EMPLOYEE

CLASSIFICATIO
N
COVERAGE
 ART. 293. COVERAGE

The provisions of this Title (Termination of

Employment) shall apply to all
establishments or undertakings, whether for
profit or not.
EMPLOYEE
CLASSIFICATION
EMPLOYEE
CLASSIFICATION
RECOGNITION AND TYPES
PHILIPPINE FEDERATION
OF CREDIT COOPERATIVES
VS. NATIONAL LABOR
RELATIONS COMMISSION
FACTS
▪ Private respondent Victoria Abril was employed by
petitioner PFCCI, a corporation engaged in
organizing services to credit and cooperatives
entities as junior auditor/field examiner and
thereafter as office secretary and as a cashier
FACTS
▪ Shortly after resuming resuming her position as office
secretary, went on leave until she gave birth to a baby
girl.
▪ Upon her return, she discovered that a certain Vangie
Santos had been permanently appointed to her former
position
▪ Nevertheless, she accepted the position as regional
field officer as evidenced by a contract which stipulated
that respondent’s employment status shall be
probationary for six months
FACTS
▪ Said period, having elapsed respondent was
allowed to work until PFCCI presented to her
another employment contract for a period of one
year, after which period, her employment was
terminated
ISSUE

Whether the respondent Victoria Abril was

illegally dismissed?
HELD
▪ YES. The contention that the respondent could
either be qualified as a casual or contractual
employee is misplaced. Thus it is important for the
court to elucidate on the kinds of employment in
this jurisdiction
HELD
▪ The law comprehends 3 kinds of employees:

- Regular employees
- Project employees
- Casual employees
HELD
▪ The court examined the contract entered into by
the parties and found it out to be ambiguous as to
preclude a precise application of the labor laws
▪ The court held that where a contract of
employment, being a contract of adhesion, is
ambiguous, any ambiguity therein shall be
construed strictly against the party who prepared it
HELD
Regardless of the designation the petitioner may
have conferred upon the respondent’s employment
status, it is uncontroverted that the respondent
having completed the probationary period, became
a regular employee who may be dismissed only for
just cause.
ROSITA PANGILINAN
VS.
GENERAL MILLING
CORPORATION
FACTS
▪ The General Milling Corporation is engaged in the
production and sale of livestock and poultry.
▪ It is also a distributor of dressed chicken to various
restaurants and establishments nationwide
▪ As such, it employs hundreds of employees some
on regular basis and others on casual basis as
“emergency workers”
FACTS
▪ The petitioners were employed as emergency workers
at its poultry plant in Cainta, Rizal under separate
temporary/casual employment contracts for a period of
5 months.
▪ Upon the expiration of their respective contracts, their
services were terminated
▪ They later filed for a complaint of illegal dismissal and
alleged that based on the nature of their work, they are
considered as regular employees and therefore cannot
be terminated without just cause
ISSUE

Whether the petitioners are considered

regular employees of the GMC when their
services was terminated.
HELD
▪ No. The court held that the petitioners were employees
with a fixed period and as such, were not regular
employees.
▪ Art. 280 of the labor code does not prohibit an
employment contract with a fixed period. It does not
necessarily follow that when the duties of the
employees consist of activities usually necessary in the
usual business of the employer, the parties are
forbidden from agreeing on a period of time for the
performance of such activities
HELD
▪ The employees cannot be said to be regular
employees but merely contractual employees and
there is nothing illegal about dismissing them by
reason of the expiration of their contracts.
EMPLOYEE
CLASSIFICATION
EMPLOYER DETERMINATION
MOISES DE LEON VS.
NLRC AND LA
TONDEÑA
FACTS
▪ Petitioner De Leon - maintenance man whose work
consisted mainly of painting company building and
equipment, and other odd jobs relating to maintenance
▪ worked for respondent for more than a year
▪ petitioner requested that he be included in the payroll
of regular employees, to which the former responded
by dismissing petitioner from his employment.
▪ Petitioner having been refused reinstatement filed a
complaint before the Labor Arbiter
FACTS
▪ Petitioner asserts that he is a regular employee
performing similar functions as of a regular
maintenance and was rehired by respondent
company’s labor agency to perform the same tasks.
▪ Respondent company claims petitioner was a casual
worker hired only to paint a certain building in the
premises and that his work as painter terminated upon
completion of the job.
▪ The Labor Arbiter ruled in favor of petitioner but was
reversed on appeal by the NLRC tribunal.
ISSUE

Whether or not petitioner De Leon is a

regular employee of respondent.
HELD
YES.
The primary standard of determining a regular
employment:
▪ the reasonable connection between the particular
activity performed by the employee in relation to the
usual business or trade of the employer
▪ whether the former is usually necessary or desirable
in the usual business or trade of the employer
HELD
It is not tenable to argue that the painting and
maintenance work of petitioner are not necessary in
respondent’s business of manufacturing liquors and
wines, just as it cannot be said that only those who are
directly involved in the process of producing wines and
liquors may be considered as necessary employees.
▪ there would have been no need for the regular
Maintenance Section of respondent company’s
Engineering Department, manned by regular
employees whom petitioner often worked with.
HELD
The law demands that the nature and entirety of the
activities performed by the employee be considered.
▪ the painting and maintenance work given him manifest a
treatment consistent with a maintenance man and not just
a painter, for if his job was truly only to paint a building
there would have been no basis for giving him other
work assignments in between painting activities
▪ petitioner performed his work of painting and
maintenance activities during his employment in
respondent’s business which lasted for more than one
year. Certainly, by this fact alone he is entitled by law to
be considered a regular employee
SAN MIGUEL
CORPORATION VS.
NLRC, EDMUNDO Y.
TORRES, JR. AND
MANUEL C.
CASTELLANO
FACTS
▪ Private respondents - former employees of the petitioner
▪ filed a complaint against the later alleging that they
were forced to retire from service while not yet
reaching the age (60yo) of retirement; they allege:
▪ they had no bad record they were never admonished,
reprimanded or suspended
▪ their retirement from work effected at the option of the
respondent corporation violated their tenurial security
of employment, as provided for in Article 280 of the
Labor Code of the Philippines
FACTS
▪ SMC averred: respondents voluntarily retired from
service and were correctly and completely paid
their separation benefits
▪ Labor Arbiter found that the complainants were not
illegally dismissed.
▪ eventually reversed by the NLRC upon appeal
▪ SMC was ordered to immediately reinstate the
private respondents
ISSUE

Whether or not the retirement of private

respondents was really voluntary.
HELD
▪ No.
▪ De leon vs. NLRC: " . . . [I]f the intention to retire is not
clearly established or if the retirement is involuntary, it
is to be treated as a discharge." Consequently, even
assuming arguendo that respondent NLRC erred in
adjudging the retirement of private respondents as
involuntary, the attendant circumstances under scrutiny
indicate that their (private respondents) intention to
retire was not clearly established.
HELD
▪ Petitioner claims that the private respondents voluntarily
applied for optional retirement
▪ four high-ranking officials of petitioner, met the
complainants at the office of Mr. Edmundo Torres, Jr., to
talk to the complainants individually
▪ when the complainants signed retirement papers,
petitioner admitted that they were reluctant to sign the
same
▪ These actuations and pretensions of petitioner's top
officials are repugnant to human behavior and
experience.
HELD
It is too evident to be overlooked that the reason
why petitioner resorted to such trick was the
anticipated resistance on the part of the
complainants to the scheme of retirement imposed
against their will.

The dismissal of the herein private respondents was

involuntary and therefore illegal.
TABAS, ET. AL VS.
CALIFORNIA
MANUFACTURING
COMPANY INC., ET.,
AL.
FACTS
▪ On July 21, 23, and 28, 1986, the petitioners petitioned
the NLRC for reinstatement and payment of various
benefits, including minimum wage, overtime pay,
holiday pay, thirteen- month pay, and emergency cost
of living allowance pay, against the respondent.
▪ On October 7, 1986, the respondent filed a motion to
dismiss as well as a position paper denying the
existence of an employer-employee relation between
them and, consequently, any liability for payment of
money claims.
FACTS
▪ petitioners were, prior employees of Livi,
▪ assigned to work as "promotional merchandisers"
pursuant to a manpower supply agreement
▪ petitioners were made to sign employment
contracts with durations of six months, upon the
expiration of which they signed new agreements
with the same period
FACTS
▪ petitioners allege that they had become regular
California employees and demand similar benefits
▪ claim that pending further proceedings, they were
notified by California that they would not be rehired. As a
result, they filed an amended complaint charging
California with illegal dismissal.
▪ California admits having refused to accept the petitioners
back to work but deny liability therefor for the reason that
it is not, to begin with, the petitioners' employer and that
the "retrenchment" had been forced by business losses as
well as expiration of contracts.
ISSUE

Whether or not Tabas et. al. are considered

as regular employees.
HELD
Yes.
▪ Philippine Bank of Communications v. NLRC: a temporary
or casual employee, under Article 218 of the Labor Code,
becomes regular after service of one year, unless he has
been contracted for a specific project. And we cannot say
that merchandising is a specific project for the obvious
reason that it is an activity related to the day-to-day
operations of California.
▪ records show that the petitioners bad been given an initial
six-month contract, renewed for another six months; under
Article 218 of the Code, they had become regular
employees-of-California and had acquired a secure tenure.
Hence, they cannot be separated without due process of law.
REGULAR
EMPLOYEES
ART. 295. REGULAR AND CASUAL
EMPLOYMENT
… 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 projector 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.
REGULAR
EMPLOYEES
CLASSIFICATION RATIONALE
PHILIPS
SEMICONDUCTORS
(PHILS.), INC. VS.
ELOISA FADRIQUELA
FACTS
The petitioner Philips Semiconductors (Phils.), Inc. is a
domestic corporation engaged in the production and assembly
of semiconductors such as power devices, RF modules, CATV
modules, RF and metal transistors and glass diods.
The employees were subjected to periodic performance
appraisal based on output, quality, attendance and work
attitude. One was required to obtain a performance rating of at
least 3.0 for the period covered by the performance appraisal
to maintain good standing as an employee.
Eloisa Fadriquela executed a Contract of Employment with the
petitioner in which she was hired as a production operator with
a daily salary of P118.
FACTS
Eloisa Fadriquela was employed for 1 year and 28 days
in total after several times of extension of her
employment due to her good performance rating.

When Eloisa Fadriquela garnered 5 absences without

explanation after demanding for such, Velayo
recommended to the petitioner that the Eloisa’s
employment be terminated due to habitual
absenteeism, in accordance with the Company Rules and
Regulations. Thus, the respondent’s contract of
employment was no longer renewed.
FACTS
The respondent filed a complaint before the National Capital
Region Arbitration Branch of the NLRC for illegal dismissal
against the petitioner:
▪ As there was no valid cause for the termination of her
employment.
▪ She was not notified of any infractions she allegedly committed;
neither was she accorded a chance to be heard.
▪ According to the respondent, the petitioner did not conduct any
formal investigation before her employment was terminated.
▪ Considering that she had rendered more than 6 months of
service, she was already a regular employee and could not be
terminated without any justifiable cause. Moreover, her
absences were covered by the proper authorizations.
ISSUE

Whether or not Eloisa Fadriquela was

already a regular employee when she
was terminated.
HELD

YES.
HELD
Art. 280. Regular and Casual Employment. – The provisions of written
agreement to the contrary notwithstanding and regardless of the oral
argument 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 . . .
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.
HELD
The two kinds of regular employees under the law are:

(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.
HELD
In this case, the respondent was employed by the
petitioner on May 8, 1992 as production operator. She
was assigned to wirebuilding at the transistor division.
There is no dispute that the work of the respondent was
necessary or desirable in the business or trade of the
petitioner. She remained under the employ of the
petitioner without any interruption since May 8, 1992 to
June 4, 1993 or for one (1) year and twenty-eight (28)
days.
HELD
The original contract of employment had been
extended or renewed for four times, to the same
position, with the same chores. Such a continuing need
for the services of the respondent is sufficient evidence
of the necessity and indispensability of her services to
the petitioner’s business. By operation of law, then, the
respondent had attained the regular status of her
employment with the petitioner, and is thus entitled to
security of tenure as provided for in Article 279 of the
Labor Code.
REGULAR
EMPLOYEES
NATURE OF WORK
BUENAVENTURA C.
MAGSALIN COCA-COLA
BOTTLERS PHILS., INC. VS.
NATIONAL ORGANIZATION
OF WORKING MEN
(NOWM),ET. AL.
FACTS
▪ Coca-Cola Bottlers Phils., Inc., herein petitioner, engaged the
services of respondent workers as "sales route helpers" for a
limited period of five months.
▪ After five months, respondent workers were employed by
petitioner company on a day-to-day basis.
▪ According to petitioner company, respondent workers were hired
to substitute for regular sales route helpers whenever the latter
would be unavailable or when there would be an unexpected
shortage of manpower in any of its work places or an unusually
high volume of work.
▪ The practice was for the workers to wait every morning outside the
gates of the sales office of petitioner company. If thus hired, the
workers would then be paid their wages at the end of the day.
FACTS
Ultimately, respondent workers asked petitioner company to
extend to them regular appointments. Petitioner company
refused.
On 07 November 1997, twenty-three (23) of the "temporary"
workers (herein respondents) filed with the National Labor
Relations Commission (NLRC) a complaint for the regularization
of their employment with petitioner company.
The complaint was amended a number of times to include other
complainants that ultimately totaled fifty-eight (58)
workers. Claiming that petitioner company meanwhile
terminated their services, respondent workers filed a notice of
strike and a complaint for illegal dismissal and unfair labor
practice with the NLRC.
ISSUE

Whether or not the nature of work of

respondents in the company is of such
nature as to be deemed necessary and
desirable in the usual business or trade of
petitioner that could qualify them to be
regular employees.
HELD
The repeated rehiring of respondent workers and
the continuing need for their services clearly attest
to the necessity or desirability of their services in
the regular conduct of the business or trade of
petitioner company. The Court of Appeals has found
each of respondents to have worked for at least one
year with petitioner company.
HELD
In determining whether an employment should be
considered regular or non-regular, the applicable test is the
reasonable connection between the particular activity
performed by the employee in relation to the usual business
or trade of the employer.
The standard, supplied by the law itself, is whether the work
undertaken is necessary or desirable in the usual business
or trade of the employer, a fact that can be assessed by
looking into the nature of the services rendered and its
relation to the general scheme under which the business or
trade is pursued in the usual course.
HELD
Although the work to be performed is only for a specific
project or seasonal, where a person thus engaged has
been performing the job for at least one year, even if the
performance is not continuous or is merely intermittent,
the law deems the repeated and continuing need for its
performance as being sufficient to indicate the necessity
or desirability of that activity to the business or trade of
the employer. The employment of such person is also
then deemed to be regular with respect to such activity
and while such activity exists.
HACIENDA FATIMA VS.
NATIONAL FEDERATION
OF SUGARCANE
WORKERS-FOOD AND
GENERAL TRADE
FACTS
In the course of a labor dispute between the petitioner and
respondent union, the union members were not given work
for more than one month. In protest, complainants staged a
strike which was however settled upon the signing of a
Memorandum of Agreement. A conciliation meeting was
conducted wherein Luisa Rombo, Ramona Rombo, Bobong
Abrega, and Boboy Silva were not considered by the
company as employees, and thus may not be members of
the union. It was also agreed that a number of other
employees will be reinstated. When respondents again
reneged on its commitment, complainants filed the present
complaint. It is alleged by the petitioners that the above
employees are mere seasonal employees.
ISSUE

Whether or not the seasonal employees

have become regular employees.
HELD
No. The SC held that for respondents to be excluded from those
classified as regular employees, it is not enough that they
perform work or services that are seasonal in nature. They must
have also been employed only for the duration of one season.
The evidence proves the existence of the first, but not of the
second, condition. The fact that respondents -- with the
exception of Luisa Rombo, Ramona Rombo, Bobong Abriga and
Boboy Silva -- repeatedly worked as sugarcane workers for
petitioners for several years is not denied by the latter.
Evidently, petitioners employed respondents for more than one
season. Therefore, the general rule of regular employment is
applicable.
HELD
The primary standard of determining regular employment is the
reasonable connection between the particular activity performed by
the employee in relation to the usual trade or business of the employer.
The test is whether the former is usually necessary or desirable in the
usual trade or business of the employer. The connection can be
determined by considering the nature of the work performed and its
relation to the scheme of the particular business or trade in its entirety.
Also if the employee has been performing the job for at least a year,
even if the performance is not continuous and merely intermittent, the
law deems repeated and continuing need for its performance as
sufficient evidence of the necessity if not indispensability of that
activity to the business. Hence, the employment is considered regular,
but only with respect to such activity and while such activity exists.
DOUGLAS MILLARES AND
ROGELIO LAGDA
VS. NLRC, TRANS-GLOBAL
MARITIME AGENCY, INC.
AND ESSO
INTERNATIONAL
SHIPPING CO., LTD.
FACTS
Petitioner Douglas Millares was employed by
private respondent ESSO International Shipping
Company LTD. (Esso International, for brevity)
through its local manning agency, private
respondent Trans-Global Maritime Agency, Inc.
(Trans-Global, for brevity) on November 16, 1968 as
a machinist. In 1975, he was promoted as Chief
Engineer which position he occupied until he opted
to retire in 1989. He was then receiving a monthly
salary of US $1,939.00.
FACTS
He applied for leave of absence, and subsequently applied
for availment of Early Retirement under Consecutive
Enlistment Incentive Plan (CEIP) since he had already
rendered more than twenty (20) years of continuous service.
His employer denied his request on the following grounds:
(1) he was employed on a contractual basis; (2) his contract of
enlistment (COE) did not provide for retirement before the
age of sixty (60) years; and (3) he did not comply with the
requirement for claiming benefits under the CEIP, i.e., to
submit a written advice to the company of his intention to
terminate his employment within thirty (30) days from his last
disembarkation date.
FACTS
Millares then filed for an extension of his leave of
absence, but was advised that since his previous
leave of absence expired, he had been dropped
from the roster of crew members.
ISSUE

Are petitioners regular or contractual employees

whose employments are terminated
everytime their contracts of employment expire?
HELD
It is clear that seafarers are considered contractual
employees. They can not be considered as regular
employees under Article 280 of the Labor Code. Their
employment is governed by the contracts they sign
everytime they are rehired and their employment is
terminated when the contract expires. Their employment is
contractually fixed for a certain period of time. They fall
under the exception of Article 280 whose 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 the
employment is for the duration of the season.
PETROLEUM SHIPPING
LIMITED AND TRANS-GLOBAL
MARITIME AGENCY VS.
NATIONAL LABOR RELATION
COMMISSION AND FLORELLO
W. TANCHICO
FACTS
▪ On March 6, 1978, Esso International Shipping
(Bahamas) Co., Ltd., (Esso) through Trans-Global
Maritime Agency, Inc. (Trans-Global) hired Florello
W. Tanchico as First Assistant Engineer. In 1981, he
became Chief Engineer. On October 13, 1992,
Tanchico returned to the Philippines for a two-
month vacation after completing his eight-month
deployment.
FACTS
▪ Prior to boarding, Tanchico underwent the required
standard medical examination which revealed that he
was suffering from “Ischemic Heart Disease,
Hypertensive Cardio-Muscular Disease and Diabetes
Mellitus”. He took medications for two months and
results came negative. However, Esso no longer
deployed him and instead offered to pay him benefits
under Career Employment Incentive Plan, to which he
accepted.
▪ In 1993, Tanchico filed a complaint against Esso for
illegal dismissal with claims for backwages, separation
pay, disability and medical benefits and 13th month pay.
ISSUE

Whether or not Tanchico is a regular employee

of Esso entitled to 13th month pay, diability
benefits and Attorney’s fees.
HELD
▪ The petition is partly meritorious.
▪ Seafarers are Contractual Employees. In Millares vs. NLRC, it is
settled that: “It is clear that seafarers are considered contractual
employees. They can not be considered as regular employees
under Article 280 of the Labor Code. Their employment is
governed by the contracts they sign everytime they are rehired
and their employment is terminated when the contract expires.
Their employment is contractually fixed for a certain period of
time. They fall under the exception of Article 280 whose
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 the
employment is for the duration of the season.”
HELD
▪ Tanchico is not entitled to 13th month pay. His work
does not fall within the coverage of PD 851 which
requires all employers to pay their employees a 13th
month pay. PD 851 contemplates the situation of land-
based workers and not of seafarers who generally earn
more than domestic land-based workers.
▪ Petition is remanded to Labor Arbiter to determine if
Tanchico has been paid disability benefits, if not, Labor
Arbiter is directed to determine the amount Tanchico is
entitled.
SKIPPERS UNITED
PACIFIC
VS. NLRC
FACTS
▪ Respondent Gervacio Rosaroso was signed up as a
Third Engineer with Nicolakis Shipping, S.A., a foreign
firm, through its recruitment and manning agency
through petitioner Skippers United Pacific, Inc.
• The term of the contract was for one year, starting July
10, 1997 to July 8, 1998, and with a salary of US$800.00
and other benefits. Barely a month after boarding the
vessel M/V Naval Gent on July 15, 1997, respondent
was ordered to disembark in Varna, Bulgaria, on
August 7, 1997, and repatriated to the Philippines.
Immediately after arriving in the Philippines,
respondent filed a complaint for illegal dismissal and
monetary claims on August 18, 199.
FACTS
• Petitioner contends that the CA, the NLRC and the
Labor Arbiter erred in not giving "full evidentiary
value" to the telexed Chief Engineer’s Report dated
September 10, 1997, which specified the causes of
respondent’s dismissal which are lack of discipline,
irresponsible and lack of diligence.
• According to petitioner, the foregoing Report
established that respondent was dismissed for just
cause. petitioner laments the award of backwages
equivalent to three months salary in favor of
respondent
ISSUES

▪ Whether or not respondent

is dismissed for just cause
▪ Whether or not the respondent is entitled
for the award of backwages.
HELD
The rule in labor cases is that the employer has the
burden of proving that the dismissal was for a just cause;
failure to show this would necessarily mean that the
dismissal was unjustified and, therefore, illegal. The
only evidence relied upon by petitioner in justifying
respondent’s dismissal is the Chief Engineer’s Report
dated September 10, 1997. As all three tribunals found,
the Report cannot be given any weight or credibility
because it is uncorroborated, based purely on hearsay,
and obviously merely an afterthought.
HELD
With regard to the award of backwages, the Court
opined that a seafarer is not a regular employee as
defined in Article 280 of the Labor Code. Hence, he is
not entitled to full backwages and separation pay in lieu
of reinstatement as provided in Article 279 of the Labor
Code. Seafarers are contractual employees whose rights
and obligations are governed primarily by the POEA
Standard Employment Contract for Filipino Seamen, the
Rules and Regulations Governing Overseas
Employment, and, more importantly, by Republic Act
(R.A.) No. 8042, or the Migrant Workers and Overseas
Filipinos Act of 1995.
HELD
While the POEA Standard Employment Contract for
Filipino Seamen and the Rules and Regulations
Governing Overseas Employment do not provide for
the award of separation or termination pay, Section
10 of R.A. 8042 provides for the award of money
claims in cases of illegal dismissals.
PENTAGON SHIPPING
VS. ADELANTAR
FACTS
▪ On August 16, 1997, respondent William B. Adelantar was
hired by Dubai Ports Authority of Jebel Ali under an
employment contract (first contract) which provided for an
unlimited period of employment with a monthly salary of 5500
dirhams.
▪ On September 3, 1997, Adelantar and petitioner Pentagon
International Shipping, Inc. (Pentagon), for and in behalf of
Dubai Ports Authority of Jebel Ali, entered into a Philippine
Overseas Employment Administration (POEA) standard
employment contract (second contract), this time providing
for a 12-month period with basic monthly salary of US$380.00
FACTS
▪ Upon completion of his probationary period on April 5, 1998,
Adelantars basic salary was increased to five thousand eight
hundred ninety dirhams (Dhs 5,890), while his overtime pay was
increased to two thousand three hundred fifty-six dirhams (Dhs
2,356) effective April 1, 1998.
▪ On June 11, 1998, however, the management barred Adelantar
from entering the port due to a previous dispute with his
superior. He was asked to hand in his health and employment
card. On the same date, he received a letter from his employer,
stating that he was being terminated for assaulting his superior
officer, although he was promised employment in another
company.
FACTS
▪ Adelantar was eventually repatriated after nine (9)
months and seven (7) days of service. After almost
a year of waiting with no work forthcoming,
Adelantar filed a complaint for illegal dismissal
with money claim against Pentagon International
Shipping, Inc.
▪ The NLRC and Labor Arbiter allowed 3months
backwages which the CA reversed and ordered full
backwages.
ISSUE

Whether or not the Court of Appeals properly

used as basis Article 279 of the Labor Code in its
award for backwages to Adelantar.
HELD
NO.
As early as the case of Coyoca v. NLRC, we held that
Filipino seamen are governed by the Rules and
Regulations of the POEA. The Standard Employment
Contract governing the Employment of All Filipino
Seamen on Board Ocean-Going Vessels of the POEA,
particularly in Part I, Sec. C specifically provides that the
contract of seamen shall be for a fixed period. In no case
should the contract of seamen be longer than 12 months.
HELD
Under the circumstances, the Court of Appeals erred in resolving
the issue of backwages based on the first contract which provided
for an unlimited period of employment as this violated the explicit
provision of the Rules and Regulations of the POEA. Therefore,
Adelantar, a seafarer, is not a regular employee as defined in
Article 280 of the Labor Code. Hence, he is not entitled to full
backwages and separation pay in lieu of reinstatement as provided
in Article 279 of the Labor Code. As we held in Millares, Adelantar is
a contractual employee whose rights and obligations are governed
primarily by Rules and Regulations of the POEA and, more
importantly, by R.A. 8042, or the Migrant Workers and Overseas
Filipinos Act of 1995.
REGULAR
EMPLOYEES
HIRING EXTEND PERIOD
FACTS
▪ Complainant Nicolas Mad was employed by respondent
Audion Electric Company on June 30, 1976 as fabricator
and continuously rendered service assigned in different
offices or projects as helper electrician, stockman and
timekeeper.
▪ He as rendered thirteen (13) years of continuous, loyal
and dedicated service with a clean record. On August 3,
complainant was surprised to receive a letter informing
him that he will be considered terminated after the
turnover of materials, including respondents, tools and
equipment not later than August 15, 1989.
▪ Complainant claims that he was dismissed without
justifiable cause and due process and that his dismissed
was done in bad faith which renders the dismissal illegal.
FACTS
▪ Petitioner contends that as an electrical contractor, its
business depends on contracts it may obtain from private
and government establishments, hence the duration of the
of the employment of its work force is not permanent but
co-terminus with the project to which they are assigned.
▪ Private respondent is a project worker whose employment
is co-terminus with the completion of project, regardless of
the number of projects in which he had worked as provided
under Policy Instruction No. 20 of the Labor Department
defining project employees as those employed in
connection with a particular construction project.
ISSUE

Whether or not the respondent NLRC committed

grave abuse of discretion amounting to lack or
excess of jurisdiction when it ruled that private
respondent was a regular employee and not a
project employee.
HELD
NO. Private respondent's employment status was
established by the Certification of Employment
dated April 10, 1989 issued by petitioner which
certified that private respondent is a bonafide
employee of the petitioner from June 30, 1976 up to
the time the certification was issued on April 10,
1989. The same certificate of employment showed
that private respondent's exposure to their field of
operation was as fabricator, helper/electrician,
stockman/timekeeper.
HELD
This proves that private respondent was regularly
and continuously employed by petitioner in various
job assignments from 1976 to 1989, for a total of 13
years. The alleged gap in employment service cited
by petitioner does not defeat private respondent's
regular status as he was rehired for many more
projects without interruption and performed
functions which vital, necessary and indispenasble
to the usual business of petitioner.
HELD
We have held that where the employment of project
employees is extended long after the supposed
project has been finished, the employees are
removed from the scope of project employees and
considered regular employees.
REGULAR
EMPLOYEES
CONTRACT TO CONTRACT
BETA ELECTRIC
CORPORATION VS.
NLRC, LABOR
ARBITER,BETA ELECTRIC
EMPLOYEES ASSOCIATION,
AND LUZVIMINDA PETILLA
FACTS
▪ Beta Electric Corporation hired Luzviminda Petilla
as clerk typist effective December 15, 1986 until
January 16, 1987, but she was reappointed for
several times and such series of appointments were
extended until June 30, 1987.
▪ Her appointments were covered by corresponding
written contracts.
FACTS
▪ On June 22, 1987, her services were terminated
without notice or investigation. On the same day,
she went to the labor arbiter on a complaint for
illegal dismissal.
▪ Beta Electric Corporation argues that Petilla's
appointment was temporary and hence, she may be
terminated at will.
ISSUE

Whether or not Petilla was hired

on a temporary basis.
HELD
▪ Under Article 281 of the Labor Code, a probationary
employee is "considered a regular employee" if he has
been "allowed to work after the probationary period."
▪ The fact that her employment has been a contract-to-
contract basis can not alter the character of employment,
because contracts can not override the mandate of law.
▪ That she had been hired merely on a "temporary basis"
"for purposes of meeting the seasonal or peak demands
of the business," and as such, her services may lawfully
be terminated "after the accomplishment of her task" is
untenable.
HELD
▪ Hence, by operation of law, she has become a regular
employee.
▪ Under the Labor Code, an employment may only be
said to be "temporary" "where it has been fixed for a
specific undertaking the completion of 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."
HELD
▪ Petilla’s work is far from being "specific" or
"seasonal", but rather, one that is usually necessary
or desirable in the usual business."
▪ And under the Code, where one performs such
activities, he is a regular employee, "the provisions
of written agreement to the contrary
notwithstanding……”
UNIVERSAL ROBINA
CORPORATION AND/OR
RANDY GREGORIO VS.
BENITO CATAPANG, ET
AL
FACTS
▪ Catapang, et al., were hired by the Universal
Robina from 1991 to 1993 to work at its duck farm
in Calauan, Laguna.
▪ They were hired under an employment contract
which provided for a five-month period.
▪ After the expiration of their employment contracts,
Robina company would renew their contracts and
re-employ them.
FACTS
▪ This practice continued until sometime in 1996,
when Robina company informed Catapang, et al.,
that they were no longer renewing their
employment contracts.
▪ Complaints for illegal dismissal, reinstatement,
backwages, damages and attorney’s fees were
filed by Catapang, et al., against Robina company
ISSUE

Whether the respondents attained the status

of regular employment after the lapse of
one year from the date of their employment.
HELD
Catapang, et al., are regular employees of
Universal Robina Corp.
▪ The primary standard of determining regular
employment is the reasonable connection between the
particular activity performed by the employee in
relation to the usual trade or business of the employer.
▪ The test is whether the activity performed is usually
necessary or desirable in the usual business or trade of
the employer.
HELD
▪ The connection can be determined by considering the
nature of work performed and its relation to the scheme
of the particular business or trade in its entirety.
▪ Also, if the employee has been performing the job for at
least a year, even if the performance is not continuous
and merely intermittent, the law deems repeated and
continuing need for its performance as sufficient
evidence of the necessity if not indispensability of that
activity to the business.
HELD
▪ Hence, the employment is considered regular, but
only with respect to such activity and while such
activity exists.
▪ The act of repeatedly and continuously hiring
private respondents in a span of 3 to 5 years to do
the same kind of work negates their contention that
they were hired for a specific project or
undertaking only.
REGULAR
EMPLOYEES
LENGTH OF TIME
ALEJANDRO MARAGUINOT,
JR. AND PAULINO ENERO
VS. NLRC, VIC DEL ROSARIO
AND VIVA FILMS
FACTS
▪ Alejandro Maraguinot, Jr. was employed by Viva Films as
part of the filming crew with a salary of P375.00 per week.
▪ About four months later, he was designated Assistant
Electrician with a weekly salary of P400.00, which was
increased to P450.00.
▪ He was again promoted to the rank of Electrician with a
weekly salary of P475.00, which was increased to P539.00.
▪ Paulino Enero was also employed as a member of the
shooting crew with a weekly salary of P375.00, which was
increased to P425.00, then to P475.00.
FACTS
▪ They sought the assistance of their supervisors, Mrs.
Alejandria Cesario, to facilitate their request to adjust
their salary in accordance with the minimum wage law.
▪ Mrs. Cesario informed them that Mr. Vic del Rosario
would increase their salary only if they signed a blank
employment contract.
▪ As they refused to sign, their services were terminated.
▪ Thus, they sued Vic del Rosario and Viva Films for
illegal dismissal.
FACTS
▪ Viva Films claimed that it is primarily engaged in
the distribution and exhibition of movies — but not
in the business of making movies.
▪ Viva Films also claimed that petitioners are project
employees of the association producers who, in
turn, act as independent contractors. As such, there
is no employer-employee relationship.
FACTS
▪ Petitioners claim that they were regular (and not
project) employees of Viva Films, citing 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.
▪ Petitioners thus considered themselves part of a work
pool from which private respondents drew workers for
assignment to different projects.
ISSUE

Whether or not the petitioners were project

employees whose employment was
automatically terminated with the
completion of their respective projects.
HELD
Petitioners had already gained the status of regular
employees.

▪ A project employee or a member of a work pool may

acquire the status of a regular employee when the following
concur:
▪ There is a continuous rehiring of project employees even
after cessation of a project; and
▪ The tasks performed by the alleged "project employee"
are vital, necessary and indispensable to the usual
business or trade of the employer.
HELD
▪ The length of time during which the employee was
continuously re-hired is not controlling, but merely
serves as a badge of regular employment.
▪ It is very clear that complainants are doing
activities which are necessary and essential to the
business of the respondents, that of movie-making.
ABESCO CONSTRUCTION
AND DEVELOPMENT CORP.
AND OSCAR BANZON VS.
ALBERTO RAMIREZ, ET. AL.
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 (LA).
Petitioners allegedly dismissed them without a valid
reason and without due process of law.
FACTS
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.
▪ being project employees, respondents' employment
was coterminous with the project to which they were
assigned
▪ were not regular employees who enjoyed security of
tenure and entitlement to separation pay upon
termination from work
FACTS
LA declared respondents as regular employees
▪ they belonged to a "work pool" from which the company
drew workers for assignment to different projects
▪ respondents were hired and re-hired over a period of 18
years, hence, they were deemed to be regular employees

▪ judgment declared respondents guilty of illegal dismissal

and ordering the latter to reinstate complainants to their
former positions with back wages and other benefits
 FACTS
▪ Petitioners appealed to the NLRC which affirmed the LA's
decision.
▪ Petitioners filed a Petition for Review in the CA arguing
that they were not liable for illegal dismissal since:
▪ respondents' services were merely put on hold until the
resumption of their business operations
▪ they had paid respondents their full wages and benefits
as provided by law, hence, the latter had no more right
to further benefits
▪ The CA was not convinced and dismissed petitioners'
appeal as well as their motion for reconsideration.
ISSUE

Whether or not respondents are regular

employees.
HELD
YES. Respondents were regular employees.
▪ employees (like respondents) who work under
different project employment contracts for several
years do not automatically become regular
employees
▪ they can remain as project employees regardless of
the number of years they work
▪ length of service is not a controlling factor in
determining the nature of one's employment
HELD
▪ employees who are members of a "work pool" from
which a company draws workers for deployment to its
different projects do not become regular employees
by reason of that fact alone, they can either be project
employees or regular employees
HELD
The principal test for determining whether employees
are "project employees“:
▪ whether they are assigned to carry out a specific
project or undertaking
▪ the duration and scope of which are specified at
the time they are engaged for that project
▪ duration, as well as the particular work/service to
be performed, is defined in an employment
agreement and is made clear to the employees at
the time of hiring
HELD
▪ 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
▪ for failure of petitioners to substantiate their claim
that respondents were project employees,
respondents are declared as regular employees
PROJECT
EMPLOYEES
ART. 295. REGULAR AND CASUAL
EMPLOYMENT
… 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
projector 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.
PROJECT
EMPLOYEES
DEFINED
ALU-TUCP VS. NLRC
AND NATIONAL STEEL
CORPORATION
FACTS
▪ On 5 July 1990, petitioners filed separate
complaints for unfair labor practice, regularization
and monetary benefits with the NLRC
▪ the Labor Arbiter declared petitioners as "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
FACTS
▪ Both parties appealed to the NLRC
▪ Petitioners argued that they were regular, not
project, employees
▪ Private respondent claimed that petitioners are
project employees as they were employed to
undertake a specific project — NSC's Five Year
Expansion Program (FAYEP I & II).
FACTS
NLRC affirmed the Labor Arbiter's holding that
petitioners were project employees
▪ they were hired to perform work in a specific
undertaking — the Five Years 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
FACTS
▪ set aside the award to petitioners of the same benefits
enjoyed by regular employees for lack of legal and
factual basis
▪ denied petitioners' motion for reconsideration thus this
Petition for Certiorari:
▪ Petitioners plead that they had been employed by
respondent NSC in connection with its Five Year
Expansion Program (FAYEP I & II) for varying lengths
of time when they were separated from NSC's service
ISSUE

Whether or not the petitioners

are project employees.
HELD

NO.
HELD
Petitioners argue that they are "regular" employees
of NSC because their jobs are "necessary, desirable
and work-related to private respondent's main
business, steel-making“.
HELD
Art. 280. Regular and Casual Employment — …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. …
HELD
The principal test for determining whether employees
are "project employees“:
▪ whether they are assigned to carry out a specific
project or undertaking
▪ the duration and scope of which are specified at
the time they are engaged for that project
▪ duration, as well as the particular work/service to
be performed, is defined in an employment
agreement and is made clear to the employees at
the time of hiring
HELD
“Project" could refer to one or the other of at least two
distinguishable types of activities:
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.
2. a particular job or undertaking that is not within the
regular business of the corporation; must also be
identifiably separate and distinct from the ordinary or
regular business operations of the employer; begins and
ends at determined or determinable times.
HELD
The job of the respondents falls on the 2nd type of
project:
▪ The carrying out of the Five Year Expansion Program
(or more precisely, each of its component projects)
constitutes a distinct undertaking identifiable from
the ordinary business and activity of NSC.
▪ Each component project begins and ends at
specified times, which had already been
determined by the time petitioners were engaged.
HELD
NSC did the work here involved only for itself:
▪ Private respondent NSC was not in the business of
constructing buildings and installing plant
machinery for the general business community
▪ NSC did not hold itself out to the public as a
construction company or as an engineering
corporation.
KIAMCO VS. NLRC
FACTS
Cisell Kiamco was hired as a project employee in
the Geothermal Agro-Industrial Plant Project in
Valencia, Negros Oriental by Philippine National Oil
Company (PNOC) through its Energy Research and
Development Division.
FACTS
CONTRACT CONTRACT
CONTRACT
1 2
3
JOB DESCRIPTION: JOB DESCRIPTION:
TECHNICIAN JOB DESCRIPTION:
TECHNICIAN
TECHNICIAN
PERIOD: PERIOD:
(5 MONTHS) PERIOD:
(5 MONTHS)
1 December 1992 to (6 MONTHS)
1 July 1992 to 30
30 April 1993 1 May 1993 to 30
November 1992
(From 26 to 22 days) November 1993
MONTHLY SALARY:
MONTHLY SALARY: MONTHLY SALARY:
3,500.00
3,500.00 3,850.00
FACTS
Memorandum
1. Misconduct
2. Absence without official leave (AWOL)
3. Non-compliance of administrative reporting
procedure on accidents
4. Unauthorized use of company vehicles
ISSUES
1. Whether Kiamco is a regular employee
or a project employee?
2. Whether petitioner is entitled to
reinstatement without loss of seniority
rights and privileges and to the
payment of full back wages?
HELD

Whether Kiamco is a regular employee or a

project employee?

Kiamco is a project employee.

Project employees are those workers hired:
(1) for a specific project or undertaking, and
(2) the completion or termination of such project
or undertaking has been determined at the
HELD
Whether petitioner is entitled to reinstatement without loss of
seniority rights and privileges and to the payment of full back
wages?

Yes. The record shows that although the contracts of the project
workers had indeed expired, the project itself was still on-going
and so continued to require the worker's services for its
completion. There is no showing that such services were
unsatisfactory to justify their termination. Kiamco was a project
employee who was specifically assigned to work in a particular
project. Therefore, in the absence of any valid reason to
terminate him, private respondents should have retained his
services until the actual completion of the project.
PHILIPPINE JAI-ALAI
VS. CLAVE
FACTS
Philippine Jai-Alai and Amusement Corporation
hired Cadatal, Jr., a plumber, and Delgra, a mason,
together with 30 other workers on February 2, 1976
for a period of one month for the renovation of its
main building.

It has its own maintenance group for the upkeep of

its premises. The renovation of its main building is
not included in maintenance.
ISSUE

Whether private respondents are regular

employees or casual emergency workers
employed for a particular job.
HELD
They are casual emergency workers.

The workers were needed as additional hands for

the renovation work and not for ordinary upkeep
and maintenance. The erection of the fire escape
and other small jobs after the renovation cannot be
deemed maintenance but more of casual work.
SANDOVAL
SHIPYARDS VS. NLRC
FACTS
Sandoval Shipyards, Inc. has been engaged in the
building and repair of vessels. It contends that each
vessel is a separate project and that the employment of
the workers is terminated with the completion of each
project.

The workers contend otherwise. They claim to be

regular workers and that the termination of one project
does not mean the end of their employment since they
can be assigned to unfinished projects.
ISSUE

Whether private respondents are regular

employees or project employees?
HELD
"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 or for repair of vessels from third parties and,
only, on occasion when it has work contract of this nature
that it hires workers to do the job which, needless to say,
lasts only for less than a year or longer.
"The completion of their work or project automatically
terminates their employment, in which case, the employer
is, under the law, only obliged to render a report on the
termination of the employment.
HELD
Complainants "are project workers whose
employments are coterminous with the completion
of the project, regardless of the number of projects
in which they have worked, as provided under
Policy Instructions No. 20 of the Ministry of Labor
and Employment" and "as their employment is one
for a definite period, they are not entitled to
separation pay
IMBUIDO VS.
NATIONAL LABOR
RELATIONS
COMMISSION
FACTS
▪ Imbuido: data encoder
▪ International Information Services, Inc.:
domestic corporation engaged in the business of
data encoding and keypunching,
▪ From August 26, 1988 until October 18, 1991:
petitioner entered into thirteen (13) separate
employment contracts with private respondent,
each contract lasting only for a period of three (3)
months.
FACTS
Aside from the basic hourly rate, specific job contract
number and period of employment, each contract
contains the following terms and conditions:
a. This Contract is for a specific project/job contract only
b. Subject shall abide with the Company’s rules and
regulations for its employees
c. The nature of your job may require you to render
overtime work with pay so as not to disrupt the
Company’s commitment of scheduled delivery dates
made on said job contract.
FACTS
▪ Petitioner and twelve (12) other employees of private
respondent allegedly agreed to the filing of a petition for
certification election involving the rank-and-file employees of
private Respondent
▪ Lakas Manggagawa sa Pilipinas (LAKAS) filed a petition for
certification election with the Bureau of Labor Relations (BLR)
▪ Edna Kasilag (Administrative Officer): issued a termination
letter for allegedly "due to low volume of work."
▪ Petitioner filed a complaint for illegal dismissal with prayer
for service incentive leave pay and 13th month differential
pay, with NLRC.
ISSUE

Whether or not the petitioner

is a mere project employee.
HELD
Yes, at first but petitioner has attained the status of a
regular employee of private Respondent.
A project employee or a member of a work pool may
acquire the status of a regular employee when the
following concur:
1. There is a continuous rehiring of project employees
even after the cessation of a project; and
2. The tasks performed by the alleged "project
employee" are vital, necessary and indispensable
to the usual business or trade of the employer.
HELD
▪ The evidence on record reveals that petitioner was employed by
private respondent as a data encoder, performing activities
which are usually necessary or desirable in the usual business or
trade of her employer, continuously for a period of more than
three (3) years, from August 26, 1988 to October 18, 1991 36 and
contracted for a total of thirteen (13) successive projects.
▪ We have previously ruled that" 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."
▪ Based on the foregoing, we conclude that petitioner has attained
the status of a regular employee of private Respondent.
CHUA VS. COURT OF
APPLEALS
FACTS
▪ Lydia Hao, treasurer of Siena Realty Corporation, filed a
complaint- affidavit with the City Prosecutor of Manila
charging Francis Chua and his wife, Elsa Chua, of four
counts of falsification of public documents.
▪ by making or causing it to appear in said Minutes of the
Annual Stockholders Meeting that one LYDIA HAO CHUA
was present and has participated in said proceedings,
when in truth and in fact, as the said accused fully well
knew that said Lydia C. Hao was never present during the
Annual Stockholders Meeting held on April 30, 1994 and
neither has participated in the proceedings thereof to the
prejudice of public interest and in violation of public faith
and destruction of truth as therein proclaimed.
ISSUE
Whether or not Hao properly filed a
derivative suit in behalf of Siena Realty
Corporation since the complaint was
instituted by respondent against petitioner
for falsifying corporate documents whose
subject concerns corporate projects of
Siena Realty Corporation.
HELD
▪ No. Not every suit filed in behalf of the corporation is a
derivative suit. For a derivative suit to prosper, it is
required that the minority stockholder suing for and on
behalf of the corporation must allege in his complaint that
he is suing on a derivative cause of action on behalf of the
corporation and all other stockholders similarly situated
who may wish to join him in the suit.
▪ The judgment must be made binding upon the corporation
in order that the corporation may get the benefit of the suit
and may not bring subsequent suit against the same
defendants for the same cause of action. In other words, the
corporation must be joined as party because it is its cause
of action that is being litigated and because judgment must
be a res adjudicata against it.
PROJECT
EMPLOYEES
RATIONALE
DE OCAMPO, JR. VS.
NLRC AND MAKATI
DEVELOPMENT
CORPORATION
FACTS
▪ On September 30, 1980, the services of 65 employees of
private respondent Makati Development Corporation were
terminated on the ground of the expiration of their contracts
▪ Philippine Transport and General Workers Association,
of which the complainants were members, filed a notice of
strike on the grounds of union-busting, subcontracting of
projects which could have been assigned to the dismissed
employees, and unfair labor practice.
▪ PTGWA declared a strike and established picket lines in
the perimeter of the MDC premises
FACTS
▪ MDC filed with the Bureau of Labor Relations a
motion to declare the strike illegal and restrain the
workers from continuing the strike;
▪ on that same day and several days thereafter, the MDC
filed applications for clearance to terminate the
employment of 90 of the striking workers, whom it
had meanwhile preventively suspended;
▪ that of the said workers, 74 were project employees
under contract with the MDC with fixed terms of
employment .
ISSUES

1. Whether or not the strike is legal.

2. If reinstatement would be proper, are the
project employees entitled to backpay?
HELD

1. No.
HELD
Under PD No. 823 as amended by PD No. 849, the strike was indeed
illegal. That law clearly provided:
Sec. 1. It is the policy of the state to encourage free trade unionism and
free collective bargaining within the framework of compulsory and
voluntary arbitration. Therefore all forms of strikes, picketing and
lockout are hereby strictly prohibited in vital industries such as in
public utilities, including transportation and communication,
companies engaged in the manufacturer processing as well as in the
distribution of fuel gas, gasoline and fuel or lubricating oil, in
companies engaged in the production or processing of essential
commodities or products for export, and in companies engaged in
banking of any kind, as well as in hospitals and in schools and colleges.
HELD
▪ However, any legitimate labor union may strike
and any employer may lockout in establishments
not covered by General Order No. 5 only on
grounds of unresolved economic issues in
collective bargaining, in which case the union or
the employer shall file a notice with the Bureau of
Labor Relations at least 30 days before the intended
strike or lockout.
 HELD
2. No.
▪ RATIONALE: if a project has already been completed,
it would be unjust to require the employer to maintain
them in the payroll while they are doing absolutely
nothing except waiting until another project is begun,
if at all.