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Big AA Manufacturer vs.

Antonio
[G.R. No. 160854 March 3, 2006]

Facts:

The respondent employees alleged that as regular employees, they worked for petitioner Big AA
from 8:00 a.m. to 5:00 p.m. in its premises and using its tools and equipment. They received
P250 per day. They alleged that they were dismissed without just cause and due process.

However, Big AA denied that respondents were its regular employees. Instead, it claimed
that Antonio was one of its independent contractors who used the services of the other
respondents. According to Big AA, its independent contractors were paid by results and
were responsible for the salaries of their own workers. As such, there was no employer-
employee relationship between petitioner and respondents. Big AA explained that it
allowed respondents to use its facilities only to meet job orders. It also denied that
respondents were laid-off, since they were merely project employees.

Issue:

Whether or not respondents are regular employees

Held:

Respondents are regular employees. They were employed for more than one year and their
work as carpenters was necessary or desirable in petitioner’s usual trade or business of
manufacturing office furniture. Under Article 280 of the Labor Code, the applicable test to
determine whether an employment should be considered regular or non-regular is the
reasonable connection between the particular activity performed by the employee in
relation to the usual business or trade of the employer.

Respondents cannot be considered project employees. Petitioner had neither shown that
respondents were hired for a specific project the duration of which was determined at the time of
their hiring nor identified the specific project or phase thereof for which respondents were hired.

Antonio was not an independent contractor for he does not carry a distinct and independent
business, and he does not possess substantial capital or investment in tools, equipment,
machinery or work premises. He works within petitioner’s premises using the latter’s tools and
materials and other facilities for the "proper implementation" of job orders. He is also under
petitioner’s control and supervision. Moreover, the Implementing Guidelines regulating
attendance, overtime, deadlines, penalties; providing petitioner’s right to fire employees or
"contractors"; requiring the carpentry division to join petitioner’s exercise program; and
providing rules on machine maintenance, all reflect control and supervision over respondents.

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