G.R. Nos. 170384-85 March 9, 2007
Petitioner, she was not given due process
LORNA DISING PUNZAL, Petitioner, vs.
ETSI TECHNOLOGIES, INC., WERNER
GEISERT, and CARMELO D. REMUDARO,
Respondents.
FACTS:
Petitioner has been an employee of respondent
for 12 years prior to her termination in
November 26, 2001. She was the Department
Secretary at the time.
Punzal e-mailed her officemates and their
families, inviting them to a Halloween party to
be held in the office.
Then she learned that Senior Vice President
Geisert did not approve of the plan to hold a
party in the office. So, she sent another email
to her officemates expressing her
disappointment, particularly saying that:
He was so unfair…para bang palagi siyang
iniisahan sa trabaho…bakit most of the parents
na mag-joined ang anak ay naka-VL naman.
Anyway, solohin na lang niya bukas ang office.
To those parents who would like to bring their
Kids in Megamall there will be Trick or Treating
at Mc Donalds Megamall Bldg. A at 10:00 AM
tomorrow and let’s not spoil the fun for our
kids.
The management considered the second e-
mail was violative of Article IV, No. 5 & 8
Improper conduct or acts of discourtesy or
disrespect and Making malicious statements
concerning Company Officer, which may result
to disciplinary actions.
Geisert and Remudaro conferred with petitioner
to give her a chance to explain her side. But did
not accept her explanation and terminated her.
LA dismissed ETSI’s complaint. NLRC
reversed and found her guilty for misconduct.
CA denied her appeal.
ISSUE:
WoN Punzal was validly terminated.
WoN Punzal was given due process.
HELD:
First issue: Yes. As the Labor Arbiter noted:
the holding of a trick or treat party in the office
premises of respondent ETSI would certainly
affect the operations of the office, since
children will be freely roaming around the office
premises, things may get misplaced and the
noise in the office will simply be too hard to
ignore. Given the reasonableness of Geisert’s
decision that provoked petitioner to send the
second e-mail message, the Court of Appeals
correctly ruled that "the message x x x
resounds of subversion and undermines the
authority and credibility of management” and
that petitioner "displayed a tendency to act
without management’s approval, and even
against management’s will."
Second Issue: it’s a No. According to
EMMA CO, petitioners, vs. NATIONAL
because she did not have counsel during her
conference with the management. Article 277
(b) of the Labor Code that
the employer xxx shall afford [the worker
whose employment is sought to be terminated]
ample opportunity to be heard and to defend
himself with the assistance of his
representatives if he so desires in accordance
with company rules and regulations pursuant to
guidelines set by the Department of Labor and
Employment, and this Court’s explicit
pronouncement that "[a]mple opportunity
connotes every kind of assistance that
management must accord the employee to
enable him to prepare adequately for his
defense including legal representation."
G.R. No. 191008 April 11, 2011
QUIRICO LOPEZ, Petitioner, vs. ALTURAS
GROUP OF COMPANIES and/or MARLITO
UY, Respondents.
FACTS:
Petitioner was hired the truck driver of
Respondent company. He was dismissed after
the company security caught him smuggling
out of the company premises 60 kilos of scrap
iron. Petitioner was given a chance to explain
himself but the company did not accept his
explanation.
Petitioner denied the allegations insisting that
he was illegally terminated and that the
complaint was fabricated to justify his illegal
dismissal.
ISSUE:
WoN petitioner was given due process.
HELD:
Yes. This Court has held that there is no
violation of due process even if no hearing was
conducted, where the party was given a
chance to explain his side of the controversy.
What is frowned upon is the denial of the
opportunity to be heard.
Petitioner was given the opportunity to explain
his side when he was informed of the charge
against him and required to submit his written
explanation with which he complied.
The above rulings are a clear recognition that
the employer may provide an employee with
ample opportunity to be heard and defend
himself with the assistance of a representative
or counsel in ways other than a formal hearing.
The employee can be fully afforded a chance to
respond to the charges against him, adduce his
evidence or rebut the evidence against him
through a wide array of methods, verbal or
written.
G.R. No. 113271 October 16, 1997
WATEROUS DRUG CORPORATION and MS.
LABOR RELATIONS COMMISSION and
ANTONIA MELODIA CATOLICO,
respondents.
FACTS:
Catolico was hired as a pharmacist by
petitioner. WATEROUS Control Clerk Eugenio
Valdez informed WATEROUS Vice President-
General Manager Emma R. Co that he noticed
an irregularity in some sales involving Catolico
and Yung Shin Pharmaceuticals (YSP), Inc.
allegedly Catolico sold to YSP Inc. 10 bottles of
Voren Tablets at P384 per unit. However, the
normal selling price is P320 per unit.
Verification was made to YSP, Inc. to
determine the discrepancy and it was found
that the cost per bottle was indeed overpriced.
YSP, Inc. Accounting Department (Ms. Estelita
Reyes) confirmed that the difference
represents refund of jack-up price of ten bottles
of Voren tablets per sales invoice, which was
paid to Ms. Catolico. Said check was sent in an
envelope addressed to Catolico.
Catolico denied receiving the same. However,
Saldana, the clerk of Waterous Drug Corp.
confirmed that she saw an open envelope with
a check amounting P640 payable to Catolico.
Waterous Drug Corp. ordered the termination
of Catolico for acts of dishonesty.
NLRC: Dismissed the Petition. Evidence of
respondents (check from YSP) being rendered
inadmissible, by virtue of the constitutional right
invoked by complainants.
ISSUE:
WoN the check is admissible as evidence.
WoN the Dismissal was valid.
HELD:
First Issue: Yes. Pursuant to the decision in the
case of People v. Marti, the constitutional
protection against unreasonable searches and
seizures refers to the immunity of one’s person
from interference by government and cannot be
extended to acts committed by private
individuals so as to bring it within the ambit of
alleged unlawful intrusion by the government.
Second Issue: It’s a No. Catolico was given an
opportunity to explain her side, she was
dismissed from the service by her Supervisor
after receipt of her letter and that of her
counsel. No hearing was ever conducted after
the issues were joined through said letters.
It is evident from the Supervisor's
memorandum that Catolico was dismissed
because of an alleged anomalous transaction
with YSP. Unfortunately for petitioners, their
evidence does not establish that there was an
overcharge.
Catolico's dismissal then was obviously
grounded on mere suspicion, which in no case
can justify an employee's dismissal. Suspicion
is not among the valid causes provided by the
Labor Code for the termination of employment
and even the dismissal of an employee for loss
of trust and confidence must rest on
substantial. Besides, Catolico was not shown to
be a managerial employee, to which class of
employees the term "trust and confidence" is
restricted.
G.R. No. 81561 January 18, 1991
PEOPLE OF THE PHILIPPINES, plaintiff-
appellee vs. ANDRE MARTI, accused-
appellant.
FACTS:
On August 14, 1987, between 10:00 and 11:00
a.m., the appellant and his common-law wife,
Shirley Reyes, went to the booth of the "Manila
Packing and Export Forwarders" in the Pistang
Pilipino Complex, Ermita, Manila, carrying with
them four (4) gift wrapped packages. Anita
Reyes (the proprietress and no relation to
Shirley Reyes) attended to them. The appellant
informed Anita Reyes that he was sending the
packages to a friend in Zurich, Switzerland.
Anita Reyes then asked the appellant if she
could examine and inspect the packages.
Appellant, however, refused, assuring her that
the packages simply contained books, cigars,
and gloves and were gifts to his friend in
Zurich.
The four (4) packages were then placed inside
a brown corrugated box.
Before being sent out for delivery, Job Reyes,
husband of Anita and proprietor of the courier
company, conducted an inspection of the
package as part of standard operating
procedures. Upon opening the package, he
noticed a suspicious odor which made him took
sample of the substance he found inside. He
reported this to the NBI and invited agents to
his office to inspect the package. In the
presence of the NBI agents, Job Reyes opened
the suspicious package and found dried-
marijuana leaves inside.
A case was filed against Andre Marti in
violation of R.A. 6425 and was found guilty by
the court a quo. Andre filed an appeal in the
Supreme Court claiming that his constitutional
right of privacy was violated and that the
evidence acquired from his package was
inadmissible as evidence against him.
ISSUE:
WoN Marti’s rights against unreasonable
search and seizure was violated.
HELD:
No. The constitutional proscription against
unlawful searches and seizures applies as a
restraint directed only against the government
and its agencies tasked with the enforcement
of the law. Thus, it could only be invoked
against the State to whom the restraint against
arbitrary and unreasonable exercise of power is
imposed. Alleged violations against
unreasonable search and seizure may only be
invoked against the State by an individual
unjustly traduced by the exercise of sovereign
authority. To agree with appellant that an act of
a private individual in violation of the Bill of
Rights should also be construed as an act of
the State would result in serious legal
complications and an absurd interpretation of
the constitution.
It will be recalled that Mr. Job Reyes was the
one who opened the box in the presence of the
NBI agents in his place of business. The mere
presence of the NBI agents did not convert the
reasonable search effected by Mr. Reyes into a
warrantless search and seizure proscribed by
the constitution. Merely to observe and look at
that which is in plain sight is not a search.
G.R. No. 181881 October 18, 2011
BRICCIO "Ricky" A. POLLO, Petitioner, vs.
CHAIRPERSON KARINA CONSTANTINO-
DAVID,
FACTS:
Petitioner is a former Supervising Personnel
Specialist of the CSC Regional Office No. IV
and also the Officer-in-Charge of the Public
Assistance and Liaison Division (PALD) under
the "Mamamayan Muna Hindi Mamaya Na"
program of the CSC.
CSC Chairperson Karina David received an
unsigned letter-complaint, informing her that
“Chief of the Mamamayan muna hindi mamaya
na division” of Civil Service Commission
Regional Office No. IV (CSC-ROIV) has been
lawyering for public officials with pending cases
in the CSC.
Chairperson David immediately formed a team
with background in information technology and
issued a memorandum directing them “to back
up all the files in the computers found in the
[CSC-ROIV] Mamamayan Muna (PALD) and
Legal divisions. Legal pleading or documents
that are related to administrative cases and
were for on the behalf of parties who were
facing charges.
Chairperson David thus issued a Show-Cause
Order requiring the petitioner to submit his
explanation or counter-affidavit within five days
from notice.
Petitioner filed his Comment, denying that he is
the person referred to in the anonymous letter-
complaint. He asserted that he had protested
the unlawful taking of his computer done while
he was on leave, citing the letter dated January
8, 2007 in which he informed Director Castillo
of CSC-ROIV that the files in his computer
were his personal files and those of his sister,
relatives, friends and some associates and that
he is not authorizing their sealing, copying,
duplicating and printing as these would violate
his constitutional right to privacy and protection
against self-incrimination and warrantless
search and seizure.
In view of the illegal search, the
files/documents copied from his computer
without his consent [are] thus inadmissible as
evidence, being “fruits of a poisonous tree.”
CSC: Dismissed petitioner.
CA: Denied appeal.
ISSUE:
WoN the search conducted was justified.
HELD:
Yes. The search of petitioner’s computer files
was conducted in connection with investigation
of work-related misconduct prompted by an
anonymous letter-complaint addressed to
Chairperson David regarding anomalies in the
CSC-ROIV where the head of the Mamamayan
Muna Hindi Mamaya Na division is supposedly
“lawyering” for individuals with pending cases
in the CSC. A search by a government
employer of an employee’s office is justified at
inception when there are reasonable grounds
for suspecting that it will turn up evidence that
the employee is guilty of work-related
misconduct.
Thus, petitioner’s claim of violation of his
constitutional right to privacy must necessarily
fail. His other argument invoking the privacy of
communication and correspondence under
Section 3(1), Article III of the 1987 Constitution
is also untenable considering the recognition
accorded to certain legitimate intrusions into
the privacy of employees in the government
workplace under the afforested authorities. We
likewise find no merit in his contention that
O’Connor and Simons are not relevant
because the present case does not involve a
criminal offense like child pornography. As
already mentioned, the search of petitioner’s
computer was justified there being reasonable
ground for suspecting that the files stored
therein would yield incriminating evidence
relevant to the investigation being conducted
by CSC as government employer of such
misconduct subject of the anonymous
complaint.
INTERNATIONAL COVENANTS AND LABOR
AND WELFARE LAWS
1. Universal Declaration of Human
Rights (Art. 3, 7, 17, 22, 23, 24,25)
2. International Covenant of
Economic, Social and Cultural
Rights (Part III, Arts. 6,7, 9 and 11)
INTERNATIONAL SCHOOL ALLIANCE OF
EDUCATORS (ISAE), petitioner,  vs.
HON. LEONARDO A. QUISUMBING;HON.
CRESENCIANO B. TRAJANO; DR. BRIAN
MACCAULEY; and INTERNATIONAL
SCHOOL, INC., respondents.
KAPUNAN, J.:
FACTS:
Private respondent International School, Inc .is
a domestic educational institution established
primarily for dependents of foreign diplomatic
personnel and other temporary residents.
Accordingly, the School hires both foreign and
local teachers as members of its faculty,
classifying the same into two: (1) foreign-hires
and (2) local-hires.
The School grants foreign-hires certain
benefits not accorded local-hires.These
include housing, transportation, shipping costs,
taxes, and home leave travel allowance.
Foreign-hires are also paid a salary rate
twenty-five percent (25%) more than local-
hires.
The School justifies the difference on two
"significant economic disadvantages" foreign-
hires have to endure, namely: (a) the
"dislocation factor" and (b) limited tenure.  renegotiate the terms thereof on the third year.
When negotiations for a new collective
bargaining agreement were held on June 1995,
petitioner International School Alliance of
Educators, "a legitimate labor union and the
collective bargaining representative of all
faculty members"4 of the School, contested the
difference in salary rates between foreign
and local-hires.
ISSUE:
 Whether or not the grant of higher
salaries to foreign hires constitutes
racial discrimination.
RULING:
YES, the Supreme Court held that
discrimination, particularly in terms of wages, is
frowned upon by the Labor Code.
Article 135, for example, prohibits and
penalizes the payment of lesser compensation
to a female employee as against a male
employee for work of equal value.
Article 248 declares it an unfair labor
practice for an employer to discriminate in
regard to wages in order to encourage or
discourage membership in any labor
organization.
The International Covenant on Economic,
Social, and Cultural Rights, in Article 7 thereof,
provides that fair wages and equal
remuneration for work of equal value
without distinction of any kind, in particular
women being guaranteed conditions of work
not inferior to those enjoyed by men, with equal
pay for equal work.
Persons who work with substantially equal
qualifications, skill, effort and responsibility,
under similar conditions, should be paid similar
salaries.  high economic demands, indicative of blue-sky
This rule applies to the School, its "international
character" notwithstanding.
STANDARD CHARTERED BANK
EMPLOYEES UNION, Petitioner, v. The
Honorable MA. NIEVES R. CONFESOR; and
the STANDARD CHARTERED
BANK, Respondents.
CALLEJO, SR., J.:
FACTS
Standard Chartered Bank (the Bank, for
brevity) is a foreign banking corporation doing
business in the Philippines. The exclusive
bargaining agent of the rank and file employees
of the Bank is the Standard Chartered Bank
Employees Union. In August of 1990, the Bank
and the Union signed a five-year collective
bargaining agreement with a provision to
Prior to the expiration of the three-year period
but within the sixty-day freedom period, the
Union initiated the negotiations.
Diokno, the Head of the Human Resources,
suggested to Divinagracia who was the
President of the Union, that Jose P. Umali, Jr.,
the President of the National Union of Bank
Employees, be excluded from the Unions
negotiating panel. However, Umali was
retained as a member thereof.
Thereafter, negotiations ensued. Diokno stated
that, in order for the Bank to make a better
offer, the Union should clearly identify what it
wanted to be included in the total economic
package.
Umali replied that it was impossible to do so
because the Banks counter-proposal was
unacceptable.He furthered asserted that it
would have been easier to bargain if the
atmosphere was the same as before, where
both panels trusted each other.
Except for the provisions on signing bonus and
uniforms, the Union and the Bank failed to
agree on the remaining economic
provisions of the CBA. The Union declared a
deadlock and filed a Notice of Strike before the
National Conciliation and Mediation Board
(NCMB).
On the other hand, the Bank filed a complaint
for Unfair Labor Practice (ULP) and Damages
before the Arbitration Branch of the National
Labor Relations Commission (NLRC) in Manila,
against the Union.
The Bank alleged that the Union violated its
duty to bargain, as it did not bargain in good
faith.It contended that the Union demanded sky
bargaining. Further, the Union violated its no
strike- no lockout clause by filing a notice of
strike before the NCMB. On July 21, 1993, then
Secretary of Labor and Employment (SOLE)
Nieves R. Confesor, dismissed both the
petitioner and the respondents charge for ULP
against each other.
ISSUE:
 Whether or not the Union was able to
substantiate its claim of unfair labor
practice against the Bank arising
from the latters alleged interference
with its choice of negotiator?
RULING:
NO. the Supreme Court ruled that under the
International Labor Organization Convention
(ILO) No. 87 FREEDOM OF ASSOCIATION
AND PROTECTION OF THE RIGHT TO
ORGANIZE, workers and employers, without
distinction whatsoever, shall have the right to
establish and, subject only to the rules of the
organization concerned, to job organizations of
their own choosing without previous
authorization.
Workers and employers organizations shall
have the right to draw up their constitutions and
rules, to elect their representatives in full
freedom to organize their administration and
activities and to formulate their programs.
Article 248(a) of the Labor Code, considers it
an unfair labor practice when an employer
interferes, restrains or coerces employees
in the exercise of their right to self-
organization or the right to form
association.The right to self-organization
necessarily includes the right to collective
bargaining.
If an employer interferes in the selection of its
negotiators or coerces the Union to exclude
from its panel of negotiators a representative of
the Union, and if it can be inferred that the
employer adopted the said act to yield adverse
effects on the free exercise to right to self-
organization or on the right to collective
bargaining of the employees, ULP under Article
248(a) in connection with Article 243 of the
Labor Code is committed.
In order to show that the employer committed
ULP under the Labor Code, substantial
evidence is required to support the claim.
Substantial evidence has been defined as such
relevant evidence as a reasonable mind might
accept as adequate to support a conclusion
The circumstances that occurred during the
negotiation do not show that the suggestion
made by Diokno to Divinagracia is an anti-
union conduct from which it can be inferred
that the Bank consciously adopted such act to
yield adverse effects on the free exercise of the
right to self-organization and collective
bargaining of the employees, especially
considering that such was undertaken previous
to the commencement of the negotiation and
simultaneously with Divinagracias suggestion
that the bank lawyers be excluded from its
negotiating panel.
After the initiation of the collective
bargaining process, with the inclusion of
Umali in the Unions negotiating panel, the
negotiations pushed through.
It is clear that such ULP charge was merely an
afterthought.The accusation occurred after the
arguments and differences over the economic
provisions became heated and the parties had
become frustrated
A. Role of Law – Art. 1700, New Civil
Code of the Philippines
BECMEN SERVICE EXPORTER AND
PROMOTION, INC., Petitioner,  vs.
SPOUSES SIMPLICIO and MILA
CUARESMA, WHITE FALCON SERVICES,
INC. and JAIME ORTIZ, Respondents.
YNARES-SANTIAGO, J.:
FACTS:
In January 6, 1997, Jasmin Cuaresma was
deployed by Becmen Service Exporter and
Promotion, Inc. to serve as assistant nurse in
Al-Birk Hospital in the Kingdom of Saudi
Arabia for a contract duration of three years,
with a corresponding salary of US$247.00 per
month.
Over a year later, she died allegedly of
poisoning. Based on the police report and the
medical report of the examining physician of
the Al-Birk Hospital, who conducted an autopsy
of Jasmin’s body, the likely cause of her
death was poisoning.
Jasmin’s body was repatriated to Manila. The
City Health Officer of Cabanatuan City
conducted an autopsy and the resulting
medical report indicated that Jasmin died
under violent circumstances, and not
poisoning as originally found by the KSA
examining physician.
On November 22, 1999, the Cuaresmas filed a
complaint against Becmen and its principal in
the KSA, Rajab & Silsilah Company, claiming
death and insurance benefits as well as moral
and exemplary damages for Jasmin’s death.
Becmen and Rajab insist that Jasmin
committed suicide, citing a prior unsuccessful
suicide attempt sometime in March or April
1998 and relying on the medical report of the
examining physician of the Al-Birk Hospital.
They likewise deny liability because the
Cuaresmas already recovered death and other
benefits totaling P130,000.00 from the OWWA.  obligation, as employer and recruiter and as
The Labor Arbiter rendered a Decision
dismissing the complaint for lack of merit.
Giving weight to the medical report of the Al-
Birk Hospital finding that Jasmin died of
poisoning, the Labor Arbiter concluded that
Jasmin committed suicide. In any case,
Jasmin’s death was not service-connected, nor
was it shown that it occurred while she was on
duty; besides, her parents have received all
corresponding benefits they were entitled to
under the law.
On appeal, the National Labor Relations
Commission reversed the decision of the
Labor Arbiter. Relying on the findings of the
City Health Officer of Cabanatuan City and the
NBI as contained in their autopsy and
toxicology report, the NLRC declared that,
based on substantial evidence adduced,
Jasmin was the victim of compensable work-
connected criminal aggression. it declared that
Jasmin’s death was the result of an "accident"
occurring within the employer’s premises that is
attributable to her employment, or to the
conditions under which she lived, and thus
arose out of and in the course of her
employment as nurse.
The appellate court affirmed the NLRC’s
findings that Jasmin’s death was compensable,
the same having occurred at the dormitory,
which was contractually provided by the
employer. Thus her death should be
considered to have occurred within the
employer’s premises, arising out of and in the
course of her employment.
ISSUE:
 Whether or not he Cuaresmas are
entitled to monetary claims, by way
of benefits and damages, for the
death of their daughter Jasmin.
RULING:
YES, the Supreme Court ruled that the
Cuaresmas were only entitled to damages. The
employment agreement does not include
provisions for insurance, or for accident,
death or other benefits that the Cuaresmas
seek to recover, and which the labor tribunals
and appellate court granted variably in the
guise of compensatory damages. Thus, they
are not entitled to the benefits they are
claiming.
However, based on the autopsy and the
exhumation reports, Jasmin was manhandled
– and possibly raped – prior to her death.
The Court futher held that Rajab, Becmen, and
White Falcon’s indifference to Jasmin’s case
has caused unfathomable pain and suffering
upon her parents.
They have turned away from their moral
entities laden with social and civic obligations in
society, to pursue justice for and in behalf of
Jasmin, her parents and those she left behind.
They have placed their own financial and
corporate interests above their moral and
social obligations, and chose to secure and
insulate themselves from the perceived
responsibility of having to answer for and
indemnify Jasmin’s heirs for her death.
Whether employed locally or overseas, all
Filipino workers enjoy the protective mantle of
Philippine labor and social legislation, contract
stipulations to the contrary notwithstanding.
This ruling is likewise rendered imperative by
Article 17 of the Civil Code which states that
laws which have for their object public order,
public policy and good customs shall not be
rendered ineffective by laws or judgments
promulgated, or by determinations or
conventions agreed upon in a foreign country.
The relations between capital and labor are
so impressed with public interest, and
neither shall act oppressively against the
other, or impair the interest or convenience
of the public.In case of doubt, all labor
legislation and all labor contracts shall be
construed in favor of the safety and decent
living for the laborer.
LEYTE GEOTHERMAL POWER
PROGRESSIVE EMPLOYEES UNION - ALU -
TUCP, Petitioner,  vs.
PHILIPPINE NATIONAL OIL COMPANY -
ENERGY DEVELOPMENT
CORPORATION, Respondent.
NACHURA, J.:
FACTS:
Majority of the employees hired by PNOC in its
Leyte Geothermal Power Projects had become
members of the petitioner union.
In view of that circumstance, the petitioner
demanded from the respondent the recognition
of it as the collective bargaining agent of said
employees and for a CBA negotiation with it.
However, the respondent did not heed such
demands of the petitioner. Sometime in 1998
when the project was about to be completed,
the respondent proceeded to serve Notices
of Termination of Employment upon the
employees who are members of the
petitioner.
On December 28, 1998, the petitioner filed a
Notice of Strike with DOLE on the ground of
purported commission by the latter of unfair
labor practice for "refusal to bargain
collectively, union busting and mass
termination." On the same day, the petitioner
declared a strike and staged such strike.
Despite earnest efforts on the part of the
Secretary of Labor and Employment to settle
the dispute amicably, the petitioner remained
adamant and unreasonable in its position,
causing the failure of the negotiation towards a
peaceful compromise
Thereafter the respondent filed a Complaint for
Strike Illegality, Declaration of Loss of
Employment and Damages at the NLRC-RAB
VIII in Tacloban City and at the same time, filed
a Petition for Cancellation of Petitioner’s
Certificate of Registration with DOLE. The
NLRC 4th Division rendered a decision in favor
of respondent. Declaring the termination of
their employment by reason of the completion
of the project, or a phase or portion thereof, to
which they were assigned, as valid and legal;
And that the officers and members of the Union
were project employees;
The Court of appeals affirmed the decision of
the NLRC.
Issue:
 Whether or not the officers and
members of petitioner Union are
project employees of respondent.
Ruling:
YES, the Supreme Court ruled that the
distinction between a regular and a project
employment is provided in Article 280,
paragraph 1, of the Labor Code.
Under which, there are four (4) kinds of
employees:
(a) regular employee or those who have been
"engaged to perform activities which are
usually necessary or desirable in the usual
business or trade of the employer";
(b) project employees or those "whose
employment has been fixed for a specific
project or undertaking[,] the completion or
termination of which has been determined
at the time of the engagement of the
employee";
(c) seasonal employees or those who work or
perform services which are seasonal in nature,
and the employment is for the duration of the
season; and
(d) casual employees or those who are not
regular, project, or seasonal employees.
Jurisprudence has added a fifth kind— a fixed-
term employee.
Article 280 of the Labor Code, as worded,
establishes that the nature of the employment
is determined by law, regardless of any
contract expressing otherwise.
The supremacy of the law over the
nomenclature of the contract and the
stipulations contained therein is to bring to life
the policy enshrined in the Constitution to
"afford full protection to labor."
Thus, labor contracts are placed on a higher
plane than ordinary contracts; these are
imbued with public interest and therefore
subject to the police power of the State.
In this case, the officers and the members of
petitioner Union were specifically hired as
project employees for respondent’s Leyte
Geothermal Power Project located at the
Greater Tongonan Geothermal Reservation in
Leyte.
Consequently, upon the completion of the
project or substantial phase thereof, the
officers and the members of petitioner
Union could be validly terminated. The
petitioners being project employees, or, to use
the correct term, seasonal employees, their
employment legally ends upon completion
of the project or the [end of the] season.
The termination of their employment cannot
and should not constitute an illegal dismissal.
B. Employer-Employee Standard of Conduct
– Art. 1701, New Civil Code of the Philippines
PAL EMPLOYEES SAVING AND LOAN
ASSOCIATION, INC. (PESALA), petitioner,  Petitioner's own computations thus clearly
vs. NATIONAL LABOR RELATIONS
COMMISSION AND ANGEL V.
ESQUEJO, respondents.  that even if there had been a meeting of the
PANGANIBAN, J.:
Facts:
Private respondent Angelo Esquejo was
employed by the petitioner as a company
guard. He alleged that he was required to work
for 12 hours a day and that during his entire
employment with the petitioner, he was
required to perform overtime work without
any additional compensation from the
latter. 
The private respondent filed with public
respondent a complaint for non-payment of
overtime pay and non-payment of the P25.00
statutory minimum wage increase mandated by
Republic Act No. 6727.
The petioners contend that as per the
Appointment Memorandum (contract) which
was signed by the private respondent, it was
expressly stipulated therein that private
respondent was to receive a monthly salary of
P1,900.00 plus P510.00 emergency allowance
for a twelve (12) hours work per day with one
(1) day off. 
The Labor Arbiter granted Esquejo’s claim for
overtime pay in the amount of P28,344.55. The
NLRC reduced the amount of the award to
(P28,066.45) and affirmed the decision of the
LA.
ISSUE:
 Whether or not an employee entitled
to overtime pay for work rendered in
excess of the regular eight hour day.
(given the fact that he entered into
a contract of labor specifying a
work-day of twelve hours at a
fixed monthly rate above the
legislated minimum wage.)
RULING:
YES, the Supreme Court ruled that the NLRC
correctly found no such agreement as to
overtime pay. In fact, the contract was definite
only as to the number of hours of work to be
rendered but vague as to what is covered by
the salary stipulated. Based on petitioner's
own computation, (LOL) it appears that the
basic salary plus emergency allowance given
to private respondent did not actually include
the overtime pay claimed by private
respondent. The petitioner admitted that it
actually paid private respondent P1,990.00 as
basic salary plus P510.00 emergency
allowance or a total of only P2,500.00.
Undoubtedly, private respondent was
shortchanged in the amount of P300.50.
establish that private respondent's claim for
overtime pay is valid. The Court further held
minds, the employment contract could not
have effectively shielded petitioner from the
just and valid claims of private respondent.
Generally speaking, contracts are respected as
the law between the contracting, parties, and
they may establish such stipulation, clause,
terms and conditions as they may see fit; and
for as long as such agreements are not
contrary to law, morals, good customs, public
policy or public order, they shall have the fore
of law between them. However, the general
right to contract is subject to the limitation
that the agreement must not be in violation
of the Constitution and/or the statute of
some rule of law. Under the Civil Code,
contracts of labor are explicitly subject to the
police power of the State because they are not
ordinary contracts but are impressed with
public interest. The contract in question would
have been deemed in violation of pertinent
labor laws, the provisions of said laws
would prevail over the terms of the contract,
and private respondent would still be entitled to
overtime pay.