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Part I.

1. Yes, Henry is a regular employee of Yin-Yang Factory.

There are two kinds of employees under the law: (1) those engaged to perform activities which are
necessary or desirable in the usual business or trade of the employer; and (2) those casual employees
who have rendered at least one year of service, whether continuous or broken, with respect to the
activities in which they are employed.

In the case at bar, Henry being an operator of the machine of Yin-Yan Factory— a manufacturer of
ceramic products, is considered to have been engaged to perform the activities which are necessary or
desirable in the usual business or trade of Yin-Yang which continuously received orders from
customers. Furthermore, Henry has been working in the factory for 10 years to which as stipulated by
law is considered to be considered a regular employee. (ABS-CBN v, Nazareno)

2. No, Girlie is not a regular employee.

As stipulated in Article 296 of the Labor Code, probationary employment shall not exceed 6 months
from the date the employee started working, unless it is covered by an apprenticeship agreement
stipulating a longer period.

Additionally, as stipulated in Section 6, Book 6 in the Omnibus Rules Implementing the Labor Code,
probationary employment is defined as the status of the employee, upon his engagement, is made to
undergo a trial period during which the employer determines his fitness to qualify for regular
employment based on reasonable standards made known to him at the time of engagement.

Since Girlie was well aware of the Probationary Employment Contract, to which she agreed to and
signed, she is still well within her 6-month probationary period as stipulated in the contract.

3. Yes, Simon is a regular employee as he was performing a service that was necessary and desirable to
Triple Star Company’s business. Moreover, Simon had discharged his duties as a handyman for the
company for a continuous and uninterrupted period of 3 years or for an equivalent of 14 months.
Additionally, Simon was under the supervision and control of the company for he was assigned to
different tasks depending on the need of the company. (Chavez v. NLRC)

4. No, Vanessa is not a regular employee.

As per Article 295 of the Labor Code, 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 of termination of which has been
determined at the time of engagement fo the employee or where the work or service to be performed
is seasonal in nature and employment is for the duration of the season.

In Vanessa’s employment contract with Cosmic Enterprises, it was stipulated that she is to work for a
period of 1 year or until the completion of the seasonal project. Since it has been determined that she
will work for a year or at the completion of the seasonal project which is not less than 8 months,
Vanessa is not deemed to be a regular employee but a casual employee.
Part II
1. GMA not a direct employer in this case because it has contracted out Jeep Services for the work
needed by GMA. Jeep Services being a contractor and as defined by DO 174-17, is to provide
services for a specific job or undertaking farmed out by principal, in this case GMA, under a Service
Agreement.

Given that Jeep Services has (1) substantial capital to carry out the job, (2) that is engaged in a
distinct and independent business and undertook to perform the job or work in its own responsibility,
according to its method, (3) that in performing the work Jeep is free from the control of GMA, such
being the case, the employees to be employed by Jeep for GMA are direct employees of Jeep Services
and not of GMA.

2. GMA is a direct employer because Pinoy being under the direct supervision of Kano who is an
employee of GMA Company, it can be gleaned that Jeep Services is not free from the control
and/direction of GMA. Without such freedom of control, it is apparent that Jeep has a labor-only
contracting arrangement with its principal GMA and acting merely as agent for the latter. Not having
the ability to exercise the right to control over the performance of the work of Pinoy, Jeep cannot be
said to be a valid contractor and as per Section 7 of DO 174-17, a contractor that is engaged in labor-
only contracting, the principal shall be deemed the direct employer of the contractor’s employees. In
this case GMA is the considered as the direct employer of Kano.
3. —
4. GMA is a direct employer
5. GMA is not a direct employer