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BRENTSCHOOL vs ZAMORA

At that time, i.e., before the advent of the Labor Code, there
Petitioner: Brent School, Inc., and Rev. Gabriel Dimache was no doubt whatever about the validity of term
Respondent: Ronaldo Zamora, the Presidential Assistant for employment. It was impliedly but nonetheless clearly
Legal Affairs, Office of the President, and Doroteo R. Alegre recognized by the Termination Pay Law, R.A. 1052, 11 as
Citation: GR No. L-48494 amended by R.A. 1787. 12 Basically, this statute provided that—
Date of Promulgation: February 5, 1990
Ponente: Narvasa In cases of employment, without a definite period, in a
commercial, industrial, or agricultural establishment or
FACTS: enterprise, the employer or the employee may terminate at
any time the employment with just cause; or without just
 Doroteo Alegre: engaged as athletic director by Brent cause in the case of an employee by serving written notice
School at a yearly compensation of PhP 20, 000. on the employer at least one month in advance, or in the
 Contract: fixed specific term for its existence which is 5 years case of an employer, by serving such notice to the
(July 18, 1971 – July 17, 1976). These were further reiterated employee at least one month in advance or one-half month
in subsidiary agreements on various occasions for every year of service of the employee, whichever is
 Three months after the expiration (April 20, 1976): Alegre longer, a fraction of at least six months being considered
was given a copy of the report filed by Brent School with as one whole year.
DOLE advising of the termination of his service effective on
July 16, 1976 The employer, upon whom no such notice was served in
- Ground for Termination: completion of contract, case of termination of employment without just cause, may
expiration of the definite period of employment hold the employee liable for damages.
 A month after: Alegre accepted the amount of PhP 3, 177.17
and signed a receipt containing the phrase, “in full payment The employee, upon whom no such notice was served in
of the services for the period May 16 to July 17, 1976 as full case of termination of employment without just cause, shall
payment of contract” be entitled to compensation from the date of termination of
 Investigation conducted by the Labor Conciliator: Alegre his employment in an amount equivalent to his salaries or
contested the announced termination of his employment. wages corresponding to the required period of notice.
- He argued that although his contract did stipulate that the
same would terminate on July 17, 1976, since his It is plain then that when the employment contract was
services were necessary and desirable in the usual signed between Brent School and Alegre on July 18, 1971, it
business of his employer, and his employment had was perfectly legitimate for them to include in it a stipulation
lasted for five years, he had acquired the status of a fixing the duration thereof.
regular employee and could not be removed except for
valid cause. The status of legitimacy continued to be enjoyed by fixed-period
 Regional Director: considered Brent School’s report as an employment contracts under the Labor Code (Presidential Decree
an application for clearance to terminate employment (not a No. 442), which went into effect on November 1, 1974. The Code
report of termination), and accepting the recommendation of contained explicit references to fixed period employment, or
the Labor Conciliator, refused to give such clearance and employment with a fixed or definite period. Nevertheless,
instead required the reinstatement of Alegre, as a "permanent obscuration of the principle of licitness of term employment began
employee," to his former position without loss of seniority to take place at about this time
rights and with full back wages. The Director pronounced "the
ground relied upon by the respondent (Brent) in terminating Article 320, entitled "Probationary and fixed period employment,"
the services of the complainant (Alegre) . . . (as) not originally stated that the "termination of employment of
sanctioned by P.D. 442," and, quite oddly, as prohibited by probationary employees and those employed WITH A FIXED
Circular No. 8, series of 1969, of the Bureau of Private PERIOD shall be subject to such regulations as the Secretary of
Schools. Labor may prescribe." The asserted objective to was "prevent the
 Brent School: filed an MR which was denied. On appeal, the circumvention of the right of the employee to be secured in their
Secretary of Labor upheld the decision of the Regional employment as provided . . . (in the Code)."
Director
Article 321 prescribed the just causes for which an employer could
 Brent appealed at the Office of the President: rebuffed for
terminate "an employment without a definite period."
lack of merit
And Article 319 undertook to define "employment without a fixed
period" in the following manner: 18
ISSUE: W/N the provisions of the Labor Code, as amended,
have anathematized fixed period employment or employment
An employment shall be deemed to be without a definite period
for a term?
for purposes of this Chapter where the employee has been
engaged to perform activities which are usually necessary or
HELD:
desirable in the usual business or trade of the employer, except
where the employment has been fixed for a specific project or
No.
undertaking the completion or termination of which has been
determined at the time of the engagement of the employee or
The employment contract between Brent School and Alegre
where the work or service to be performed is seasonal in nature
was executed on July 18, 1971, at a time when the Labor Code
and the employment is for the duration of the season.
of the Philippines (P.D. 442) had not yet been promulgated.
Indeed, the Code did not come into effect until November 1,
The question immediately provoked by a reading of Article 319 is
1974, some three years after the perfection of the
whether or not a voluntary agreement on a fixed term or period
employment contract, and rights and obligations thereunder
would be valid where the employee "has been engaged to perform
had arisen and been mutually observed and enforced.
activities which are usually necessary or desirable in the usual GMA NETWORK vs PABRIGA
business or trade of the employer." The definition seems a non
sequitur. From the premise — that the duties of an employee Petitioner: GMA Network Inc.,
entail "activities which are usually necessary or desirable in Respondents: Carlos Oabriga, Geoffrey Arias, Kirby campo,
the usual business or trade of the employer the" — Arnold Lagahit, Armando Catubig
conclusion does not necessarily follow that the employer and Citation: GR No. 176419
employee should be forbidden to stipulate any period of time Date of Promulgation: Nov. 27, 2013
for the performance of those activities. There is nothing Ponente: Leonardo-De Castro
essentially contradictory between a definite period of an
employment contract and the nature of the employee's duties FACTS:
set down in that contract as being "usually necessary or
desirable in the usual business or trade of the employer." The  July 19, 1999 – due to the miserable working conditions,
concept of the employee's duties as being "usually necessary or private respondents (Television Technicians) were forced to
desirable in the usual business or trade of the employer" is not file a complaint before NLRC Regional Arbitration Branch No.
synonymous with or identical to employment with a fixed term. VII Cebu City
Logically, the decisive determinant in term employment should not  Private respondents – were engaged in the ff activities:
be the activities that the employee is called upon to perform, but 1) Manning of Technical Operations Center:
the day certain agreed upon by the parties for the commencement (a) Responsible for the airing of local commercials; and
and termination of their employment relationship, a day certain (b) Logging/monitoring of national commercials (satellite)
being understood to be "that which must necessarily come,
although it may not be known when." 19 Seasonal employment, 2) Acting as Transmitter/VTR men:
and employment for a particular project are merely instances (a) Prepare tapes for local airing;
employment in which a period, where not expressly set down, (b) Actual airing of commercials;
necessarily implied. (c) Plugging of station promo;
(d) Logging of transmitter reading; and
Accordingly, and since the entire purpose behind the development (e) In case of power failure, start up generator set to
of legislation culminating in the present Article 280 of the Labor resume program;
Code clearly appears to have been, as already observed, to
prevent circumvention of the employee's right to be secure in his 3) Acting as Maintenance staff;
tenure, the clause in said article indiscriminately and completely (a) Checking of equipment;
ruling out all written or oral agreements conflicting with the (b) Warming up of generator;
concept of regular employment as defined therein should be (c) Filling of oil, fuel, and water in radiator; and
construed to refer to the substantive evil that the Code itself has
singled out: agreements entered into precisely to circumvent 4) Acting as Cameramen
security of tenure. It should have no application to instances  August 4, 1999 – GMA received a Notice of Hearing of the
where a fixed period of employment was agreed upon Complaint
knowingly and voluntarily by the parties, without any force,  Next day – Engineering manager Roy Villacastin confronted
duress or improper pressure being brought to bear upon the private respondents about the complaint
employee and absent any other circumstances vitiating his  Aug. 9, 1999 – Private respondents were summoned to the
consent, or where it satisfactorily appears that the employer office of the GMA’s Area Manager, Susan Aliňo and they
and employee dealt with each other on more or less equal were made to explain why they filed the complaint
terms with no moral dominance whatever being exercised by  Next day – they were barred from entering and reporting for
the former over the latter. Unless thus limited in its purview, work without any notice stating the reasons
the law would be made to apply to purposes other than those  Aug. 13, 1999 – Private respondent through counsel wrote a
explicitly stated by its framers; it thus becomes pointless and letter to Susan requesting that they be back to work
arbitrary, unjust in its effects and apt to lead to absurd and
 August 23, 1999 – A reply letter from Bienvenido Bustria,
unintended consequences.
petitioner’s Head of Personnel and Labor Relations Division,
admitted the non-payment of benefits but did not mention the
Respondent Alegre's employment was terminated upon the
request of private respondents to be allowed to return to work
expiration of his last contract with Brent School on July 16,
 Sept, 15, 1999 – private respondents sent another letter to
1976 without the necessity of any notice. The advance written
Bustria reiterating their request to work but the same was
advice given the Department of Labor with copy to said
ignored
petitioner was a mere reminder of the impending expiration
of his contract, not a letter of termination, nor an application  October 8, 1999 – Private respondents filed an Amended
for clearance to terminate which needed the approval of the Complaint raising addtl issues if unfair labor practice, illegal
Department of Labor to make the termination of his services dismissal, and damages & attorney’s fees
effective. In any case, such clearance should properly have  Sept. 23, 1999 – a mandatory conference was set to settle
been given, not denied. the dispute, but of no avail
 Both were directed to file their position papers, to which
they complied.
 LA – dismissed the complaint for illegal dismissal and unfair
labor practice, but held GMA liable for 13th month pay
 NLRC – reversed the LA’s decision
a) All complainants are regular employees with respect
to the particular activity to which they were assigned,
until it ceased to exist. As such, they are entitled to
payment of separation pay computed at one (1) month
salary for every year of service;
b) They are not entitled to overtime pay and holiday pay; regular, project or seasonal employees, while, as a general rule,
and those performing activities not usually necessary or desirable in
the employer’s usual business or trade are casual employees. The
c) They are entitled to 13th month pay, night shift reason for this distinction may not be readily comprehensible to
differential and service incentive leave pay. those who have not carefully studied these provisions: only
employers who constantly need the specified tasks to be
For purposes of accurate computation, the entire records performed can be justifiably charged to uphold the constitutionally
are REMANDED to the Regional Arbitration Branch of protected security of tenure of the corresponding workers. The
origin which is hereby directed to require from consequence of the distinction is found in Article 279 of the Labor
respondent the production of additional documents Code, which provides:
where necessary.
ARTICLE 279. Security of tenure. – In cases of regular
Respondent is also assessed the attorney’s fees of ten employment, the employer shall not terminate the services of an
percent (10%) of all the above awards. employee except for a just cause or when authorized by this Title.
An employee who is unjustly dismissed from work shall be entitled
ISSUE: to reinstatement without loss of seniority rights and other
1. W/N the private respondents are regular employees of privileges and to his full backwages, inclusive of allowances, and
GMA? to his other benefits or their monetary equivalent computed from
2. W/N private respondents are entitled to a separation pay the time his compensation was withheld from him up to the time
absent a finding that they were illegally dismissed of his actual reinstatement.
3. W/N private respondents are entitled to NSDP considering
the absence of evidence On the other hand, the activities of project employees may or may
not be usually necessary or desirable in the usual business or
HELD: trade of the employer, as we have discussed in ALU-TUCP v.
National Labor Relations Commission,9 and recently reiterated in
1. YES. Leyte Geothermal Power Progressive Employees Union-ALU-
TUCP v. Philippine National Oil Company-Energy Development
At the outset, we should note that the nature of the employment is Corporation.10 In said cases, we clarified the term "project" in the
determined by law, regardless of any contract expressing test for determining whether an employee is a regular or project
otherwise. The supremacy of the law over the nomenclature of the employee:
contract and the stipulations contained therein is to bring to life the
policy enshrined in the Constitution to afford full protection to It is evidently important to become clear about the meaning and
labor. Labor contracts, being imbued with public interest, are scope of the term "project" in the present context. The "project" for
placed on a higher plane than ordinary contracts and are subject the carrying out of which "project employees" are hired would
to the police power of the State.7 ordinarily have some relationship to the usual business of the
employer. Exceptionally, the "project" undertaking might not have
Respondents claim that they are regular employees of petitioner an ordinary or normal relationship to the usual business of the
GMA Network, Inc. The latter, on the other hand, interchangeably employer. In this latter case, the determination of the scope and
characterize respondents’ employment as project and fixed parameters of the "project" becomes fairly easy. It is unusual (but
period/fixed term employment. There is thus the need to clarify the still conceivable) for a company to undertake a project which has
foregoing terms. absolutely no relationship to the usual business of the company;
thus, for instance, it would be an unusual steel-making company
The terms regular employment and project employment are taken which would undertake the breeding and production of fish or the
from Article 280 of the Labor Code, which also speaks of casual cultivation of vegetables. From the viewpoint, however, of the
and seasonal employment: legal characterization problem here presented to the Court, there
should be no difficulty in designating the employees who are
ARTICLE 280. Regular and casual employment. – The retained or hired for the purpose of undertaking fish culture or the
provisions of written agreement to the contrary production of vegetables as "project employees," as distinguished
notwithstanding and regardless of the oral agreement of the from ordinary or "regular employees," so long as the duration and
parties, an employment shall be deemed to be regular where scope of the project were determined or specified at the time of
the employee has been engaged to perform activities which engagement of the "project employees." For, as is evident from
are usually necessary or desirable in the usual business or the provisions of Article 280 of the Labor Code, quoted earlier, the
trade of the employer, except where the employment has principal test for determining whether particular employees are
been fixed for a specific project or undertaking the properly characterized as "project employees" as distinguished
completion or termination of which has been determined at from "regular employees," is whether or not the "project
the time of the engagement of the employee or where the employees" were assigned to carry out a "specific project or
work or services to be performed is seasonal in nature and undertaking," the duration (and scope) of which were specified at
employment is for the duration of the season. the time the employees were engaged for that project.

An employment shall be deemed to be casual if it is not covered In the realm of business and industry, we note that "project" could
by the preceding paragraph: Provided, That, any employee who refer to one or the other of at least two (2) distinguishable types of
has rendered at least one year of service, whether such service is activities. Firstly, a project could refer to a particular job or
continuous or broken, shall be considered a regular employee with undertaking that is within the regular or usual business of the
respect to the activity in which he is employed and his employment employer company, but which is distinct and separate, and
shall continue while such activity actually exist. identifiable as such, from the other undertakings of the company.
Such job or undertaking begins and ends at determined or
Pursuant to the above-quoted Article 280 of the Labor Code, determinable times. The typical example of this first type of project
employees performing activities which are usually necessary or is a particular construction job or project of a construction
desirable in the employer’s usual business or trade can either be company. A construction company ordinarily carries out two or
more [distinct] identifiable construction projects: e.g., a twenty- 4) Acting as Cameramen14
five-storey hotel in Makati; a residential condominium building in
Baguio City; and a domestic air terminal in Iloilo City. Employees These jobs and undertakings are clearly within the regular or
who are hired for the carrying out of one of these separate usual business of the employer company and are not
projects, the scope and duration of which has been determined identifiably distinct or separate from the other undertakings
and made known to the employees at the time of employment, are of the company. There is no denying that the manning of the
properly treated as "project employees," and their services may operations center to air commercials, acting as
be lawfully terminated at completion of the project. transmitter/VTR men, maintaining the equipment, and acting
as cameramen are not undertakings separate or distinct from
The term "project" could also refer to, secondly, a particular job or the business of a broadcasting company.
undertaking that is not within the regular business of the
corporation. Such a job or undertaking must also be identifiably Petitioner’s allegation that respondents were merely substitutes or
separate and distinct from the ordinary or regular business what they call pinch-hitters (which means that they were employed
operations of the employer. The job or undertaking also begins to take the place of regular employees of petitioner who were
and ends at determined or determinable times. x x x.11 absent or on leave) does not change the fact that their jobs cannot
(Emphases supplied, citation omitted.) be considered projects within the purview of the law. Every
industry, even public offices, has to deal with securing substitutes
Thus, in order to safeguard the rights of workers against the for employees who are absent or on leave. Such tasks, whether
arbitrary use of the word "project" to prevent employees from performed by the usual employee or by a substitute, cannot be
attaining the status of regular employees, employers claiming that considered separate and distinct from the other undertakings of
their workers are project employees should not only prove that the the company. While it is management’s prerogative to device a
duration and scope of the employment was specified at the time method to deal with this issue, such prerogative is not absolute
they were engaged, but also that there was indeed a project. As and is limited to systems wherein employees are not ingeniously
discussed above, the project could either be (1) a particular job or and methodically deprived of their constitutionally protected right
undertaking that is within the regular or usual business of the to security of tenure. We are not convinced that a big corporation
employer company, but which is distinct and separate, and such as petitioner cannot device a system wherein a sufficient
identifiable as such, from the other undertakings of the company; number of technicians can be hired with a regular status who can
or (2) a particular job or undertaking that is not within the regular take over when their colleagues are absent or on leave, especially
business of the corporation. As it was with regard to the distinction when it appears from the records that petitioner hires so-called
between a regular and casual employee, the purpose of this pinch-hitters regularly every month.
requirement is to delineate whether or not the employer is in
constant need of the services of the specified employee. If the In affirming the Decision of the NLRC, the Court of Appeals
particular job or undertaking is within the regular or usual business furthermore noted that if respondents were indeed project
of the employer company and it is not identifiably distinct or employees, petitioner should have reported the completion of its
separate from the other undertakings of the company, there is projects and the dismissal of respondents in its finished projects:
clearly a constant necessity for the performance of the task in
question, and therefore said job or undertaking should not be There is another reason why we should rule in favor of private
considered a project. respondents. Nowhere in the records is there any showing
that petitioner reported the completion of its projects and the
In the case at bar, as discussed in the statement of facts, dismissal of private respondents in its finished projects to
respondents were assigned to the following tasks: the nearest Public Employment Office as per Policy
Instruction No. 2015 of the Department of Labor and
1) Manning of Technical Operations Center: Employment [DOLE]. Jurisprudence abounds with the
consistent rule that the failure of an employer to report to the
(a) Responsible for the airing of local commercials; and nearest Public Employment Office the termination of its
workers’ services everytime a project or a phase thereof is
(b) Logging/monitoring of national commercials (satellite) completed indicates that said workers are not project
employees.
2) Acting as Transmitter/VTR men:
In the extant case, petitioner should have filed as many reports of
(a) Prepare tapes for local airing; termination as there were projects actually finished if private
respondents were indeed project employees, considering that the
(b) Actual airing of commercials; latter were hired and again rehired from 1996 up to 1999. Its failure
to submit reports of termination cannot but sufficiently convince us
(c) Plugging of station promo; further that private respondents are truly regular employees.
Important to note is the fact that private respondents had rendered
(d) Logging of transmitter reading; and more than one (1) year of service at the time of their dismissal
which overturns petitioner’s allegations that private respondents
(e) In case of power failure, start up generator set to resume were hired for a specific or fixed undertaking for a limited period
program; of time.1

3) Acting as Maintenance staff; the Court of Appeals also ruled that even if it is assumed that
respondents are project employees, they would nevertheless
(a) Checking of equipment; have attained regular employment status because of their
continuous rehiring:
(b) Warming up of generator;
Be that as it may, a project employee may also attain the
(c) Filling of oil, fuel, and water in radiator; and status of a regular employee if there is a continuous rehiring
of project employees after the stoppage of a project; and the
activities performed are usual [and] customary to the Similarly, in the case at bar, we find it unjustifiable to allow
business or trade of the employer. The Supreme Court ruled petitioner to hire and rehire workers on fixed terms, ad infinitum,
that a project employee or a member of a work pool may depending upon its needs, never attaining regular employment
acquire the status of a regular employee when the following status. To recall, respondents were repeatedly rehired in several
concur: fixed term contracts from 1996 to 1999. To prove the alleged
contracts, petitioner presented cash disbursement vouchers
1) There is a continuous rehiring of project employees even signed by respondents, stating that they were merely hired as
after cessation of a project; and pinch-hitters. It is apparent that respondents were in no position
to refuse to sign these vouchers, as such refusal would entail not
2) The tasks performed by the alleged project employee are getting paid for their services. Plainly, respondents as "pinch-
vital, necessary and indispensable to the usual business or hitters" cannot be considered to be in equal footing as petitioner
trade of the employer. corporation in the negotiation of their employment contract.

The circumstances set forth by law and the jurisprudence is In sum, we affirm the findings of the NLRC and the Court of
present in this case. In fine, even if private respondents are Appeals that respondents are regular employees of
to be considered as project employees, they attained regular petitioner.1âwphi1 As regular employees, they are entitled to
employment status, just the same.21 (Citation omitted.) security of tenure and therefore their services may be terminated
only for just or authorized causes. Since petitioner failed to prove
As stated above, petitioner interchangeably characterizes any just or authorized cause for their termination, we are
respondents’ service as project and fixed term employment. constrained to affirm the findings of the NLRC and the Court of
These types of employment, however, are not the same. While Appeals that they were illegally dismissed.
the former requires a project as restrictively defined above, the
duration of a fixed-term employment agreed upon by the parties
may be any day certain, which is understood to be "that which 2) YES
must necessarily come although it may not be known when."25
The decisive determinant in fixed-term employment is not the In light, however, of our ruling that respondents were illegally
activity that the employee is called upon to perform but the day dismissed, we affirm the findings of the NLRC and the Court of
certain agreed upon by the parties for the commencement and Appeals that respondents are entitled to separation pay in lieu of
termination of the employment relationship.26 reinstatement. We quote with approval the discussion of the Court
of Appeals:
Cognizant of the possibility of abuse in the utilization of fixed-term
employment contracts, we emphasized in Brent that where from However, since petitioner refused to accept private
the circumstances it is apparent that the periods have been respondents back to work, reinstatement is no longer
imposed to preclude acquisition of tenurial security by the practicable. Allowing private respondents to return to their
employee, they should be struck down as contrary to public policy work might only subject them to further embarrassment,
or morals.27 We thus laid down indications or criteria under which humiliation, or even harassment.
"term employment" cannot be said to be in circumvention of the
law on security of tenure, namely: Thus, in lieu of reinstatement, the grant of separation pay
equivalent to one (1) month pay for every year of service is
1) The fixed period of employment was knowingly and voluntarily proper which public respondent actually did. Where the
agreed upon by the parties without any force, duress, or improper relationship between private respondents and petitioner has
pressure being brought to bear upon the employee and absent been severely strained by reason of their respective
any other circumstances vitiating his consent; or imputations of accusations against each other, to order
reinstatement would no longer serve any purpose. In such
2) It satisfactorily appears that the employer and the employee situation, payment of separation pay instead of reinstatement
dealt with each other on more or less equal terms with no moral is in order.33 (Citations omitted.)
dominance exercised by the former or the latter.28 (Citation
omitted.) 3) YES

These indications, which must be read together, make the Brent As regards night shift differential, the Labor Code provides
doctrine applicable only in a few special cases wherein the that every employee shall be paid not less than ten percent
employer and employee are on more or less in equal footing in (10%) of his regular wage for each hour of work performed
entering into the contract. The reason for this is evident: when a between ten o’clock in the evening and six o’clock in the
prospective employee, on account of special skills or market morning.34 As employees of petitioner, respondents are entitled
forces, is in a position to make demands upon the prospective to the payment of this benefit in accordance with the number of
employer, such prospective employee needs less protection than hours they worked from 10:00 p.m. to 6:00 a.m., if any. In the
the ordinary worker. Lesser limitations on the parties’ freedom of Decision of the NLRC affirmed by the Court of Appeals, the
contract are thus required for the protection of the employee. records were remanded to the Regional Arbitration Branch of
origin for the computation of the night shift differential and the
We reject the petitioner’s submission that it resorted to hiring separation pay. The Regional Arbitration Branch of origin was
employees for fixed terms to augment or supplement its regular likewise directed to require herein petitioner to produce additional
employment "for the duration of peak loads" during short-term documents where necessary. Therefore, while we are affirming
surges to respond to cyclical demands; hence, it may hire and that respondents are entitled to night shift differential in
retire workers on fixed terms, ad infinitum, depending upon the accordance with the number of hours they worked from 10:00 p.m.
needs of its customers, domestic and international. Under the to 6:00 a.m., it is the Regional Arbitration Branch of origin which
petitioner's submission, any worker hired by it for fixed terms of should determine the computation thereof for each of the
months or years can never attain regular employment status. x x respondents, and award no night shift differential to those of them
x. who never worked from 10:00 p.m. to 6:00 a.m.
It is also worthwhile to note that in the NLRC Decision, it was
herein petitioner GMA Network, Inc. (respondent therein) which
was tasked to produce additional documents necessary for the
computation of the night shift differential.
.