Topic: Regular or Fixed Term

PHILEX MINING CORPORATION V. NLRC, ET AL.

10 August 1999

Facts:
 Private respondents Rosella Austria and Linda Tamondong, both licensed chemical
engineers, undertook training at the Assay/Metallurgical Department of Philex from October
1987 to March 1988. After completing their training, they were hired by Philex in June 1988
as Geochemical Aides.
 Private respondents Cornelio Borja, and electrical technician graduate, and Gerald dela Cruz,
a licensed mechanical engineer claimed that they were hired in January 1989 and were
assigned to work in the Metallurgical Department.
 Each of the private respondents signed a Contract of Temporary Employment with Philex.
The contracts were all dated 15 April 1989 and contained similar provisions – That in
connection with the special project of the Metallurgical Department on Geochemical
Analysis, Philex confirms their temporary employment for a period of 1 year effective 16
April 1989; that as temporary employees, they are not entitled to benefits granted to regular
workers; that they were engaged to work in an exploration project with a specific
completion date and that such project is not part of the regular mining activity of the
company; Finally, that their employment will be terminated at the expiration date stated
without need of further notice.
 The contract likewise defined the nature of private respondent’s respective functions. Austria
and Tamondong were designated “Geochemical Aides”. Borja and dela Cruz were designated
as “Utility”.
 On 27 June 1989, private respondents were informed that they will not be allowed to work
anymore, prompting their institution of separate complaints for illegal dismissal against
petitioner before the LA.
 LA dismissed the complaints since they were merely contractual employees and their
termination was a result of the expiration of their contracts. LA found the argument that the
employees were hired before the signing of the contract absurd especially for a corporation
with vast operations. (Spoiler: SC didn’t think so.) On appeal, NLRC reversed. NLRC held
that they were regular employees since they were performing jobs usually necessary and
desirable in the usual business or trade of the employer but denied their claim to rights and
benefits attached to regular status pursuant to Philex’ collective bargaining agreement.
Further, the NLRC found the contract void for being violative of Art 280 of the LC. MR
denied.
 Philex claims that in 1989, it embarked on a large-scale mining exploration throughout the
country. Thousands of samples were brought in for analysis. The lack of regular personnel
necessitated the hiring of private respondents during this exploration phase. Philex invokes
the SC’s ruling in Brent v. Zamora and Pakistan International Airlines v. Ople in arguing that
the contracts are valid (voluntarily and knowingly entered into by the parties).

Issue: WON private respondents are regular employees

Held: Yes.

Ruling:
 The actual date of the hiring of private respondent is significant in the light of the collective
bargaining agreement (CBA) between petitioner and its other employees. It is not disputed
that said CBA fixes the probationary period of Geochemical Aides at six (6) months, while
that of Utility Men, at three (3) months.
 At the time private respondents Tamondong and Austria were made to sign the subject
 contracts, they had already attained the status of regular employees, having been allowed
to work by petitioner beyond the probationary period of six (6) months. Private respondents
Borja and Dela Cruz, on the other hand, were just nine (9) days short of completing their
probationary period of three (3) months when they were made to sign said contracts by
petitioner.
 Petitioner’s timing is indeed suspicious. The signing of the contracts at a time when private
respondents had already attained, in the case of Austria and Tamondong, or were about to
attain, in the case of Borja and de la Cruz, regular employment status under the CBA is an
indication of petitioner’s illegal intent. The contracts appear to be a subterfuge, having been
foisted upon private respondents to circumvent their right to be secure in their tenure.
 The fact that private respondents were made to sign such agreement after they were hired
is not as “absurd– as the Labor Arbiter thought. As even a cursory study of jurisprudence
would show, companies “with vast operations– are not immune from the temptation of
circumventing labor laws for the sake of profit.
 Project employees are those workers hired (1) for a specific project or undertaking, and (2)
the completion or termination of such project has been determined at the time of the
engagement of the employee.
 The principal test for determining whether particular employees are properly characterized
as “project employees,– as distinguished from “regular employees,– is whether or not the
“project employees– were assigned to carry out a “specific project or undertaking,– the
duration and scope of which were specified at the time the employees were engaged for
that project.
 In this case, petitioner has not shown that private respondents were informed that they
were to be assigned to a “specific project or undertaking.– Neither has it been established
that they were informed of the duration and scope of such project or undertaking at the
time of their engagement, that is, on June 1988 on the part of Austria and Tamondong, and
on January 1989 in the case of Borja and de la Cruz. Private respondents were informed
thereof only much later on April 1989.
 Private respondents’ functions as described above are no doubt “usually necessary or
desirable in the usual business or trade– of petitioner- mining company. Consequently, the
NLRC should not have denied private respondents’ claim to rights and benefits attached to
such status pursuant to petitioner’s collective bargaining agreement.