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ABBOTT v ALCARAZ

FACTS

Petitioner Abbott Laboratories, Philippines (Abbott) caused the publication in a major


broadsheet newspaper of its need for a Medical and Regulatory Affairs Manager
(Regulatory Affairs Manager) who would: (a) be responsible for drug safety surveillance
operations, staffing, and budget; (b) lead the development and implementation of
standard operating procedures/policies for drug safety surveillance and vigilance; and (c)
act as the primary interface with internal and external customers regarding safety
operations and queries.4 Alcaraz - who was then a Regulatory Affairs and Information
Manager at Aventis Pasteur Philippines, Incorporated (another pharmaceutical company
like Abbott) – showed interest and submitted her application.

Abbott formally offered Alcaraz the abovementioned position. n Abbott’s offer sheet.7 it
was stated that Alcaraz was to be employed on a probationary basis.8 Later that day, she
accepted the said offer and received an electronic mail (e-mail) from Abbott’s Recruitment
Officer, petitioner Teresita C. Bernardo (Bernardo), confirming the same. Attached to
Bernardo’s e-mail were Abbott’s organizational chart and a job description of Alcaraz’s
work.
Alcaraz signed an employment contract which stated, inter alia, that she was to be placed
on probation for a period of six (6) months beginning February 15, 2005 to August 14,
2005. The said contract was also signed by Abbott’s General Manager, petitioner Edwin
Feist (Feist).

During the course of her employment, Alcaraz noticed that some of the staff had
disciplinary problems. Thus, she would reprimand them for their unprofessional behavior
such as non-observance of the dress code, moonlighting, and disrespect of Abbott
officers. However, Alcaraz’s method of management was considered by Walsh (Manager
of the Literature Drug Surveillance Drug Safety of Hospira which Alvaraz’s unit is a part
of) to be "too strict.

Alcaraz had a meeting with petitioner Cecille Terrible (Terrible), Abbott’s former HR
Director, to discuss certain issues regarding staff performance standards. In the course
thereof, Alcaraz accidentally saw a printed copy of an e-mail sent by Walsh to some staff
members which essentially contained queries regarding the former’s job performance.
Alcaraz asked if Walsh’s action was the normal process of evaluation. Terrible said that
it was not.

Alcaraz was called to a meeting with Walsh and Terrible where she was informed that
she failed to meet the regularization standards for the position of Regulatory Affairs
Manager.18 Thereafter, Walsh and Terrible requested Alcaraz to tender her resignation,
else they be forced to terminate her services. She was also told that, regardless of her
choice, she should no longer report for work and was asked to surrender her office
identification cards. She requested to be given one week to decide on the same, but to
no avail.

Alcaraz told her administrative assistant, Claude Gonzales (Gonzales), that she would be
on leave for that day. However, Gonzales told her that Walsh and Terrible already
announced to the whole Hospira ALSU staff that Alcaraz already resigned due to health
reasons.

On May 23, 2005, Walsh, Almazar, and Bernardo personally handed to Alcaraz a letter
stating that her services had been terminated effective May 19, 2005.21 The letter detailed
the reasons for Alcaraz’s termination – particularly, that Alcaraz: (a) did not manage her
time effectively; (b) failed to gain the trust of her staff and to build an effective rapport with
them; (c) failed to train her staff effectively; and (d) was not able to obtain the knowledge
and ability to make sound judgments on case processing and article review which were
necessary for the proper performance of her duties.22 On May 27, 2005, Alcaraz received
another copy of the said termination letter via registered mail.
Alcaraz felt that she was unjustly terminated and thus, filed a complaint for illegal
dismissal.
She claimed that she should have already been considered as a regular and not a
probationary employee given Abbott’s failure to inform her of the reasonable standards
for her regularization upon her engagement as required under Article 295 of the Labor
Code. In this relation, she contended that while her employment contract stated that she
was to be engaged on a probationary status, the same did not indicate the standards on
which her regularization would be based. She further averred that the individual
petitioners maliciously connived to illegally dismiss her when: (a) they threatened her with
termination; (b) she was ordered not to enter company premises even if she was still an
employee thereof; and (c) they publicly announced that she already resigned in order to
humiliate her.
On the contrary, petitioners m
ntained that Alcaraz was validly terminated from her probationary employment given her
failure to satisfy the prescribed standards for her regularization which were made known
to her at the time of her engagement.

LA RULING

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

NLRC RULING
The NLRC reversed the findings of the LA and ruled that there was no evidence showing
that Alcaraz had been apprised of her probationary status and the requirements which
she should have complied with in order to be a regular employee. It held that Alcaraz’s
receipt of her job description and Abbott’s Code of Conduct and Performance Modules
was not equivalent to her being actually informed of the performance standards upon
which she should have been evaluated on.

CA RULING
Affirmed the ruling of the NLRC.

ISSUE
1. Whether or not Alcaraz was sufficiently informed of the reasonable standards to
qualify her as a regular employee.
2. Whether or not Alcaraz was validly terminated from her employment.
RULING

ISSUE 1:
A probationary employee, like a regular employee, enjoys security of tenure. However, in
cases of probationary employment, aside from just or authorized causes of termination,
an additional ground is provided under Article 295 of the Labor Code, i.e., the probationary
employee may also be terminated for failure to qualify as a regular employee in
accordance with the reasonable standards made known by the employer to the employee
at the time of the engagement.Thus, the services of an employee who has been engaged
on probationary basis may be terminated for any of the following: (a) a just or (b) an
authorized cause; and (c) when he fails to qualify as a regular employee in accordance
with reasonable standards prescribed by the employer. (d) In all cases of probationary
employment, the employer shall make known to the employee the standards under which
he will qualify as a regular employee at the time of his engagement. Where no standards
are made known to the employee at that time, he shall be deemed a regular employee.

In other words, the employer is made to comply with two (2) requirements when dealing
with a probationary employee: first, the employer must communicate the regularization
standards to the probationary employee; and second, the employer must make such
communication at the time of the probationary employee’s engagement. If the employer
fails to comply with either, the employee is deemed as a regular and not a probationary
employee.

A punctilious examination of the records reveals that Abbott had indeed complied with the
above-stated requirements. This conclusion is largely impelled by the fact that Abbott
clearly conveyed to Alcaraz her duties and responsibilities as Regulatory Affairs Manager
prior to, during the time of her engagement, and the incipient stages of her employment.
On this score, the Court finds it apt to detail not only the incidents which point out to the
efforts made by Abbott but also those circumstances which would show that Alcaraz was
well-apprised of her employer’s expectations that would, in turn, determine her
regularization:
(a) On June 27, 2004, Abbott caused the publication in a major broadsheet newspaper of
its need for a Regulatory Affairs Manager, indicating therein the job description for as well
as the duties and responsibilities attendant to the aforesaid position; this prompted
Alcaraz to submit her application to Abbott on October 4, 2004;
(b) In Abbott’s December 7, 2004 offer sheet, it was stated that Alcaraz was to be
employed on a probationary status;
(c) On February 12, 2005, Alcaraz signed an employment contract which specifically
stated, inter alia, that she was to be placed on probation for a period of six (6) months
beginning February 15, 2005 to August 14, 2005;
(d) On the day Alcaraz accepted Abbott’s employment offer, Bernardo sent her copies of
Abbott’s organizational structure and her job description through e-mail;
(e) Alcaraz was made to undergo a pre-employment orientation where Almazar informed
her that she had to implement Abbott’s Code of Conduct and office policies on human
resources and finance and that she would be reporting directly to Walsh;
(f) Alcaraz was also required to undergo a training program as part of her orientation;
(g) Alcaraz received copies of Abbott’s Code of Conduct and Performance Modules from
Misa who explained to her the procedure for evaluating the performance of probationary
employees; she was further notified that Abbott had only one evaluation system for all of
its employees; and
(h) Moreover, Alcaraz had previously worked for another pharmaceutical company and
had admitted to have an "extensive training and background" to acquire the necessary
skills for her job.6

Considering the totality of the above-stated circumstances, it cannot, therefore, be


doubted that Alcaraz was well-aware that her regularization would depend on her ability
and capacity to fulfill the requirements of her position as Regulatory Affairs Manager
and that her failure to perform such would give Abbott a valid cause to terminate her
probationary employment.

In fine, the Court rules that Alcaraz’s status as a probationary employee and her
consequent dismissal must stand. Consequently, in holding that Alcaraz was illegally
dismissed due to her status as a regular and not a probationary employee, the Court finds
that the NLRC committed a grave abuse of discretion.

ISSUE 2:

A different procedure is applied when terminating a probationary employee; the usual


two-notice rule does not govern.65 Section 2, Rule I, Book VI of the Implementing Rules
of the Labor Code states that "if the termination is brought about by the x x x failure of an
employee to meet the standards of the employer in case of probationary employment, it
shall be sufficient that a written notice is served the employee, within a reasonable time
from the effective date of termination."
As the records show, Alcaraz's dismissal was effected through a letter dated May 19,
2005 which she received on May 23, 2005 and again on May 27, 2005. Stated therein
were the reasons for her termination, i.e., that after proper evaluation, Abbott determined
that she failed to meet the reasonable standards for her regularization considering her
lack of time and people management and decision-making skills, which are necessary in
the performance of her functions as Regulatory Affairs Manager.66 Undeniably, this
written notice sufficiently meets the criteria set forth above, thereby legitimizing the cause
and manner of Alcaraz’s dismissal as a probationary employee under the parameters set
by the Labor Code.67
Kimberly Clark v. Secretary of Labor
[G.R. No. 156668 | 23 November 2007]
TOPIC: General Concepts | PONENTE: J. Nachura AUTHOR: TIGLAO
NOTES:
CASE LAW/ DOCTRINE:
Considering that an employee becomes regular with respect to the activity in which he is
employed one year after he is employed, the reckoning date for determining his
regularization is his hiring date. Therefore, it is error for petitioner Kimberly to claim that
it is from April 21, 1986 that the one-year period should be counted. While it is a fact that
the issue of regularization came about only when KILUSAN-OLALIA filed a petition for
certification election, the concerned employees attained regular status by operation of
law.

Further, the grant of the benefit of regularization should not be limited to the employees
who questioned their status before the labor tribunal/court and asserted their rights; it
should also extend to those similarly situated. There is, thus, no merit in petitioner's
contention that only those who presented their circumstances of employment to the courts
are entitled to regularization.
FACTS:
The CBA executed by and between Kimberly and United Kimberly-Clark
Employees Union (UKCEO-PTGWO) expired.
Within the freedom period, KILUSAN-OLALIA, a newly formed labor organization,
challenged the incumbency of UKCEO-PTGWO, by filing a petition for certification
election.
UKCEO-PTGWO won. KILUSAN filed a protest. The former was declared as the
exclusive bargaining representative of Kimberly Corp.
KILUSAN filed a petition for certiorari against the order of the Ministry of Labor.
During the pendency of G.R. No. 77629, Kimberly dismissed from service several
employees and refused to heed the workers grievances, impelling KILUSAN-OLALIA to
stage a strike
Kimberly, in this case, contends that the reckoning point in determining who among its
casual employees are entitled to regularization should be April 21, 1986, the date
KILUSAN-OLALIA filed a petition for certification election to challenge the incumbency
of UKCEO-PTGWO
Kimberly also argues that the employees who are not parties in G.R. No. 77629 should
not be included in the implementation orders.
ISSUE(S): W/N Kimberly is correct in its contention.

HELD: No. Considering that an employee becomes regular with respect to the activity in
which he is employed one year after he is employed, the reckoning date for determining
his regularization is his hiring date. Therefore, it is error for petitioner Kimberly to claim
that it is from April 21, 1986 that the one-year period should be counted. While it is a fact
that the issue of regularization came about only when KILUSAN-OLALIA filed a petition
for certification election, the concerned employees attained regular status by operation of
law.

Further, the grant of the benefit of regularization should not be limited to the employees
who questioned their status before the labor tribunal/court and asserted their rights; it
should also extend to those similarly situated. There is, thus, no merit in petitioner's
contention that only those who presented their circumstances of employment to the courts
are entitled to regularization

RATIO:
The law [thus] provides for two kinds of regular employees, namely: (1) those who are
engaged to perform activities which are usually necessary or desirable in the usual
business or trade of the employer; and (2) those who have rendered at least one year of
service, whether continuous or broken, with respect to the activity in which they are
employed. The individual petitioners herein who have been adjudged to be regular
employees fall under the second category. These are the mechanics, electricians,
machinists, machine shop helpers, warehouse helpers, painters, carpenters, pipefitters
and masons. It is not disputed that these workers have been in the employ of KIMBERLY
for more than one year at the time of the filing of the petition for certification election by
KILUSAN-OLALIA.

Owing to their length of service with the company, these workers became regular
employees, by operation of law, one year after they were employed by KIMBERLY
through RANK. While the actual regularization of these employees entails the mechanical
act of issuing regular appointment papers and compliance with such other operating
procedures as may be adopted by the employer, it is more in keeping with the intent and
spirit of the law to rule that the status of regular employment attaches to the casual worker
on the day immediately after the end of his first year of service. To rule otherwise, and to
instead make their regularization dependent on the happening of some contingency or
the fulfillment of certain requirements, is to impose a burden on the employee which is
not sanctioned by law.

That the first stated position is the situation contemplated and sanctioned by law is further
enhanced by the absence of a statutory limitation before regular status can be acquired
by a casual employee. The law is explicit. As long as the employee has rendered at least
one year of service, he becomes a regular employee with respect to the activity in which
he is employed. The law does not provide the qualification that the employee must first
be issued a regular appointment or must first be formally declared as such before he can
acquire a regular status. Obviously, where the law does not distinguish, no distinction
should be drawn.

ROWELL INDUSTRIAL CORPORATION vs CA Case Digest


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

ROWELL INDUSTRIAL CORPORATION, Petitioner, vs. HON. COURT OF APPEALS


and JOEL TARIPE, Respondents.

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

On 17 February 2000, respondent Taripe filed a complaint against petitioner RIC for
regularization and payment of holiday pay, as well as indemnity for severed finger,
which was amended on 7 April 2000 to include illegal dismissal. Respondent Taripe
alleges that RIC employed him starting 8 November 1999 as power press machine
operator, such position of which was occupied by RIC’s regular employees and the
functions of which were necessary to the latter’s business. Respondent Taripe adds that
upon employment, he was made to sign a document, which was not explained to him
but which was made a condition for him to be taken in and for which he was not
furnished a copy. Respondent Taripe states that he was not extended full benefits
granted under the law and the CBA and that on 6 April 2000, while the case for
regularization was pending, he was summarily dismissed from his job although he never
violated any of the RIC’s company rules and regulations.
Petitioner RIC, for its part, claims that Taripe was a contractual employee, whose
services were required due to the increase in the demand in packaging requirement of
its clients for Christmas season and to build up stock levels during the early part of the
following year; that on 6 March 2000, Taripe’s employment contract expired.

Petitioner RIC emphasizes that while an employee’s status of employment is vested by


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

ISSUE: Whether respondent was a regular employee of petitioner company.

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

Regular employees are further classified into: (1) regular employees by nature of work;
and (2) regular employees by years of service. The former refers to those employees
who perform a particular activity which is necessary or desirable in the usual business
or trade of the employer, regardless of their length of service; while the latter refers to
those employees who have been performing the job, regardless of the nature thereof,
for at least a year.

The aforesaid Article 280 of the Labor Code, as amended, however, does not proscribe
or prohibit an employment contract with a fixed period. It does not necessarily follow
that where the duties of the employee consist of activities usually necessary or
desirable in the usual business of the employer, the parties are forbidden from agreeing
on a period of time for the performance of such activities. There is nothing essentially
contradictory between a definite period of employment and the nature of the employee’s
duties. What Article 280 of the Labor Code, as amended, seeks to prevent is the
practice of some unscrupulous and covetous employers who wish to circumvent the law
that protects lowly workers from capricious dismissal from their employment. The
aforesaid provision, however, should not be interpreted in such a way as to deprive
employers of the right and prerogative to choose their own workers if they have
sufficient basis to refuse an employee a regular status. Management has rights which
should also be protected.

In the case at bar, respondent Taripe signed a contract of employment prior to his
admission into the petitioner’s company. Based on the said contract, respondent
Taripe’s employment with the petitioner is good only for a period of five months unless
the said contract is renewed by mutual consent. And as claimed by petitioner RIC,
respondent Taripe, along with its other contractual employees, was hired only to meet
the increase in demand for packaging materials during the Christmas season and also
to build up stock levels during the early part of the year.

Although Article 280 of the Labor Code, as amended, does not forbid fixed term
employment, it must, nevertheless, meet any of the following guidelines in order that it
cannot be said to circumvent security of tenure: (1) that 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.

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

Likewise, other than the bare allegations of petitioner RIC that respondent Taripe was
hired only because of the increase in the demand for packaging materials during the
Christmas season, petitioner RIC failed to substantiate such claim with any other
evidence. Petitioner RIC did not present any evidence which might prove that
respondent Taripe was employed for a fixed or specific project or that his services were
seasonal in nature.

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

With regard to the second guideline, petitioner RIC and respondent Taripe cannot be
said to have dealt with each other on more or less equal terms with no moral dominance
exercised by the former over the latter. As a power press operator, a rank and file
employee, he can hardly be on equal terms with petitioner RIC. As the Court of Appeals
said, “almost always, employees agree to any terms of an employment contract just to
get employed considering that it is difficult to find work given their ordinary
qualifications.”

Therefore, for failure of petitioner RIC to comply with the necessary guidelines for a
valid fixed term employment contract, it can be safely stated that the aforesaid contract
signed by respondent Taripe for a period of five months was a mere subterfuge to deny
to the latter a regular status of employment.

Settled is the rule that the primary standard of determining regular employment is the
reasonable connection between the particular activity performed by the employee in
relation to the casual business or trade of the employer. The connection can be
determined by considering the nature of the work performed and its relation to the
scheme of the particular business or trade in its entirety.

Given the foregoing, indeed, respondent Taripe, as a rectangular power press machine
operator, in charge of manufacturing covers for “four liters rectangular tin cans,” was
holding a position which is necessary and desirable in the usual business or trade of
petitioner RIC, which was the manufacture of tin cans. Therefore, respondent Taripe
was a regular employee of petitioner RIC by the nature of work he performed in the
company.

Respondent Taripe does not fall under the exceptions mentioned in Article 280 of the
Labor Code, as amended, because it was not proven by petitioner RIC that he was
employed only for a specific project or undertaking or his employment was merely
seasonal. Similarly, the position and function of power press operator cannot be said to
be merely seasonal. Such position cannot be considered as only needed for a specific
project or undertaking because of the very nature of the business of petitioner RIC.
Indeed, respondent Taripe is a regular employee of petitioner RIC and as such, he
cannot be dismissed from his employment unless there is just or authorized cause for
his dismissal.

Well-established is the rule that regular employees enjoy security of tenure and they
can only be dismissed for just cause and with due process, notice and hearing. And in
case of employees’ dismissal, the burden is on the employer to prove that the dismissal
was legal. Thus, respondent Taripe’s summary dismissal, not being based on any of the
just or authorized causes enumerated under Articles 282, 283, and 284 of the Labor
Code, as amended, is illegal.

[G.R. No. 149985 May 5, 2006]


PHILIPPINE LONG DISTANCE TELEPHONE COMPANY, INC., Petitioner, vs.
ROSALINA C. ARCEO,*** Respondent.

FACTS:

May 1990 – ARCEO applied for the position of telephone operator with PLDT. She,
however, failed the pre-employment qualifying examination. Having failed the test,
ARCEO requested PLDT to allow her to work at the latter’s office even without pay.
PLDT agreed and assigned her to its commercial section where she was made to
perform various tasks like photocopying documents, sorting out telephone bills and
notices of disconnection, and other minor assignments and activities. After two weeks,
PLDT decided to pay her the minimum wage.
February 15, 1991 – PLDT saw no further need for ARCEO's services and decided to
fire her but, through the intervention of PLDT’s commercial section supervisor, she was
recommended for an on-the-job training on minor traffic work. When she failed to
assimilate traffic procedures, the company transferred her to auxiliary services, a minor
facility.
Subsequently, ARCEO took the pre-qualifying exams for the position of telephone
operator two more times but again failed in both attempts.
October 30, 1991 – PLDT discharged ARCEO from employment. She then filed a case
for illegal dismissal before the labor arbiter. On May 11, 1993, the arbiter ruled in her
favor. PLDT was ordered to reinstate ARCEO to her “former position or to an equivalent
position.”
June 9, 1993 – ARCEO was reinstated as casual employee with a minimum wage of
P106 per day. She was assigned to photocopy documents and sort out telephone bills.

CAUSE OF ACTION:
September 3, 1996 (more than three years after her reinstatement) – ARCEO filed a
complaint for unfair labor practice, underpayment of salary, underpayment of overtime
pay, holiday pay, rest day pay and other monetary claims. She alleged in her complaint
that, since her reinstatement, she had yet to be regularized and had yet to receive the
benefits due to a regular employee.

DECISION of the labor arbiter, NLRC, CA:


August 18, 1997 – The labor arbiter ruled that ARCEO was already qualified to become
a regular employee. He also found that PLDT denied her all the benefits and privileges
of a regular employee.
November 28, 1997 – The NLRC affirmed the decision of the labor arbiter finding
ARCEO eligible to become a regular employee.
June 29, 2001 – The CA affirmed the decision of the NLRC.

ISSUE:

Does the proviso in Art. 280 of the Labor Code which “regularizes” a casual employee
who has rendered at least one year of service subject to the condition that the
employment subsists or the position still exists?

HELD
Reinstatement to an “equivalent position” – PLDT’s argument that respondent’s position
has been abolished, if indeed true, does not preclude ARCEO’s becoming a regular
employee. The order to reinstate her also included the alternative to reinstate her to “a
position equivalent thereto.” Thus, PLDT can still “regularize” her in an equivalent
position.

PLDT failed to show position “no longer subsists” – Moreover, PLDT’s argument does
not hold water in the absence of proof that the activity in which ARCEO was engaged
(like photocopying of documents and sorting of telephone bills) no longer subsists.
Under Art. 280, any employee who has rendered at least one year of service “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.” For PLDT’s failure to show
that the activity undertaken by ARCEO has been discontinued, we are constrained to
confirm her “regularization” in that position.

Date of regularization (when entitled to benefits) – Considering that she has already
worked in PLDT for more than one year at the time she was reinstated, she should be
entitled to all the benefits of a regular employee from June 9, 1993 the day of her actual
reinstatement.

Pier 8 Arrastre and Stevedoring Services Inc. vs. Boclot


[G.R. No. 173849. Sept. 28, 2007]

Facts:

Petitioner Pier 8 Arrastre and Stevedoring Services, Inc. (PASSI) is a domestic


corporation engaged in the business of providing Arrastre and stevedoring servicesat
Pier 8 in the Manila North Harbor. PASSI has been rendering Arrastre and stevedoring
services at the port area since 1974 and employs stevedores who assist in the loading
and unloading of cargoes to and from the vessels. Boclot was hired by PASSI to
perform the functions of a stevedore. Later on, Boclot filed Complaint with the Labor
Arbiter claiming regularization; payment of service incentive leave and 13th month pays;
moral, exemplary and actual damages; and attorney’s fees. He alleged that he was
hired by PASSI in October 1999 and was issued company ID No. 304, a PPA Pass and
SSS documents. In fact, respondent contended that he became a regular employee by
April 2000, since it was his sixth continuous month in service in PASSI’s regular course
of business. He argued on the basis of Articles 280 and 281 of the Labor Code. He
maintains that under paragraph 2 of Article 280, he should be deemed a regular
employee having rendered at least one year of service with the company.

ISSUE

Whether or not he has attained regular status

DECISION

Yes. The primary standard, therefore, of determining a regular employment is the


reasonable connection between the particular activity performed by the employee in
relation to the usual business or trade of the employer. The test is whether the former is
usually necessary or desirable in the usual business or trade of the employer. The
connection can be determined by considering the nature of the work performed and its
relation to the scheme of the particular business or trade in its entirety.
No doubt, serving as a stevedore, respondent performs tasks necessary or desirable
to the usual business of petitioners. However, it should be deemed part of the nature
ofhis work that he can only work as a stevedore in the absence of the employee
regularly employed for the very same function.
Also, if the employee has been performing the job for at least one year, even if the
performance is not continuous or merely intermittent, the law deems the repeated and
continuing need for its performance as sufficient evidence of the necessity if not
indispensability of that activity to the business

Article II of its CBA. Under a union-shop agreement, although nonmembers may be


hired, an employee is required to become a union member after a certain period, in
order to retain employment. This requirement applies to present and future employees.
The same article of the CBA stipulates that employment in PASSI cannot be obtained
without prior membership in the union.

Hence, applying the foregoing provisions of the CBA, respondent should be considered
a regular employee after six months of accumulated service. Having rendered 228.5
days, or eight months of service to petitioners since 1999, then respondent is entitled to
regularization by virtue of the said CBA provisions.
The Peninsula Manila v. Alipio
G.R. No. 167310 | June 17, 2008| J. Quisumbing

Doctrine: An employment is deemed regular when the activities performed by the


employee are usually necessary or desirable in the usual business of the employer.
However, any employee who has rendered at least 1 year of service, even though
intermittent, is deemed regular with respect to the activity performed and while such
activity actually exists.

Petitioners: The Peninsula Manila, Rolf Pfisterer (General Manager) & Benilda
Quevedo-Santos (HR Manager)
Respondent: Elaine Alipio

FACTS:
 The Peninsula Manila (Manila Pen) operates a clinic 24 hours a day and employs
3 regular nurses who work 8 hours each day on 3 separate shifts. It also
engages the services of reliever nurses who substitute for the regular nurses who
are either off-duty or absent.
 Alipio was hired as a reliever nurse. However, she had been performing the
usual tasks and functions of a regular nurse since the start of her employment on
Dec. 11, 1993. Hence, after about 4 years, she inquired why she was not
receiving her 13th month pay.
 Manila Pen then required her to submit a summary of her tour of duty for 1997.
After submitting, she was paid her 13th month pay for 1997. Alipio also
requested for the payment of her 13th month pay for 1993 to 1996, but her
request was denied.
 In 1998, Alipio was informed by a fellow nurse that she can only report for work
after meeting up with the HR Manager Quevedo- Santos. When asked regarding
her payslip vouchers, she told her that she made copies of them because Manila
Pen does not give her copies. This response peeved Santos for she was
allegedly not entitled to get copies of her payslip vouchers. Santos thereafter
directed Alipio not to report for work anymore, as a consequence of which the
latter filed a complaint for illegal dismissal.
 Labor Arbiter: Dismissed the complaint for lack of merit but directed Manila Pen
to pay separation pay for having served as a reliever nurse for a long time.
 NLRC: Affirmed with the modification of deleting the award of separation pay.
 CA: Reversed. Ordered to:
o reinstate Alipio as regular staff nurse without loss of seniority rights;
o pay her full backwages and all the benefits under the Labor Code from
December 12, 1994 up to the time of her actual reinstatement
o moral damages, exemplary damages, and attorney's fees equivalent to
10% of the total monetary award

ISSUE: WON Alipio was illegally dismissed. (my own words) – YES.
RATIO:
 The conclusions reached by the NLRC and the Labor Arbiter, that Alipio was not
a regular employee of the hotel and that she was validly dismissed, are not
supported by law and evidence on record.
 Under Art. 280 of LC, an employment is deemed regular when the activities
performed by the employee are usually necessary or desirable in the usual
business of the employer. However, any employee who has rendered at least 1
year of service, even though intermittent, is deemed regular with respect to the
activity performed and while such activity actually exists.
o In the case at bar, Alipio's services were engaged by the hotel
intermittently from 1993 up to 1998. Her services as a reliever nurse were
undoubtedly necessary and desirable in the hotel's business of providing
comfortable accommodation to its guests. In any case, since she had
rendered more than 1 year of intermittent service, she had become a
regular employee as early as December 12, 1994. Lastly, per the hotel's
own Certification dated April 22, 1997, she was already a "regular staff
nurse" until her dismissal.
 Being a regular employee, Alipio enjoys security of tenure. Her services may be
terminated only upon compliance with the substantive and procedural requisites
for a valid dismissal: (1) the dismissal must be for any of the causes provided in
Art. 282 of LC, and (2) the employee must be given an opportunity to be heard
and to defend himself.
o In the case at bar, Alipio was illegally dismissed because Manila Pen
failed to comply with the twin requisites for a valid termination.
1) The dismissal was not based on a just cause - Misconduct is any forbidden
act or dereliction of duty. Alipio's act of obtaining copies of her payslips
cannot be characterized as misconduct, much less a grave misconduct. On
the contrary, it is absurd that she had to resort to her own resourcefulness to
get hold of these documents since it was incumbent upon Manila Pen, as her
employer, to give her copies of her payslips.
2) She was deprived of procedural due process - When Santos had a meeting
with Alipio, she was not informed that the hotel was contemplating her
dismissal. Neither was she informed of the ground for which her dismissal
was sought. She was simply told right there and then that she was already
dismissed, thereby affording no opportunity for her to be heard and defend
herself.
Arlene Samonte vs La Salle Greenhills
GR No. 199683, Feb 10, 2016

As each and all of the various and varied classes of employees in the gamut of the
labor force, from non-professionals to professionals, are afforded full protection of law
and security of tenure as enshrined in the Constitution, the entitlement is determined on
the basis of the nature of the work, qualifications of the employee, and other relevant
circumstances.

QUICK FACTS:

Resp. LSGI for 15yrs contracted the services of medical personnels herein petitioners.
However, LSGI Head Administartor informed the Medical Service Team that their
contracts will no longer be renewed. Petitoners, upon asking for separation pay and was
denied of such, filed for illegal dismissal with prayer for separation pay. The LA
dismissed complaint to which NLRC reversed and on appeal CA ruled against the
regular employment of petitioners as well.

FACTS:

The facts are not in dispute.


From 1989, and for fifteen (15) years thereafter, LSGI contracted the services of
medical professionals, specifically pediatricians, dentists and a physician, to comprise
its Health Service Team (HST).

Petitioners, along with other members of the HST signed uniform one-page Contracts of
Retainer for the period of a specific academic calendar beginning in June of a certain
year (1989 and the succeeding 15 years) and terminating in March of the following year
when the school year ends.

After fifteen consecutive years of renewal each academic year, where the last Contract
of Retainer was for the school year of 2003-2004, LSGI Head Administrator, Herman
Rochester, on that last day of the school year, informed the Medical Service Team,
including herein petitioners, that their contracts will no longer be renewed for the
following school year by reason of LSGI's decision to hire two (2) full-time doctors and
dentists. One of the physicians from the same Health Service Team was hired by LSGI
as a full-time doctor.

When petitioners', along with their medical colleagues', requests for payment of their
separation pay were denied, they filed a complaint for illegal dismissal with prayer for
separation pay, damages and attorney's fees before the NLRC. They included the
President of LSGI, Bro. Bernard S. Oca, as respondent.

PETITIONER’S CONTENTION:

In their Position Paper, petitioners alleged that they were regular employees who could
only be dismissed for just and authorized causes and that in the course of their
employment, each of the complainants served an average of nine hours a week. But
beyond their duty hours, they were on call for any medical exigencies of the La Sallian
community. Furthermore, over the years, additional tasks were assigned to the
complainants and were required to suffer several services/activites. Complainants were
likewise included among so-called members of the "LA SALLIAN FAMILY: Builder of a
Culture of Peace," under the heading "Health Services Team" of the La Salle Green
Hills High School Student Handbook 2003-2004. Such public presentation of the
complainants as members of the "LA SALLIAN FAMILY" leaves no doubt about the
intent of respondent school to project complainants as part of its professional staff.

RESPONDENT’S CONTENTION:
On the other hand, in their Position Paper, LSGI denied that complainants were regular
employees, asserting that complainants were independent contractors who were
retained by LSGI by reason of their medical skills and expertise to provide ancillary
medical and dental services to both its students and faculty, consistent with the
following circumstances:

1. Complainants were professional physicians and dentists on retainer basis, paid on


monthly retainer fees, not regular salaries;

2. LSGI had no power to impose disciplinary measures upon complainants including


dismissal from employment;

3. LSGI had no power of control over how complainants actually performed their
professional services.

LABOR ARBITER:

The Labor Arbiter dismissed petitioners' (and their colleagues') complaint and ruled that
complainants, as propounded by LSGI, were independent contractors under
retainership contracts and never became regular employees of LSGI. The Labor Arbiter
based its over-all finding of the absence of control by LSGI over complainants on the
following points:

1. The professional services provided by complainants, including herein petitioners,


cannot be considered as necessary to LSGI's business of providing primary and
secondary education to its students.

2. The pay slips of complainants are not salaries but professional fees less taxes
withheld for the medical services they provided;

3. Issuance of identification cards to, and the requirement to log the time-in and time-out
of, complainants are not indicia of LSGI's power of control over them but were only
imposed for security reasons and in compliance with the agreed clinic schedules of
complainants at LSGI premises.

4. In contrast to regular employees of LSGI, complainants: (a) were not required to


attend or participate in school-sponsored activities and (b) did not enjoy benefits such
as educational subsidy for their dependents.

5. On this score alone, complainants' respective clinic schedule at LSGI for two (2) to
three (3) days a week for three (3) hours a day, for a maximum of nine (9) hours a
week, was not commensurate to the required number of hours work rendered by a
regular employee in a given week of at least 40 hours a week or 8 hours a day for five
(5) days. In addition, the appointed clinic schedule was based on the preference of
complainants.

Curiously, despite the finding that complainants were independent contractors and not
regular employees, the Labor Arbiter, on the ground of compassionate social justice,
awarded complainants separation pay at the rate of one-half month salary for every
year of service:

Separately, both parties, complainants, including herein petitioners, and respondents


appealed to the NLRC.

NLRC:

The NLRC disagreed with the Labor Arbiter's ruling that complainants were independent
contractors based on the latter's opinion that the services rendered by complainants are
not considered necessary to LSGI's operation as an educational institution. The NLRC
noted that Presidential Decree No. 856, otherwise known as the Sanitation Code of the
Philippines, requires that private educational institutions comply with the sanitary laws.
Nonetheless, the NLRC found that complainants were fixed-period employees whose
terms of employment were subject to agreement for a specific duration. In all, the NLRC
ruled that the Contracts of Retainer between complainants and LSGI are valid fixed-
term employment contracts where complainants as medical professionals understood
the terms thereof when they agreed to such continuously for more than ten (10) years.
Consequently, the valid termination of their retainership contracts at the end of the
period stated therein, did not entitle complainants to reinstatement, nor, to payment of
separation pay.
CA:

At this point, only herein petitioners, filed a petition for certiorari under Rule 65 of the
Rules of Court before the Court of Appeals alleging that grave abuse of discretion
attended the ruling of the NLRC that they were not regular employees and thus not
entitled to the twin remedies of reinstatement to work with payment of full backwages or
separation pay with backwages.

In dismissing the petition for certiorari, the appellate court ruled that the NLRC did not
commit an error of jurisdiction which is correctible by a writ of certiorari. The Court of
Appeals found that the NLRC's ruling was based on the Contracts of Retainer signed by
petitioners who, as professionals, supposedly ought to have known the import of the
contracts they voluntarily signed, i.e. (a) temporary in character; (b) automatically
ceasing on the specified expiration date, or (c) likewise deemed terminated if job/task
shall be completed on a date prior to specified expiration date.

The Court of Appeals ruled against petitioners' claim of regular employment, thus:

Moreover, this Court is not persuaded by petitioners' averments that they are regular
employees simply because they received benefits such as overtime pay, allowances,
Christmas bonuses and the like; or because they were subjected to administrative rules
such as those that regulate their time and hours of work, or subjected to LSGFs
disciplinary rules and regulations; or simply because they were treated as part of LSGFs
professional staff. It must be emphasised that LSGI, being the employer, has the
inherent right to regulate all aspects of employment of every employee whether regular,
probationary, contractual or fixed-term. Besides, petitioners were hired for specific tasks
and under fixed terms and conditions and it is LSGI's prerogative to monitor their
performance to see if they are doing their tasks according to the terms and conditions of
their contract and to give them incentives for good performance.[8]

ISSUE:

1. WON there exists and employee-employer relationship between petitioners and LSGI
2. WON petitioners were fixed employees
HELD:

1. Article 280 of the Labor Code classifies employees into regular, project, seasonal,
and casual:

Art. 280. Regular and casual employment. The provisions of written agreement to the
contrary notwithstanding and regardless of the oral agreement of the parties, an
employment shall be deemed to be regular where the employee has been engaged to
perform activities which are usually necessary or desirable in the usual business or
trade of the employer, except where the employment has been fixed for a specific
project or undertaking the completion or termination of which has been determined at
the time of the engagement of the employee or where the . work or service to be
performed is seasonal in nature and the employment is for the duration of the season.

An employment shall be deemed to be casual if it is not covered by the preceding


paragraph: Provided, That any employee who has rendered at least one year of service,
whether such service is continuous or broken, shall be considered a regular employee
with respect to the activity in which he is employed and his employment shall continue
while such activity exists.

The provision classifies regular employees into two kinds (1) those "engaged to perform
activities which are usually necessary or desirable in the usual business or trade of the
employer"; and (2) casual employees who have "rendered at least one year of service,
whether such service is continuous or broken."

The NLRC correctly identified the existence of an employer-employee relationship


between petitioners and LSGI and not a bilateral independent contractor relationship.
On more than one occasion, we recognised certain workers to be independent
contractors: individuals with unique skills and talents that set them apart from ordinary
employees. We found them to be independent contractors because of these unique
skills and talents and the lack of control over the means and methods in the
performance of their work. In some instances, doctors and other medical professional
may fall into this independent contractor category, legitimately providing medical
professional services. However, as has been declared by the-NLRC and the appellate
court, petitioners herein are not independent contractors.

2. Tersely put, a fixed-term employment is allowable under the Labor Code only if the
term was voluntarily and knowingly entered into by the parties who must have dealt with
each other on equal terms not one exercising moral dominance over the other.

Indeed, Price, et. al. v. Innodata Corp., teaches us, from the wording of Article 280 of
the Labor Code, that the nomenclature of contracts, especially employment contracts,
does not define the employment status of a person: Such is defined and prescribed by
law and not by what the parties say it should be. Equally important to consider is that a
contract of employment is impressed with public interest such that labor contracts must
yield to the common good. Thus, provisions of applicable statutes are deemed written
into the contract, and the parties are not at liberty to insulate themselves and their
relationships from the impact of labor laws and regulations by simply contracting with
each other.

Further, a fixed-term contract is an employment contract, the repeated renewals of


which make for a regular employment.

In the case at bar, the Court of Appeals disregarded the repeated renewals of the
Contracts of Retainer of petitioners spanning a decade and a half. The Court of Appeals
ruled that petitioners never became regular employees.

We completely disagree with the Court of Appeals.

The uniform one-page Contracts of Retainer signed by petitioners were prepared by


LSGI alone. Petitioners, medical professionals as they were, were still not on equal
footing with LSGI as they obviously did not want to lose their jobs that they had stayed
in for fifteen (15) years. There is no specificity in the contracts regarding terms and
conditions of employment that would indicate that petitioners and LSGI were on equal
footing in negotiating it. Notably, without specifying what are the tasks assigned to
petitioners, LSGI "may upon prior written notice to the retainer, terminate [the] contract
should the retainer fail in any way to perform his assigned job/task to the satisfaction of
La Salle Greenhills, Inc. or for any other just cause."

While vague in its sparseness, the Contract of Retainer very clearly spelled out that
LSGI had the power of control over petitioners.

Time and again we have held that the power of control refers to the existence of the
power and not necessarily to the actual exercise thereof, nor is it essential for the
employer to actually supervise the performance of duties of the employee. It is enough
that the employer has the right to wield that power.

In all, given the following: (1) repeated renewal of petitioners' contract for fifteen years,
interrupted only by the close of the school year; (2) the necessity of the work performed
by petitioners as school physicians and dentists; and (3) the existence of LSGI's power
of control over the means and method pursued by petitioners in the performance of their
job, we rule that petitioners attained regular employment, entitled to security of tenure
who could only be dismissed for just and authorized causes. Consequently, petitioners
were illegally dismissed and are entitled to the twin remedies of payment of separation
pay and full back wages. We order separation pay in lieu of reinstatement given the
time that has lapsed, twelve years, in the litigation of this case.

Sagun v. ANZ Global Services and Operations


(Perlas-Bernabe, J.) 2016

Facts:
- Sagun was employed at HSBC Electronics Data Processing when he applied
online for the position of Payments and Cash Processing Lead at ANZ
- After passing the interview and online exam, Senior VP for Operations, Cruzada,
offered Sagun the position of Customer Service Officer, which he accepted on
June 8, 2011
- In the letter of confirmation of the offer, the terms and conditions of his
employment required a satisfactory result of his pre-employment screening
o Required to undergo a police record check prior to commencing work or at
other times during employment
o Undergo other checks (e.g. bankruptcy, sanctions screening, reference,
etc.)
o He was to be on probationary status for 6 months and that appointment
would take effect from the date of reporting (to be not later than July 11,
2011)
o Initial and ongoing employment is conditional on ANZ being satisfied
of the results. In case results are unsatisfactory, ANZ may choose to
not commence employment, or terminate the same immediately
- On June 11, 2011, Sagun tendered his resignation at HSBC and the
acknowledged copy thereof was transmitted to ANZ
- On July 11, 2011, Sagun was handed a letter of retraction informing him that the
offer had been withdrawn because of the material inconsistencies found in his
declared information and documents
o He only held a position of a Lvl. 1, not Lvl. 2, Technical Support
Representative
o He was terminated for cause due to his absence without official leave and
not because of his resignation
o He failed to report for work on or before July 11, 2011
- Sagun filed a complaint for illegal dismissal before the NLRC arguing that his
employment contract had already been perfected ipon his acceptance of the offer
on June 8, 2011
- Respondents countered that no employer-employee relation existed and thus the
NLRC has no jurisdiction and presented that Sagun made material
misrepresentations
- LA: dismissed the case. No perfected employment contract.
- NLRC and CA: affirmed. There is a difference between the perfection of the
employment contract (June 8, 2011) and the commencement of the employer-
employee relationship. The relationship never existed since the employment offer
is conditioned on the satisfactory completion of his background check

ISSUE:
1. W/N an employer-employee relationship existed – NO
HELD:
- An employment contract, like any other contract, is perfected at the moment the
parties come to agree upon its terms and conditions, and thereafter, concur in
the essential elements thereof
- There was already a perfected contract of employment when petitioner signed
ANZ's employment offer and agreed to the terms and conditions that were
embodied therein. Nonetheless, the offer of employment extended to petitioner
contained several conditions before he may be deemed an employee of ANZ.
- a condition is defined as "every future and uncertain event upon which an
obligation or provision is made to depend. It is a future and uncertain event upon
which the acquisition or resolution of rights is made to depend by those who
execute the juridical act."41 Jurisprudence states that when a contract is subject
to a suspensive condition, its effectivity shall take place only if and when the
event which constitutes the condition happens or is fulfilled.
- Here, the subject employment contract required a satisfactory completion of
petitioner's background check before he may be deemed an employee of ANZ
- To reiterate, in a contract with a suspensive condition, if the condition does not
happen, the obligation does not come into effect. Thus, until and unless petitioner
complied with the satisfactory background check, there exists no obligation on
the part of ANZ to recognize and fully accord him the rights under the
employment contract.
-

POSEIDON FISHING v. NLRC


G.R. No. 168052
February 20, 2006
FACTS:
Petitioner Poseidon Fishing is a fishing company engaged in the deep-sea fishing
industry. Its various vessels catch fish in the outlying islands of the Philippines, which
are traded and sold at the Navotas Fish Port. One of its boat crew was private
respondent Jimmy S. Estoquia. Petitioner Terry de Jesus is the manager of petitioner
company.
Private respondent was employed by Poseidon Fishing in January 1988 as Chief Mate.
After five years, he was promoted to Boat Captain. In 1999, petitioners, without
reason, demoted respondent from Boat Captain to Radio Operator of petitioner
Poseidon.
On 3 July 2000, private respondent failed to record a 7:25 a.m. call in one of the
logbooks. However, he was able to record the same in the other logbook.
Around 9:00 o’clock in the morning of 4 July 2000, petitioner Terry de Jesus detected
the error in the entry in the logbook. Subsequently, she asked private respondent to
prepare an incident report to explain the reason for the said oversight.
At around 2:00 o’clock in the afternoon of that same day, petitioner Poseidon’s
secretary, namely Nenita Laderas, summoned private respondent to get his separation
pay (P55,000.00). However, he refused to accept the amount as he believed that he did
nothing illegal to warrant his immediate discharge from work.
He filed a complaint for illegal dismissal with the Labor Arbiter, alleging nonpayment of
wages with prayer for back wages, damages, attorney’s fees, and other monetary
benefits.
He averred that petitioner Poseidon demoted him from Boat Captain to Radio Operator
without any reason and shortly, he was terminated without just cause and without
due process of law.
Conversely, petitioners Poseidon and Terry de Jesus strongly asserted that private
respondent was a contractual or a casual employee whose services could be
terminated at the end of the contract even without a just or authorized cause in view of
Article 280 of the Labor Code.
Petitioners further posited that when the private respondent was engaged, it was made
clear to him that he was being employed only on a"por viaje" or per trip basis and
that his employment would be terminated at the end of the trip for which he was being
hired.
Labor Arbiter decided in favor of private respondent. LA held that even if the private
respondent was a casual employee, he became a regular employee after a period of
one year and, thereafter, had attained tenurial security which could only be lost due to a
legal cause after observing due process.
NLRC affirmed the decision of the Labor Arbiter with the modification, inter alia,
that: (a) the private respondent would be paid his separation pay equivalent to one-half
of his monthly pay for every year of service that he has rendered in lieu of
reinstatement; and (b) an amount equivalent to six months salary should be
deducted from his full backwages because it was his negligence in the
performance of his work that brought about his termination.
An MR was denied.
CA also dismissed their certiorari.
ISSUE:
WON private respondent was a regular employee at the time his employment was
terminated on 04 July 2000
HELD/RATIO:
REGULAR EMPLOYEE. Asserting their right to terminate the contract with private
respondent per the "Kasunduan" with him, petitioners pointed to the provision thereof
stating that he was being employed only on a ‘’por viaje’’ basis and that his employment
would be terminated at the end of the trip for which he was being hired.
Petitioners lament that fixed-term employment contracts are recognized as valid under
the law notwithstanding the provision of Article 280 of the Labor Code.
Accordingly, and since the entire purpose behind the development of legislation
culminating in the present Article 280 of the Labor Code clearly appears to have been,
as already observed, to prevent circumvention of the employee’s right to be secure in
his tenure, the clause in said article indiscriminately and completely ruling out all written
or oral agreements conflicting with the concept of regular employment as defined
therein should be construed to refer to the substantive evil that the Code itself has
singled out: agreements entered into precisely to circumvent security of tenure.
The case of Brent cited some familiar examples of employment contracts which may
neither be for seasonal work nor for specific projects, but to which a fixed term is an
essential and natural appurtenance, i.e., overseas employment contracts, appointments
to the positions of dean, assistant dean, college secretary, principal, and other
administrative offices in educational institutions, which are by practice or tradition
rotated among the faculty members, and where fixed terms are a necessity without
which no reasonable rotation would be possible. Thus, in Brent, the acid test in
considering fixed-term contracts as valid is: if from the circumstances it is
apparent that periods have been imposed to preclude acquisition of tenurial
security by the employee, they should be disregarded for being contrary to public
policy.
It is apparent from Brent School that the critical consideration is the presence or
absence of a substantial indication that the period specified in an employment
agreement was designed to circumvent the security of tenure of regular
employees which is provided for in Articles 280 and 281 of the Labor Code. This
indication must ordinarily rest upon some aspect of the agreement other than the mere
specification of a fixed term of the employment agreement, or upon evidence aliunde of
the intent to evade.
In the case under consideration, the agreement has such an objective - to frustrate the
security of tenure of private respondent- and fittingly, must be nullified. In this case,
petitioners’ intent to evade the application of Article 280 of the Labor Code is
unmistakable. In a span of 12 years, private respondent worked for petitioner
company first as a Chief Mate, then Boat Captain, and later as Radio Operator.
His job was directly related to the deep-sea fishing business of petitioner
Poseidon. His work was, therefore, necessary and important to the business of his
employer. Such being the scenario involved, private respondent is considered a
regular employee of petitioner under Article 280 of the Labor Code.
Moreover, unlike in the Brent case where the period of the contract was fixed and
clearly stated, note that in the case at bar, the terms of employment of private
respondent as provided in the Kasunduan was not only vague, it also failed to provide
an actual or specific date or period for the contract.
Furthermore, as petitioners themselves admitted in their petition before this Court,
private respondent was repeatedly hired as part of the boat’s crew and he acted in
various capacities onboard the vessel.
Ostensibly, in the case at bar, at different times, private respondent occupied the
position of Chief Mate, Boat Captain, and Radio Operator. In petitioners’ interpretation,
however, this act of hiring and re-hiring actually highlight private respondent’s
contractual status saying that for every engagement, a fresh contract was entered into
by the parties at the outset as the conditions of employment changed when the private
respondent filled in a different position. But to this Court, the act of hiring and re-hiring in
various capacities is a mere gambit employed by petitioner to thwart the tenurial
protection of private respondent. Such pattern of re-hiring and the recurring need
for his services are testament to the necessity and indispensability of such
services to petitioners’ business or trade.
To recapitulate, it was after 12 long years of having private respondent under its wings
when petitioners, possibly sensing a brewing brush with the law as far as private
respondent’s employment is concerned, finally found a loophole to kick private
respondent out when the latter failed to properly record a 7:25 a.m. call. Capitalizing on
this faux pas, petitioner summarily dismissed private respondent. On this note, we
disagree with the finding of the NLRC that private respondent was negligent on account
of his failure to properly record a call in the log book. A review of the records would
ineluctably show that there is no basis to deduct six months’ worth of salary from the
total separation pay that private respondent is entitled to. We note further that the
NLRC’s finding clashes with that of the Labor Arbiter which found no such negligence
and that such inadvertence on the part of private respondent, at best, constitutes simple
negligence punishable only with admonition or suspension for a day or two.
As correctly pointed out by the Court of Appeals, the "activity of catching fish is a
continuous process and could hardly be considered as seasonal in nature."
More to the point, in Maraguinot, Jr. v. National Labor Relations Commission,35 we ruled
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.
In fine, inasmuch as private respondent’s functions as described above are no doubt
"usually necessary or desirable in the usual business or trade" of petitioner fishing
company and he was hired continuously for 12 years for the same nature of tasks, we
are constrained to say that he belongs to the ilk of regular employee. Being one, private
respondent’s dismissal without valid cause was illegal. And, where illegal dismissal is
proven, the worker is entitled to back wages and other similar benefits without
deductions or conditions.
DISPOSITIVE PORTION:
WHEREFORE, the present petition is hereby DENIED. The Decision of the Court of
Appeals dated 14 March 2005 in CA-G.R. SP No. 81140 is hereby AFFIRMED WITH
MODIFICATION by deleting the reduction of an amount equivalent to six months of pay
from private respondent’s separation pay. The case is remanded to the Labor Arbiter for
further proceedings solely for the purpose of determining the monetary liabilities of
petitioners in accordance with the decision. The Labor Arbiter is ORDERED to submit
his compliance thereon within thirty (30) days from notice of this decision, with copies
furnished to the parties. Costs against petitioners.

JOSEFINA BENARES vs. JAIME PACHO, RODOLFO PANCHO JR,


JOSELITO MEDALLA, ET. AL
FACTS:
On July 24, 1991, complainants thru counsel wrote the Regional Director of the
Department of Labor and Employment, Bacolod City for intercession particularly in the
matter of wages and other benefits mandated by law.
On September 24, 1991, a routine inspection was conducted by personnel of the
Bacolod District Office of the Department of Labor and Employment. Accordingly, a
report and recommendation was made, hence, the endorsement by the Regional
Director of the instant case to the Regional Arbitration Branch, NLRC, Bacolod City for
proper hearing and disposition.
On October 15, 1991, complainants alleged to have been terminated without being paid
termination benefits by respondent in retaliation to what they have done in reporting to
the Department of Labor and Employment their working conditions viz-a-viz (sic) wages
and other mandatory benefits.
On July 14, 1992, notification and summons were served to the parties wherein
complainants were directed to file a formal complaint.
On July 28, 1992, a formal complaint was filed for illegal dismissal with money claims.
From the records, summons and notices of hearing were served to the parties and
apparently no amicable settlement was arrived, hence, the parties were directed to file
their respective position papers.
On January 22, 1993, complainant submitted their position paper, while respondent filed
its position paper on June 21, 1993.
On March 17, 1994, complainants filed their reply position paper and affidavit.
Correspondingly, a rejoinder was filed by respondent on May 16, 1994.
On August 17, 1994, from the Minutes of the scheduled hearing, respondent failed to
appear, and that the Office will evaluate the records of the case whether to conduct a
formal trial on the merits or not, and that the corresponding order will be issued.
On January 16, 1996, the Labor Arbiter issued an order to the effect that the case is
now deemed submitted for resolution.
On April 30, 1998, the Labor Arbiter a quo issued the assailed decision dismissing the
complaint for lack of merit.
On June 26, 1998, complainants not satisfied with the aforecited ruling interposed the
instant appeal before the NLRC. The NLRC held that respondents attained the status of
regular seasonal workers of Hda. Maasin II having worked therein from 1964-1985. It
found that petitioner failed to discharge the burden of proving that the termination of
respondents was for a just or authorized cause. Hence, respondents were illegally
dismissed and should be awarded their money claims.
The Court of Appeals affirmed the NLRC’s ruling, with the modification that the
backwages and other monetary benefits shall be computed from the time compensation
was withheld in accordance with Article 279 of the Labor Code, as amended by
Republic Act No. 6715.
ISSUE: W/N the petitioner is guilty of illegal dismissal with money claims.
HELD: YES, the Supreme Court dismissed the instant petition and affirmed the Decision
of the Court of Appeals base on the following premise:
Petitioner underscores the NLRC decision’s mention of the “payroll” she presented
despite the fact that she allegedly presented 235 sets of payroll, not just one payroll.
This circumstance does not in itself evince any grave abuse of discretion on the part of
the NLRC as it could well have been just an innocuous typographical error.
Verily, the NLRC’s decision, affirmed as it was by the Court of Appeals, appears to have
been arrived at after due consideration of the evidence presented by both parties.
The SC finds no reason to disturb the finding that respondents were illegally terminated.
When there is no showing of clear, valid and legal cause for the termination of
employment, the law considers the matter a case of illegal dismissal and the burden is
on the employer to prove that the termination was for a just or authorized cause.25 In
this case, as found both by the NLRC and the Court of Appeals, petitioner failed to
prove any such cause for the dismissal of respondents.

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