RUBEN CARPIO VS. MODAIR MANILA CO. LTD., INC.

FACTS:
Carpio was employed as a "contractor's employee (per project basis)," designated as
"Electrician 3” by Modair for the following projects: IBIDEN BACK END EXPANSION Project;
PIL GREEN CONSTRUCTION Project; FAC D. UTIL. WORKS Project; IBIDEN CPU S3 Project
and NYK TECH PARK project. In the said projects, his services were terminated after
completion and then he will be hired again for another project. After the completion of NYK
project, Carpio signed his Final Release of Pay dated April 25, 2013, which incorporated a Quit
Claim whereby he waived any claims against Modair and confirmed the full payment of
everything due him from the NYK Project. He also executed an Affidavit of Release and
Quitclaim dated May 24, 2013, similar to that for the Ibiden CPU Project.
Carpio filed against Modair a Complaint for illegal dismissal and regularization. Carpio argued
that he had attained regular status owing to his repeated re-hiring by Modair for various
construction projects; and that he was illegally dismissed since, despite other available projects,
he was not given any work following completion of the NYK Project; ultimately praying for
regularization, a finding of illegal dismissal, reinstatement with backwages, damages, and
attorney's fees.
On the other hand, Modair prayed that the Complaint be dismissed, and argued that Carpio
remained a project-based employee despite recurrent re-hiring; that he was not illegally
dismissed as his engagement was co-terminus with each project; and that, at any rate, Carpio
freely and knowingly executed the Affidavit of Desistance and the Quitclaim and Release, both
dated December 11, 2013. Modair also presented a Resignation Letter dated February 14, 2000
(Resignation Letter), showing that Carpio voluntarily resigned effective February 19, 2000.
LA dismissed Carpio’s claim. It found that, not being covered then by any project employment
contract, Carpio's service from 1998 was in the nature of regular employment, which, however,
was interrupted when Carpio submitted the Resignation Letter. Since then, Carpio's
employment had been covered by project-based contracts, making him a project-based
employee who was not illegally dismissed, but whose engagement concluded following the
completion of the respective projects.
NLRC and the Court of Appeals ruled that Carpio is a project employee.
ISSUE:
whether Carpio is entitled to backwages and to his money claims
RULING:
1) Regarding payment of backwages in cases of illegal dismissal, for regular employment,
backwages are computed from the time of dismissal until reinstatement, if such is ordered, or
until finality of the decision ordering separation pay, if reinstatement is infeasible; while for
project employment, backwages are computed from the date of the termination of employment
until the actual completion of the work.

Upon the employer lies the burden of proof to establish project employment by showing that: (1)
the employee was assigned to carry out a specific project or undertaking; and (2) the duration
and scope of which were specified at the time the employee was engaged for such project.
Moreover, the employer must also prove that there was indeed a project undertaken. Failing
these, the worker will be presumed a regular employee.

For the instant controversy, the foregoing concepts must be contextualized within the
construction industry, the governing rule being DOLE Department Order (D.O.) No. 19-93,
Series of 1993 (D.O. 19-93), the "Guidelines Governing the Employment of Workers in the
Construction Industry". D.O. 19-93 provides for two employment categories: project-based,
pertaining to "those employed in connection with a particular construction project or phase
thereof and whose employment is co-terminus with each project or phase of the project to which
they are assigned"; and non-project based, "are those employed without reference to any
particular construction project or phase of a project," particularly, probationary, casual, and
regular employees.

2) Carpio has no outstanding money claims against Modair. Upon completing the NYK Project,
Carpio signed his Final Release of Pay dated April 25, 2013, which incorporated a Quit Claim
whereby he waived any claims against Modair and confirmed the full payment of everything due
him from the NYK Project. He also executed an Affidavit of Release and Quitclaim dated May
24, 2013, acknowledging cessation of his employment upon termination of the project, stating
that he had no claims against Modair, and that a Modair official explained the affidavit to him.
Once an employee resigns and executes a quitclaim in favor of the employer, he is thereby
estopped from filing any further money claims against the employer arising from his employment
Such money claims may be given due course only when the voluntariness of the execution of
the quitclaim or release is put in issue, or when it is established that there is an unwritten
agreement between the employer and employee which would entitle the employee to other
renumeration or benefits upon his or her resignation. Tellingly, Carpio never renounced his.
Final Release of Pay dated April 25, 2013, with Quit Claim, and Affidavit of Release and
Quitclaim dated May 24, 2013.

NIPPON PAINT PHILIPPINES, INC., PETITIONER, VS. NIPPON PAINT PHILIPPINES

EMPLOYEES ASSOCIATION [NIPPEA], RESPONDENT.
RULING:
As a rule, employees have a vested right over existing benefits voluntarily granted to them by
their employer. Any benefit and supplement being enjoyed by the employees cannot be
reduced, diminished, discontinued, or eliminated by the employer. The principle of non-
diminution of benefits under Article 100  of the Labor Code is actually founded on the
constitutional mandate to protect the rights of workers, promote their welfare, and afford them
full protection. In turn, Article 4 of the Labor Code states that "[a]ll doubts in the implementation
and interpretation of this Code, including its implementing rules and regulations, shall be
rendered in favor of labor."

There is diminution of benefits "when the following requisites are present: (1) the grant or
benefit is founded on a policy or has ripened into a practice over a long period of time; (2) the
practice is consistent and deliberate; (3) the practice is not due to error in the construction or
application of a doubtful or difficult question of law; and (4) the diminution or discontinuance is
done unilaterally by the employer."
In Vergara, Jr. v. Coca-Cola Bottlers Philippines, Inc., the Court ruled that to establish the
existence of a regular company practice, the employee must prove by substantial evidence that
the giving of the benefit is done over a long period of time and that it has been made
consistently and deliberately, i.e., despite the employer's knowledge that the payment of a
benefit is not required by any law or agreement. The Court ruled:

To be considered as a regular company practice the employee must prove by substantial

evidence that the giving of the benefit is done over a long period of time, and that it has
been made consistently and deliberately. Jurisprudence has not laid down any hard-and-fast
rule as to the length of time that company practice should have been exercised in order to
constitute voluntary employer practice. The common denominator in previously decided cases
appears to be the regularity and deliberateness of the grant of benefits over a significant period
of time. It requires an indubitable showing that the employer agreed to continue giving
the benefit knowing fully well that the employees are not covered by any provision of the
law or agreement requiring payment thereof. In sum, the benefit must be characterized by
regularity, voluntary and deliberate intent of the employer to grant the benefit over a
considerable period of time. (Emphasis supplied; citations omitted.)
As to the absence of a hard-and-fast rule on the length of time by which a benefit is considered
to have ripened into a company practice, the Court, on different occasions, found the existence
of a company practice as to the benefits that have been given for six years, three years and
nine months, three years and four months, and as will be discussed below, at least two years.

Here, the Court finds that petitioner's grant of additional holiday pay for  Eidul Adho to its
employees for a period of two years ripened into a company practice. Thus, petitioner can no
longer withdraw the grant of such additional holiday pay without violating the principle of non-
diminution of benefits.