BOOK SIX

POST-EMPLOYMENT
TITLE I
TERMINATION OF EMPLOYMENT
[PART 1. INTRODUCTION: EMPLOYEES
SECURITY OF TENURE]
ART. 292. COVERAGE
The provision of this Title shall apply to all
establishments or undertakings, whether for
profit or not.
ART. 293. SECURITY OF TENURE
In cases of regular employment, the employer
shall not terminate the services of an employee
except for a just cause or when authorized by
this Title. An employee who is unjustly dismissed
from work shall be entitled to reinstatement
without loss of seniority rights and other
privileges and to his full backwages, inclusive
allowances, and to his other benefits or their
monetary equivalent computed from the time his
compensation was withheld from him up to the
time of his actual reinstatement.
1. CONSTIITUTIONAL GUARANTY OF TENURE
The policy of the state is to assure the right of workers
to security of tenure. The guaranty is an act of social
justice.
1.1 Non-regular employees
Security of tenure the right not to be removed
from ones job without valid cause valid procedure
is so fundamental it extends to regular
(permanent) as well as non-regular (temporary)
employment.
In short, there is security of tenure for a limited
period and security of tenure for an unlimited
period.
2. TENURE OF MANAGERIAL EMPLOYEES
Employers are allowed a wider latitude of discretion in
terminating the employment of managerial personnel
or those who, while not similar of rank, perform
functions which by their nature of require the
employers full trust and confidence. This should be
distinguished from the case of ordinary rank-and-file
employees, whose termination on the basis of same
grounds require a higher proof of involvement in the
events in question. Mere uncorroborated assertions
and accusations by the employer will not suffice.
But while a managerial employee may be dismissed
merely on the ground of loss of confidence, the matter
of determining whether the cause for dismissing an
employee is justified on ground of loss of confidence,
cannot be left entirely to the employer.
2.1 Even managerial employees are entitled
to security of tenure
While an employer has its own interests to protect,
and pursuant thereto, it may terminate a
managerial employee for a just cause, such
prerogative to dismiss or lay off an employee must
be exercised without abuse of discretion. Its
implementation
should
be
tempered
with
compassion and understanding.

TERMINATION OF EMPLOYMENT (contd)

[PART 2. KINDS OF EMPLOYMENT]
ART. 294. REGULAR AND CASUAL EMPLOYMENT
The provisions of written agreement to the
contrary notwithstanding and regardless of the
oral agreement of the parties, an employment
shall be deemed to be regular where the
employee has been engaged to perform
activities which are usually necessary or
desirable in the usual business or trade of the
employer, except where the employment has
been fixed for a specific project or undertaking
the completion or termination of which has been
determined at the time of the engagement of the
employee or where the work or 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 actually
exists.
1. ESSENTIALITY
OF
EMPLOYER-EMPLOYEE
RELATIONSHIP
1.1 Article 294 presupposes employment
relationship
This Article 294 applies where the existence of
employer-employee relationship is not the issue in
the
dispute.
This article limits itself
to
differentiating
four
kinds
of
employment
arrangement: regular, project, seasonal and casual.
The article presupposes that the relationship of
being employer and employee exists between the
parties.
1.2 Examples of non-employment
Commission Agent
Singer Sewing Machine Co. vs. Drilon, et. al.,
G.R. No. 91307, January 24, 1991 The Court
finds the contention of the respondents that the
union members are employees under Article 280
[now 294] of the Labor Code to have no basis. The
definition that regular employees are those who
perform activities which are desirable and
necessary for the business of the employer is not
determinative in this case.
Article 280 does not apply where the existence of
an employment relationship is in dispute.
A non-employee even after eleven years
Where there is no employer-employee relationship,
the non-employee remains as such despite
passage of time. In the four-fold test of
employment relationship, passage of time or
length of service is not one of the four elements.
One may be providing service to another for years,
even decades, but the long period of time does not
make the non-employee an employee. The
absence of the element of control did not convert

Labor Relations And Employment Relations | Prepared by Terence Valdehueza

the retainer relationship to one of employment.

The worker claimed that he was doing work that
was necessary or desirable to the companys
business and that, therefore, he, with eleven years
of service, had become a regular employee. The
Court says that his claim has no basis. Article 280
is not the yardstick for determining the existence
of the employer-employee relationship. One party
may render services for and in behalf of another no
matter how necessary for the latters business,
even without being hired as an employee.
2. REGULAR EMPLOYMENT
The primary standard to determine a regular
employment is the reasonable connection between the
particular activity performed by the employee in
relation to the usual business. The test is whether the
former is usually necessary or desirable in the usual
business or trade of the employer.
What determines regularity or casualness is not the
employment contract, written or otherwise, but the
nature of the job. If the job is usually necessary or
desirable to the main business of the employer, then
employment is regular.
The basis of regular status of the employee is entirely
different from the basis of computation of the
compensation. The latter may be based on the time
spent on the job, on actual output, or some other
arrangement.
Article 281 [now 280] of the Labor Code reinforces the
[constitutional] mandate to protect the interest of the
Labor. Its language manifests the intent to safeguard
the tenurial interest of the worker who should not be
denied the rights and benefits due a regular employee
through lopsided agreements with economically
powerful employer.
If the work is integral part of the business and worker
does not furnish an independent business or
professional services, the work is presumed to be a
regular employment. Considering the provisions of
Article 280, there are two kinds of regular employees:
(1) regular employees by nature of work, and (2)
regular employees by year of service.
2.1 Examples of regular employment by
nature of work
De Leon vs. National Labor Relations
Commission, G.R. No. 70705, August 21, 1989
The law demands that the nature and entirety of
the activities performed by the employee be
considered. What determined whether a certain
employment is regular or casual is not the will and
word of the employer, to which the worker often
accedes, much less the procedure of hiring the
employee or the manner of paying his salary. It is
the nature of the activities performed in relation to
the particular business or trade considering all
circumstances, and in some cases the length of
time of its performance and its continued
existence.
2.1a
Workers supplied by labor-only
contractor considered regular employees of
the contractee

Ecal, et al. vs. National Labor Relations

Commission (Third Division), J. Matchuka and
Hi-Line Timber, Inc., G.R. No. 92777-78,
March 13, 1991 Since petitioners perform
tasks which are usually necessary or desirable in
the main business of Hi-Line, they should be
deemed regular employees of the latter and, such,
are entitled to all the benefits and rights
appurtenant to regular employment.
2.1b
Contractual Project employee
becoming regular
Magante
vs.
National
Labor
Relations
Commission and Constress Philippines, Inc.
G.R. No. 74969, May 7, 1990 the determining
factor of the status of complainant-petitioner or
any worker is the nature of the work performed by
the latter and the place where he performed his
assignment.
2.1c Day-to-Day Contractual employee
becoming regular
Baguio Country Club Corporation vs. National
Labor Relations Commission, et. al., G.R. No.
71664, February 28, 1992 Such repeated
hiring and the continuing need for his service are
sufficient
evidence
of
the
necessity
and
indispensability of his service to the petitioners
business or trade.
Furthermore, he performed the said tasks which
lasted for more than one year, until early January
1981 when he was terminated. Certainly, by this
fact alone he is entitled by law to be considered a
regular employee.
2.1d Temporary employee becoming regular
Beta Electric Corporation vs. National Labor
Relations Commission, et. al., G.R. No. 86408,
February 15, 1990 Under the Labor Code, an
employment may be only be said to be
temporary where it has been fixed for a specific
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.
Where the employee has been engaged to perform
activities which are 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.
2.1e No legal room for perpetual employment
Sorreda
vs.
Cambridge
Electronics
Corporation, G.R. No. 172927, February 11,
2010 A contract of perpetual employment
deprives management of its prerogative to decide
whom to hire, fire, and promote, and renders
inutile the basic precepts of labor relations. While
management may validly waive it prerogatives,
such waiver should not be contrary to law, public
order, public policy, morals or good customs.
An absolute and unqualified employment for life in
the mold of petitioners concept of perpetual
employment is contrary to public policy and good
customs, as it unjustly forbids the employer from

Labor Relations And Employment Relations | Prepared by Terence Valdehueza

terminating the services of an employee despite

the existence of a just or valid cause.
2. 2
Casual
employee;
regular
employee by year(s) of service
The other type of regular employee is the casual
employee who, after one year of service, becomes
regular. But he is regular only for that work

activity for which he was hired. His employment

may be on-and-off, but every time the particular
work activity occurs, he is the one to be rehired. In
this sense he is a regular casual. A casual may
become regular even if he is not issued a regular
appointment.

Labor Relations And Employment Relations | Prepared by Terence Valdehueza