1. GMA Network, Inc. v Pabriga, et al.

,
G.R. No. 176419 (2013)

FACTS: Private respondents were engaged by petitioner for the latter’s operations in the
Technical Operations Center as Transmitter/VTR men, as Maintenance staff and as
Cameramen. On July 19 1999 due to the miserable working conditions private respondents
were forced to file a complaint against petitioner before the NLRC Regional Arbitration Branch
No. VII Cebu City.

Private respondents filed an amended complaint raising the following additional issues of 1)
Unfair Labor Practice; 2) Illegal dismissal; and 3) Damages and Attorneys fees.

An amicable settlement between the parties was set but the same proved to be futile.

The Labor Arbiter dismissed the complaint of respondents for illegal dismissal and unfair labor
practice, but held petitioner liable for 13th month pay.

The NLRC reversed the Decision of the Labor Arbiter, and held that:

a) All complainants are regular employees with respect to the particular activity to which
they were assigned, until it ceased to exist. As such, they are entitled to payment of
separation pay computed at one (1) month salary for every year of service;

b) They are not entitled to overtime pay and holiday pay; and

c) They are entitled to 13th month pay, night shift differential and service incentive leave
pay.

When Petitioner elevated the case to the CA via a Petition for Certiorari, it rendered its Decision
denying the petition for lack of merit. Hence, this present Petition for Review on Certiorari.

ISSUES:

[1] Did the CA err in finding the respondents as regular employees of the petitioner?

[2] Did the CA err in awarding separation pay to the respondents absent a finding that
respondents were illegally dismissed?

HELD: 1. Respondents claim that they are regular employees of petitioner GMA Network, Inc.
The latter, on the other hand, interchangeably characterizes respondents employment as
project and fixed period/fixed term employment. The SC held that the respondents are
REGULAR Ee.

ARTICLE 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 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 actually
exist.

Pursuant to the above-quoted Article 280 of the Labor Code, employees performing activities
which are usually necessary or desirable in the employers usual business or trade can either be
regular, project or seasonal employees, while, as a general rule, those performing activities not
usually necessary or desirable in the employers usual business or trade are casual employees.
The consequence of the distinction is found in Article 279 of the Labor Code, which provides:

ARTICLE 279. Security of tenure. In cases of regular employment, the employer shall not
terminate the services of an employee except for a just cause or when authorized by this Title.
An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss
of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to
his other benefits or their monetary equivalent computed from the time his compensation was
withheld from him up to the time of his actual reinstatement.

On the other hand, the activities of project employees may or may not be usually necessary or
desirable in the usual business or trade of the employer.

The term "project" could also refer to, secondly, a particular job or undertaking that is not within
the regular business of the corporation. Such a job or undertaking must also be identifiably
separate and distinct from the ordinary or regular business operations of the employer. The job
or undertaking also begins and ends at determined or determinable times. (ALU-TUCP v.
National Labor Relations Commission, G.R. No. 109902, August 2, 1994)

The jobs and undertakings are clearly within the regular or usual business of the employer
company and are not identifiably distinct or separate from the other undertakings of the
company. There is no denying that the manning of the operations center to air commercials,
acting as transmitter/VTR men, maintaining the equipment, and acting as cameramen are not
undertakings separate or distinct from the business of a broadcasting company.

In sum, we affirm the findings of the NLRC and the Court of Appeals that respondents are
regular employees of petitioner. As regular employees, they are entitled to security of tenure
and therefore their services may be terminated only for just or authorized causes. Since
petitioner failed to prove any just or authorized cause for their termination, we are constrained to
affirm the findings of the NLRC and the Court of Appeals that they were illegally dismissed.
 2. Since the respondents were illegally dismissed, they were entitled to separation pay in
lieu of reinstatement.

As regards night shift differential, the Labor Code provides that every employee shall be paid
not less than ten percent (10%) of his regular wage for each hour of work performed between
ten o'clock in the evening and six o'clock in the morning.

As employees of petitioner, respondents are entitled to the payment of this benefit in

accordance with the number of hours they worked from 10:00 p.m. to 6:00 a.m., if any.

The matter of attorney's fees cannot be touched once and only in the fallo of the decision, else,
the award should be thrown out for being speculative and conjectural. In the absence of a
stipulation, attorney's fees are ordinarily not recoverable; otherwise a premium shall be placed
on the right to litigate. They are not awarded every time a party wins a suit.

In the case at bar, the factual basis for the award of attorney's fees was not discussed in the
text of NLRC Decision. Thus, the Court constrained to delete the same.

2. San Miguel Corp. v. National Labor Relations Commission,

G.R. No. 125606, [October 7, 1998]

FACTS: Private respondent was hired by petitioner as helper/brickler for a specific project in
November 1990, the repair and upgrading of furnace C at its Manila Glass Plant. His contract of
employment provided that temporary employment was only for a period of approximately 4
months.

On April 30, 1991, the respondent completed the repair and upgrading of furnace C which
resulted in the termination of his services and employment.

On May 10, 1991, the respondent was hired again for a specific job or undertaking, which
involved the draining/cooling down of furnace F and the emergency repair of furnace E. The
project was only for a period of 3 months.

After the completion of the tasks, his services were terminated in July 1991.

Subsequently, the complainant saw his name in a Memorandum posted at the Company’s
Bulletin Board as among those who were considered dismissed.

After the lapse of more than 3 years from the completion of the last undertaking for which the
private respondent was hired, the private respondent filed a complaint for illegal dismissal.

The LA ruled that the private respondent was a project employee and that the position of helper
does not fall within the classification of regular employees. The case was then taken to the
NLRC.

The NLRC reversed the decision of the LA. The NLRC ruled that the Respondents scheme of
subsequently re-hiring complainant after only ten (10) days from the last day of the expiration of
his contract of employment for a specific period, and giving him again another contract of
employment for another specific period cannot be countenanced. This is one way of doing
violence to the employees constitutional right to security of tenure under which even employees
under probationary status are amply protected. The petitioner then moved for reconsideration.

ISSUE: Whether or not the respondent is a project or a fixed period employee.

RULING: The respondent is a project employee.

Art. 280. Regular and Casual Employment. - The provisions of written agreement to the contrary
notwithstanding and regardless of the oral agreement of one 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 actually exists.

Note that the plant where the private respondent was employed for only seven months is
engaged in the manufacturer of glass, an integral component of the packaging and
manufacturing business of petitioner. The process of manufacturing glass requires a furnace,
which has a limited operating life. Petitioner resorted to hiring project or fixed term employees in
having said furnaces repaired since said activity is not regularly performed. Said furnaces are to
be repaired or overhauled only in case of need and after being used continuously for a varying
period of five (5) to ten (10) years. In 1990, one of the furnaces of petitioner required repair and
upgrading. This was a undertaking distinct and separate from petitioner's business of
manufacturing glass. For this purpose, petitioner must hire workers to undertake the said repair
and upgrading. Private respondent was, thus, hired by petitioner on November 28, 1990 on a
"temporary status for a specific job" for a determined period of approximately four months

Upon completion of the undertaking, or on April 30, 1991, private respondent's services were
terminated. A few days, thereafter, two of petitioner's furnaces required "draining/coolong down"
and "emergency repair". Private respondent was again hired on May 10, 1991 to help in the new
undertaking, which would take approximately three (3) months to accomplish. Upon completion
of the second undertaking, private respondent's services were likewise terminated. He was not
hired a third time, and his two engagements taken together did not total one full year in order to
qualify him as an exception to the exception falling under the cited proviso in the second
paragraph of Art. 280 of the Labor Code.

Clearly, private respondent was hired for a specific project that was not within the regular
business of the corporation. For petitioner is not engaged in the business of repairing furnaces.
Although the activity was necessary to enable petitioner to continue manufacturing glass, the
necessity therefor arose only when a particular furnace reached the end of its life or operating
cycle. Or, as on the second undertaking, when a particular furnace required an emergency
repair. In other words, the undertakings where private respondent was hired primarily as
helper/bricklayer have specified goals and purpose which are fulfilled once the
designated work was completed. Moreover, such undertakings were also identifiably
separate and distinct from the usual, ordinary or regular business operations of
petitioner, which is glass manufacturing. These undertakings, the duration and scope of
which had been determined and made known to private respondent at the time of his
employment clearly indicated the nature of his employment as a project employee. Thus,
his services were terminated legally after the completion of the project.

3, Gadia v. Sykes Asia, Inc.,

G.R. No. 209499, [January 28, 2015])

FACTS: Sykes Asia is a corporation engaged in Business Process Outsourcing (BPO) which
provides support to its international clients from various sectors (e.g., technology,
telecommunications, retail services) by carrying on some of their operations, governed by
service contracts that it enters with them. On September 2, 2003,12 Alltel Communications, Inc.
(Alltel), a United States-based telecommunications firm, contracted Sykes Asia’s services to
accommodate the needs and demands of Alltel clients for its postpaid and prepaid services
(Alltel Project). Thus, on different dates, Sykes Asia hired petitioners as customer service
representatives, team leaders, and trainers for the Alltel Project.

Sometime in 2009, Alltel informed Sykes that it is terminating its contract with Sykes. As a
result, Sykes sent each of the petitioners end-of-life notices informing them of their dismissal
from service due to the termination of the contract with Alltel. Aggrieved, they filed a case for
illegal dismissal with the NLRC.

As a defense, Sykes alleged that the petitioners were merely project employees, which was
clearly shown by their respective employment contracts.

ISSUE: Whether or not the petitioners are project employees.

HELD: Yes, the petitioners are project employees

Article 294 (now, Article 195[280]) of the Labor Code provides that an employee is deemed
regular when he has been engaged to perform activities which are deemed usually necessary
and desirable in the usual business or trade of the employer, except (i) 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 (ii) where the work or
services to be performed is seasonal in nature and the employment if for the duration of the
season.
Accordingly, the the principal test for determining whether particular employees are properly
characterised 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 (i) 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 (ii) 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.

Thus, for 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, the Court held that Sykes was able to prove both requisites.

As regards the first requisite, it held that Sykes adequately informed the petitioners of their
employment status at the time of their engagement. As was shown by their respective
employment contracts, they were hired for the Alltel Project and their positions were “project-
based and as such is co-terminus to the project.”

As regards the second requisite, it held that “the duration of the undertaking begins and ends at
determined or determinable times” which means capable of being determined or fixed. As such,
indicating in the contract that their employment is “co-terminus with the project” is sufficient
compliance with this requisite.

4. UST v. Samahang Manggagawa ng UST;

G.R. No. 184262. ** April 24, 2017.

FACTS: The instant case stemmed from a complaint for regularization and illegal dismissal filed
by respondents Samahang Manggagawa ng UST and Pontesor, et al. against the 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, as laborers, 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. The respondents
in this case argued that for as long as the petitioner continues to operate and exist as an
educational institution, with rooms, buildings, and facilities to maintain, the latter could not
dispense with their services which are necessary and desirable to the business of the petitioner.
Petitioner admitted that it repeatedly hired the respondents in different capacities throughout the
aforesaid years. Petitioners maintained that the respondents were merely hired on a per-project
basis, as evidenced by numerous Contractual Appointments signed by them. The said contracts
defined the nature and the 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.

The LA ruled in favor of Pontersor , et al’s favor and ordered the petitioner to reinstate them to
their former jobs with full backwages and seniority rights. The LA ruled that they are regular
employees considering that they rendered at least 1 year of service, the activities they did was
vital and indispensable to the maintenance of the buildings or classrooms of the petitioner and
that the Contracts were contrived to preclude them from obtaining security of Tenure.

The NLRC then reversed the LA’s ruling, and found that Pontesor, et al cannot be considered
as regular employees as they knowingly and voluntarily entered into fixed term contracts of
employment with the petitioner, as a result they could not be illegally dismissed upon the
expiration of their contracts. Respondents then filed a petition to the CA.

The CA reversed the ruling of the NLRC and said that they are not considered as fixed term
employees or project employees since they performed work that is necessary and desirable to
the petitioner’s business as evidenced by the repeated rehiring and continuous need for their
services. The petitioner then moved for reconsideration.

ISSUE: Whether or not Pontesor, et al are regular employees of the petitioner.

RULING: The court ruled in favor of Pontesor, et al. The respondents are considered
regularized casual employees.

Article 295 of the Labor Code, 30 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. 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.

5. Herma Shipyard, Inc. v. Oliveros;

G.R. No. 208936. April 17, 2017.

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, the respondents filed 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.

Respondents further alleged that as a condition to their continuous and uninterrupted

employment, petitioners made them sign employment contracts for a fixed period ranging from
one to four months to make it appear that they were project-based employees. Per respondents,
petitioners resorted to this scheme to defeat their right to security of tenure, but in truth there
was never a time when they ceased working for Henna Shipyard due to expiration of project-
based employment contracts. In fact, if they were indeed project employees, petitioners should
have reported to the Department of Labor and Employment (DOLE) the completion of such
project. But petitioners have never submitted such report to the DOLE.

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, In support thereof, Herma Shipyard presented contracts of employment.

ISSUE:
Whether or not respondents who are project employees have become regular employees as a
result of their repeated hiring by the petitioner for various projects.

RULING: The Court held in the negative.

A project employee under Article 280 (now Article 294) of the Labor Code, as amended, is
one 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,

The services of project-based employees are co-terminus with the project and may be
terminated upon the end or completion of the project or a phase thereof for which they were
hired.

Repeated rehiring of project employees to different projects does not automatically make
them regular employees. 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.

It is significant to note that the corporation does not construct vessels for sale or otherwise
which will demand continuous productions of ships and will need permanent or regular workers.
It merely accepts contracts for shipbuilding and repairs for third parties. Workers are hired only
when there are projects, the completion of which usually require less than a year or longer.
Thus the completion of the work or project automatically results in the termination of project
based employment in which case, the employer is under the law, only obliged to render a report
on the termination of the employment.

Hence, Herma Shipyard should be allowed '"to reduce its work force into a number suited for
the remaining work to be done upon the completion or proximate accomplishment of each
particular project." As for respondents, since they were assigned to a project or a phase thereof
which begins and ends a determined or determinable times, their services were lawfully
terminated upon the completion of such project or phase thereof

Moreover, the extension of the respondent’s employment does not violate the second requisite
of project employment that the completion or termination of such project or undertaking be
determined at the time of engagement of the employee. In case of delay or where such work is
not finished within the estimated completion, respondents’ period of employment can be
extended until it is completed. The duration and nature of their employment remains
coterminous with the particular project which they were fully informed of at the time of their
engagement.

6.Lingat v. CCBPI
(G.R. No. 205688. July 4, 2018.)

FACTS: Petitioners filed a complaint for illegal dismissal, moral and exemplary damages and
attorney’s fees against Coca-Cola Bottlers. Phil. Inc (CCBPI). The petitioners stated that they
were hired as plant driver and forklift operator, and segregator/mixer respectively. They added
that they had continually worked for CCBPI until their illegal dismissal. Petitioners are alleging
that they are regular employees of the CCBPI because it engaged them to do tasks that are
necessary and desirable for the employer’s trade and business. They asserted that their work
was the link between CCBPI and its sales force. The petitioners alleged that CCBPI engaged
Lingat as a plant driver but he also worked as forklift operator. He drove CCBPI’s truck loaded
with soft drinks and other products and returned the empty bottles as well as the unsold soft
drinks.
Petitioners further stated that after becoming regular employees (as they had been employed
for more than a year), and by way of a modus operandi, CCBPI transferred them from one
agency to another. These agencies included Lipercon Services, Inc., People Services, Inc.,
Interserve Management and Manpower Resources, Inc. The latest agency to where they were
transferred was MDTC. They claimed that such transfer was a scheme to avoid their
regularization in CCBPI. The petitioners stressed that the aforesaid agencies were labor-only
contractors which did not have any equipment, machinery, and work premises for warehousing
purposes. They maintained that they were regular employees of CCBPI because they worked
within the premises of CCPI, use the equipment, the facilities, cater on its products and served
the sales force. In other words, while at work they were under the direction, control and
supervision of the operations by Coca Cola employees as they perform their work within Coca-
Cola’s premises. Finally, petitioners argued that CCBPI dismissed them after it found out that
they were "overstaying." As such, they posited that they were illegally dismissed as their
termination was without cause and due process of law.
CCBPI and Lyons declared that CCBPI was engaged in the business of manufacturing,
distributing, and marketing of softdrinks and other beverage products. By reason of its business,
CCBPI entered into a Warehousing Management Agreement with MDTC for the latter to
perform warehousing and inventory functions for the former. CCBPI and Lyons likewise
stressed that petitioners were employees of MDTC, not CCBPI. They averred that MDTC was
the one who engaged petitioners and paid their salaries. They also claimed that CCBPI only
coordinated with the Operations Manager of MDTC in order to monitor the end results of the
services rendered by the employees of MDTC. They added that it was MDTC which imposed
corrective action upon its employees when disciplinary matters arose.
The LA ruled in favor of the petitioners, and said that the complainants were illegally dimissed
from their employment since the respondents failed to refute that petitioners were employees of
CCBPI and the latter undermined their regular status by transferring them to an agency.
Moreover, as plant driver and segregator/mixer, petitioners performed activities necessary in the
usual business or trade of CCBPI and served them for 1 year. On appeal, the NLRC dismissed
the illegal dismissal case.Contrary to the finding of the NLRC, the CA found that the illegal
dismissal case filed by Lingat had not yet prescribed. It held that, aside from money claims,
Lingat prayed for reinstatement, as such, pursuant to Article 1146 of the Civil Code, Lingat had
four years within which to file his case. It noted that Lingat filed this suit on May 5, 2008 or only
three years and one day from his alleged illegal dismissal; thus, he timely filed his case against
respondents.
Nevertheless, the CA agreed with the NLRC that MDTC was an independent contractor and the
employer of petitioners. It gave weight to petitioners' latest IDs, which were issued by MDTC as
well as to the Articles of Incorporation of MDTC, which indicated that its secondary purpose was
"to engage in the business of land transportation" and "the business of warehousing services." It
further ruled that MDTC had substantial capital stock, as well as properties and equipment,
which supported the conclusion that MDTC was a legitimate labor contractor.

On January 16,2 013, the CA denied the Motion for Reconsideration on the assailed Decision.

ISSUE: Whether or not the Court of Appeals gravely erred in declaring [that] Petitioners [were]
not regular employees of Respondent CCBPI

RULING:

Yes. To ascertain if one is a regular employee, it is primordial to determine the reasonable

connection between the activity he or she performs and its relation to the trade or business of
the supposed employer. Relating petitioners' tasks to the nature of the business of CCBPI –
which involved the manufacture, distribution, and sale of soft drinks and other beverages – it
cannot be denied that mixing and segregating as well as loading and bringing of CCBPI's
products to its customers involved distribution and sale of these items. Simply put, petitioners'
duties were reasonably connected to the very business of CCBPI. They were indispensable to
such business because without them the products of CCBPI would not reach its customers.
Similarly, petitioners have worked for CCBPI since 1993 (Lingat) and 1996 (Altoveros) until the
non-renewal of their contracts in 2005. Aside from the fact that their work involved the
distribution and sale of the products of CCBPI, they remained to be working for CCBPI despite
having been transferred from one agency to another. Hence, such repeated re-hiring of
petitioners, and the performance of the same tasks for CCBPI established the necessity and the
indispensability of their activities in its business.

7. ABS-CBN Broadcasting Corp. v. Nazareno

G.R. No. 164156, September 26, 2006

FACTS: Petitioner ABS-CBN Broadcasting Corporation (ABS- CBN) is engaged in the

broadcasting business. Petitioner employed respondents Nazareno, Gerzon, Deiparine, and
Lerasan as production assistants (PAs) on different dates. They were assigned at the news and
public affairs, for various radio programs in the Cebu Broadcasting Station, with a monthly
compensation of P4,000. They were issued ABS-CBN employees’ identification cards and were
required to work for a minimum of eight hours a day, including Sundays and holidays.

The PAs were under the control and supervision of Assistant Station Manager Dante J. Luzon,
and News Manager Leo Lastimosa. On December 19, 1996, petitioner and the ABS-CBN Rank-
and-File Employees executed a Collective Bargaining Agreement (CBA) to be effective during
the period from December 11, 1996 to December 11, 1999. However, since petitioner refused to
recognize PAs as part of the bargaining unit, respondents were not included to the CBA.
On October 12, 2000, respondents filed a Complaint for Recognition of Regular Employment
Status, Underpayment of Overtime Pay, Holiday Pay, Premium Pay, Service Incentive Pay, Sick
Leave Pay, and 13th Month Pay with Damages against the petitioner before the NLRC.
Respondents insisted that they belonged to a "work pool" from which petitioner chose persons
to be given specific assignments at its discretion and were thus under its direct supervision and
control regardless of nomenclature.

ISSUE: Are Nazareno et. al employees of ABS-CBN?

HELD: We agree with respondents’ contention that where a person has rendered at least one
year of service, regardless of the nature of the activity performed, or where the work is
continuous or intermittent, the employment is considered regular as long as the activity exists,
the reason being that a customary appointment is not indispensable before one may be formally
declared as having attained regular status.

It is of no moment that petitioner hired respondents as "talents." The fact that respondents
received pre- agreed "talent fees" instead of salaries, that they did not observe the required
office hours, and that they were permitted to join other productions during their free time are not
conclusive of the nature of their employment. Respondents cannot be considered "talents"
because they are not actors or actresses or radio specialists or mere clerks or utility employees.
They are regular employees who perform several different duties under the control and direction
of ABS- CBN executives and supervisors.

In this case, it is undisputed that respondents had continuously performed the same activities
for an average of five years. Their assigned tasks are necessary or desirable in the usual
business or trade of the petitioner. The persisting need for their services is sufficient evidence of
the necessity and indispensability of such services to petitioner’s business or trade. While length
of time may not be a sole controlling test for project employment, it can be a strong factor to
determine whether the employee was hired for a specific undertaking or in fact tasked to
perform functions which are vital, necessary and indispensable to the usual trade or business of
the employer.

8. ALU-TUCP v. NLRC
(GR 109902, August 2, 1994)

FACTS: On 5 July 1990, petitioners filed separate complaints for unfair labor practice,
regularization and monetary benefits with the NLRC the Labor Arbiter in a Decision dated 7
June 1991, declared petitioners "regular project employees who shall continue their
employment as such for as long as such [project] activity exists," but entitled to the salary of a
regular employee pursuant to the provisions in the collective bargaining agreement. It also
ordered payment of salary differentials.

Both parties appealed to the NLRC from that decision. Petitioners argued that they were
regular, not project, employees. Private respondents, on the other hand, claimed that petitioners
are project employees as they were employed to undertake a specific project NSC's Five Year
Expansion Program. The NLRC in its questioned resolutions modified the Labor Arbiter's
decision. It affirmed the Labor Arbiter's holding that petitioners were project employees since
they were hired to perform work in a specific undertaking - the Five Year Expansion Program,
the completion of which had been determined at the time of their engagement and which
operation was not directly related to the business of steel manufacturing. The NLRC, however,
set aside the award to petitioners of the same benefits enjoyed by regular employees for lack of
legal and factual basis.

The law on the matter is Article 280 of the Labor Code

Petitioners argue that they are "regular" employees of NSC because: (i) their jobs are
"necessary, desirable and work-related to private respondent's main business, steelmaking";
and (ii) they have rendered service for six (6) or more years to private respondent NSC.

ISSUE: Whether or not petitioners are properly characterized as "project employees" rather
than "regular employees" of NSC.

RULING: Yes. In the realm of business and industry, we note that "project" could refer to... 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. Such job or undertaking begins and ends at determined or
determinable times.

The term "project" could also refer to, secondly, a particular job or undertaking that is not within
the regular business of the corporation. Such a job or undertaking must also be identifiably
separate and distinct from the ordinary or regular business operations of the employer. The job
or undertaking also begins and ends at determined or determinable times.

During the time petitioners rendered services to NSC, their work was limited to one or another of
the specific component projects which made up the FAYEP I and II. There is nothing in the
record to show that petitioners were hired for, or in fact assigned to, other purposes, e.g., for
operating or maintaining the old, or previously installed and commissioned, steel-making
machinery and equipment, or for selling the finished steel products. "It is well established by the
facts and evidence on record that herein 13 complainants were hired and engaged for specific
activities or undertaking the period of which has been determined at time of hiring or
engagement.

the employment of each 'project worker' is dependent and co-terminous with the completion or
termination of the specific activity or undertaking [for which] he was hired which has been pre-
determined at the time of engagement.

Petitioners next claim that their service to NSC of more than six (6) years should qualify them as
regular employees. We believe this claim is without legal basis.

The second paragraph of Article 280 of the Labor Code, quoted above, providing that an
employee who has served for at least one (1) year, shall be considered a regular employee,
relates to casual employees, not to project employees.
This Court ruled that the proviso in the second paragraph of Article 280 relates only to casual
employees and is not applicable to those who fall within the definition of said Article's first
paragraph, i.e., project employees

9. Equipment Technical Services v. CA

(GR 157680, October 8, 2008)

FACTS: Petitioner ETS is primarily engaged in the business of sub-contracting plumbing works
of on-going building construction. Among its clients was Uniwide. Petitioner Joseph James
Dequito was, during the period material, occupying the position of manager of ETS, albeit the
CA referred to him as ETS’ president. On various occasions involving different projects, ETS
hired the services of private respondents as pipe fitters, plumbers, or threaders.
In December 1998, ETS experienced financial difficulties when Uniwide, its client at the time,
failed to pay for the plumbing work being done at its Coastal Mall. As a result, ETS was only
able to pay its employees 13th month pay equivalent to two weeks’ salary.

Unhappy over what they thought was ETS’ failure to release the balance of their 13th month
pay, private respondents brought their case before the Arbitration Branch of the NLRC
Later, two other cases were filed against ETS for illegal dismissal and payment of money claims
when the complainants thereat were refused work in another ETS project, i.e., Richville project,
allegedly because they refused to sign individual employment contracts with ETS.

The three cases were consolidated before the labor arbiter. However, conciliation efforts failed.
The Labor Arbiter issued a Decision, holding that private respondents were ETS’ regular, not
merely project, employees. Accordingly, ETS was adjudged liable for illegal dismissal and
directed to pay private respondents their money claims plus 10% of the total award as attorney’s
fees.

ETS appealed from the labor arbiter’s decision. The NLRC rendered a resolution which, while
reversing the labor arbiter’s holding with respect to the nature of private respondents’
employment and the illegality of their dismissal, nevertheless upheld the validity of the monetary
award extended by the labor arbiter, part of which included the award of backwages.

ETS elevated its case to the CA via a petition for certiorari under Rule 65. As its principal
contention, ETS ascribed on the NLRC the commission of grave abuse of discretion in affirming
the monetary award in favor of private respondents, despite its finding that there was no illegal
dismissal in this case

The CA stated that the NLRC’s determination that private respondents are “project workers” is
“utterly unsupported by the evidence on record and is patently erroneous” and, therefore, is
tainted with grave abuse of discretion. Hence, this petition.

ISSUE: Whether or not respondents are seasonal or project workers.

RULING: The petition is without merit.

As the Court has consistently held, the service of project employees are co-terminus with the
project and may be terminated upon the end or completion of that project or project phase for
which they were hired. Regular employees, in contrast, enjoy security of tenure and are entitled
to hold on to their work or position until their services are terminated by any of the modes
recognized under the Labor Code.

The principal test for determining whether an employee is properly characterized as “project
employee,” as distinguished from “regular employee,” is whether or not “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 employees were engaged for that project.8 And as Article 280 of
the Labor Code, defining a regular employee vis-à-vis a project employee, would have it:

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 x x x.

It bears to stress at the outset that ETS admits hiring or employing private respondents to
perform plumbing works for various projects. Given this postulate, regular employment may
reasonably be presumed and it behooves ETS to prove otherwise, that is, that the employment
in question was contractual in nature ending upon the expiration of the term fixed in the contract
or for a specific project or undertaking. But the categorical finding of the CA, confirmatory for the
most part of that of the labor arbiter, is that not a single written contract of employment fixing the
terms of employment for the duration of the Uniwide project, or any other project, was submitted
by ETS despite the latter’s allegations that private respondents were merely contractual
employees. Records of payroll and other pertinent documents, such as job contracts secured by
ETS showing that private respondents were hired for specific projects, were also not submitted
by ETS.

Moreover, if private respondents were indeed employed as project employees, petitioners

should have had submitted a report of termination every time their employment was terminated
owing to the completion of each plumbing project.

In termination disputes, the burden of proving that an employee had been dismissed for a lawful
cause or that the exacting procedural requirements under the Labor Code had been complied
with lies with the employer. Where there is no showing of a clear, valid, and legal cause for
termination of employment, the law considers the case a matter of illegal dismissal.

Based on the foregoing criteria, the factual findings of the labor arbiter on the regular nature of
private respondents’ employment, juxtaposed with ETS’ failure to support its “project-workers
theory,” impel us to dismiss the instant petition.
 10. Dacuital v. L. M. Camus Engineering Corp.
(GR 176748, September 1, 2010)

FACTS: Respondent L.M. Camus Engineering Corporation (LMCEC) is a domestic

corporation duly organized and existing under and by virtue of Philippine laws, engaged in
construction, engineering, and air-conditioning business; while respondent Luis M.Camus
(Camus) is the company president. Petitioners Dacuital and the others were hired by LMCEC as
welder, tinsmith, pipefitter and mechanical employees.

During the months of January, February and March 2001, petitioners were required by
LMCEC to surrender their identifIcation cards and ATM cards and were ordered to execute
contracts of employment. Most of the petitioners did not comply with the directive as they
believed that it was only respondents' strategy to get rid of petitioners' regular status since they
would become new employees disregarding their length of service. Petitioners were later
dismissed from employment. Hence, the complaint for illegal dismissal and non-payment of
monetary benefits filed by petitioners and other LMCEC employees who were similarly situated.

Respondents denied that petitioners were illegally dismissed from employment. They claimed
that petitioners were project employees and, upon the completion of each project, they were
served notices of project completion. They clarified that the termination of petitioners’
employment was due to the completion of the projects for which they were hired.

Petitioners, however, countered that they were regular employees as they had been engaged to
perform activities which are usually necessary or desirable in the usual business or trade of
LMCEC. They denied that they were project or contractual employees because their
employment was continuous and uninterrupted for more than one (1) year. Finally, they
maintained that they were part of a work pool from which LMCEC drew its workers for its
various projects.

The Labor Arbiter rendered a decision declaring the dismissal of the complainant-employees as
illegal and the complainants are entitled to reinstatement without back wages.

The NLRC modified the decision of the Labor Arbiter and ordered the reinstatement of the
complainants with limited backwages. The respondents appealed the decision to the Court of
Appeals and the appellate court held that the complainants are project employees and hence,
there was no illegal dismissal.

ISSUE: Whether or not the petitioners are project employees

RULING: The court ruled in the negative. Article 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.

The principal test used to determine whether employees are project employees is
whether or not the employees were assigned to carry out a specific project or
undertaking, the duration or scope of which was specified at the time the employees
were engaged for that project.

Even though the absence of a written contract does not by itself grant regular status to
petitioners, such a contract is evidence that petitioners 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 the employment contracts raises a serious question of whether the
employees were properly informed at the onset of their employment of their status as project
employees.

While it is true that respondents presented the employment contract of Dacuital, the contract
does not show that he was informed of the nature, as well as the duration of his
employment. In fact, the duration of the project for which he was allegedly hired was not
specified in the contract.

11. Filipinas Pre-Fabricated Building Systems, Inc v. Puente

(GR 153832, March 18, 2005)

FACTS: "[Respondent] avers that he started working with [Petitioner] Filsystems, Inc., a
corporation engaged in construction business, on June 12, 1989; that he was initially hired by
[petitioner] company as an ‘installer’; that he was later promoted to mobile crane operator and
was stationed at the company premises; that his work was not dependent on the completion or
termination of any project; that since his work was not dependent on any project, his
employment with the [petitioner-]company was continuous and without interruption for the past
ten (10) years;that on October 1, 1999, he was dismissed from his employment allegedly
because he was a project employee. He filed a pro forma complaint for illegal dismissal.

"The [petitioner-]company however claims that complainant was hired as a project employee in
the company’s various projects; that his employment contracts showed that he was a project
worker with specific project assignments; that after completion of each project assignment, his
employment was likewise terminated and the same was correspondingly reported to the
DOLE.Labor Arbiter dismissed the complaint for lack of merit. The CA concluded that
respondent was a regular employee of petitioners.

ISSUE: Whether Roger Puente is a project employee.

RULING: In general, the factual findings of the Court of Appeals are binding on the Supreme
Court. One exception to this rule, however, is when the factual findings of the former are
contrary to those of the trial court (or the lower administrative body, as the case may be). The
question of whether respondent is a regular or a project employee is essentially factual in
nature; nonetheless, the Court is constrained to resolve it due to the incongruent findings of the
NLRC and the CA. The Labor Code defines regular, project and casual employees as follows:

“ART. 280. Regular and Casual Employment. - The provision 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.”

With particular reference to the construction industry, to which Petitioner Filsystems belongs,
Department (of Labor and Employment) Order No. 19,11 Series of 1993, which make it clear
that a project employee is one 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."

In D.M. Consunji, Inc. v. NLRC, this Court has ruled that "the length of service of a project
employee is not the controlling test of employment tenure but whether or not ‘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.’"

In the present case, the contracts of employment of Puente attest to the fact that he was hired
for specific projects. His employment was coterminous with the completion of the projects for
which he had been hired. Those contracts expressly provided that his tenure of employment
depended on the duration of any phase of the project or on the completion of the construction
projects. Furthermore, petitioners regularly submitted to the labor department reports of the
termination of services of project workers. Such compliance with the reportorial requirement
confirms that respondent was a project employee. Respondent’s Complaint specified the
address of Filsystems, as "69 INDUSTRIA ROAD, B.BAYAN Q.C.," but specified his place of
work as "PROJECT TO PROJECT." These statements, coupled with the other pieces of
evidence presented by petitioners, convinces the Court that -- contrary to the subsequent claims
of respondent -- he performed his work at the project site, not at the company’s premises.
Respondent’s employment contract provides as follows: "x xx employment, under this contract
is good only for the duration of the project unless employee’s services is terminated due to
completion of the phase of work/section of the project or piece of work to which employee is
assigned:
"We agree clearly that employment is on a Project to Project Basis and that upon termination of
services there is no separation pay: POSITION : Mobil Crane Operator; PROJECT NAME :
World Finance Plaza; LOCATION : Meralco Ave., Ortigas Center, Pasig City; ASSIGNMENT :
Lifting & Hauling of Materials

Evidently, although the employment contract did not state a particular date, it did specify that the
termination of the parties’ employment relationship was to be on a "day certain" -- the day when
the phase of work termed "Lifting & Hauling of Materials" for the "World Finance Plaza" project
would be completed. Thus, respondent cannot be considered to have been a regular employee.
He was a project employee.

That he was employed with Petitioner Filsystems for ten years in various projects did not ipso
facto make him a regular employee, considering that the definition of regular employment in
Article 280 of the Labor Code makes a specific exception with respect to project employment.
The mere rehiring of respondent on a project-to-project basis did not confer upon him regular
employment status. "The practice was dictated by the practical consideration that experienced
construction workers are more preferred." It did not change his status as a project employee.

12. Tomas Lao Construction v. NLRC

(GR 116781, September 5, 1997)

FACTS: Andres Lao issued a Memorandum requiring all workers to sign employment contract
forms which explicitly described the construction workers (respondents included) as project
employees. Respondents refused to sign, saying that the scheme would downgrade their status
from regular employees to project employees.

As a result, their salaries were withheld. They were later terminated when they stood firm in
their refusal. They filed a case for illegal dismissal.

LA dismissed their complaint, but this was reversed by NLRC Fourth Division. e NLRC also
overruled the fixing by the Labor Arbiter of the term of employment of complainants uniformly at
five (5) years since the periods of employment of the construction workers as alleged in their
complaints were never refuted by petitioners. In granting monetary awards to complainants,
NLRC disregarded the veil of corporate fiction and treated the three (3) corporations as forming
only one entity on the basis of the admission of petitioners that "the three (3) operated as one
(1), intermingling and commingling all its resources, including manpower facility."

Before the SC, petitioners argued that respondents are not regular employees since they were
regularly maintained in the payroll and were free to offer their services to other companies. The
Court held that the respondents were regular employees. The employment relation is not
severed by merely being suspended. The employees are merely on leave of absence without
pay until they are reemployed. The Court also said that the repeated rehiring and the continuing
need for the services of the respondents over a long span of time have made them regular
employees. The Court also ruled that the respondents were illegally dismissed.

ISSUE: Whether or not the employees are project employees

RULING: No. the respondents are not project employees. if private respondents were indeed
employed as "project employees," petitioners should have submitted a report of
termination to the nearest public employment office every time their employment was
terminated due to completion of each construction project. The records show that they did
not. Policy Instruction No. 20 is explicit that employers of project employees are exempted from
the clearance requirement but not from the submission of termination report. We have
consistently held that failure of the employer to file termination reports after every project
completion proves that the employees are not project employees. Nowhere in the New Labor
Code is it provided that the reportorial requirement is dispensed with. The fact is that
Department Order No. 19 superseding Policy Instruction No. 20 expressly provides that the
report of termination is one of the indicators of project employment.

We agree with the NLRC that the execution of the project employment contracts was "farcical."
Obviously, the contracts were a scheme of petitioners to prevent respondents from being
considered as regular employees. It imposed time frames into an otherwise flexible
employment period of private respondents some of whom were employed as far back as 1969.
Clearly, here was an attempt to circumvent labor laws on tenurial security. Settled is the rule
that when periods have been imposed to preclude the acquisition of tenurial security by the
employee, they should be struck down as contrary to public morals, good customs or public
order. Worth noting is that petitioners had engaged in various joint venture agreements in the
past without having to draft project employment contracts. That they would require execution of
employment contracts and waivers at this point, ostensibly to be used for audit purposes, is a
suspect excuse, considering that petitioners enforced the directive by withholding the salary of
any employee who spurned the order.

13. Abesco Constuction and Development Corporation v. Ramirez

(GR 141168, April 10, 2006) (INC)

FACTS: Petitioner company was engaged in a construction business where respondents were
hired on different dates from 1976 to 1992 either as laborers, road roller operators, painters or
drivers.

In 1997, respondents filed two separate complaints for illegal dismissal against the company
and its General Manager, Oscar Banzon, before the Labor Arbiter. Petitioners allegedly
dismissed them without a valid reason and without due process of law. The complaints also
included claims for non- payment of the 13th month pay, five days’ service incentive leave pay,
premium pay for holidays and rest days, and moral and exemplary damages. The LA later on
ordered the consolidation of the two complaints.

Petitioners denied liability to respondents and countered that respondents were “project
employees” since their services were necessary only when the company had projects to be
completed. Petitioners argued that, being project employees, respondents’ employment was
coterminous with the project to which they were assigned. They were not regular employees
who enjoyed security of tenure and entitlement to separation pay upon termination from work.
ISSUE: Whether respondents were project employees or regular employees.

RULING: Yes, the respondents were regular employees.

The Labor Arbiter ruled that the employees are regular employees as manifested by the hiring
and rehiring of the respondents for Abesco projects. In his resolution, the Labor Arbiter
highlighted the fact that the respondents were part of a work pool which was readily tapped by
the company at their discretion and that it has been a practice for a period of 18 years.

The Supreme Court sustained the ruling of the Labor Arbiter but indicated that a long period of
service does not automatically make the respondents regular employees as length of service is
not a controlling factor.

The Supreme Court explained that the primary test to determine whether the respondents are
regular or project employees is (i) whether they are assigned to carry out a specific project or
undertaking and (ii) the duration and scope of which are specified at the time they are engaged
for that project. The high court also emphasized that such duration and particular work/service
to be performed should be defined in the employment agreement and are made clear to the
employees at the time of hiring.

In this case, petitioners did not have that kind of agreement with respondents. Neither did they
inform respondents of the nature of the latter's work at the time of hiring. Hence, for failure of
petitioners to substantiate their claim that respondents were project employees, the SC
constrained to declare the respondents as regular employees.”

14. Pasos v PNCC

(GR 192394, July 3, 2013)

FACTS: Petitioner Roy D. Pasos started working for respondent PNCC on April 26, 1996.
Based on the PNCC's "Personnel Action Form Appointment for Project Employment" dated April
30, 1996,petitioner was designated as "Clerk II (Accounting)" and was assigned to the "NAIA II
Project." It was likewise stated therein that he is a project employee and his contract may be
terminated at any time for cause as provided by law or existing company policy and that after
services are terminated, the employee shall be under no obligation to re-employ with the
Company nor shall the Company be obliged to re-employ the employee. Petitioners
employment, however, did not end on July 25, 1996 but was extended until August 4, 1998, or
more than two years later, based on the "Personnel Action Form Project Employment" dated
July 7, 1998. Based on PNCCs "Appointment for Project Employment" dated November 11,
1998,petitioner was rehired on even date as "Accounting Clerk (Reliever)" and assigned to the
"PCSO Q.I. Project." It was stated therein that his employment shall end on February 11, 1999
and may be terminated for cause or in accordance with the provisions of Article 282 of the Labor
Code, as amended. However, said employment did not actually end on February 11, 1999 but
was extended until February 19, 1999 based on the "Personnel Action Form-Project
Employment" dated February 17, 1999.
On February 23, 1999, petitioner was again hired by PNCC as "Accounting Clerk" and was
assigned to the "SM-Project" based on the "Appointment for Project Employment" dated
February 18, 1999.It did not specify the date when his employment will end but it was stated
therein that it will be "co-terminus with the completion of the project." Said employment
supposedly ended on August 19, 1999 per "Personnel Action Form Project Employment" dated
August 18, 1999,where it was stated, "termination of petitioners project employment due to
completion of assigned phase/stage of work or project effective at the close of office hours on
19 August 1999." However, it appears that said employment was extended per "Appointment for
Project employment" dated August 20, 1999 as petitioner was again appointed as "Accounting
Clerk" for "SM Project (Package II)." It did not state a specific date up to when his extended
employment will be, but it provided that it will be "co-terminus with the project." In "Personnel
Action Form Project Employment" dated October 17, 2000,it appears that such extension would
eventually end on October 19, 2000.

Despite the termination of his employment on October 19, 2000, petitioner claims that his
superior instructed him to report for work the following day, intimating to him that he will again
be employed for the succeeding SM projects. For purposes of reemployment, he then
underwent a medical examination which allegedly revealed that he had pneumonitis. Petitioner
was advised by PNCCs physician, Dr. Arthur C. Obena, to take a 14-day sick leave.

On November 27, 2000, after serving his sick leave, petitioner claims that he was again referred
for medical examination where it was revealed that he contracted Kochs disease. He was then
required to take a 60-day leave of absence. The following day, he submitted his application for
sick leave but PNCCs Project Personnel Officer, Mr. R.S. Sanchez told him that he was not
entitled to sick leave because he was not a regular employee.

After he presented his medical clearance to the Project Personnel Officer on even date, he was
informed that his services were already terminated on October 19, 2000 and he was already
replaced due to expiration of his contract. This prompted petitioner on February 18, 2003 to file
a complaint for illegal dismissal against PNCC with a prayer for reinstatement and back wages.
He argued that he is deemed a regular employee of PNCC due to his prolonged employment as
a project employee as well as the failure on the part of PNCC to report his termination every
time a project is completed. He further contended that his termination without the benefit of an
administrative investigation was tantamount to an illegal dismissal.

The LA ruled in favor of the petitioner attained regular employment status with the repeated
hiring and rehiring of his services more so when the services he was made to render were usual
and necessary to PNCCs business. The Labor Arbiter likewise found that from the time
petitioner was hired in 1996 until he was terminated, he was hired and rehired by PNCC and
made to work not only in the project he had signed to work on but on other projects as well,
indicating that he is in fact a regular employee. He also noted petitioners subsequent contracts
did not anymore indicate the date of completion of the contract and the fact that his first contract
was extended way beyond the supposed completion date.
The case was then elevated to the NLRC. The NLRC found that petitioner was employed in
connection with certain construction projects and his employment was co-terminus with each
project as evidenced by the Personnel Action Forms and the Termination Report submitted to
the DOLE. It likewise noted the presence of the following project employment indicators in the
instant case, namely, the duration of the project for which petitioner was engaged was
determinable and expected completion was known to petitioner; the specific service that
petitioner rendered in the projects was that of an accounting clerk and that was made clear to
him and the service was connected with the projects; and PNCC submitted termination reports
to the DOLE and petitioners name was included in the list of affected employees, hence the
instant petition.

ISSUE: Whether or not petitioner is a regular employee and not a mere project employee?

RULING: The petitioner is a regular employee and not a mere project employee. In the case at
bar, appointments issued to the petitioner indicated that he was hired for specific projects. This
Court is convinced however that although he started as a project employee, he eventually
became a regular employee of PNCC.

Under Article 280 of the Labor Code, as amended, a project employee is one 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." Thus, the principal test used to determine whether
employees are project employees is whether or not the employees were assigned to carry out a
specific project or undertaking, the duration or scope of which was specified at the time the
employees were engaged for that project.

In the case at bar, petitioner worked continuously for more than two years after the supposed
three-month duration of his project employment for the NAIA II Project. While his appointment
for said project allowed such extension since it specifically provided that in case his "services
are still needed beyond the validity of the contract, the Company shall extend his services,"
there was no subsequent contract or appointment that specified a particular duration for the
extension. His services were just extended indefinitely until "Personnel Action Form Project
Employment" dated July 7, 1998 was issued to him which provided that his employment will end
a few weeks later or on August 4, 1998. While for the first three months, petitioner can be
considered a project employee of PNCC, his employment thereafter, when his services were
extended without any specification of as to the duration, made him a regular employee of
PNCC. And his status as a regular employee was not affected by the fact that he was assigned
to several other projects and there were intervals in between said projects since he enjoys
security of tenure.

Failure of an employer to file termination reports after every project completion proves that an
employee is not a project employee.
 15. Raycor Aircontrol Systems, Inc. v. San Pedro
(GR 158132, July 4, 2007)

FACTS: Raycor Aircontrol Systems, Inc. (petitioner) hired Mario San Pedro (respondent) as
tinsmith operator subject to the condition that his employment shall commence "on August 24,
1995 and shall be effective only for the duration of the contract at Uniwide Las Pinas after
completion of which on November 18, 1995, it automatically terminates without necessity of
further notice." As the Uniwide Las Pinas project (first project) lasted for one year, petitioner
extended respondent's contract beyond November 18, 1995. When this first project was finally
completed, petitioner again extended respondent's employment by assigning him to its Olivarez
Plaza, Binan, Laguna project (second project) until December 1996. Subsequently, petitioner
rehired respondent as ducting man and assigned him to its Cabuyao, Laguna project (third
project) until April 1997. Thereafter, petitioner transferred respondent to its Llanas, Alabang
project (fourth project) and later, to its Uniwide Coastal project in Baclaran, Paranaque (fifth
project). Petitioner did not anymore issue new contracts to respondent each time his
employment was extended.

The petitioner declared that the contract of employment of respondent was set to expire on
November 1, 1997, the same to take effect on November 3, 1997. Thus, when the respondent
reported for work on November 3, 1997, he was informed by the company timekeeper that he
had been terminated.

Respondent filed a Complaint for illegal dismissal with damages. The LA rendered a Decision in
favor of respondent. On appeal by petitioner, the NLRC issued a Resolution, affirming the LA
Decision, and a Resolution denying petitioner's Motion for Reconsideration.

Petitioner filed a Petition for Certiorari which the CA denied and filed a Motion for
Reconsideration which was also denied by the CA. Hence, the petition.

ISSUE:

1. Whether or not the private respondent was a regular employee

2. WoN he was illegally dismissed.

RULING: Respondent was a regular employee and was illegally dismissed.

1. As to status of employment

The CA, as well as the NLRC and LA, considered respondent a regular employee of petitioner
because of the existence of a reasonable connection between the former's regular activity in
relation to the latter's business. They based this finding on the uncontroverted fact that
petitioner repeatedly rehired respondent in five successive projects for 23 continuous months.
The concurrent findings of the CA and the labor tribunals on the existence of an employer-
employee relationship between the parties in the present case are factual in nature and are
accorded due deference for being well-founded.
The Court recognized that petitioner was engaged in a peculiar business which constrained it
not to maintain a regular work force. It is not so much that this Court cannot appreciate
petitioner's contentions about the nature of its business and its inability to maintain a large
workforce on its permanent payroll.

The Court ruled against petitioner, the petitioner failed to adduce clear and convincing evidence
that the projects to which its workers were assigned were of limited scope and duration and that,
at the time of hiring, said workers knowingly accepted the restrictions on their employment.

Petitioner utterly failed to adduce additional evidence which would have convinced us that: 1)
each time it hired and rehired respondent, it intended for him to accomplish specific tasks in the
particular project to which he was assigned; 2) it intended for respondent to carry out these
specific tasks in accordance with the project plan it had drawn out and within the limited time it
had to complete the same; and 3) it made such restrictions on each engagement known to
respondent, and the same were freely accepted by him. Petitioner's failure to present such
evidence is inexcusable, given its access to such documents as project contracts, payment
remittances, employment records and payslips.

Consequently, the Court affirms the finding of the CA and the labor tribunals that respondent
became a regular employee after 23 months of rehiring.

2. As to illegal dismissal

Petitioner claims that respondent was laid off due to adverse business conditions it suffered at
that time, attributing these to the Asian currency crisis, in general, and to the rehabilitation of
Uniwide, in particular. The CA rejected such pretext and held that Raycor could not establish
exculpation from liability in the illegal dismissal of San Pedro by invoking another company's
economic reverses.

To justify termination of employment under Article 283 of the Labor Code, the employer must
prove compliance with the following requirements: (a) a written notice must be served on the
employees, and the Department of Labor and Employment (DOLE) at least one month before
the intended cessation of business; and (b) the cessation of business must be bona fide in
character.

It is readily apparent that petitioner did not comply with any of the foregoing requirements. There
is no evidence that it complied with the one-month notice requirement. While petitioner claims
that it issued to respondent a Memorandum of termination of employment, it failed to prove that
such document was served upon respondent and the DOLE. Moreover, the notice is less than
one month, for the memorandum states that respondent's contract of employment is to expire
on November 3, 1997, or only three days later from the date of the Memorandum.

Worse, there is no evidence at all that petitioner dismissed respondent because it actually
ceased or suspended business operations, or it resorted to the dismissal of respondent and
other employees to stave off cessation or suspension of its business.
Again, for failure of petitioner to discharge its burden of proving business reverses as a ground
for the lay-off of respondent, we uphold the CA in ruling that the latter's dismissal was illegal.

WHEREFORE, the petition is DENIED.

16. Macarthur Malicdem and Hermenigildo Flores vs. Marulas Industrial Corporation
(G.R. No. 204406; February 26, 2014)

TOPIC: Effect of continuous re-hiring of a project employee for the same tasks that are vital,
necessary and indispensable to the usual trade or business of the employer.

DOCTRINE: Once a project or work pool employee has been: (1) continuously, as opposed to
intermittently, rehired 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, pursuant to Article 280 of the Labor
Code and jurisprudence. To rule otherwise would allow circumvention of labor laws in industries
not falling within the ambit of Policy Instruction No. 20/Department Order No. 19, hence allowing
the prevention of acquisition of tenurial security by project or work pool employees who have
already gained the status of regular employees by the employers conduct.

FACTS: Petitioners Malicdem and Flores were hired by respondent corporation as extruder
operators in 2006 They were responsible for the bagging of filament yarn, the quality of pp yarn
package and the cleanliness of the work place area. Their employment contracts were for a
period of one (1) year. Every year thereafter, they would sign a Resignation/Quitclaim in favor of
Marulas a day after their contracts ended, and then sign another contract for one (1) year until
such time that they were told not to report to work anymore. They were asked to sign a paper
acknowledging the completion of their contractual status. Claiming that they were illegally
dismissed, the corporation countered that their contracts showed that they were fixed term
employees for a specific undertaking which was to work on a particular order of a customer for a
specific period. Their severance from employment then was due to the expiration of their
contracts.

ISSUE: Whether or not petitioners were illegally dismissed

HELD: Yes. 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. 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. It is clear then that there was deliberate intent on
the part of the employer to prevent the regularization of petitioners. To begin with, there is no
actual project. The only stipulations in the contracts were the dates of their effectivity, the duties
and responsibilities of the petitioners as extruder operators, the rights and obligations of the
parties, and the petitioner’s compensation and allowances. As there was no specific project or
undertaking to speak of, the respondents cannot invoke the exception in Article 280 of the Labor
Code. This is a clear attempt to frustrate the regularization of the petitioners and to circumvent
the law.

Even granting that petitioners were project employees; they can still be considered as regular as
they were continuously hired by the same employer for the same position as extruder operators.
Being responsible for the operation of machines that produced sacks, their work was vital and
indispensable the business of the employer.

The respondents cannot use the alleged expiration of the employment contracts of the
petitioners as a shield of their illegal acts. The project employment contracts that the petitioners
were made to sign every year since the start of their employment were only a stratagem to
violate their security of tenure in the company.

The respondent’s invocation of William Uy Construction Corp. v. Trinidad is misplaced

because it is applicable only in cases involving the tenure of project employees in the
construction industry. It is widely known that in the construction industry, a project employees
work depends on the availability of projects, necessarily the duration of his employment. It is not
permanent but coterminous with the work to which he is assigned. It would be extremely
burdensome for the employer, who depends on the availability of projects, to carry him as a
permanent employee and pay him wages even if there are no projects for him to work on. The
rationale behind this is that once the project is completed it would be unjust to require the
employer to maintain these employees in their payroll.

17. William Uy Construction Corp. and/or Uy, et al. v. Trinidad

FACTS: On August 1, 2006 respondent filed a complaint for illegal dismissal and unpaid
benefits against petitioner. Trinidad claimed that he had been working with the latter company
for 16 years since 1988 as driver of its service vehicle, dump truck, and transit mixer and he had
signed several employment contracts with the company that identified him as a project
employee although he had always been assigned to work on one project after another with
some intervals.

Respondent further alleged that in December 2004 petitioner company terminated him from
work after it shut down operations because of lack of projects.He learned later, however, that
although it opened up a project in Batangas, it did not hire him back for that project.

Petitioner company countered that it was in the construction business.By the nature of such
business, it had to hire and engage the services of project construction workers, including
respondent Trinidad, whose employments had to be co-terminus with the completion of specific
company projects.For this reason, every time the company employed Trinidad, he had to
execute an employment contract with it, called Appointment as Project Worker.

On December 23, 2006 the LA rendered a decision, dismissing respondent Trinidad's complaint
for unjust dismissal. The LA held that, since Trinidad was a project employee and since his
company submitted the appropriate establishment termination report to DOLE, his loss of work
cannot be regarded as unjust dismissal. It found no basis for granting Trinidad overtime pay,
holiday pay, and 13thmonth pay.

The NLRC affirmed the LAs ruling, prompting respondent Trinidad to elevate his case to the
CA.On April 24, 2008 the latter rendered a decision, reversing the NLRCs findings. Petitioner
company moved for a reconsideration of the decision but the CA denied the motion.

ISSUE: Whether or not the repeated rehiring of respondent Trinidad over several years as
project employee for its various projects automatically entitled him to the status of a regular
employee?

HELD: No, Trinidad was a project employee. The petition is granted.

The test for distinguishing a project employee from a regular employee is whether or not he has
been assigned to carry out a specific project or undertaking, with the duration and scope of his
engagement specified at the time his service is contracted.Here, it is not disputed that petitioner
company contracted respondent Trinidad's service by specific projects with the duration of his
work clearly set out in his employment contracts. He remained a project employee regardless of
the number of years and the various projects he worked for the company.

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. But this standard will not be fair, if applied to the construction industry, simply
because construction firms cannot guarantee work and funding for its payrolls beyond the life of
each project and getting projects is not a matter of course. Construction companies have no
control over the decisions and resources of project proponents or owners. There is no
construction company that does not wish it has such control but the reality, understood by
construction workers, is that work depends on decisions and developments over which
construction companies have no say.

In this case, respondent Trinidad's series of employments with petitioner company were co-
terminus with its projects. When its Boni Serrano-Katipunan Interchange Project was finished in
December 2004, Trinidad's employment ended with it. He was not dismissed. His employment
contract simply ended with the project for which he had signed up. His employment history
belies the claim that he continuously worked for the company. Intervals or gaps separated one
contract from another.

The CA noted that DOLE Order 19 required employers to submit a report of termination of
employees every completion of construction project and, since petitioner company submitted at
the hearing before the LA only the termination report covering respondent Trinidad's last project,
it failed to satisfy such requirement.

But respondent Trinidad did not say in his complaint that he had been illegally dismissed after
each of the projects for which he had been signed up. His complaint was essentially that he
should have been rehired from the last project since he had already acquired the status of a
regular employee. Consequently, petitioner company needed only to show the last status of
Trinidad's employment, namely, that of a project employee under a contract that had ended and
the company's compliance with the reporting requirement for the termination of that
employment. Indeed, both the Labor Arbiter and the NLRC were satisfied that the fact of
petitioner company's compliance with DOLE Order 19 had been proved in this case.

Parenthetically, the Social Security System should be able to alleviate the temporary
unemployment of construction workers, a problem that is inherent in the nature of their work.

CA SET ASIDE. NLRC AFFIRMED.

18. Bajaro v. Metro Stonerich Corp;

GR 227982, April 23, 2018

FACTS: Metro Stonerich is a domestic entity engaged in the construction business, owned and
operated by Nuño. On June 4, 2008, Metro Stonerich hired Bajaro as a concrete pump operator,
tasked with operating the pouring of freshly mixed concrete on the former’s construction
projects. Bajaro was called to work from 7:00am until 4:00pm from Mondays to Saturdays. He
was assigned to various construction projects until May 10, 2014. He received a daily wage of
Php 500.

Sometime in April 2014, while Bajaro was working at KCC Mall of Marbel in South Cotabato, he
noticed that one of the pipes was filled with concrete. He lifted the pipe to empty and clean it but
he felt an excruciating pain on his thighs and since then he could no longer walk properly. He
then requested the Secretary and Manager of Stonerich to take him to the hospital but he was
ignored and was told to go home instead.

Bajaro went to the office of Metro Stonerich to ask for financial assistance but was rejected. He
then went to East Avenue Medical Center to get treated and after two weeks, he was issued a
certificate that he was fit to return to work.

When he arrived at the workplace, he was informed to work the next day. On May 8 and 9,2014,
he was informed that he should no longer report to work.

Bajaro then filed a complaint before the Labor Arbiter for illegal dismissal against Metro
Stonerich as he was continuously employed for six years and performed activities that were
necessary and desirable for the latter’s business. On the other hand, Metro Stonerich argued
that Bajaro is not a regular employee, but a project employee. Bajaro was hired for five different
construction projects, with each project lasting for a period of five months or 12 months. As
proof that Bajaro was engaged on a per project basis, Metro Stonerich pointed out that it even
submitted reports to the Department of Labor and Employment upon the completion of the
projects Bajaro was engaged in.
The LA dismissed the complaint of Bajaro and held that he was a project employee as
evidenced by the employment contracts he signed each time he was engaged by Metro
Stonerich. Each contract clearly indicated the specific project, as well as the duration of his
work. As a project employee, his employment was conterminous with each project. Bajaro then
filed an appeal against the LA.

The NLRC dismissed Bajaro’s appeal for lack of merit. NLRC found that Bajaro was a project
employee since his employment contracts prove that at the time he was hired/rehired, the
duration and scope of his engagement were already specified. The NLRC rejected Bajaro's
claim that his continued and repeated rehiring made him a regular employee. The NLRC
observed that based on the records presented by Metro Stonerich, it was clear that Bajaro was
hired on different dates for various projects. Bajaro then took the case to the CA.

The CA rendered that the NLRC did not commit any grave abuse of discretion to warrant the
nullification of its decision. The CA agreed with the decision of the NLRC. The CA then found
that Bajaro signed a Kasunduan Para sa Katungkulang Serbisyo whenever he was hired as a
concrete pump operator which indicated that he adequately apprised of his employment status,
and was sufficiently informed that his employment will last only until the completion of each
construction project. The case was then taken to the SC.

ISSUE: Whether or not Bajaro is a project employee

RULING: Bajaro is a project employee of Metro Stonerich

Art. 294. 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.

Parenthetically, in a project-based employment, the employee is assigned to a particular project

or phase, which begins and ends at a determined or determinable time. Consequently, the
services of the project employee may be lawfully terminated upon the completion of such project
or phase. For employment to be regarded as project-based, it is incumbent upon the employer
to prove that (i) the employee was hired to carry out a specific project or undertaking; and (ii) the
employee was notified of the duration and scope of the project. In order to safeguard the rights
of workers against the arbitrary use of the word "project" as a means to prevent employees from
attaining regular status, employers must prove that the duration and scope of the employment
were specified at the time the employees were engaged, and prove the existence of the project.
In the case at bar, Bajaro was hired by Metro Stonerich as a concrete pump operator in five
different construction projects, to wit: (i) SM Cubao Expansion and Renovation project
located at Araneta Center, Cubao for five months, which began on June 3, 2008; (ii) Robinson's
Place Ilocos Nmie for five months, which commenced on January 24, 2009; (iii) Robinson's
Tacloban, Marasbaras for five months, which stmied on December 14, 2010; (iv) KCC Mall
Marbel Expansion, Koronadal City for 12 months, which commenced on October 24, 2011; and
(v) KCC Mall Zamboanga Project, Zamboanga City for 12 months, which started on January 11,
2013

It is undisputed that Bajaro was adequately informed of his employment status (as a
project employee) at the time of his engagement. This is clearly substantiated by his
employment contracts (Kasunduan Para sa Katungkulang Serbisyo (Pamproyekto), stating
that: (i) he was hired as a project employee; and (ii) his employment was for the indicated
stmiing dates therein, and will end on the completion of the project. The said contracts that he
signed sufficiently apprised him that his security of tenure with Metro Stonerich would only last
as long as the specific phase for which he was assigned. In fact, the target date of completion
was even indicated in each individual contract clearly warning him of the period of his
employment.

Bajaro's Continuous Rehiring and His Performance of Work that was Necessary and
Desirable to Metro Stonerich's Business Did Not Confer Upon Him Regular Employment
Status.

The repeated and successive rehiring of project employees do not qualify them as
regular employees, as length of service is not the controlling determinant of the
employment tenure of a project employee, but whether the employment has been fixed
for a specific project or undertaking, its completion has been determined at the time of
the engagement of the employee.

19. Alcatel v. Relos;

G.R. No. 164315. July 3, 2009.

FACTS: Complainant Rene R. Relos filed a complaint for illegal dismissal with monetary claims
against defendant Alcatel Philippines. Previously, complainant was repeatedly rehired in various
capacities (estimator/draftsman, civil works inspector, civil engineer, etc.) for several projects of
defendant from January 1988 to December 1993 (with different periods, from 1 to 11 months).
On 31 December 1995, complainant’s last contract terminated. In March 1997, he instituted the
labor case claiming that he was illegally dismissed as he was a regular employee.

“Alcatel argues that respondent was a project employee because he worked on distinct
projects with the terms of engagement and the specific project made known to him at the time
of the engagement. Alcatel clarifies that [complainant’s] employment was coterminous with
the project for which he was hired and, therefore, [complainant] was not illegally dismissed but
was validly dismissed upon the expiration of the term of his project employment. Alcatel
explains that its business relies mainly on the projects it enters into and thus, it is constrained
to hire project employees to meet the demands of specific projects.

“On the other hand, [complainant] insists that he is a regular employee because he was
assigned by Alcatel on its various projects since 4 January 1988 performing functions desirable
or necessary to Alcatel’s business. [Complainant] adds that his employment contracts were
renewed successively by Alcatel for seven years. [Complainant] contends that, even assuming
that he was a project employee, he became a regular employee because he was re-hired every
termination of his employment contract and he performed functions necessary to Alcatel’s
business. [Complainant] also claims that he was illegally dismissed because he was dismissed
during the existence of the project.”

ISSUES:

1. Whether the respondent was a regular employee or a project employee; and

2. Whether the respondent was illegally dismissed.

HELD: The complainant was a project employee and hence, he was not illegally dismissed.

“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.

The complainant was a project employee. “The specific projects for which the 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.

While complainant was continuously rehired by Alcatel and he “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 the 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 [complainant] a regular employee
of Alcatel as respondent was not continuously rehired after the cessation of a project.
[Complainant] remained a project employee of Alcatel working on the PLDT 1342 project.
“The employment of a project employee ends on the date specified in the employment
contract. Therefore, respondent was not illegally dismissed but his employment terminated
upon the expiration of his employment contract”

20. Price v. Innodata Phils, Inc.

(GR 178505, September 30, 2008)

FACTS: Innodata Philippines, Inc., is engaged in the encoding/data conversion business. It

employs encoders, indexers, formatters, programmers, quality/quantity staff, and others, to
maintain its business and do the job orders of its clients. Cherry J. Price and Stephanie
Domingo and Lolita Arbilera were employed as formatters by Innodata Philippines, Inc. They
worked from March 4, 1997, until their separation on March 3, 1998.

They believed that their job was necessary and desirable to the usual business of the company
which is data processing/conversion and that their employment is regular pursuant to Article 280
of the Labor Code,they filed a complaint for illegal dismissal and for damages as well as for
attorney’s fees against Innodata Phils., Incorporated.

Innodata contended that their employment contracts expired, having a fixed period of one (1)
year. Since the period expired, their employment was likewise terminated applying the ruling in
the Brent School case.

The LA rendered a judgement in favor of the complainants to have been illegally dismissed by
Innodata Philippines Inc and ordered for their reinstatement to their former positions. Innodata
an appeal to the NLRC.

The NLRC found that petitioners were not regular employees, but were fixed-term employees as
stipulated in their respective contracts of employment. The NLRC applied Brent School, Inc. v.
Zamora and St. Theresa’s School of Novaliches Foundation v. National Labor Relations
Commission in which this Court upheld the validity of fixed-term contracts. The determining
factor of such contracts is not the duty of the employee but the day certain agreed upon by the
parties for the commencement and termination of the employment relationship. The NLRC
observed that the petitioners freely and voluntarily entered into the fixed-term employment
contracts with INNODATA. Hence, INNODATA was not guilty of illegal dismissal when it
terminated petitioners’ employment upon the expiration of their contracts on 16 February 2000.

The NLRC reversed and set aside the LA’s decision that the contract was for a fixed term and
that the dismissal of their one year term agreed upon was valid. The case was taken to the CA.

The Court of Appeals further expounded that in fixed-term contracts, the stipulated period of
employment is governing and not the nature thereof. Consequently, even though petitioners
were performing functions that are necessary or desirable in the usual business or trade of the
employer, petitioners did not become regular employees because their employment was for a
fixed term, which began on 16 February 1999 and was predetermined to end on 16 February
2000.

The appellate court concluded that the periods in petitioners’ contracts of employment were not
imposed to preclude petitioners from acquiring security of tenure; and, applying the ruling of this
Court in Brent, declared that petitioners’ fixed-term employment contracts were valid.
INNODATA did not commit illegal dismissal for terminating petitioners’ employment upon the
expiration of their contracts.

It was then found that the contract given to them provided two periods. Aside from the fixed-one
year term set in par 1. Par. 7.4 provides for a 3 month probationary period wherein the petitioner
has the right to terminate the employment for failure of the employees to meet and pass the
qualifications and standards set by the employer. Hence, the instant petition.

ISSUE: Whether or not the respondents are regular employees.

RULING: Yes, petitioners are regular employees.

Regular employment has been defined by Article 280 of the Labor Code, as amended, which
reads:

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 engagement of the employee or where the work or
services to be performed is seasonal in nature and 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.
(Underscoring ours).

Based on the afore-quoted provision, the following employees are accorded regular
status: (1) those who are engaged to perform activities which are necessary or desirable
in the usual business or trade of the employer, regardless of the length of their
employment; and (2) those who were initially hired as casual employees, but have
rendered at least one year of service, whether continuous or broken, with respect to the
activity in which they are employed.

Undoubtedly, petitioners belong to the first type of regular employees.

Under Article 280 of the Labor Code, the applicable test to determine whether an employment
should be considered regular or non-regular is the reasonable connection between the
particular activity performed by the employee in relation to the usual business or trade of the
employer.22

In the case at bar, petitioners were employed by INNODATA on 17 February 1999 as

formatters. The primary business of INNODATA is data encoding, and the formatting of the data
entered into the computers is an essential part of the process of data encoding. Formatting
organizes the data encoded, making it easier to understand for the clients and/or the intended
end users thereof. Undeniably, the work performed by petitioners was necessary or
desirable in the business or trade of INNODATA.

However, it is also true that while certain forms of employment require the performance of usual
or desirable functions and exceed one year, these do not necessarily result in regular
employment under Article 280 of the Labor Code. Under the Civil Code, fixed-term employment
contracts are not limited, as they are under the present Labor Code, to those by nature
seasonal or for specific projects with predetermined dates of completion; they also include those
to which the parties by free choice have assigned a specific date of termination

21. Olongapo Maintenance Services, Inc. v. Chantengco

(GR 156146, June 21, 2007)

FACTS: Olongapo maintenance Services Inc. (OMSI) is engaged in the business of providing
janitorial and maintenance services to various clients, one of which was Manila international
airport authority (MIAA). Respondents are janitors, grass cutters and degreasers who were
assigned at the airport by OMSI. In January 1999, OMSI terminated respondents on the ground
that latter are project employees. According to OMSI, their employment being coterminous with
OMSI’s contract with MIAA, when said contract ended, the respondents’ tenures are over.

Respondents claim of illegal dismissal.

ISSUE: W/N respondents are project based or regular employees.

HELD: Respondents are regular employees. Respondents, as janitors, grass cutters, and
degreasers, performed work “necessary or desirable” in the janitorial and maintenance service
business of OMSI.

The principal test in determining whether an employee is a project employee is whether:

1. He/she is assigned to carry out a “specific contracts between OMSI and the MIAA.
Clearly, OMSI failed to establish their case by substantial evidence.
2. Where the work or service to be performed is seasonal in nature and the employment is
for the duration of the season.
A true project employee should be assigned to a project which begins and ends at
determined or determinable times, and be informed thereof at the time of hiring.

In the instant case, there is no proof that respondents’ engagement as project employees has
been predetermined, as required by law. OMSI did not provide evidence that respondents were
informed that they were to be assigned to a “specific project or undertaking” at the time they
were hired. The employment contracts for the specific project signed by the respondents were
never presented. All that OMSI submitted are the service.

Neither could the belated submission of respondents’ application forms to the CA via a
motion for reconsideration benefit OMSI, said practice defeats speedy administration of
justice.

In termination cases, the burden of proof rests on the employer to show that the dismissal
is for a just cause. Thus, employers who hire project employees are mandated to state and
prove the actual basis for the latter's dismissal. Unfortunately for OMSI, it failed to
discharge the burden. All that we have is OMSI’s self - serving assertion that the
respondents were hired as project employees.

22. PNOC-EDC v. NLRC

(GR 169353, April 13, 2007)

FACTS: Petitioner 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.
Each geothermal project undergoes the stages of exploration, development, and utilization
or production. For each stage, several activities are undertaken such as drilling,
construction, civil works, structural works, mechanical works, and electrical works until the
project is finally completed

Petitioner’s Southern Negros Geothermal Production Field in Negros Oriental is divided

into two phases PAL1 and and PAL2. It hired employees in order to augment its
manpower requirement occasioned by the increased activities in developing PAL2. The
termination/expiration of their respective employment were specified in their initial
employment contracts, which, however, were renewed and extended on their respective
expiry dates. On May 29, 1998, petitioner submitted reports to the Department of Labor
and Employment (DOLE) Regional Sub-Branch No. VII in Dumaguete City, stating that six
of its employees were being terminated. Petitioners then sent notices of termination stating
that they were being terminated from employment effective June 30, 1998 due to the
substantial completion of the civil works phase of PAL2

On October 29, 1998, six employees filed before the NLRC a complaint for illegal
dismissal against the Petitioner. In their Position Paper, respondents stated that they had
rendered continuous and satisfactory services from the dates of their respective
employment until illegally dismissed on June 30, 1998.

Petitioner asserted that respondents were contractual employees; as such, they cannot
claim to have been illegally dismissed because upon the expiration of the term of the
contract or the completion of the project, their employer-employee relationship also ended.

The LA dismissed the complaint for lack of legal and factual basis and that the employer-
employee relationship between the parties was severed upon the expiration of the
contracts upon the completion of the projects concerned. The respondents filed an appeal
to the NLRC.

The NLRC reversed the decision of the LA and asked the respondents to be reinstated.
The NLRC stated 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 petitioner. The NLRC further ruled that the
employment contracts of respondents were not for a specific project or for a fixed period.
According to the NLRC, the dismissals made on June 30, 1998 under the pretext of project
completion were illegal, being founded on an invalid, unjust, and unauthorized cause. The
petitioner then took the case to the CA.

The CA dismissed the petition. The CA ruled that respondents were performing activities
necessary and desirable in the normal operations of the business of petitioner. The
appellate court 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: Whether or not the respondents are regular employees.

RULING: Yes, the respondents are regular employees.

Article 280. REGULAR AND CASUAL EMPLOYEES. 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.
Thus, the applicable formula to ascertain whether an employment should be
considered regular or non-regular is the reasonable connection between the
particular activity performed by the employee in relation to the usual business or
trade of the employer.

Unmistakably, the alleged projects stated in the employment contracts were either too
vague or imprecise to be considered as the "specific undertaking" contemplated by law.
Petitioner's act of repeatedly and continuously hiring respondents to do 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 projects has led the Court to conclude that
respondents are, in fact, regular employees.

23. PNOC-EDC v. NLRC

(GR 97747, March 31, 1993)

FACTS: On November 11, 1980, petitioners hired private respondent Francisco Mata as
Service Driver on a daily wage of P39.74. Assigned to the PNOC-EDA Bacon-Manito
Geothermal Project in Bonga, Sorsogon, Sorsogon. After 5 years, his employment was
terminated through a letter of advice signed by his supervisor, B.B. Balista, allegedly for
"contract expiration" even when the project was still a continuing one. Thereafter, private
respondent complained of illegal dismissal, and accused petitioners of withholding his
backwages, overtime pay, and separation pay. A dismissal of the complaint was sought on
jurisdictional ground, petitioner company asserting that it is a government-owned and controlled
corporation, hence, its employees must be governed by the Civil Service Law and not by the
Labor Code, and citing National Housing Corporation v. Benjamin Juco and the NLRC (134
SCRA 176).

Labor Arbiter Voltaire A. Balitaan dismissed the complaint for lack of jurisdiction. On appeal to
public respondent, however, the First Division, set aside the Labor Arbiter's decision, assumed
jurisdiction over the case, and directed the Arbitration Branch to conduct further proceedings.

Petitioners maintained that private respondent was a project employee whose employment was
for a definite period and coterminous with the project for which he was hired. It was for this
reason that his employment was terminated.

LA ruled that the private respondent was actually a company driver, servicing or performing
activities which are usually necessary or at least desirable in the business of the company, and
not a contractual project employee. Hence, the company is guilty of illegal dismissal. Petitioner
then appealed to NLRC and was dismissed by the latter for lack of merit. Petitioner then filed
the petition for certiorari.

ISSUES:

1. WoN Francisco Mata was a regular employee

2. WoN Francisco Mara was illegally dismissed
RULING: No, Francisco Mata is a project employee and was illegally dismissed.

1. As to status of employment - Project Ee

Private respondent, while admitting such fixed term contract of employment, counters that the
same was used as a vehicle to circumvent the law on security of tenure, as provided not only by
the Labor Code but likewise guaranteed by the Constitution.

The Court cited the case of Brent School v. Zamora, where can be gleaned from the said case,
the two guidelines, by which fixed contracts of employments can be said NOT to circumvent
security of tenure, are either:

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.

The petitioner's fixed contract of employment with private respondent satisfied the above stated
guidelines. Respondent Mata shows that he indeed signed the same. In fact petitioners claim
that all the previous employment contracts were also translated for the benefit of private
respondent, and it was only when he understood the same that he signed said contracts. As per
Guideline No. 1, given the circumstances behind private respondent Mata's employment, private
respondent is a project employee.

In this case, It is clear that private respondent Mata is a project employee considering that he
does not belong to a "work pool" from which petitioner PNOC would draw workers for
assignment to other projects at its discretion. It is likewise apparent from the facts of the case
that private respondent Mata was utilized only for one particular project, the well-completion
project which was part of the exploration stage of the PNOC Bacon-Manito Geothermal Project.
Hence, private respondent Mata can be dismissed upon the termination of the projects as there
would be no need for his services. We should not expect petitioner to continue on hiring private
respondent in the other phases of the project when his services will no longer be needed.

2. As to illegal dismissal - yes

Paragraph No. 5, Policy Instruction No. 20, reads, as follows:

If a construction project or any phase thereof has a duration of more than one year and a
Project employee is allowed to be employed therein for at least one year, such employee may
not be terminated until the completion of the project or of any phase thereof in which he is
employed without a previous written clearance from the Secretary of Labor. If such an employee
is terminated without a clearance from the Secretary of Labor, he shall be entitled to
reinstatement with backwages.

In Ochoco vs. NLRC, the Supreme Court ruled that "if petitioner was employed as a project
employee, private respondent should have submitted a report of termination to the nearest
public employment office every time his employment is terminated due to the completion of
each project as required by Policy Instruction No. 20.

Applying the Ochoco doctrine to the instant case, respondent corporation should have filed as
many reports of termination as there were construction projects actually finished, considering
that petitioner had been hired since 1980 up to 1985. Not a single report was submitted by the
respondent company. This failure to submit reports of termination convinced Us more that
petitioner was indeed a regular employee.

The records do not show that petitioners obtained the necessary written clearance to terminate
the contract of employment of private respondent Mata. The latter is. therefore, entitled to
reinstatement with backwages.

Considering, however, that the Bacon-Manito project has already been completed and is,
presumably, now operating, reinstatement of private respondent is impossible. He is, however,
entitled to backwages and separation pay. For this purpose, We adopt the Executive Labor
Arbiter's computation as to how much backwages and separation pay private respondent will
get, as follows:

[S]ince at the time of his dismissal complainant was receiving P56.00 dally wage then his back
wages for three (3) years amounted to P51,408.00 computed as follows: P56.00 daily wage x
25.5 normal days work in a month x 12 mos. x 3 years.

The petition is DISMISSED. It is hereby ORDERED that petitioners pay private respondent Mata
P51,408.00 as backwages and P3,570.00 as separation pay.

24. Maraguinot, Jr. v. NLRC

(GR 120969, January 22, 1998)

FACTS: Petitioner Maraguinot Jr. was employed by respondent in July 1989 as part of a filming
crew with a salary of Php 375 per week. After four months, he was designated as Assistant
Electrician with a weekly salary of Php 400 which was increased to Php 450. In June 1991 he
was promoted to Electrician with a weekly salary of Php 475 which was increased to Php 593.
Paulino Enero, on his part, claims that respondents employed him in June 1990 as a member of
the shooting crew with a weekly salary of P375.00, which was increased to P425 in May 1991,
then to P475.00 on 21 December 1991. Petitioners' tasks consisted of loading, unloading and
arranging movie equipment in the shooting area as instructed by the cameraman, returning the
equipment to Viva Films' warehouse, assisting in the "fixing" of the lighting system, and
performing other tasks that the cameraman and/or director may assign.
In May 1992, petitioners requested Mrs. Alejandria Cesario, their supervisor to adjust their
salary in accordance with the minimum wage law. The latter informed the petitioners that Mr. Vic
Del Rosario will agree to their request as long as they sign a blank employment contract which
in turn they refused to sign. As petitioners refused to sign, private respondents forced Enero to
go on leave then refused to take him back when he reported for work.

Meanwhile, Maraguinot was dropped from the company payroll and private respondents
terminated his services. Labor Arbiter found that the complainants were illegally dismissed. The
NLRC, in reversing the Labor Arbiter, then concluded that these circumstances, taken together,
indicated that complainants were "project employees." petitioners filed the instant petition,
claiming that the NLRC committed grave abuse of discretion amounting to lack or excess of
jurisdiction in: (1)finding that petitioners were project employees; (2) ruling that petitioners were
not illegally dismissed; and (3) reversing the decision of the Labor Arbiter.
To support their claim that they were regular (and not project) employees of private
respondents, petitioners cited their performance of activities that were necessary or desirable in
the usual trade or business of private respondents and added that their work was
continuous,i.e., after one project was completed they were assigned to another project.

The OSG likewise rejects petitioners' contention that since they were hired not for one project,
but for a series of projects, they should be deemed regular employees.

the OSG asserts that what matters is that there.was a time-frame for each movie project made
known to petitioners at the time of their hiring.

ISSUE: Whether or not the petitioners are project employees

RULING: The petitioners are project employees

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 cessation of a project;

and

2) The tasks performed by the alleged "project employee" are vital, necessary and
indispensable to the usual business or trade of the employer.

However, the length of time during which the employee was continuously re-hired is not
controlling, but merely serves as a badge of regular employment.

In the instant case, the evidence on record shows that petitioner Enero was employed for a total
of two (2) years and engaged in at least eighteen (18) projects, while petitioner Maraguinot was
employed for some three (3) years and worked on at least twenty-three (23) projects.
Moreover, as petitioners' tasks involved, among other chores, the loading, unloading and
arranging of movie equipment in the shooting area as instructed by the cameramen, returning
the equipment to the Viva Films' warehouse, and assisting in the "fixing" of the lighting system, it
may not be gainsaid that these tasks were vital, necessary and indispensable to the usual
business or trade of the employer. As regards the underscored phrase, it has been held that this
is ascertained by considering the nature of the work performed and its relation to the scheme of
the particular business or trade in its entirety.[36]

A recent pronouncement of this Court anent project or work pool employees who had attained
the status of regular employees proves most instructive:

The denial by petitioners of the existence of a work pool in the company because their projects
were not continuous is amply belied by petitioners themselves who admit that: xxx

A work pool may exist although the workers in the pool do not receive salaries and are free to
seek other employment during temporary breaks in the business, provided that the worker shall
be available when called to report for a project. Although primarily applicable to regular
seasonal workers, this set-up can likewise be applied to project workers insofar as the effect of
temporary cessation of work is concerned. This is beneficial to both the employer and employee
for it prevents the unjust situation of "coddling labor at the expense of capital" and at the same
time enables the workers to attain the status of regular employees. Clearly, the continuous
rehiring of the same set of employees within the framework of the Lao Group of Companies is
strongly indicative that private respondents were an integral part of a work pool from which
petitioners drew its workers for its various projects.

All that we hold today is that 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,
pursuant to Article 280 of the Labor Code and jurisprudence. To rule otherwise would allow
circumvention of labor laws in industries not falling within the ambit of Policy Instruction No.
20/Department Order No. 19, hence allowing the prevention of acquisition of tenurial security by
project or work pool employees who have already gained the status of regular employees by the
employer's conduct.

25. D.M. Consunji Construction Corp. v. Bello

(GR 159371, July 29, 2013)
FACTS: Bello brought a complaint for illegal dismissal and damages against DMCI and/or
Rachel Consunji. In his position paper, he claimed that DMCI had employed him as a mason
without any interruption from February 1, 1990 until October 10, 1997. He alleged that he had
been a very diligent and devoted worker and had served DMCI as best as he could and without
any complaints. He had never violated any company rules and that his job as a mason had
been necessary and desirable in the usual business or trade of DMCI.

Bello 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, stating that he had been
terminated due to "RSD" effective November 5, 1997

Bello did not know the meaning of "RSD" as the cause of his termination and that such cause
had not been explained to him. He also claims that he had not been given prior notice of his
termination and he had not been paid separation pay as mandated by law. At the time of his
dismissal, DMCIs projects had not yet been completed and that even if he had been terminated
due to an authorized cause, he should have been given at least one month pay or at least one-
half month pay for every year of service he had rendered, whichever was higher.

DMCI contended that Bello had only been a project employee, as borne out by his contract of
employment and appointment papers and that although his last project employment contract
had been set to expire on October 7, 1997, he had tendered his voluntary resignation on
October 4, 1997 for health reasons that had rendered him incapable of performing his job, per
his resignation letter.

The LA ruled that Bello has been illegally dismissed. The NLRC reversed the LA decision. On
appeal, the CA reversed the NLRC decision and ruled that Bello had already acquired the status
of a regular employee although he was only a project employee. Petitioner sought for
reconsideration but the same was denied. Hence, this petition.

ISSUE: Whether or not Bello is a regular employee and he voluntarily resigned

HELD: Bello had acquire the status of a regular employee

Regularization of a project 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 Bellos appointment and employment showed that he performed his
tasks as a mason in DMCIs various construction projects. 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 employees 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.
Labor Law - An employer must prove that the resignation was voluntary, and its evidence
thereon must be clear, positive and convincing. The employer cannot rely on the weakness of
the employee's evidence.

DMCI claims that Bello voluntarily resigned from work. It presented his supposed handwritten
resignation letter to support the claim. However, Bello denied having resigned, explaining that
he had signed the letter because DMCI had made him believe that the letter was for the
purpose of extending his sick leave.

In resolving the matter against DMCI, the CA relied on the conclusion by ELA Panganiban-
Ortiguerra that she could not give credence to the voluntary resignation for health reasons in the
face of Bellos 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.

The CAs reliance on the conclusion and finding by ELA Panganiban-Ortiguerra was warranted.
Her observation that the handwriting in the resignation letter was "undeniably different" from that
of Bello could not be ignored or shunted aside simply because she had no expertise to make
such a determination, as the NLRC tersely stated in its decision. To begin with, her supposed
lack of expertise did not appear in the records, rendering the NLRC's statement speculative and
whimsical. If we were now to outrightly discount her competence to make that observation, we
would disturb the time-honored practice of according respect to the findings of the first-line trier
of facts in order to prefer the speculative and whimsical statement of an appellate forum like the
NLRC. 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.

It is axiomatic in labor law that 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.

The decision of CA is hereby AFFIRMED.

26. Caseres v. Universal Robina Sugar Milling Corp

 (GR 159343, September 28, 2007)

FACTS: Universal Robina Sugar Milling Corporation is a corporation engaged in the cane sugar
milling industry. Pedy Caseres started working for respondents in 1989, while Andito Pael in
1993. At the start of their employment, they were made to sign a contract of employment for a
specific project or undertaking. Their contracts were renewed from time to time, until May 1999
they were given notice that their contracts will not be renewed anymore.

Petitioners filed a complaint for illegal dismissal and regularization. The LA dismissed the
complaint for not being substantiated with clear and convincing evidence.

The NLRC affirmed the LA’s dismissal and the CA also dismissed the petition filed before it.
Hence, the instant petition.

ISSUE: Whether or not the petitioners are seasonal/project/ term employees not regular
employees of respondents.

RULING: The petitioners are project employees.

Article 280 of the Labor Code provides:

ART. 280. Regular and Casual Employees. The provision 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 actually exists.

The foregoing provision provides for three kinds of employees: (a) 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"; (b) 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 (c) casual employees or those who are neither regular nor project employees.
The principal test for determining whether an employee is a project employee or a regular
employee is whether 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. A project employee is one 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. A true project employee should be
assigned to a project which begins and ends at determined or determinable times, and be
informed thereof at the time of hiring.

In the case at bar, We note that complainants never bothered to deny that they voluntarily,
knowingly and willfully executed the contracts of employment. Neither was there any showing
that respondents exercised moral dominance on the complainants, it is clear that the contracts
of employment are valid and binding on the complainants.

The execution of these contracts in the case at bar is necessitated by the peculiar nature
of the work in the sugar industry which has an off milling season. The very nature of the
terms and conditions of complainants' hiring reveals that they were required to perform
phases of special projects for a definite period after their services are available to other
farm owners. This is so because the planting of sugar does not entail a whole year
operation, and utility works are comparatively small during the off-milling season.

Petitioners' repeated and successive re-employment on the basis of a contract of

employment for more than one year cannot and does not make them regular employees.
Length of service is not the controlling determinant of the employment tenure of a
project employee.

The fact that petitioners were constantly re-hired does not ipso facto establish that they
became regular employees. Their respective contracts with respondent show that there
were intervals in their employment. In petitioner Caseres's case, while his employment
lasted from August 1989 to May 1999, the duration of his employment ranged from one
day to several months at a time, and such successive employments were not continuous.
With regard to petitioner Pael, his employment never lasted for more than a month at a
time. These support the conclusion that they were indeed project employees, and since
their work depended on the availability of such contracts or projects, necessarily the
employment of respondent's work force was not permanent but coterminous with the
projects to which they were assigned and from whose payrolls they were paid.

27. Hanjin Heavy Industries and Construction Co., Ltd. v. Ibanez

(GR 170181, June 26, 2008)

FACTS: Felicito Ibanez (tireman), Elmer Gacula (Crane Operator), Elmer Dagotdot (Welder),
Aligwas Carolino (Welder), Ruel Calda (Warehouseman) filed a complaint at the NLRC for
illegal dismissal with prayer for reinstatement and payment of backwages. The group alleged
that the contract they have is good for three months, subject to automatic renewal if there is no
notice of termination from Hanjin, and that the contract would automatically terminate upon the
completion of the project. They further averred that during the time they were dismissed, the
project was still ongoing and Hanjin hired people for the positions that they had vacated. Lastly,
they also allege that they are entitled to a completion bonus as part of the industry practice and
this was substantiated by past payroll payments. Hanjin failed to furnish a copy of the contract
agreements with the dismissed group. Instead it showed the quitclaims that had been executed
by the group that released Hanjin and its representatives from any claims with their
employment. It contained clearance certificates that show that respondents are free from
accountability.

ISSUE: WON the members of the dismissed group are project employees?

HELD: No, Hanjin was unable to prove they were not regular employees.

The rehiring of construction workers on a project to project basis does not confer upon them
regular employment status, since their re-hiring is only a natural consequence of the fact that
experienced construction workers are preferred. Employees who are hired for carrying out a
separate job, distinct from the other undertakings of the company, the scope and duration of
which has been determined and made known to the employees at the time of the employment,
are properly treated as project employees and their services may be lawfully terminated upon
the completion of a project. Should the terms of their employment fail to comply with this
standard, they cannot be considered project employees.

Hanjin was unable to show the written contracts it had with the workers. White the absence of
the contract does not grant permanent status it is the burden of the employer to prove that the
employees were aware that their contract with the company is for per project only. While Hanjin
submitted a termination report including the worker’s names to prove that the services of their
services were only contracted for a per project basis, Hanjin only submitted one report. It was
unable to disprove the allegation of the workers that they were part of a pool that Hanjin
contacted once a project was to be completed. Employers cannot mislead their employees,
whose work is necessary and desirable in the former's line of business, by treating them as
though they are part of a work pool from which workers could be continually drawn and then
assigned to various projects and thereafter denied regular status at any time by the expedient
act of filing a Termination Report. This would constitute a practice in which an employee is
unjustly precluded from acquiring security of tenure, contrary to public policy, morals, good
customs and public order.

Hanjin alleged that per Department Order 19, Series of 1993 of DOLE, the payment of
completion bonus is further proof that the workers were only project employees as Hanjin is
mandated by law to pay it to the temporary workers whose contracts are about to end upon the
completion of the project. SC views the completion bonus terminology here reflects the fact that
the project has already been completed and that is the premium they wished to pay. Quitclaims
are viewed with disfavor, especially when there is a clear proof that the waiver was wangled
from an unsuspecting or gullible person. Where the terms are unconscionable in its face. For
quitclaims to be valid, it must constitute a reasonable settlement to commensurate to their legal
rights. It does not preclude them from seeking benefits they were entitled to such as back
wages. The respondents were also not granted the twin requirements of notice and hearing.