terminated their services right there and then because of their refusal to
sign the agreement. Thereafter, petitioners filed their complaint for illegal dismissal, monetary claims and
damages. Lu denied having dismissed petitioners, claiming that their relationship was one of joint venture
where he provided the vessel and other fishing paraphernalia, while petitioners, as industrial partners,
provided labor by fishing in the high seas. Lu alleged that there was no employer-employee relationship as its
elements were not present.

ISSUES: 1.Is there an employer-employee relationship?

2.Are the respondents entitled to security of tenure?

RULING: 1.Yes. In this case, petitioner contends that it was the piado who hired respondents, however, it was
shown by the latter’s evidence that the employer stated in their Social Security System (SSS) online inquiry
system printouts was MGTR, which is owned by petitioner. The Court has gone over these printouts and found
that the date of the SSS remitted contributions coincided with the date of respondents’ employment with
petitioner. Petitioner failed to rebut such evidence. Thus, the fact that petitioner had registered the
respondents with SSS is proof that they were indeed his employees. The coverage of the Social Security Law is
predicated on the existence of an employer-employee relationship. Moreover, the records show that the 4%
backing incentive fee which was divided among the fishermen engaged in the fishing operations approved by
petitioner was paid to respondents after deducting the latter’s respective vale or cash advance. Notably, even
the piado’s name was written in the backing incentive fee sheet with the corresponding vale which was
deducted from his incentive fee. If indeed a joint venture was agreed upon between petitioner and
respondents, why would these fishermen obtain vale or cash advance from petitioner and not from the piado
who allegedly hired and had control over them. It was established that petitioner exercised control over
respondents. It should be remembered that the control test merely calls for the existence of the right to
control, and not necessarily the exercise thereof. It is not essential that the employer actually supervises the
performance of duties by the employee. It is enough that the former has a right to wield the power.20
Petitioner admitted in his pleadings that he had contact with respondents at sea via the former’s radio
operator and their checker. He claimed that the use of the radio was only for the purpose of receiving
requisitions for the needs of the fishermen in the high seas and to receive reports of fish catch so that they
can then send service boats to haul the same. However, such communication would establish that he was
constantly monitoring or checking the progress of respondents’ fishing operations throughout the duration
thereof, which showed their control and supervision over respondents’ activities. Also, the payment of
respondents’ wages based on the percentage share of the fish catch would not be sufficient to negate the
employer-employee relationship existing between them. Lastly, petitioner wielded the power of dismissal
over respondents when he dismissed them after they refused to sign the joint fishing venture agreement.
Thus, respondents are regular employees of the petitioner.

2.Yes. As respondents were petitioner’s regular employees, they are entitled to security of tenure under
Section 3,27 Article XIII of the 1987 Constitution. It is also provided under Article 279 of the Labor Code, that
the right to security of tenure guarantees the right of employees to continue in their employment absent a
just or authorized cause for termination. Considering that respondents were petitioner’s regular employees,
the latter’s act of asking them to sign the joint fishing venture agreement which provides that the venture
shall be for a period of one year from the date of the agreement, subject to renewal upon mutual agreement
of the parties, and may be pre-terminated by any of the parties before the expiration of the one-year period,
is violative of the former’s security of tenure. And respondents’ termination based on their refusal to sign the
same, not being shown to be one of those just causes for termination under Article 282,28 is, therefore,
illegal.

32. San Miguel Coporation v Teodosio

G.R. No. 163033, October 2, 2009.
FACTS: Respondent Eduardo Teodosio as a casual forklift operator, was tasked with loading and unloading
pallet of beer cases within the brewery premises. Respondent continuously worked for months, then was
asked to rest, and then rehired again as a forklifter multiple times. He continued to work as such until August
1993.
Sometime in August 1993, respondent was made to sign an Employment with a Fixed Period contract
by SMC. On March 20, 1995, respondent was transferred to the plants bottling section as a case piler.
Respondent opposed this, hee asserted that he would be more effective as a forklift operator because he had
been employed as such for more than three years already, and he be transferred to his former position as a
forklift operator. However, SMC did not answer his letter.
Respondent informed SMC that he was applying for the vacant position of bottling crew as he was interested
in becoming a regular employee of SMC. On June 1, 1995, SMC notified the respondent that his employment
shall be terminated on July 1, 1995 in compliance with the Employment with a Fixed Period contract due to
the reorganization and streamlining of its operations.
In a letter dated July 3, 1995, respondent expressed his dismay for his dismissal. Thereafter, respondent
signed a Receipt and Release document in favor of SMC and accepted his separation pay, thereby releasing all
his claims against SMC.
On July 4, 1995, respondent filed a Complaint against NLRC for illegal dismissal and underpayment of wages
and other benefits. However, The CA granted the petition and ratiocinated that the Employment with a Fixed
Period contract was just a scheme of SMC to circumvent respondent’s security of tenure.

ISSUE: Whether or not the respondent was a regular employee of SMC.

RULING: Yes. The Labor Code provides that a casual employee can be considered as a regular employee if said
casual employee has rendered at least one year of service regardless of the fact that such service may be
continuous or broken. If the employee has been performing the job for at least one year, even if the
performance is not continuous or merely intermittent, the law deems the repeated and continuing need for its
performance as sufficient evidence of the necessity, if not indispensability, of that activity to the business of
the employer. Moreover, the nature of respondents’ work is necessary in the business in which SMC is
engaged. SMC is primarily engaged in the manufacture and marketing of beer products, for which purpose, it
specifically maintains a brewery in Bacolod City.
Moreover, the nature of respondents’ work is necessary in the business in which SMC is engaged. SMC
is primarily engaged in the manufacture and marketing of beer products, for which purpose, it specifically
maintains a brewery in Bacolod City. Respondent, on the other hand, was engaged as a forklift operator
tasked to lift and transfer pallets and pile them from the bottling section to the piling area. And, even after the
installation of the automated palletizers, SMC did not leave the position of forklift operator vacant. SMC even
transferred one of its regular employees to the Bacolod City Brewery to replace respondent who was in turn
transferred to the bottling section of the plant. This demonstrates the continuing necessity and
indispensability of hiring a forklift operator to the business of SMC.

Issue: Whether or not the fixed term employment contract is valid.

Ruling: Not valid, Undoubtedly, respondent is a regular employee of SMC. Consequently, the employment
contract with a fixed period which SMC had respondent execute was meant only to circumvent respondents
right to security of tenure and is, therefore, invalid.
Since respondent was already a regular employee months before the execution of the Employment with a
Fixed Period contract, its execution was merely a ploy on SMCs part to deprive respondent of his tenurial
security. Hence, no valid fixed-term contract was executed. The employment status of a person is defined and
prescribed by law and not by what the parties say it should be. Equally important to consider is that a contract
of employment is impressed with public interest such that labor contracts must yield to the common good.
Provisions of applicable statutes are deemed written into the contract, and the parties are not at liberty to
insulate themselves and their relationships from the impact of labor laws and regulations by simply
contracting with each other.
Having gained the status of a regular employee, respondent is entitled to security of tenure and could only be
dismissed on just or authorized causes and after he has been accorded due process.
SMC insists that the termination of respondents employment was in accordance with the Employment with a
Fixed Period contract; and that respondent was given opportunities to become a regular employee when he
was transferred to the bottling section of the plant. However, considering that respondent was already a
regular employee of SMC at that time, the reason advanced by SMC for his termination would not constitute a
just or authorized cause.

(addition: with regard to quitclaim entered by respondent. Also, SMC cannot take refuge in the Receipt and
Release document signed by the respondent. The burden of proving that the quitclaim or waiver was
voluntarily entered into rests on the employer. SMC failed to discharge this burden. This is buttressed by the
fact that before the respondent signed the document, he already informed SMC in the letter dated July 3,
1995, that even if he would be compelled to receive his separation pay and be forced to sign a waiver to that
effect, he was not waiving his right to question his dismissal and to claim employment benefits. This clearly
proves that respondent did not freely and voluntarily consent to the execution of the document.

As aptly concluded by the CA, herein respondent, having been unjustly dismissed from work, is entitled to
reinstatement without loss of seniority rights and other privileges and to full back wages, inclusive of
allowances, and to other benefits or their monetary equivalents computed from the time compensation was
withheld up to the time of actual reinstatement.

33. Basan et. al., vs Coca Cola

G.R. No. 1744365-66, February 4, 2015

FACTS: On February 18, 1997, petitioners Romeo Basan, Danilo Dizon, Jaime L. Tumabiao, Jr., Roberto Dela
Rama, Jr., Ricky S. Nicolas, Crispulo D. Donor, Galo Falguera filed a complaint for illegal dismissal with money
claims against respondent Coca-Cola Bottlers Philippines, alleging that respondent dismissed them without
just cause and prior written notice required by law. Respondent corporation, however, countered that it hired
petitioners as temporary route helpers to act as substitutes for its absent regular route helpers merely for a
fixed period in anticipation of the high volume of work in its plants or sales offices.6 As such, petitioners’
claims have no basis for they knew that their assignment as route helpers was temporary in duration. On
August 21, 1998, the Labor Arbiter ruled in favor of petitioners and found that since they were performing
activities necessary and desirable to the usual business of petitioner for more than the period for
regularization, petitioners are considered as regular employees, and thus, their dismissal was done contrary to
law in the absence of just cause and prior written notice. On January 30, 2003, the NLRC affirmed the Labor
Arbiter’s decision and rejected respondent’s contention that petitioners were merely employed for a specific
project or undertaking the completion or termination of which has been determined at the time of their
engagement. In its Decision dated August 31, 2005, the CA reversed the rulings of the NLRC and the Labor
Arbiter.

ISSUE: Whether or not the petitioners are regular employees of the respondent corporation?

RULING: Yes. It must be noted that the same has already been resolved in Magsalin v. National Organization of
Working Men, wherein this Court has categorically declared that the nature of work of route helpers hired by
Coca-Cola Bottlers Philippines, Inc. is necessary and desirable in its usual business or trade thereby qualifying
them as regular employees. The argument of petitioner that its usual business or trade is softdrink
manufacturing and that the work assigned to respondent workers as sales route helpers so involves merely
“postproduction activities” one which is not indispensable in the manufacture of its products, scarcely can be
persuasive. If, as so argued by petitioner company, only those whose work are directly involved in the
production of softdrinks may be held performing functions necessary and desirable in its usual business or
trade, there would have then been no need for it to even maintain regular truck sales route helpers. The
nature of the work performed must be viewed from a perspective of the business or trade in its entirety and
not on a confined scope. The repeated rehiring of respondent workers and the continuing need for their
services clearly attest to the necessity or desirability of their services in the regular conduct of the business or
trade of petitioner company. Here, respondent, in its position paper, expressly admitted that petitioners were
employed as route helpers in anticipation of the high volume of work in its plants and sales offices As such,
respondent’s contention that petitioners could not have attained regular employment status for they merely
rendered services for periods of less than a year cannot be sustained in view of the Magsalin doctrine
previously cited. Indeed, the “pernicious practice” of engaging employees for a fixed period short of the six-
month probationary period of employment, and again, on a day-to-day basis thereafter, mocks the law.

34. Gapayao vs. Fulo

G.R. No. 193493; June 13, 2013

FACTS: Jaime Fulo (deceased) died of "acute renal failure secondary to 1st degree burn 70% secondary
electrocution" while doing repairs at the residence and business establishment of petitioner. Thereafter,
private respondent filed a claim for social security benefits with the Social Security System (SSS)–Sorosogon
Branch. However, upon verification and evaluation, it was discovered that the deceased was not a registered
member of the SSS. Respondent filed a Petition before the SSC where she sought social security coverage and
payment of contributions in order to avail herself of the benefits accruing from the death of her husband.
Petitioner filed an Answer disclaiming any liability on the premise that the deceased was not the former’s
employee, but was rather an independent contractor whose tasks were not subject to petitioner’s control and
supervision.

ISSUE: Whether there exists between the deceased Jaime Fulo and petitioner an employer-employee
relationship that would merit an award of benefits in favor of private respondent under social security laws.
What kind of employee is Mr. Fulo?

RULING: YES. Fulo is a regular employee. Under Article 280 of the Labor Code, seasonal employees are not
covered by the definitions of regular and casual employees. Farm workers may be considered regular seasonal
employees. Jurisprudence has identified the three types of employees mentioned in the provision: (1) regular
employees or those who have been engaged to perform activities that are usually necessary or desirable in
the usual business or trade of the employer; (2) project employees or those whose employment has been
fixed fora specific project or undertaking, the completion or termination of which has been determined at the
time of their engagement, or those whose work or service is seasonal in nature and is performed for the
duration of the season; and (3) casual employees or those who are neither regular nor project employees.
Farm workers generally fall under the definition of seasonal employees. The court have consistently held that
seasonal employees may be considered as regular employees. Regular seasonal employees are those called to
work from time to time. The nature of their relationship with the employer is such that during the off season,
they are temporarily laid off; but reemployed during the summer season or when their services may be
needed. They are in regular employment because of the nature of their job,and not because of the length of
time they have worked.
The rule, however, is not absolute. In Hacienda Fatima v. National Federation of Sugarcane Workers-Food &
General Trade, the Court held that seasonal workers who have worked for one season only may not be
considered regular employees. Similarly, in Mercado, Sr. v. NLRC, it was held that when seasonal employees
are free to contract their services with other farm owners, then the former are not regular employees.
For regular employees to be considered as such, the primary standard used is the reasonable connection
between the particular activity they perform and the usual trade or business of the employer- the test is
whether the former is usually necessary or desirable in the usual business or trade of the employer. The
connection can be determined by considering the nature of the work performed and its relation to the scheme
of the particular business or trade in its entirety. Also if the employee has been performing the job for at least
one year, even if the performance is not continuous or merely intermittent, the law deems the repeated and
continuing need for its performance as sufficient evidence of the necessity if not indispensability of that
activity to the business. Hence, the employment is also considered regular, but only with respect to such
activity and while such activity exists.
EVIDENCE PROVEN: A reading of the records reveals that the deceased was indeed a farm worker who was in
the regular employ of petitioner. From year to year, starting January 1983 up until his death, the deceased had
been working on petitioner’s land by harvesting abaca and coconut, processing copra, and clearing weeds. His
employment was continuous in the sense that it was done for more than one harvesting season. Moreover, no
amount of reasoning could detract from the fact that these tasks were necessary or desirable in the usual
business of petitioner.
The other tasks allegedly done by the deceased outside his usual farm work only bolster the existence of an
employer-employee relationship. As found by the SSC, the deceased was a construction worker in the building
and a helper in the bakery, grocery, hardware, and piggery – all owned by petitioner.
The most telling indicia of this relationship is the Compromise Agreement executed by petitioner and private
respondent.
Pakyaw workers are considered employees for as long as their employers exercise control over them.We do
not give credence to the allegation that the deceased was an independent contractor hired by a certain Adolfo
Gamba, the contractor whom petitioner himself had hired to build a building. The allegation was based on the
self-serving testimony of Joyce Gapay Demate, the daughter of petitioner. The latter has not offered any other
proof apart from her testimony to prove the contention.

35. Paz v. Northern Tobacco Redrying Co.

G.R. No. 199554; February 18, 2015

FACTS: Zenaida Paz filed a Petition praying that the computation of his Retirement Pay as determined by the
NLRC be reinstated. Northern Tobacco Redrying Co., Inc. (NTRCI), a flue-curing and redrying of tobacco leaves
business employs approximately 100 employees with seasonal workers "tasked to sort, process, store and
transport tobacco leaves during the tobacco season of March to September. NTRCI hired Zenaida Paz
sometime in 1974 as a seasonal sorter, paid P185.00 daily. NTRCI regularly re-hired her every tobacco season
since then. She signed a seasonal job contract at the start of her employment and a pro-forma application
letter prepared by NTRCI in order to qualify for the next season. On May 18, 2003, Paz was 63 years old when
NTRCI informed her that she was considered retired under company policy. A year later, NTRCI told her she
would receive P12,000.00 as retirement pay. Paz, with two other complainants, filed a Complaint for illegal
dismissal against NTRCI on March 4, 2004. She amended her Complaint on April 27, 2004 into a Complaint for
payment of retirement benefits, damages, and attorney's fees as P12,000.00 seemed inadequate for her 29
years of service. NTRCI countered that no CBA existed between NTRCI and its workers. Thus, it computed the
retirement pay of its seasonal workers based on Article 287 of the Labor Code. NTRCI raised the requirement
of at least six months of service a year for that year to be considered in the retirement pay computation. It
claimed that Paz only worked for at least six months in 1995, 1999, and 2000 out of the 29 years she rendered
service. Thus, Paz's retirement pay amounted to P12,487.50 after multiplying her 185.00 daily salary by 22½
working days in a month, for three years. The Labor Arbiter confirmed that the correct retirement pay Paz was
P12,487.50.

The NLRC modified the Labor Arbiter's Decision and likewise denied reconsideration, ruling that Paz's
retirement pay should be computed pursuant to RA 7641 and that all the months she was engaged to work for
respondent for the last 28 years should be added and divided by six (for a fraction of six months is considered
as one year) to get the number of years for her retirement pay. The CA dismissed the Petition and modified
the NLRC's Decision in that "financial assistance is awarded to . . . Zenaida Paz in the amount of P60,356.25."
The CA found that while applying the clear text of Article 287 resulted in the amount of P12,487.50 as
retirement pay, "this amount was so meager that it could hardly support . . . Paz, now that she is weak and
old, unable to find employment." The CA discussed jurisprudence on financial assistance and deemed it
appropriate to apply the formula: One-half-month pay multiplied by 29 years of service divided by two
yielded P60,356.25 as Paz's retirement pay.

ISSUE 1: Whether or not Paz is a regular employee of Northern Tobacco Redrying Co.

ISSUE 2: Whether or not the CA erred in computing Paz’s retirement pay and that of the NLRC’s computation
should be reinstated.

RULING 1: YES. Article 280 of the Labor Code and jurisprudence identified three types of employees, namely:
"(1) regular employees or those who have been engaged to perform activities which are usually necessary or
desirable in the usual business or trade of the employer; (2) project employees or those whose employment
has been fixed for a specific project or undertaking, the completion or termination of which has been
determined at the time of the engagement of the employee or where the work or service to be performed is
seasonal in nature and the employment is for the duration of the season; and (3) casual employees or those
who are neither regular nor project employees."

Jurisprudence also recognizes the status of regular seasonal employees.

Mercado, Sr. v. National Labor Relations Commission did not consider as regular employees the rice and sugar
farmland workers who were paid with daily wages. This was anchored on the Labor Arbiter's findings that
"petitioners were required to perform phases of agricultural work for a definite period, after which their
services were available to any farm owner." This court explained that the proviso in the second paragraph of
Article 280 in that "any employee who has rendered at least one year of service, whether such service is
continuous or broken, shall be considered a regular employee" applies only to "casual" employees and not
"project" and regular employees in the first paragraph of Article 280. On the other hand, the workers of La
Union Tobacco Redrying Corporation in Abasolo v. National Labor Relations Commission were considered
regular seasonal employees since they performed services necessary and indispensable to the business for
over 20 years, even if their work was only during tobacco season. This court applied the test laid down in De
Leon v. National Labor Relations Commission for determining regular employment status:

The test of whether or not an employee is a regular employee has been laid down in De Leon v. NLRC, in which
the Court held:
The primary standard, therefore, of determining regular employment is the reasonable connection between
the particular activity performed by the employee in relation to the usual trade or business of the employer.
The test is whether the former is usually necessary or desirable in the usual business or trade of the employer.
The connection can be determined by considering the nature of the work performed and its relation to the
scheme of the particular business or trade in its entirety. Also if the employee has been performing the job for
at least a year, even if the performance is not continuous and merely intermittent, the law deemsrepeated
and continuing need for its performance as sufficient evidence of the necessity if not indispensability of that
activity to the business. Hence, the employment is considered regular, but only with respect to such activity,
and while such activity exists.
Thus, the nature of one's employment does not depend solely on the will or word of the employer. Nor on the
procedure for hiring and the manner of designating the employee, but on the nature of the activities to be
performed by the employee, considering the employer's nature of business and the duration and scope of
work to be done. In the case at bar, while it may appear that the work of petitioners is seasonal, inasmuch as
petitioners have served the company for many years, some for over 20 years, performing services necessary
and indispensable to LUTORCO's business, serve as badges of regular employment. Moreover, the fact that
petitioners do not work continuously for one whole year but only for the duration of the tobacco season does
not detract from considering them in regular employment since in a litany of cases this Court has already
settled that seasonal workers who are called to work from time to time and are temporarily laid off during off-
season are not separated from service in said period, but are merely considered on leave until re-employed.
Respondent NTRCI engaged the services of petitioner Paz as a seasonal sorter and had been regularly rehired
from 1974,until she was informed in 2003 that she was being retired under company policy.

The services petitioner Paz performed as a sorter were necessary and indispensable to respondent NTRCI's
business of flue-curing and redrying tobacco leaves. She was also regularly rehired as a sorter during the
tobacco seasons for 29 years since 1974. These considerations taken together allowed the conclusion that
petitioner Paz was a regular seasonal employee, entitled to rights under Article 279 of the Labor Code.

RULING 2 : NO. The Court affirmed the CA's decision with modification.
An employer may provide for retirement benefits in an agreement with its employees such as in a Collective
Bargaining Agreement. Otherwise, Article 287 of the Labor Code, as amended, governs. Since respondent
NTRCI failed to present a copy of a Collective Bargaining Agreement on the alleged retirement policy, we apply
Article 287 of the Labor Code, as amended by RA 7641. This provides for the proper computation of
retirement benefits in the absence of a retirement plan or agreement:
In the absence of a retirement plan or agreement providing for retirement benefits of employees in the
establishment, an employee upon reaching the age of sixty (60) years or more, but not beyond sixty-five (65)
years which is hereby declared the compulsory retirement age, who has served at least five (5) years in the
said establishment, may retire and shall be entitled to retirement pay equivalent to at least one-half (1/2)
month salary for every year of service, a fraction of at least six (6) months being considered as one whole year.
Unless the parties provide for broader inclusions, the term 'one-half (1/2) month salary' shall mean fifteen (15)
days plus one-twelfth (1/12) of the 13th month pay and the cash equivalent of not more than five (5) days of
service incentive leaves. Respondent NTRCI followed the formula in Article 287 and offered petitioner Paz the
amount of P12,487.50 as retirement pay based on the three years she worked for at least six months in 1995,
1999, and 2000. While the present case involves retirement pay and not separation pay, Article 287 of the
Labor Code on retirement pay similarly provides that "a fraction of at least six (6) months being considered as
one whole year." Thus, the Court's reading of this proviso in the Labor Code in Philippine Tobacco applies in
this case. An employee must have rendered at least six months in a year for said year to be considered in the
computation. The Court of Appeals found "no positive proof on the total number of months Paz actually
rendered work [for respondent NTRCI]." On the other hand, both the Labor Arbiter and the Court of Appeals
established from the records that she rendered at least six months of service for 1995, 1999, and 2000 only.
Based on these factual findings, retirement pay pursuant to Article 287 of the Labor Code was correctly
computed at P12,487.50 and was awarded to petitioner Paz.

36. DUSIT HOTEL NIKKO vs. RENATO M. GATBONTON

G.R. No. 161654 May 5, 2006.

FACTS: On November 21, 1998, respondent Renato M. Gatbonton was hired as Chief Steward in petitioner
Dusit Hotel Nikko’s Food and Beverage Department. He signed a three-month probationary employment
contract until February 21, 1999. The hotel alleged that at the end of the probation period, Ingo Rauber,
Director of its Food and Beverage Department, observed that Gatbonton failed to meet the qualification
standards for Chief Steward, and Rauber recommended a two month extension of Gatbonton’s probationary
period, or until April 22, 1999. At the end of the 4th month, on March 24, 1999, Rauber informed Gatbonton
that the latter had poor ratings on staff supervision, productivity, quantity of work, and overall efficiency and
did not qualify as Chief Steward. Gatbonton requested another month or until April 22, 1999 to improve his
performance, to which Rauber agreed but allegedly refused to sign the Performance Evaluation Form. Neither
did he sign the Memorandum on the extension.
On March 31, 1999, a notice of termination of probationary employment effective April 9, 1999, on the
above alleged grounds was served on Gatbonton. Consequently, he filed a complaint for illegal dismissal and
non- payment of wages, with prayers for reinstatement, full backwages, and damages, including attorney’s
fees.

ISSUE: Was respondent a regular employee at the time of his dismissal?

RULING: Yes. 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. Here, the
petitioner did not present proof that the respondent was evaluated from November 21, 1998 to February 21,
1999, nor that his probationary employment was validly extended. In the absence of any evaluation or valid
extension, the court cannot conclude that respondent failed to meet the standards of performance set by the
hotel for a chief steward. At the expiration of the three-month period, Gatbonton had become a regular
employee. It is an elementary rule in the law on labor relations that a probationary employee engaged to work
beyond the probationary period of six months, as provided under Article 281 of the Labor Code, or for any
length of time set forth by the employer (in this case, three months), shall be considered a regular employee.

37. ALILING vs. FELICIANO, ET. AL.

G.R. No. 185829, April 25, 2012

FACTS: Respondent Wide Wide World Express Corporation (WWWEC) offered to employ petitioner Armando
Aliling (Aliling) on June 2, 2004 as “Account Executive (Seafreight Sales),” with a compensation package of a
monthly salary of PhP 13,000, transportation allowance of PhP 3,000, clothing allowance of PhP 800, cost of
living allowance of PhP 500, each payable on a per month basis and a 14th month pay depending on the
profitability and availability of financial resources of the company. The offer came with a six (6)-month
probation period condition with this express caveat: “Performance during probationary period shall be made
as basis for confirmation to Regular or Permanent Status.”

On June 11, 2004, Aliling and WWWEC inked an Employment Contract under the terms of conversion to
regular status shall be determined on the basis of work performance; and employment services may, at any
time, be terminated for just cause or in accordance with the standards defined at the time of engagement.
However, instead of a Seafreight Sale assignment, WWWEC asked Aliling to handle Ground Express (GX), a
new company product launched on June 18, 2004 involving domestic cargo forwarding service for Luzon.
Marketing this product and finding daily contracts for it formed the core of Aliling’s new assignment.

A month after, Manuel F. San Mateo III (San Mateo), WWWEC Sales and Marketing Director, emailed Aliling to
express dissatisfaction with the latter’s performance. On September 25, 2004, Joseph R. Lariosa (Lariosa),
Human Resources Manager of WWWEC, asked Aliling to report to the Human Resources Department to
explain his absence taken without leave from September 20, 2004. Aliling responded two days later. He
denied being absent on the days in question, attaching to his reply-letter a copy of his timesheet which
showed that he worked from September 20 to 24, 2004. Aliling’s explanation came with a query regarding the
withholding of his salary corresponding to September 11 to 25, 2004.

On October 15, 2004, Aliling tendered his resignation to San Mateo. While WWWEC took no action on his
tender, Aliling nonetheless demanded reinstatement and a written apology, claiming in a subsequent letter
dated October 1, 2004 to management that San Mateo had forced him to resign.

Lariosa’s response-letter of October 1, 2004, informed Aliling that his case was still in the process of
being evaluated. On October 6, 2004, Lariosa again wrote, this time to advise Aliling of the termination of his
services effective as of that date owing to his “non-satisfactory performance” during his probationary period.
Records show that Aliling, for the period indicated, was paid his outstanding salary.

However, or on October 4, 2004, Aliling filed a Complaint for illegal dismissal due to forced resignation,
nonpayment of salaries as well as damages with the NLRC against WWWEC. Appended to the complaint was
Aliling’s Affidavit dated November 12, 2004, 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.”

Refuting Aliling’s basic posture, WWWEC stated that in the letter offer and employment contract adverted to,
WWWEC and Aliling have signed a letter of appointment on June 11, 2004 containing the terms of
engagement.

The Labor Arbiter explained that Aliling cannot be validly terminated for non-compliance with the quota
threshold absent a prior advisory of the reasonable standards upon which his performance would be
evaluated. Both parties appealed the decision to the NLRC, which affirmed the decision of the Labor Arbiter.

The CA anchored its assailed action on the strength of the following premises: (a) respondents failed to prove
that Aliling’s dismal performance constituted gross and habitual neglect necessary to justify his dismissal; (b)
not having been informed at the time of his engagement of the reasonable standards under which he will
qualify as a regular employee, Aliling was deemed to have been hired from day one as a regular employee;
and (c) the strained relationship existing between the parties argues against the propriety of reinstatement.
Hence, the instant petition.

ISSUES: 1.Was Aliling a probationary employee or a regular employee?

2.Was Aliling illegally dismissed?

RULING: 1.Aliling was a REGULAR EMPLOYEE. Aliling, albeit hired from management’s standpoint as a
probationary employee, was deemed a regular employee by force of the following self-explanatory provisions:

Article 281 of the Labor Code

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. (Emphasis supplied.)

Section 6(d) of the Implementing Rules of Book VI, Rule VIII-A of the Labor Code
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:
xxxx
(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. (Emphasis supplied.)

To repeat, the labor arbiter, NLRC and the CA are agreed, on the basis of documentary evidence adduced, that
respondent WWWEC did not inform petitioner Aliling of the reasonable standards by which his probation
would be measured against at the time of his engagement.

Respondents further allege that 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. To recall, in that email
message, San Mateo reminded 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, San Mateos email cannot support their allegation on 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 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 the explicit
provision of 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.

2.YES. First off, the attendant circumstances in the instant case aptly show that the issue of petitioners alleged
failure to achieve his quota, as a ground for terminating employment, strikes the Court as a mere afterthought
on the part of WWWEC. Being an experimental activity and having been launched for the first time, the sales
of GX services could not be reasonably quantified. This would explain why Amador implied in her email that
other bases besides sales figures will be used to determine Alilings performance. And yet, despite such a
neutral observation, Aliling was still dismissed for his dismal sales of GX services. In any event, WWWEC failed
to demonstrate the reasonableness and the bona fides on the quota imposition.

Employees must be reminded that while probationary employees do not enjoy permanent status, they enjoy
the constitutional protection of security of tenure. They can only be terminated for cause or when they
otherwise fail to meet the reasonable standards made known to them by the employer at the time of their
engagement. Respondent WWWEC miserably failed to prove the termination of petitioner was for a just cause
nor was there substantial evidence to demonstrate the standards were made known to the latter at the time
of his engagement. Hence, petitioners right to security of tenure was breached.
38. MYLENE CARVAJAL vs. LUZON DEVELOPMENT BANK AND/OR OSCAR Z. RAMIREZ
G.R. No. 186169, August 1, 2012

FACTS: Petitioner Mylene Carvajal was employed as a trainee-teller by respondent Luzon Development Bank
(Bank) on under a six-month probationary employment contract. Subsequently, the Bank sent petitioner a
Memorandum directing her to explain in writing why she should not be subjected to disciplinary action for
"chronic tardiness" for a total of 8 times. Petitioner apologized in writing and explained that she was in the
process of making adjustments regarding her work and house chores. She was thus reprimanded in writing
and reminded of her status as a probationary employee. A second Memorandum was again sent to petitioner
directing her to explain why she should not be suspended for "chronic tardiness" on 13 occasions. Petitioner
submitted her written explanation and manifested her acceptance of the consequences of her actions.
Petitioner was then informed, through a Memorandum, of her suspension for 3 working days without pay
effective 21 January 2004. Finally, in a Memorandum dated 22 January 2004, petitioner’s suspension was
lifted but, her employment was terminated effective 23 January 2004. Petitioner filed a complaint for illegal
dismissal before the LA. Petitioner alleged, that the following were the reasons for her termination: 1) she is
not an effective frontliner; 2) she has mistakenly cleared a check; 3) tardiness; 4) absenteeism; and 5)
shortage. Respondents averred that petitioner was terminated as a probationary employee on three grounds,
namely: 1) chronic tardiness; 2) unauthorized absence; and 3) failure to perform satisfactorily as a
probationary employee.

ISSUE: Whether the petitioner’s employment status ripened can be considered a regular employee at the
time of her dismissal.

RULING: No. At the time of her engagement and as mandated by law, petitioner was informed in writing of
the standards necessary to qualify her as a regular employee. Her appointment letter states that “ Possible
extension of this contract will depend on the job requirements of the Bank and your overall performance.
Performance review will be conducted before possible renewal can take effect. The Bank reserves the right to
immediately terminate this contract in the event of a below satisfactory performance, serious disregard of
company rules and policies and other reasons critical to its interests.” Petitioner knew, at the time of her
engagement, that she must comply with the standards set forth by respondent and perform satisfactorily in
order to attain regular status. She was apprised of her functions and duties as a trainee-teller. Respondent
released to petitioner its evaluation of her performance. Petitioner was found wanting.
A probationary employee, like a regular employee, enjoys security of tenure. However, in cases of
probationary employment, aside from just or authorized causes of termination, an additional ground is
provided under Article 281 of the Labor Code, i.e., the probationary employee may also be terminated for
failure to qualify as a regular employee in accordance with reasonable standards made known by the
employer to the employee at the time of the engagement. Thus, the services of an employee who has been
engaged on probationary basis may be terminated for any of the following: (1) a just or (2) an authorized
cause and (3) when he fails to qualify as a regular employee in accordance with reasonable standards
prescribed by the employer.
It is evident that the primary cause of respondent’s dismissal from her probationary employment was her
"chronic tardiness." At the very start of her employment, petitioner already exhibited poor working habits.
Petitioner did not provide a satisfactory explanation for the cause of her tardiness.

39. 39. MERALCO vs GALA

G.R. Nos. 191288 & 191304, March 7, 2012

FACTS: Respondent Jan Carlo Gala was a probationary lineman in Meralco who got dismissed for alleged
complicity in pilferages of Meralco’s electrical supplies. Gala denied involvement upon investigation and
maintained that even assuming his superiors committed a wrongdoing, his mere presence at the scene of the
incident was not sufficient to hold him liable as a conspirator. Meralco proceeded with the investigation and
eventually terminated his employment to which Gala responded by filing an illegal dismissal complaint. The
Labor Arbiter dismissed the complaint for lack of merit and held that Respondent’s participation in the
pilferage rendered him unqualified as a regular employee. However, the ruling was reversed by the NLRC and
found that Gala had been illegally dismissed since there was no concrete showing of misconduct or
dishonesty. He was awarded backwages and attorney’s fees. The CA denied Meralco’s petition for lack of
merit. Hence, the present petition for review on certiorari. Gala would want the petition to be dismissed
outright on procedural grounds, claiming that the Verification and Certification, Secretary’s Certificate and
Affidavit of Service accompanying the petition do not contain the details of the Community Tax Certificates of
the affiants, and that the lawyers who signed the petition failed to indicate their updated MCLE certificate
numbers, in violation of existing rules.
ISSUES: 1. Should the case be dismissed outright on procedural grounds on the basis of non-adherence to
existing rules on procedure?
2. Did Gala qualify as a regular employee of Meralco?

RULING: 1. NO. The court stressed that it is the spirit and intention of labor legislation that the NLRC and the
labor arbiters shall use every reasonable means to ascertain the facts in each case speedily and objectively,
without regard to technicalities of law or procedure, provided due process is duly observed. (Art 221) In
keeping with the policy and in the interest of substantial justice, the court deemed it proper to give due course
to the petition, especially in view of the conflict between the findings of the labor arbiter, on the one hand,
and the NLRC and the CA, on the other. As ruled in S.S. Ventures International, Inc. v. S.S. Ventures Labor
Union, the application of technical rules of procedure in labor cases may be relaxed to serve the demands of
substantial justice.

2. NO. Gala misses the point. He forgets that as a probationary employee, his overall job performance and his
behavior were being monitored and measured in accordance with the standards (i.e., the terms and
conditions) laid down in his probationary employment agreement. Under paragraph 8 of the agreement, he
was subject to strict compliance with, and non-violation of the Company Code on Employee Discipline, Safety
Code, rules and regulations and existing policies. Par. 10 required him to observe at all times the highest
degree of transparency, selflessness and integrity in the performance of his duties and responsibilities, free
from any form of conflict or contradicting with his own personal interest.

On the whole, the totality of the circumstances obtaining in the case convinces us that Gala could not but have
knowledge of the pilferage of company electrical supplies on May 25, 2006; he was complicit in its
commission, if not by direct participation, certainly, by his inaction while it was being perpetrated and by not
reporting the incident to company authorities. Thus, we find substantial evidence to support the conclusion
that Gala does not deserve to remain in Meralco’s employ as a regular employee. He violated his probationary
employment agreement, especially the requirement for him "to observe at all times the highest degree of
transparency, selflessness and integrity in the performance of their duties and responsibilities."He failed to
qualify as a regular employee.

40. PSWRI vs CA
G.R. No. 205278. June 11, 2014
FACTS: Petitioner Philippine Spring Water Resources, Inc. (PSWRI), hired Mahilum as Vice President for Sales
and Marketing for the Bulacan South Luzon Area. Mahilum was designated as over-all chairman of the
inauguration of PSWRI’s Bulacan Plant. However, due to his busy schedule, meetings on the program of
activities for the inauguration and Christmas party were conducted without Mahilum’s presence. Evangelista
took charge and assumed the lead role until the day of the affair. On the inaugural day, Mahilum’s attention
was, however, called when Lua got furious because he was not recognized during the program. He was not
mentioned in the opening remarks or called to deliver his inaugural speech. Upon inquiry from the emcees of
the program, Mahilum learned that they were not apprised of Lua’s decision to deliver the speech considering
that he previously declined to have a part in the program as he would be very busy during the affair. On the
following day, Mahilum was required to explain why Lua was not recognized and made to deliver his speech.
At the same time, he was placed under preventive suspension for 30 days. Mahilum submitted his written
explanation. Subsequently, an investigation was conducted. When his 30-day suspension ended, Mahilum
reported for work but was prevented from entering the workplace. Sometime in the first week of March 2005,
he received a copy of the Memorandum terminating his services effective the next day. Thereafter, a
clearance certificate was issued to Mahilum. He received the amount of P43,998.56 and was made to execute
the Release, Waiver and Quitclaim in favor of the company and Lua. Mahilum filed a complaint for illegal
dismissal with prayer for reinstatement, payment of backwages and damages. He argued that he was illegally
suspended and, thereafter, dismissed constructively from the service. He also claimed that he was forced to
sign the waiver. The Labor Arbiter (LA) dismissed Mahilum’s complaint for lack of merit on the ground that the
quitclaim he had executed barred his right to question his dismissal under the principle of estoppel. Being a
person of sufficient aptitude and intellect Mahilum could not have been forced to sign the document.
Aggrieved, Mahilum appealed the decision.

ISSUES: 1.Is Mahilum a regular employee of PSWRI?

2.Was he illegally dismissed?
RULINGS: 1.Yes. Mahilum was correctly considered by the NLRC and CA as a regular employee. No grave abuse
of discretion may be attributed for the application of Article 279 of the Labor Code13 in determining the
legality of MahilumÊs dismissal. A probationary employee, like a regular employee, enjoys security of tenure.
In cases of probationary employment, however, aside from just or authorized causes of termination, an
additional ground is provided under Article 281 of the Labor Code, that is, the probationary employee may
also be terminated for failure to qualify as a regular employee in accordance with reasonable standards made
known by the employer to the employee at the time of the engagement. Thus, the services of an employee
who has been engaged on probationary basis may be terminated for any of the following: (1) a just or (2) an
authorized cause and (3) when he fails to qualify as a regular employee in accordance with reasonable
standards prescribed by the employer.14 As applied to the petitionerÊs arguments, it would seem that PSWRI
and Lua now invoke the first and third ground for MahilumÊs termination. The Court, however, cannot
subscribe to the premise that Mahilum failed to qualify as a regular employee when he failed to perform at
par with the standards made known by the company to him. In this case, it is lear that the primary cause of
MahilumÊs dismissal from his employment was borne out of his alleged lapses as chairman for the
inauguration of the Bulacan plant companyÊs Christmas party. In fact, the termination letter to him cited „loss
of trust and confidence‰ as a ground for his dismissal. Under the circumstances, the petitioners may not be
permitted to belatedly harp on its choice not to extend his alleged probationary status to regular employment
as a ground for his dismissal. Besides, having been allowed to work after the lapse of the probationary period,
Mahilum became a regular employee. He was hired in June 2004 and was dismissed on February 5, 2005.
Thus, he served the company for eight (8) months.

2.Yes. As previously explained, Mahilum was a regular employee who was entitled to security of tenure. Thus,
he could only be dismissed from service for causes provided in Article 282 of the Labor Code.16 At this point, it
bears stressing that the NLRC and the CA, in their decisions, both found Mahilum to have been illegally
dismissed Consequently, the Court finds no reason to depart from the finding that MahilumÊs failure to
effectively discharge his assignment as the over-all chairman of the festivities was due to mere inadvertence
and the mistaken belief that he had properly delegated the details of the program to another officer. Further,
his designation as the chairman of the whole affair did not form part of his duty as a supervisor. Mahilum was
engaged to supervise the sales and marketing aspects of PSWRIÊs Bulacan Plant. Verily, the charge of loss of
trust and confidence had no leg to stand on, as the act complained of was not work-related. Simply put, the
petitioners were not able to prove that Mahilum was unfit to continue working for the company. Likewise,
warranting the agreement of the Court is the finding of the CA in its Amended Decision that the quitclaim
executed by Mahilum did not operate to bar a cause of action for illegal dismissal. That the amounts received
by Mahilum were only those owing to him under the law indeed bolstered the fact that the quitclaim was
executed without consideration. Suffice it to say, the subject quitclaim may not be considered as a valid and
binding undertaking.

41. UNIVERSIDAD DE STA. ISABEL vs. MARVIN-JULIAN L. SAMBAJON, JR.

FACTS: Universidad de Sta. Isabel (petitioner) is a non-stock, non-profit religious educational institution.
Petitioner hired respondent as a full-time college faculty member on probationary status, as evidenced by an
Appointment Contract. After the aforesaid contract expired, petitioner continued to give teaching loads to
respondent who remained a full-time faculty member for the two semesters of school-year (SY) 2003-2004;
and two semesters of SY 2004-2005. Sometime in June 2003, after respondent completed his course in Master
of Arts in Education, he submitted the corresponding Special Order from the CHED, together with his
credentials for the said master’s degree, to the Human Resources Department of petitioner for the purpose of
salary adjustment/increase. Subsequently, respondent’s salary was increased. He was likewise re-ranked from
Assistant Professor to Associate Professor. In a letter dated October 15, 2004 addressed to the President of
petitioner, Sr. Evidente, respondent vigorously argued that his salary increase should be made effective as of
June 2003 and demanded the payment of his salary differential but was denied. Respondent insisted on his
demand for retroactive pay. In a letter dated January 10, 2005, Sr. Evidente denied and reiterated the school
policy on re-ranking of teachers. However, respondent found the above explanation insufficient and not clear
enough. In his letter dated January 12, 2005, he pointed out the case of another faculty member. To resolve
the issue, a dialogue was held between respondent and Sr. Evidente and the parties gave conflicting accounts.
On February 26, 2005, respondent received his letter of termination. Respondent filed a complaint for illegal
dismissal against the petitioner.

ISSUE: Is respondent a regular employee?

RULING: NO. The probationary employment of teachers in private schools is not governed purely by the
Article 281 of the Labor Code. The Labor Code is supplemented with respect to the period of probation by
special rules found in the Manual of Regulations for Private Schools. On the matter of probationary period,
Section 92 of the 1992 Manual of Regulations for Private Schools regulations states:
Section 92. Probationary Period. – Subject in all instances to compliance with the Department and school
requirements, the probationary period for academic personnel shall not be more than three (3) consecutive
years of satisfactory service for those in the elementary and secondary levels, six (6) consecutive regular
semesters of satisfactory service for those in the tertiary level, and nine (9) consecutive trimesters of
satisfactory service for those in the tertiary level where collegiate courses are offered on a trimester basis.
Thus, it is the Manual of Regulations for Private Schools, and not the Labor Code, that determines whether or
not a faculty member in an educational institution has attained regular or permanent status. Section 93 of the
1992 Manual of Regulations for Private Schools provides that full-time teachers who have satisfactorily
completed their probationary period shall be considered regular or permanent.
Since it was explicitly provided in the third appointment contract dated February 26, 2004, that unless
renewed in writing respondent’s appointment automatically expires at the end of the stipulated period of
employment, the CA erred in concluding that simply because the word "probationary" no longer appears
below the designation (Full-Time Faculty Member), respondent had already become a permanent employee.
Noteworthy is respondent’s admission of being still under probationary period in his January 12, 2005 letter to
Sr. Evidente reiterating his demand for salary differential, which letter was sent almost one year after he
signed the February 26, 2004 appointment contract. In this case, petitioner applied the maximum three-year
probationary period – equivalent to six consecutive semesters – provided in the Manual of Regulations. This
can be gleaned from the letter dated March 24, 2004 of Sr. Grace Namocancat, D.C. addressed to respondent,
informing the latter of the result of evaluation of his performance for SY 2003-2004 and stating that
November 2004 marks his second year of full-time teaching, which means he had one more year to become a
permanent employee

ISSUE: Was respondent illegally dismissed?

RULING: YES, notwithstanding the limited engagement of probationary employees, they are entitled to
constitutional protection of security of tenure during and before the end of the probationary period. The
services of an employee who has been engaged on probationary basis may be terminated for any of the
following: (a) a just or (b) an authorized cause; and (c) when he fails to qualify as a regular employee in
accordance with reasonable standards prescribed by the employer. Thus, while no vested right to a
permanent appointment had as yet accrued in favor of respondent since he had not completed the
prerequisite three-year period (six consecutive semesters) necessary for the acquisition of permanent status
as required by the Manual of Regulations for Private Schools-- which has the force of law -- he enjoys a limited
tenure. During the said probationary period, he cannot be terminated except for just or authorized causes, or
if he fails to qualify in accordance with reasonable standards prescribed by petitioner for the acquisition of
permanent status of its teaching personnel.
In a letter dated February 26, 2005, petitioner terminated the services of respondent stating that his
probationary employment as teacher will no longer be renewed upon its expiry on March 31, 2005,
respondent’s fifth semester of teaching. No just or authorized cause was given by petitioner. Prior to this,
respondent had consistently achieved above average rating based on evaluation by petitioner’s officials and
students. He had also been promoted to the rank of Associate Professor after finishing his master’s degree
course on his third semester of teaching. Clearly, respondent’s termination after five semesters of satisfactory
service was illegal.

42. Canadian Opportunities Unlimited, Inc. vs. Dalangin, Jr.

G.R. No. 172223. February 6, 2012.
FACTS: Respondent Bart Q. Dalangin, Jr. filed a complaint for illegal dismissal, with prayer for reinstatement
and backwages, as well as damages (moral and exemplary) and attorneys fees, against petitioner Canadian
Opportunities Unlimited, Inc. (company). The company, based in Pasong Tamo, Makati City, provides
assistance and related services to applicants for permanent residence in Canada. Dalangin was hired by the
company only in the previous month, or in October 2001, as Immigration and Legal Manager, with a monthly
salary of P15,000.00. He was placed on probation for six months. He was to report directly to the Chief
Operations Officer, Annie Llamanzares Abad. His tasks involved principally the review of the clients
applications for immigration to Canada to ensure that they are in accordance with Canadian and Philippine
laws.
Through a memorandum dated, signed by Abad, the company terminated Dalangins employment, declaring
him unfit and unqualified to continue as Immigration and Legal Manager.
Labor Arbiter Magno declared Dalangins dismissal illegal as they were not established by clear and substantial
proof.
NLRC rendered a decision on March 26, 2004 granting the appeal, thereby reversing the labor arbiters ruling.
It found Dalangins dismissal to be a valid exercise of the companys management prerogative.
CA held that the NLRC erred when it ruled that Dalangin was not illegally dismissed. Hence, this petition.

ISSUE: Whether Dalangin, a probationary employee, was validly dismissed.

RULING: Yes. The essence of a probationary period of employment fundamentally lies in the purpose or
objective of both the employer and the employee during the period. While the employer observes the fitness,
propriety and efficiency of a probationer to ascertain whether he is qualified for permanent employment, the
latter seeks to prove to the former that he has the qualifications to meet the reasonable standards for
permanent employment.
The trial period or the length of time the probationary employee remains on probation depends on the parties
agreement, but it shall not exceed six (6) months under Article 281 of the Labor Code, unless it is covered by
an apprenticeship agreement stipulating a longer period. Article 281 provides:
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.
As the Court explained in International Catholic Migration Commission, the word probationary, as used to
describe the period of employment, implies the purpose of the term or period, but not its length. Thus, the
fact that Dalangin was separated from the service after only about four weeks does not necessarily mean that
his separation from the service is without basis.
Contrary to the CAs conclusions, we find substantial evidence indicating that the company was justified in
terminating Dalangins employment, however brief it had been. Time and again, we have emphasized that
substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a
conclusion.
Dalangin overlooks the fact, wittingly or unwittingly, that he offered glimpses of his own behavior and
actuations during his four-week stay with the company; he betrayed his negative attitude and regard for the
company, his co-employees and his work.
Dalangin admitted in compulsory arbitration that the proximate cause for his dismissal was his refusal to
attend the companys Values Formation Seminar scheduled for October 27, 2001, a Saturday. He refused to
attend the seminar after he learned that it had no relation to his duties, as he claimed, and that he had to
leave at 2:00 p.m. because he wanted to be with his family in the province. When Abad insisted that he attend
the seminar to encourage his co-employees to attend, he stood pat on not attending, arguing that marked
differences exist between their positions and duties, and insinuating that he did not want to join the other
employees. He also questioned the scheduled 2:00 p.m. seminars on Saturdays as they were not supposed to
be doing a company activity beyond 2:00 p.m. He considers 2:00 p.m. as the close of working hours on
Saturdays; thus, holding them beyond 2:00 p.m. would be in violation of the law.
The Values Formation Seminar incident is an eye-opener on the kind of person and employee Dalangin was.
His refusal to attend the seminar brings into focus and validates what was wrong with him, as Abad narrated
in her affidavit and as reflected in the termination of employment memorandum. It highlights his lack of
interest in familiarizing himself with the companys objectives and policies. Significantly, the seminar involved
acquainting and updating the employees with the companys policies and objectives. Had he attended the
seminar, Dalangin could have broadened his awareness of the companys policies, in addition to Abads briefing
him about the companys policies on punctuality and attendance, and the procedures to be followed in
handling the clients applications. No wonder the company charged him with obstinacy.
The incident also reveals Dalangins lack of interest in establishing good working relationship with his co-
employees, especially the rank and file; he did not want to join them because of his view that the seminar was
not relevant to his position and duties. It also betrays an arrogant and condescending attitude on his part
towards his co-employees, and a lack of support for the company objective that company managers be
examples to the rank and file employees.
Additionally, very early in his employment, Dalangin exhibited negative working habits, particularly with
respect to the one hour lunch break policy of the company and the observance of the companys working
hours. Thus, Abad stated that Dalangin would take prolonged lunch breaks or would go out of the office
without leave of the company only to call the personnel manager later to inform the latter that he would be
unable to return as he had to attend to personal matters. Without expressly countering or denying Abads
statement, Dalangin dismissed the charge for the companys failure to produce his daily time record.
The same thing is true with Dalangins handling of Tecsons application for immigration to Canada, especially his
failure to find ways to appeal the denial of Tecsons application, as Abad stated in her affidavit. Again, without
expressly denying Abads statement or explaining exactly what he did with Tecsons application, Dalangin
brushes aside Abads insinuation that he was not doing his job well, with the ready argument that the company
did not even bother to present Tecsons testimony.
In the face of Abads direct statements, as well as those of his co-employees, it is puzzling that Dalangin chose
to be silent about the charges, other than saying that the company could not cite any policy he violated. All
along, he had been complaining that he was not able to explain his side, yet from the labor arbiters level, all
the way to this Court, he offered no satisfactory explanation of the charges. In this light, coupled with
Dalangins adamant refusal to attend the companys Values Formation Seminar and a similar program
scheduled earlier, we find credence in the companys submission that Dalangin was unfit to continue as its
Immigration and Legal Manager. As we stressed earlier, we are convinced that the company had seen enough
from Dalangins actuations, behavior and deportment during a four-week period to realize that Dalangin would
be a liability rather than an asset to its operations.
We, therefore, disagree with the CA that the company could not have fully determined Dalangins performance
barely one month into his employment. As we said in International Catholic Migration Commission, the
probationary term or period denotes its purpose but not its length. To our mind, four weeks was enough for
the company to assess Dalangins fitness for the job and he was found wanting. In separating Dalangin from
the service before the situation got worse, we find the company not liable for illegal dismissal.

43. UNIVAC DEVELOPMENT vs SORIANO

G.R. No. 182072. June 19, 2013.
FACTS: Respondent was hired by petitioner, the company’s Chairperson Sadamu Watanabe on probationary
basis as legal assistant of the company. Respondent claimed that on February 15, 2005, or eight (8) days prior
to the completion of his six months probationary period, Castro allegedly informed him that he was being
terminated from employment due to the company’s cost-cutting measures. He allegedly asked for a thirty-day
notice but his termination was ordered to be effective immediately. Thus, he was left with no choice but to
leave the company. Petitioner, on the other hand, denied the allegations of respondent and claimed instead
that prior to his employment, respondent was informed of the standards required for regularization.
Petitioner also supposedly informed him of his duties and obligations which included safekeeping of case
folders, proper coordination with the company’s lawyers, and monitoring of the status of the cases filed by or
against the company. Petitioner claimed that respondent was not illegally dismissed from employment, rather,
he in fact abandoned his job by his failure to report for work. Citing respondent’s educational background and
knowledge of the laws, he was presumed to know prior to employment the reasonable standards required for
regularization.

ISSUE: Whether respondent was illegally dismissed from employment by petitioner?

RULING: Yes. It is undisputed that respondent was hired as a probationary employee. As such, he did not
enjoy a permanent status. Nevertheless, he is accorded the constitutional protection of security of tenure
which means that he can only be dismissed from employment for a just cause or when he fails to qualify as a
regular employee in accordance with reasonable standards made known to him by the employer at the time
of his engagement. It is primordial that at the start of the probationary period, the standards for regularization
be made known to the probationary employee. In this case, as held by the CA, petitioner failed to present
adequate evidence to substantiate its claim that respondent was apprised of said standards. It is evident from
the LA and NLRC decisions that they merely relied on surmises and presumptions in concluding that
respondent should have known the standards considering his educational background as a law graduate.
Equally important is the requirement that in order to invoke failure to meet the probationary standards as a
justification for dismissal, the employer must show how these standards have been applied to the subject
employee. In this case, aside from its bare allegation, it was not shown that a performance evaluation was
conducted to prove that his performance was indeed unsatisfactory. Indeed, the power of the employer to
terminate a probationary employee is subject to three limitations, namely: (1) it must be exercised in
accordance with the specific requirements of the contract; (2) 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 (3) there must be
no unlawful discrimination in the dismissal.32 In this case, not only did petitioner fail to show that respondent
was apprised of the standards for regularization but it was likewise not shown how these standards had been
applied in his case. Pursuant to well-settled doctrine, petitioner’s failure to specify the reasonable standards
by which respondent’s alleged poor performance was evaluated as well as to prove that such standards were
made known to him at the start of his employment, makes respondent a regular employee. In other words,
because of this omission on the part of petitioner, respondent is deemed to have been hired from day one as
a regular employee. To justify the dismissal of an employee, the employer must, as a rule, prove that the
dismissal was for a just cause and that the employee was afforded due process prior to dismissal.

44. Magis young Achiever’s Learning Center v Manalo

GR 178835, February 13, 2009.
FACTS: On April 18, 2002, respondent Adelaida P. Manalo was hired as a teacher and acting principal of
petitioner Magis Young Achievers Learning Center. respondent, on March 29, 2003, wrote a letter of
resignation addressed to Violeta T. Cario, directress of petitioner. On March 31, 2003, respondent received a
letter of termination from petitioner, the letter mentioned that the position of principal will be abolished due
to cost-cutting scheme of petitioner. Thus, the contract between respondent and petitioner can no longer be
renewed.
 Respondent filed a complaint for illegal dismissal and non-payment of 13th month pay, with a prayer
for reinstatement, claiming that her termination violated the provisions of her employment contract, and that
the alleged abolition of the position of Principal was not among the grounds for termination by an employer
under Article 282, she further asserted that the 30-day notice rule and payment of separation pay was not
complied with.
Petitioner, in its position paper, countered that respondent was legally terminated because the one-
year probationary period, from April 1, 2002 to March 3, 2003, had already lapsed and she failed to meet the
criteria set by the school pursuant to the Manual of Regulation for Private Schools.
(Note: A probationary employee or probationer is one who is on trial for an employer, during which the latter
determines whether or not he is qualified for permanent employment. For academic personnel in private
schools, colleges and universities, probationary employment is governed by Section 92 of the 1992 Manual of
Regulations for Private Schools, for academic personnel in private elementary and secondary schools, it is only
after one has satisfactorily completed the probationary period of three (3) school years and is rehired that he
acquires full tenure as a regular or permanent employee.
It is important that the contract of probationary employment specify the period or term of its
effectivity. The failure to stipulate its precise duration could lead to the inference that the contract is binding
for the full three-year probationary period.)
Issue: Whether or not respondent had acquired regular or permanent tenure as teacher.
Ruling: No. we cannot subscribe to the proposition that the respondent has acquired regular or permanent
tenure as teacher. She had rendered service as such only from April 18, 2002 until March 31, 2003. She has
not completed the requisite three-year period of probationary employment, as provided in the Manual. She
cannot, by right, claim permanent status. There should also be no doubt that respondents appointment as
Acting Principal is merely temporary, or one that is good until another appointment is made to take its place.
An acting appointment is essentially a temporary appointment, revocable at will. The undisturbed unanimity
of cases shows that one who holds a temporary appointment has no fixed tenure of office; his employment
can be terminated any time at the pleasure of the appointing power without need to show that it is for cause.

ISSUE: Whether or not respondent, even as a probationary employee, was illegally dismissed.

RULING: yes, probationary employees enjoy security of tenure during the term of their probationary
employment such that they may only be terminated for cause as provided for by law, or if at the end of the
probationary period, the employee failed to meet the reasonable standards set by the employer at the time of
the employees engagement. Undeniably, respondent was hired as a probationary teacher and, as such, it was
incumbent upon petitioner to show by competent evidence that she did not meet the standards set by the
school. This requirement, petitioner failed to discharge. To note, the termination of respondent was effected
by that letter stating that she was being relieved from employment because the school authorities allegedly
decided, as a cost-cutting measure, that the position of Principal was to be abolished. Nowhere in that letter
was respondent informed that her performance as a school teacher was less than satisfactory.
Issue: Whether or not respondents resignation is valid.
Ruling: Not valid, not only because there was no express acceptance thereof by the employer, but because
there is a cloud of doubt as to the voluntariness of respondents resignation. well-entrenched is the rule that
resignation is inconsistent with the filing of a complaint for illegal dismissal. To be valid, the resignation must
be unconditional, with the intent to operate as such; there must be a clear intention to relinquish the position.
To be valid, the resignation must be unconditional, with the intent to operate as such; there must be a clear
intention to relinquish the position.

45. MERCADO vs AMA COMPUTER COLLEGE-PARAÑAQUE CITY, INC.

G.R. No. 183572

FACTS: The petitioners were faculty members who started teaching at AMACC on May 25, 1998.The
petitioners executed individual Teacher’s Contracts for each of the trimesters that they were engaged to
teach, with the following common stipulation: 1. POSITION. The TEACHER has agreed to accept a non-tenured
appointment to work in the College 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, set forth in its Guidelines on the Implementation of AMACC
Faculty Plantilla. Under the new screening guidelines, teachers were to be hired or maintained based on
extensive teaching experience,capability, potential, high academic qualifications and research background. On
September 7, 2000, the petitioners individually received a memorandum from AMACC,through, informing
them that with the expiration of their contract to teach, their contract would no longer be renewed.
The Labor Arbiter Ruling declared that the petitioners had been illegally dismissed.On appeal, the NLRC in a
Resolution dated July 18, 2005 denied AMACC’s appeal for lack of merit and affirmed in toto the LA’s ruling.
The NLRC, however, observed that the applicable lawis Section 92 of the Manual of Regulations for Private
Schools (which mandates a probationary period of nine consecutive trimesters of satisfactory service for
academic personnel in the tertiary level where collegiate courses are offered on a trimester basis), not Article
281 of the Labor Code(which prescribes a probationary period of six months) as the LA ruled. The CA granted
AMACC’s petition for certiorari and dismissed the petitioners’ complaint for illegal dismissal.

ISSUE: Whether or not the CA correctly found that the NLRC committed grave abuse of discretion in ruling that
the petitioners were illegally dismissed.

RULING: NO. The use of employment for fixed periods during the teachers’ probationary period is likewise an
accepted practice in the teaching profession. AMACC’s right to academic freedom is particularly important in
the present case, because of the new screening guidelines for AMACC faculty put in place for the school year
2000-2001. The school’s prerogative to provide standards for its teachers and to determine whether or not
these standards have been met is in accordance with academic freedom that gives the educational institution
the right to choose who should teach. The provision on employment on probationary status under the Labor
Code is a primary example of the fine balancing of interests between labor and management that the Code
has institutionalized pursuant to the underlying intent of the Constitution. Labor, for its part, is given the
protection during the probationary period of knowing the company standards the new hires have to meet
during the probationary period, and to be judged on the basis of these standards, aside from the usual
standards applicable to employees after they achieve permanent status. Under the terms of the Labor Code,
these standards should be made known to the teachers on probationary status at the start of their
probationary period, or at the very least under the circumstances of the present case, at the start of the
semester or the trimester during which the probationary standards are to be applied.
Of critical importance in invoking a failure to meet the probationary standards, is that the school should show
– as a matter of due process – how these standards have been applied . 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 is subject to the terms of Article 281 of the Labor Code. Unless this reconciliation is made, the
requirements of this Article on probationary status would be fully negated as the school may freely choose not
to renew contracts simply because their terms have expired. The inevitable effect of course is to wreck the
scheme that the Constitution and the Labor Code established to balance relationships between labor and
management. Given the clear constitutional and statutory intents, we cannot but conclude that in a situation
where the probationary status overlaps with a fixed-term contract not specifically used for the fixed term it
offers, Article 281 should assume primacy and the fixed-period character of the contract must give way. This
conclusion is immeasurably strengthened by the petitioners’ and the AMACC’s hardly concealed expectation
that the employment on probation could lead to permanent status, and that the contracts are renewable
unless the petitioners fail to pass the school’s standards. While we can grant that the standards were duly
communicated to the petitioners and could be applied beginning the 1st trimester of the school year 2000-
2001, glaring and very basic gaps in the school’s evidence still exist. The exact terms of the standards were
never introduced as evidence; neither does the evidence show how these standards were applied to the
petitioners.Without these pieces of evidence (effectively, the finding of just cause for the non-renewal of the
petitioners’ contracts), we have nothing to consider and pass upon as valid or invalid for
each of the petitioners.

46. ST. PAUL COLLEGE QUEZON CITY v. ANCHETA

G.R. No. 169905 September 7, 2011

FACTS: Remigio Michael was hired by the St. Paul College (SPCQC) as a teacher in the Gen. Education Dept.
with a probationary rank in SY 1996-1997 which was renewed the following year. His wife, Cynthia was also
hired as a part time teacher of the Mass Comm Dept in the 2nd Sem SY 1996-1997 and her appointment was
renewed for SY 1997-1998. The spouses both wrote a letter addressed to Sr. Lilia asking for their contract to
be renewed which was indeed granted by the College Council as evidenced by a letter sent by petitioner. A
letter dated April 22, 1998 was sent to petitioner Sr. Bernadette and signed by some of the teachers of SPCQC,
including the respondent spouses. The said letter contained the teachers' sentiments regarding two school
policies, namely: first, the policy of penalizing the delay in encoding final grades and, second, the policy of
withholding salaries of the teachers. Meanwhile, a letter was written by petitioner Sr. Bernadette to
respondent Remigio Michael, reiterating the conversation that took place between them the day before the
date of the said letter. The letter enumerated the departmental and instructional policies that respondent
Remigio Michael failed to comply with, such as the late submission of final grades, failure to submit final test
questions to the Program Coordinator, the giving of tests in the essay form instead of the multiple choice
format as mandated by the school and the high number of students with failing grades in the classes that he
handled. Accordingly, Sr. Bernadette wrote a letter endorsing the termination of the spouses. Respondents
submitted their comments however they were still terminated and their letter for reconsideration denied thus
the filling of a complaint for illegal dismissal which was dismissed by both NLRC and Labor Arbiter but was
granted by the CA. Petitioners’ motion for reconsideration was denied hence the present petition.
ISSUE: Whether or not the spouses were illegally dismissed.RULING:No, the spouses were not illegally
dismissed.

RULING: The Court finds that there was a valid and just cause for dismissal. The Labor Code commands that
before an employer may legally dismiss an employee from the service, the requirement of substantial and
procedural due process must be complied with. Under the requirement of substantial due process, the
grounds for termination of employment must be based on just or authorized causes. Petitioner school charged
respondent Remigio Michael of non-compliance with a school policy regarding the submission of final test
questions to his program coordinator for checking or comment which was admitted by the respondent in his
letter. Respondent Remigio Michael's spouse shared the same defenses and admissions as to the charges
against her. The plain admissions of the charges against them were the considerations taken into account by
the petitioner school in their decision not to renew the respondent spouses' employment contracts. This is a
right of the school that is mandated by law and jurisprudence. It is the prerogative of the school to set high
standards of efficiency for its teachers since quality education is a mandate of the Constitution. Schools cannot
be required to adopt standards which barely satisfy criteria set for government recognition. The same
academic freedom grants the school the autonomy to decide for itself the terms and conditions for hiring its
teacher, subject of course to the overarching limitations under the Labor Code. The authority to hire is
likewise covered and protected by its management prerogative the right of an employer to regulate all aspects
of employment, such as hiring, the freedom to prescribe work assignments, working methods, process to be
followed, regulation regarding transfer of employees, supervision of their work, lay-off and discipline, and
dismissal and recall of worker.

47. D. M. CONSUNJI CORPORATION, vs. ROGELIO P. BELLO

G.R. No. 159371.July 29, 2013
FACTS: Bello brought a complaint for illegal dismissal and damages against DMCI and/or Rachel Consunji. He
claimed that DMCI had employed him as a mason without any interruption from February 1, 1990 until
October 10, 1997. He contended that his job as a mason had been necessary and desirable in the usual
business or trade of DMCI. Later on, he had been diagnosed to be suffering from pulmonary tuberculosis,
thereby necessitating his leave of absence. Upon his recovery, he had reported back to work, but DMCI had
refused to accept him and had instead handed to him a termination paper. Accordingly, he had been
terminated due to RSD but he did not know the meaning of RSD as the cause of his termination and this cause
was not explained to him. He was also not given prior notice of his termination and that he had not been paid
his separation pay as mandated by law. Meanwhile, DMCI contended that Bello had only been a a project
employee, as borne out by his contract of employment and appointment papers and that after his termination
from employment, it had complied with the reportorial requirements of the Department of Labor and
Employment (DOLE) pursuant to the mandates of Policy Instruction No. 20, as revised by Department Order
No. 19, series of 1993. Lastly, it is alleged that Bello tendered his voluntary resignation on for health reasons
that had rendered him incapable of performing his job, per his resignation letter.

ISSUES: 1. WHETHER OR NOT PRIVATE RESPONDENT WAS A REGULAR EMPLOYEE

2. WHETHER OR NOT PRIVATE RESPONDENT WAS DISMISSED OR VOLUNTARILY RESIGNED.

RULINGS: 1. A project employee is one who is hired for a specific project or undertaking, and the completion
or termination of such project or undertaking has been determined at the time of engagement of the
employee. In the context of the law, Bello was a project employee of DMCI at the beginning of their employer-
employee relationship. The project employment contract they then entered into clearly gave notice to him at
the time of his engagement about his employment being for a specific project or phase of work. He was also
thereby notified of the duration of the project, and the determinable completion date of the project.
However, the history of Bello’s appointment and employment showed that he performed his tasks as a mason
in DMCI’ss various constructions projects. Thus, Bello acquired in time the status of a regular employee by
virtue of his continuous work as a mason of DMCI. The work of a mason like him • a skilled workman working
with stone or similar material was really related to building or constructing, and was undoubtedly a function
necessary and desirable to the business or trade of one engaged in the construction industry like DMCI. His
being hired as a mason by DMCI in not one, but several of its projects revealed his necessity and desirability to
its construction business. It is settled that the extension of the employment of a project employee long after
the supposed project has been completed removes the employee from the scope of a project employee and
makes him a regular employee. In this regard, the length of time of the employee’s service, while not a
controlling determinant of project employment, is a strong factor in determining whether he was hired for a
specific undertaking or in fact tasked to perform functions vital, necessary and indispensable to the usual
business or trade of the employer.18 On the other hand, how DMCI chose to categorize the employment
status of Bello was not decisive of his employment status. What were of consequence in that respect were his
actual functions and the length of his stay with DMCI. Verily, the principal test for determining whether an
employee is a project employee, as distinguished from a regular employee, is whether or not he is assigned to
carry out a specific project or undertaking, the duration and scope of which are specified at the time he is
engaged for the project. Still, DMCI contends that Bello’s services as a mason were deemed necessary and
desirable in its usual business only for the period of time it had taken it to complete the project. The
contention may be correct if each engagement of Bello as a mason over the span of eight years was to be
treated separately. The contention cannot be upheld, however, simply because his successive reengagement
in order to perform the same kind of work as a mason firmly manifested the necessity and desirability of his
work in DMCIÊs usual business of construction.

2. No. The conclusion by ELA Panganiban-Ortiguerra that she could not give credence to the voluntary
resignation for health reasons in the face of Bello’s declaration that he had been led to sign the letter to
obtain the extension of his leave of absence due to illness, and on her observation that the handwriting in the
supposed resignation letter is undeniably different from that of complainant something that she said DMCI
had not rebutted. Yet, even had the letter been actually signed by him, the voluntariness of the resignation
could not be assumed from such fact alone. His claim that he had been led to believe that the letter would
serve only as the means of extending his sick leave from work should have alerted DMCI to the task of proving
the voluntariness of the resignation. It was obvious that, if his claim was true, then he did not fully
comprehend the import of the letter, rendering the resignation farcical. The doubt would then be justifiably
raised against the letter being at all intended to end his employment. Under the circumstances, DMCI became
burdened with the obligation to prove the due execution and genuineness of the document as a letter of
resignation. The employer who interposes the defense of voluntary resignation of the employee in an illegal
dismissal case must prove by clear, positive and convincing evidence that the resignation was voluntary; and
that the employer cannot rely on the weakness of the defense of the employee. The requirement rests on the
need to resolve any doubt in favor of the working man.

48. POSEIDON FISHING vs NLRC, ET. AL.

G.R. No. 168052, February 20, 2006
FACTS: Petitioner Poseidon Fishing is a fishing company engaged in the deep-sea fishing industry with Terry de
Jesus as the manager.
Jimmy S. Estoquia was employed as Chief Mate in January 1988 and after five years. The contract with
Eustoqia per the "Kasunduan", there was a provision stating that he was being employed only on a ‘’por viaje’’
basis and that his employment would be terminated at the end of the trip for which he was being hired.
He was promoted to Boat Captain but was later demoted to Radio Operator. As a Radio Operator, he
monitored the daily activities in their office and recorded in the duty logbook the names of the callers and
time of their calls.
On 3 July 2000, Estoquia failed to record a 7:25 a.m. call in one of the logbooks. When he reviewed the two
logbooks, he noticed that he was not able to record the said call in one of the logbooks so he immediately
recorded the 7:25 a.m. call after the 7:30 a.m. entry.
In the morning of 4 July 2000, petitioner detected the error in the entry in the logbook. Estoquia was asked to
prepare an incident report to explain the reason for the said oversight. On the same day, Poseidon’s secretary
summoned Estoquia to get his separation pay
Estoquia filed a complaint for illegal dismissal with the Labor Arbiter. Poseidon and Terry de Jesus asserted
that Estoquia was a contractual or a casual employee employed only on a"por viaje" or per trip basis and that
his employment would be terminated at the end of the trip for which he was being hired.

ISSUES: 1. Is Eustoqia a regular employee?

2. Is deep -sea fishing a seasonal industry?
3. Was Eustoqia illegally dismissed?

RULING: 1. Yes, Eustoquia was a regular employee.

Article 280 draws a line between regular and casual employment. The provision enumerates two (2) kinds of
employees, the regular employees and the casual employees. The regular employees consist of the following:
1) those engaged to perform activities which are usually necessary or desirable in the usual business or trade
of the employer; and
2) those who have rendered at least one year of service whether such service is continuous or broken.

In a span of 12 years, Eustoquia worked for petitioner first as a Chief Mate, then Boat Captain, and later as
Radio Operator. His job was directly related to the deep-sea fishing business of petitioner Poseidon. His work
was, therefore, necessary and important to the business of his employer. Such being the scenario involved,
Eustoquia is considered a regular employee.
There is nothing in the contract that says complainant is a casual, seasonal or a project worker. The date July 1
to 31, 1998 under the heading "Pagdating" had been placed there merely to indicate the possible date of
arrival of the vessel and is not an indication of the status of employment of the crew of the vessel.
The test to determine whether employment is regular or not is the reasonable connection between the
particular activity performed by the employee in relation to the usual business or trade of the employer. And,
if the employee has been performing the job for at least one year, even if the performance is not continuous
or merely intermittent, the law deems the repeated and continuing need for its performance as sufficient
evidence of the necessity, if not indispensability of that activity to the business.
In the case at bar, the act of hiring and re-hiring in various capacities is a mere gambit employed by petitioner
to thwart the tenurial protection of private respondent. Such pattern of re-hiring and the recurring need for
his services are testament to the necessity and indispensability of such services to petitioners’ business or
trade.

2. No, the activity of catching fish is a continuous process and could hardly be considered as seasonal in
nature.

Project employees is defined as those workers hired:

(1) for a specific project or undertaking, and
(2) the completion or termination of such project has been determined at the time of the engagement of the
employee.

The principal test for determining whether particular employees are "project employees" as distinguished
from "regular employees," is whether or not the "project employees" were assigned to carry out a "specific
project or undertaking," the duration and scope of which were specified at the time the employees were
engaged for that project.
In this case, Eustoquia was never informed that he will be assigned to a "specific project or undertaking” at the
time of their engagement.
Once a project or work pool employee has been: (1) continuously, as opposed to intermittently, re-hired by
the same employer for the same tasks or nature of tasks; and (2) these tasks are vital, necessary and
indispensable to the usual business or trade of the employer, then the employee must be deemed a regular
employee.
Eustoquia’s functions were usually necessary or desirable in the usual business or trade of petitioner fishing
company and he was hired continuously for 12 years for the same nature of tasks. Hence, he was of regular
employee.

3. Yes, Eustoqia was illegally dismissed.

There is no sufficient evidence on record to prove Eustoqia’s negligence, gross or simple, in the performance
of his duties to warrant a reduction of six months salary and be summarily dismissed. At best, the simple
negligence is punishable only with admonition or suspension for a day or two.
His dismissal was without valid cause and where illegal dismissal is proven, the worker is entitled to back
wages and other similar benefits without deductions or conditions.

49. OMNI HAULING SERVICES vs. BON

G.R. No. 199388, September 3, 2014

FACTS: Petitioner Omni provides garbage hauling services and hired respondents as garbage truck drivers and
paleros who were then paid on a per trip basis. When the service contract was renewed for another year,
respondents were required to sign employment contracts which provided that they will be rehired only for the
duration of the same period. However, respondents refused to sign the employment contracts, claiming that
they were regular employees since they were engaged to perform activities which were necessary and
desirable to Omni’s usual business or trade. Omni then terminated the employment of respondents which
resulted in the filing of cases for illegal dismissal, nonpayment of Emergency Cost of Living Allowance (ECOLA)
and 13th month pay, and actual, moral, and exemplary damages.

ISSUE: Whether or not respondents were project employees.

RULING: No. A project employee is assigned to a project which begins and ends at determined or
determinable times. Unlike regular employees who may only be dismissed for just and/or authorized causes
under the Labor Code, the services of employees who are hired as project employees may be lawfully
terminated at the completion of the project. According to jurisprudence, the principal test for determining
whether particular employees are properly characterized as project employees as distinguished from regular
employees, is whether or not the employees were assigned to carry out a specific project or undertaking, the
duration (and scope) of which were specified at the time they were engaged for that project. The project
could either be (1) a particular job or undertaking that is within the regular or usual business of the employer
company, but which is distinct and separate, and identifiable as such, from the other undertakings of the
company; or (2) a particular job or undertaking that is not within the regular
business of the corporation. In order to safeguard the rights of workers against the arbitrary use of the word
project to prevent employees from attaining a regular status, employers claiming that their workers are
project employees should not only prove that the duration and scope of the employment was specified at the
time they were engaged, but also that there was indeed a project.
Hence, even though the absence of a written contract does not by itself grant regular status to respondents,
such a contract is evidence that respondents were informed of the duration and scope of their work and their
status as project employees. In this case, where no other evidence was offered, the absence of an
employment contract puts into serious question whether the employees were properly informed at the onset
of their employment status as project employees. It is doctrinally entrenched that in illegal dismissal cases, the
employer has the burden of proving with clear, accurate, consistent and convincing evidence that a dismissal
was valid.
In this case, records are bereft of any evidence to show that respondents were made to sign employment
contracts explicitly stating that they were going to be hired as project employees, with the period of their
employment to be coterminous with the original period of Omni’s service contract with the Quezon City
government. Neither is petitioners’ allegation that respondents were duly apprised of the project-based
nature of their employment supported by any other evidentiary proof. Thus, the logical conclusion is that
respondents were not clearly and knowingly informed of their employment status as mere project employees,
with the duration and scope of the project specified at the time they were engaged. As such, the presumption
of regular employment should be accorded in their favor pursuant to Article 280 of the Labor Code which
provides that [employees] who have rendered at least one year of service, whether such service is continuous
or broken [as respondents in this case ] shall be considered as [regular employees] with respect to the activity
in which [they] are employed and [their] employment shall continue while such activity actually exists. Add to
this the obvious fact that respondents have been engaged to perform activities which are usually necessary or
desirable in the usual business or trade of Omni, i.e., garbage hauling, thereby confirming the strength of the
aforesaid conclusion. The determination that respondents are regular and not merely project employees
resultantly means that their services could not have been validly terminated at the expiration of the project,
or, in this case, the service contract of Omni with the Quezon City government. As regular employees, it is
incumbent upon petitioners to establish that respondents had been dismissed for a just and/or authorized
cause. However, petitioners failed in this respect; hence, respondents were illegally dismissed.

50. GADIA, ET AL VS. SYKES ASIA, INC.

G.R. No. 209499, January 28, 2015

FACTS: Alitel Communications Inc., a US-based telecommunications company hired Sykes Asia, a corporation
engaged in Business Process Outsourcing (BPO), to handle its (Alitel) clients‟ needs and demands for its
prepaid and postpaid services. Thus, on different dates, Sykes Asia hired the petitioners herein, who
commenced work until the services of Sykes Asia were terminated by Alitel sometime in 2009. In view of this
development, Sykes Asia sent end-of-life notices to the petitioners, informing them of their dismissal due to
the termination of the Alitel project. The petitioners thereafter filed separate complaints for illegal dismissal,
with prayer for reinstatement, and other monetary benefits against the company and several of its officers. In
their defense, the respondents averred that the petitioners were “project-based employees, not regular
employees, as such the termination of the Alitel project served as a valid ground for their dismissal. They were
in fact furnished notices of termination at least 30 days prior to their dates of dismissal.

ISSUE: Whether or not the petitioners are project-based employees. The Court‟s ruling:

RULING: No A project employee is assigned to a project which begins and ends at determined or determinable
times.1âwphi1Unlike regular employees who may only be dismissed for just and/or authorized causes under
the Labor Code, the services of employees who are hired as "project-based employees" may be lawfully
terminated at the completion of the project. or an employee to be considered project-based, the employer
must show compliance with two (2) requisites, namely that: (a) the employee was assigned to carry out a
specific project or undertaking; and (b) the duration and scope of which were specified at the time they were
engaged for such project.

In this case, records reveal that Sykes Asia adequately informed petitioners of their employment status at the
time of their engagement, as evidenced by the latter’s employment contracts which similarly provide that they
were hired in connection with the Alltel Project, and that their positions were "project-based and as such is co-
terminus to the project." In this light, the CA correctly ruled that petitioners were indeed project-based
employees, considering that: (a) they were hired to carry out a specific undertaking, i.e., the Alltel Project; and
(b) the duration and scope of such project were made known to them at the time of their engagement, i.e.,
"co-terminus with the project."

As regards the second requisite, the CA correctly stressed that "[t]he law and jurisprudence dictate that ‘the
duration of the undertaking begins and ends at determined or determinable times’" while clarifying that "[t]he
phrase ‘determinable times’ simply means capable of being determined or fixed." In this case, Sykes Asia
substantially complied with this requisite when it expressly indicated in petitioners’ employment contracts
that their positions were "co-terminus with the project." To the mind of the Court, this caveat sufficiently
apprised petitioners that their security of tenure with Sykes Asia would only last as long as the Alltel Project
was subsisting. In other words, when the Alltel Project was terminated, petitioners no longer had any project
to work on, and hence, Sykes Asia may validly terminate them from employment. Further, the Court likewise
notes the fact that Sykes Asia duly submitted an Establishment Employment Report and an Establishment
Termination Report to the Department of Labor and Employment Makati-Pasay Field Office regarding the
cessation of the Alltel Project and the list of employees that would be affected by such cessation. As correctly
pointed out by the CA, case law deems such submission as an indication that the employment was indeed
project-based.

51. PNOC vs NLRC, ET. AL.

G.R. No. 169353, April 13, 2007

FACTS: PNOC-Energy Development Corporation is a government-owned and controlled corporation engaged

in the exploration, development and utilization of energy. It undertakes several projects in areas where
geothermal energy has been discovered. One of its projects is the Palipinpinon II (PAL II), which for its
development, it was necessary to augment the manpower requirement due to increased activities, PNOC
hired employees including private respondents in the Administration and Maintenance Section.

The termination/expiration of their respective employment was specified in their initial employment
contracts, which, however, were renewed and extended on their respective expiry dates.

Prior to the termination of respondent, PNOC submitted to the DOLE termination reports for their
termination and they were subsequently furnished with notices of termination due to the substantial
completion of the civil works phase of PAL II.

Thereafter, respondents filed a complaint for illegal dismissal. The Labor Arbiter dismissed the
complaint ruling that respondents were not dismissed from work; the employer-employee relationship
between the parties was severed upon expiration of the respective contracts of respondents and the
completion of the projects concerned.

The NLRC reversed the decision of the Labor Arbiter ruling that respondents were regular non-project
employees for having worked for more than one year in positions that required them to perform activities
necessary and desirable in the normal business or trade of PNOC. The NLRC further ruled that the employment
contracts of respondents were not for a specific project or for a fixed period. Thus the dismissals made under
the pretext of project completion were illegal, being founded on an invalid, unjust and unauthorized cause.
The Court of Appeals affirmed NLRC’s decision holding that respondents were performing activities necessary
and desirable in the normal operations of the business of PNOC. It further explained that the repeated re-
hiring and the continuing need for the services of the project employees over a span of time had made them
regular employees.

ISSUE: Were respondents regular employees or project employees?

RULING: RESPONDENTS ARE REGULAR EMPLOYEES.

Laws Applicable: Art. 280, Labor Code

Art. 280. Regular and Casual Employment – The provisions of written agreement to the contrary
notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be
regular where the employee has been engaged to perform activities which are usually necessary or desirable
in the usual business or trade of the employer, except here the employment has been fixed for a specific
project or undertaking, the completion or termination of which has been determined at the time of the
engagement of the employee or where the work or service to be performed is seasonal in nature and the
employment is for the duration of the season.
An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided,
That, any employee who has rendered at least one year of service, whether such service is continuous or
broken, shall be considered a regular employee with respect to the activity in which he is employed and his
employment shall continue with such activity exists.

The principal test for determining whether particular employees are properly characterized as “project
employees,” as distinguished from “regular employees,” is whether or not the project employees were
assigned to carry out a “specific project or undertaking,” the duration and scope of which were specified at
the time the employees were engaged for that project. However, PNOC failed to substantiate its claim that
respondents were hired merely as project employees. The records of the case reveal that the supposed
specific project or undertaking of PNOC was not satisfactorily identified in the contracts of respondents. Also,
its act of repeatedly and continuously hiring respondents to the same kind of work belies its contention that
respondents were hired for a specific project or undertaking. The absence of a definite duration for the
project/s has led the Court to conclude that respondents are, in fact, regular employees.
Another cogent factor which militates against the corporation’s insistence that the services of
respondents were terminated because the projects for which they were hired had been completed is the fact
that respondents’ contracts of employment were extended a number of times for different or new projects. It
must be stressed that a contract that misuses a purported fixed-term employment to block the acquisition of
tenure by employees deserves to be struck down for being contrary to law, morals, good customs, public
order and public policy.

52. Alcatel Philippines, Inc. vs. Relos

G.R. No. 164315. July 3, 2009
FACTS: Alcatel is a domestic corporation primarily engaged in the business of installation and supply of
telecommunications equipment. Petitioner Delos Reyes was a former Administrative Officer of Alcatel. Alcatel
offered respondent temporary employment for the proposal preparation for PLDT X-5 project for the period 4
January 1988 to 28 February 1988. Alcatel again offered respondent temporary employment to assist in the
PLDT’s X-4 IOT project. Again, Alcatel offered respondent temporary employment to assist in the
implementation of the PLDT 1342 Project. Upon the expiration of his contract, respondent was again offered
temporary employment this time as Civil Works Engineer. Respondent was offered temporary employment in
the same capacity five more times. Alcatel hired respondent as project employee for the PLDT 1342 project to
work as Civil Engineer. Alcatel renewed respondent’s contract twice. In a letter dated 22 December 1993,13
Alcatel informed respondent that the civil works portion of the project was near completion; however, the
remaining works encountered certain delays and had not been completed as scheduled. Alcatel then extended
respondent’s employment for another three months. Thereafter, Alcatel employed respondent as a Site
Inspector until 31 December 1995. On 11 December 1995, Alcatel informed respondent that the project would
be completed on 31 December 1995 and that his contract with Alcatel would expire on the same day. Alcatel
asked respondent to settle all his accountabilities with the company and advised him that he would be called if
it has future projects that require his expertise. Respondent filed a complaint for illegal dismissal, separation
pay, unpaid wages, unpaid overtime pay, damages, and attorney’s fees against Alcatel. Respondent alleged
that he was a regular employee of Alcatel and that he was dismissed during the existence of the project.

ISSUES: 1. Whether respondent was a regular employee or a project employee

2. Whether respondent was illegally dismissed

RULINGS: 1. A project employee. The principal test for determining whether a particular employee is a
project employee or a regular employee is whether the project employee was assigned to carry out a specific
project or undertaking, the duration and scope of which were specified at the time the employee is engaged
for the project. “Project” may refer to a particular job or undertaking that is within the regular or usual
business of the employer, but which is distinct and separate and identifiable as such from the undertakings of
the company. Such job or undertaking begins and ends at determined or determinable times. In the Court’s
review of respondent’s employment contracts, we are convinced that respondent was a project employee.
The specific projects for which respondent was hired and the periods of employment were specified in his
employment contracts. The services he rendered, the duration and scope of each employment are clear
indications that respondent was hired as a project employee In Maraguinot, Jr. v. NLRC, the Court said:
A project employee or a member of a work pool may acquire the status of a regular employee when the
following concur:
1)There is a continuous rehiring of project employees even after the cessation of a project; and 2)The tasks
performed by the alleged project employee’s are vital, necessary and indispensable to the usual business or
trade of the employer.
While respondent performed tasks that were clearly vital, necessary and indispensable to the usual business
or trade of Alcatel, respondent was not continuously rehired by Alcatel after the cessation of every project.
Records show that respondent was hired by Alcatel from 1988 to 1995 for three projects, namely the PLDT X-5
project, the PLDT X-4 IOT project and the PLDT 1342 project. On 30 April 1988, upon the expiration of
respondent’s contract for the PLDT X-4 IOT project, Alcatel did not rehire respondent until 1 February 1991, or
after a lapse of 33 months, for the PLDT 1342 project. Alcatel’s continuous rehiring of respondent in various
capacities from February 1991 to December 1995 was done entirely within the framework of one and the
same project―the PLDT 1342 project. This did not make respondent a regular employee of Alcatel as
respondent was not continuously rehired after the cessation of a project. Respondent remained a project
employee of Alcatel working on the PLDT 1342 project.

2. No. Respondent was not illegally dismissed but his employment terminated upon the expiration of his
employment contract. Here, Alcatel employed respondent as a Site Inspector until 31 December 1995.

53. ERMA SHIPYARD, Inc. ESGUERRA vs. Oliveros

FACTS: Herma Shipyard is a domestic corporation engaged in the business of shipbuilding and repair. The
respondents were its employees occupying various positions such as welder, leadman, pipe fitter, laborer,
helper, etc. On June 17, 2009, respondents filed before a Regional Arbitration Branch, a Complaint for illegal
dismissal, regularization, and non-payment of service incentive leave pay with prayer for the payment of full
backwages and attorney's fees against petitioners. Respondents alleged that they are Herma Shipyard's
regular employees who have been continuously performing tasks usually necessary and desirable in its
business. On various dates, however, petitioners dismissed them from employment. For their defense,
petitioners argued that respondents were its project-based employees in its shipbuilding projects and that the
specific project for which they were hired had already been completed.

ISSUE: Are the respondents project employees?

RULING: YES. The services of project-based employees are co-terminous with the project and may be
terminated upon the end or completion of the project or a phase thereof for which they were hired. 19 The
principal test in determining whether particular employees were engaged as project-based employees, as
distinguished from regular employees, is whether they were assigned to carry out a specific project or
undertaking, the duration and scope of which was specified at, and made known to them, at the time of their
engagement. 20 It is crucial that the employees were informed of their status 8rS project employees at the
time of hiring and that the period of their employment must be knowingly and voluntarily agreed upon by the
parties, without any force, duress, or improper pressure being brought to bear upon the employees or any
other circumstances vitiating their consent.
The records of this case reveal that for each and every project respondents were hired. They were adequately
informed of their employment status as project-based employees at least at the time they signed their
employment contracts. They were fully apprised of the nature and scope of their work whenever they affixed
their signature to their employment contract. Their contracts of employment (mostly written in the
vernacular) provide in no uncertain terms that they were hired as project-based employees whose services are
coterminous with the completion date thereof. There is no indication that respondents were coerced into
signing their employment contracts or that they affixed their signature thereto against their will. While they
claim that they signed the said contracts in order to secure continuous employment, they have not, however
presented sufficient evidence to support the same other than their bare allegations. It is settled that
"[c]ontracts for project employment are valid under the law.

ISSUE: Does the respondent`s performance of tasks usually necessary or desirable in the usual business or
trade of their petitioner made them regular employees?

RULING: NO. It is settled, however, that project-based employees may or may not be performing tasks usually
necessary or desirable in the usual business or trade of the employer. The fact that the job is usually necessary
or desirable in the business operation of the employer does not automatically imply regular employment;
neither does it impair the validity of the project employment contract stipulating a fixed duration of
employment.

ISSUE: Does the repeated rehiring of project employees to different projects does not ipso facto
make them regular employees?
RULING: NO. The repeated and successive rehiring of respondents as project-based employees does not [also],
by and of itself: qualify them as regular employees. Case law states that length of service (through rehiring) is
not the controlling determinant of the employment tenure [of project-based employees but, as earlier
mentioned], whether the employment has been fixed for a specific project or undertaking, with its completion
having been determined at the time of [their] engagement."
While generally, length of service provides a fair yardstick for determining when an employee initially hired on
a temporary basis becomes a permanent one, entitled to the security and benefits of regularization, this
standard will not be fair, if applied to the constrn9tion industry because construction firms cannot guarantee
work and funding for its payrolls beyond the life of each project as they have no control over the decisions and
resources of project proponents or owners. Thus, once the project is completed it would be unjust to require
the employer to maintain these employees in their payroll since this would be tantamount to making the
employee a privileged retainer who collects payment from his employer for work not done, and amounts to
labor coddling at the expense of management.

54. University of Santo Tomas (UST) vs. Samahang Manggagawa ng UST

G.R. No. 184262. April 24, 2017.
FACTS: NLRC reinstated the Decision of the Labor Arbiter (LA) in declaring respondents Fernando Pontesor
(Pontesor ), Rodrigo Clacer (Clacer), Santiago Buisa, Jr. (Buisa), and Jimmy Nazareth (Nazareth; Pontesor, et al.,
collectively) as regular employees of petitioner University of Santo Tomas (petitioner) and, thus, were illegally
dismissed by the latter. Hence, this petition on certiorari.
A complaint 7 for regularization and illegal dismissal filed by respondents Samahang Manggagawa ng UST and
Pontesor, et al. (respondents) against petitioner before the NLRC. Respondents alleged that on various periods
spanning the years 1990-1999, petitioner repeatedly hired Pontesor, et al. to perform various maintenance
duties within its campus, i.e., as laborer, mason, tinsmith, painter, electrician, welder, carpenter. Essentially,
respondents insisted that in view of Pontesor, et al.' s performance of such maintenance tasks throughout the
years, they should be deemed regular employees of petitioner. Respondents further argued that for as long as
petitioner continues to operate and exist as an educational institution, with rooms, buildings, and facilities to
maintain, the latter could not dispense with Pontesor, et al. 's services which are necessary and desirable to
the business of petitioner.
On the other hand, while petitioner admitted that it repeatedly hired Pontesor, et al. in different capacities
throughout the aforesaid years, it nevertheless maintained that they were merely hired on a per-project basis,
as evidenced by numerous Contractual Employee Appointments (CEAs) signed by them. In this regard,
petitioner pointed out that each of the CEAs that Pontesor, et al. signed defined the nature and term of the
project to which they are assigned, and that each contract was renewable in the event the project remained
unfinished upon the expiration of the specified term. In accordance with the express provisions of said CEAs,
Pontesor, et al. 's project employment were automatically terminated: (a) upon the expiration of the specific
term specified in the CEA; (b) when the project is completed ahead of such expiration; or (c) in cases when
their employment was extended due to the non-completion of the specific project for which they were hired,
upon the completion of the said project. As such, the termination of Pontesor, et al. 's employment with
petitioner was validly made due to the completion of the specific projects for which they were hired.
LA ruled in Pontesor, et al. 's favor and, accordingly, ordered petitioner to reinstate them to their former jobs
with full backwages and without loss of seniority rights. The LA found that Pontesor, et al. should be deemed
as petitioner's regular employees, considering that: (a) they have rendered at least one (1) year of service to
petitioner as its employees; (b) the activities for which they were hired for are vital or inherently indispensable
to the maintenance of the buildings or classrooms where petitioner's classes were held; and (c) their CEAs
were contrived to preclude them from obtaining security of tenure.

The NLRC vacated the LA ruling and, consequently, entered a new one dismissing respondents' complaint for
lack of merit.
The CA reversed and set aside the NLRC ruling and, accordingly, reinstated that of the LA.
Petitioner moved for reconsideration,24 but the same was denied; hence, this petition.

ISSUE: whether or not the CA correctly ruled that Pontesor, et al. are regular employees and, consequently,
were illegally dismissed by petitioner.

RULING: Yes, regularized casual employees and were illegally dismissed

Guided by the foregoing considerations, the Court finds that the CA correctly ascribed grave abuse of
discretion on the part of the NLRC, as its finding that Pontesor, et al. are not regular employees of petitioner
patently deviates from the evidence on record as well as settled legal principles of labor law.
Article 29529 of the Labor Code, as amended, distinguishes project employment from regular employment as
follows:
Art. 295 [280]. Regular and casual employment. - The provisions of written agreement to the contrary
notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be
regular where the employee has been engaged to perform activities which are usually necessary or desirable
in the usual business or trade of the employer, except where the employment has been fixed for a specific
project or undertaking the completion or termination of which has been determined at the time of the
engagement of the employee or where the work or services to be performed is seasonal in nature and the
employment is for the duration of the season.
An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided, That
any employee who has rendered at least one year of service, whether such service is continuous or broken,
shall be considered a regular employee with respect to the activity in which he is employed and his
employment shall continue while such activity exists.
In the case at bar, a review of Pontesor, et al. 's respective CEAs reveal that petitioner repeatedly rehired them
for various positions in the nature of maintenance workers, such as laborer, mason, painter, tinsmith,
electrician, carpenter, and welder, for various periods spanning the years 1990-1999. Akin to the situation of
the employees in Kimberly, Pontesor, et al. 's nature of work are not necessary and desirable to petitioner's
usual business as an educational institution; hence, removing them from the ambit of the first category of
regular employees under Article 295 of the Labor Code. Nonetheless, it is clear that their respective
cumulative periods of employment as per their respective CEAs each exceed one (1) year. Thus, Pontesor, et
al. fall under the second category of regular employees under Article 295 of the Labor Code. Accordingly, they
should be deemed as regular employees but only with respect to the activities for which they were hired and
for as long as such activities exist.
In this relation, the Court clarifies that Pontesor, et al. were not project employees of petitioner, who were
validly terminated upon the completion of their respective projects/undertakings.
According to jurisprudence, the principal test for determining whether particular employees are properly
characterized as "project[based] employees" as distinguished from "regular employees," is whether or not the
employees were assigned to carry out a "specific project or undertaking," the duration (and scope) of which
were specified at the time they were engaged for that project. The project could either be (1) a particular job
or undertaking that is within the regular or usual business of the employer company, but which is distinct and
separate, and identifiable as such, from the other undertakings of the company; or (2) a particular job or
undertaking that is not within the regular business of the corporation. In order to safeguard the rights of
workers against the arbitrary use of the word "project" to prevent employees from attaining a regular status,
employers claiming that their workers are project[-based] employees should not only prove that the duration
and scope of the employment was specified at the time they were engaged, but also, that there was indeed a
project.
As aptly held by the CA, Pontesor, et al. could not be considered as project employees because the specific
undertakings or projects for which they were employed were not clearly delineated. This is evidenced by the
vagueness of the project descriptions set forth in their respective CEAs, which states that they were tasked "to
assist" in various carpentry, electrical, and masonry work. In fact, when the aforesaid CEAs are pieced
together, it appears that during the years 1990 to 1999, Pontesor, et al. were each engaged to perform all-
around maintenance services throughout the various facilities/installations in petitioner's campus. Thus, it
seems that petitioner, through the CEAs, merely attempted to compartmentalize Pontesor, et al.' s various
tasks into purported "projects" so as to make it appear that they were hired on a per-project basis. Verily, the
Court cannot countenance this practice as to do so would effectively permit petitioners to avoid hiring
permanent or regular employees by simply hiring them on a temporary or casual basis, thereby violating the
employees' security of tenure relative to their jobs.
In view of the foregoing, Pontesor, et al. should, as discussed earlier, be considered regularized casual
employees who enjoy, inter alia, security of tenure. Accordingly, they cannot be terminated from employment
without any just and/or authorized cause, which unfortunately, petitioner was guilty of doing in this case.
Hence, Pontesor, et al. must be reinstated to their former or equivalent positions, with full backwages and
without loss of seniority rights.

55. TELEVISION AND PRODUCTION EXPONENTS, INC. vs SERVAÑA

G.R. No. 167648. January 28, 2008
FACTS: TAPE is a domestic corporation engaged in the production of television programs. Respondent Roberto
C. Servaña had served as a security guard for TAPE from March 1987 until he was terminated on 3 March
2000. Respondent filed a complaint for illegal dismissal and nonpayment of benefits against TAPE. He alleged
that he was first connected with Agro-Commercial Security Agency but was later on absorbed by TAPE as a
regular company guard. He was detailed at Broadway Centrum. On 2 March 2000, respondent received a
memorandum informing him of his impending dismissal on account of TAPE’s decision to contract the services
of a professional security agency. At the time of his termination, respondent was receiving a monthly salary of
P6,000.00. He claimed that the holiday pay, unpaid vacation and sick leave benefits and other monetary
considerations were withheld from him. He further contended that his dismissal was undertaken without due
process and violative of existing labor laws, aggravated by nonpayment of separation pay. 3 In a motion to
dismiss which was treated as its position paper, TAPE countered that the labor arbiter had no jurisdiction over
the case in the absence of an employer-employee relationship between the parties. TAPE averred that
respondent was an independent contractor falling under the talent group category and was working under a
special arrangement which is recognized in the industry. Respondent for his part insisted that he was a regular
employee having been engaged to perform an activity that is necessary and desirable to TAPEÊs business for
thirteen years.

ISSUE: Whether an employer-employee relationship exists between TAPE and respondent?

RULING: Yes. The position of TAPE is untenable. Respondent was first connected with Agro-Commercial
Security Agency, which assigned him to assist TAPE in its live productions. When the security agency’s contract
with RPN-9 expired in 1995, respondent was absorbed by TAPE or, in the latter’s language retained as talent.
Clearly, respondent was hired by TAPE. Respondent presented his identification card to prove that he is
indeed an employee of TAPE. It has been in held that in a business establishment, an identification card is
usually provided not just as a security measure but to mainly identify the holder thereof as a bona fide
employee of the firm who issues it. Respondent claims to have been receiving P5,444.44 as his monthly salary
while TAPE prefers to designate such amount as talent fees. Wages, as defined in the Labor Code, are
remuneration or earnings, however designated, capable of being expressed in terms of money, whether fixed
or ascertained on a time, task, piece or commission basis, or other method of calculating the same, which is
payable by an employer to an employee under a written or unwritten contract of employment for work done
or to be done, or for service rendered or to be rendered. It is beyond dispute that respondent received a fixed
amount as monthly compensation for the services he rendered to TAPE. The Memorandum informing
respondent of the discontinuance of his service proves that TAPE had the power to dismiss respondent.
Control is manifested in the bundy cards submitted by respondent in evidence. He was required to report daily
and observe definite work hours. Private respondents failed to show that petitioner has substantial capital or
investment to be qualified as an independent contractor. They likewise failed to present a written contract
which specifies the performance of a specified piece of work, the nature and extent of the work and the term
and duration of the relationship between herein petitioner and private respondent TAPE. Even granting
arguendo that respondent is a program employee, stills, classifying him as an independent contractor is
misplaced. An independent contractor is not an employee of the employer, while a talent or program
employee is an employee. The only difference between a talent or program employee and a regular employee
is the fact that a regular employee is entitled to all the benefits that are being prayed for. More importantly,
respondent had been continuously under the employ of TAPE from 1995 until his termination in March 2000,
or for a span of 5 years. Regardless of whether or not respondent had been performing work that is necessary
or desirable to the usual business of TAPE, respondent is still considered a regular employee under Article 280
of the Labor Code. As a regular employee, respondent cannot be terminated except for just cause or when
authorized by law.