1. CHERYLL SANTOS LEUS v. ST. SCHOLASTICA’S COLLEGE WESTGROVE, GR No.

187226, 2015-01-28

Facts:

petitioner) worked as a non-teaching employee at the Catholic school St. Scholastica's College
Westgrove (SSCW), engaged in extramarital affairs, and became pregnant unnaturally. she wed the
child's father, and was expelled by SSCW in that sequence.

The petitioner's partner and her had an extramarital child. When SSCW discovered the petitioner was
expecting, Sr. Edward Quiambao instructed her to submit a letter of resignation with effect from June 1,
2003. The petitioner said in return... notified Sr. Quiambao that she wouldn't quit her job because she
became pregnant... lacking the advantages of marriage.

expressly ordered the petitioner to justify her continued employment by providing written justification
after participating in premarital sex and becoming pregnant as a result, both of which constitute serious
misconduct and behavior unbecoming of an employee. of a Catholic university.

In a letter[11] dated June 6, 2003, SSCW, through counsel, argued that premarital sexual interactions are
seen as dishonorable and immoral behavior or serious misconduct, even if they occur between
consenting adults who are not legally barred from getting married. are reasons to terminate your
employment... Petitioner complained about their unjust firing

Issues:

Whether an employee of a catholic educational institution's pregnancy outside of marriage is grounds

for termination of employment will determine whether the petitioner's dismissal was legal.

Ruling:

Without more, the petitioner's unmarried pregnancy alone does not constitute adequate evidence to
label her actions as dishonorable or immoral.

It must be proven beyond a reasonable doubt that premarital sex and, subsequently, Pregnancies
outside of marriage are in fact viewed as shameful or sinful.

The totality of the situation concerning the alleged behavior... You must judge whether something is
shameful or immoral. against the accepted standards of behavior.
taking into account all of the circumstances surrounding the behavior; and second, evaluating those
factors in relation to the... current standards of behavior, or what society as a whole regards as moral
and respectable. The Constitution safeguards an employee's right to tenure security.

When the law speaks of morality, it invariably refers to secular, public morality rather than religious
morality. Thus, the proscription against "disgraceful or immoral conduct" under Section 94(e) of the
1992 MRPS, which is made as a ground for dismissal, must obviously... refer to public and secular
morals.

2. LEGEND HOTEL v. HERNANI S. REALUYO, GR No. 153511, 2012-07-18

Facts:

Respondent averred that he had worked as a pianist at the Legend Hotel's Tanglaw Restaurant from
September 1992 with an initial rate of P400.00/night that was given to him after each night's
performance; that his rate had increased to P750.00/night; and that during his... employment, he could
not choose the time of performance, which had been fixed from 7:00 pm to 10:00 pm for three to six
times/week.

He added that the Legend Hotel's restaurant manager had required him to conform with the venue's
motif; that he had been subjected to the rules on... employees' representation checks and chits, a
privilege granted to other employees;

He added that the Legend Hotel's restaurant manager had required him to conform with the venue's
motif; that he had been subjected to the rules on... employees' representation checks and chits, a
privilege granted to other employees

In its defense, petitioner denied the existence of an employer- employee relationship with respondent,
insisting that he had been only a talent engaged to provide live music at Legend Hotel's Madison Coffee
Shop for three hours/day on two days each week; and stated that the... economic crisis that had hit the
country constrained management to dispense with his services.

the Labor Arbiter (LA) dismissed the complaint for lack of merit upon finding that the parties had no
employer- employee relationship.

On the pivotal issue of whether or not there existed an employer-employee relationship between the
parties, our finding is in the negative.

The finding finds support in the service contract dated September 1, 1992

This is reinforced by the undisputed fact that complainant received his talent fee nightly, unlike the
regular employees of the hotel who are paid by monthly
And thus, absent the power to control with respect to the means and methods by which his work was to
be accomplished, there is no employer-employee relationship between the parties

WHEREFORE, this case must be, as it is hereby, DISMISSED for lack of merit.

Respondent appealed, but the National Labor Relations Commission (NLRC) affirmed the LA on May 31,
2001. assailed the decision of the NLRC in the Court of Appeals (CA) on certiorari.the CA set aside the
decision of the NLRC,... Well settled is the rule that of the four (4) elements of employer- employee
relationship, it is the power of control that is more decisive.he was supervised and controlled by
respondent's restaurant manager who at certain times would require him to perform only tagalog songs
or music, or wear barong tagalog to... conform with Filipiniana motif of the place and the time of his
performance is fixed by the respondents from 7:00 pm to 10:00 pm, three to six times a week. Petitioner
could not choose the time of his performance.he is considered a regular employee of private
respondents since the job of the petitioner was in furtherance of the restaurant business of respondent
hotel.

Granting that petitioner was initially a contractual employee, by the sheer length of... service he had
rendered for private respondents, he had been converted into a regular employee... he dismissal was
due to retrenchment in order to avoid or minimize business losses,... The power of selection was firmly
evidenced by, among others, the express written recommendation dated January 12, 1998 bynChristine
Velazco, petitioner's restaurant manager, for the increase of his remuneration.

Issues:

WHEN IT RULED THAT THERE IS THE EXISTENCE OF EMPLOYER-EMPLOYEE RELATIONSHIP BETWEEN THE
PETITIONER HOTEL AND RESPONDENT ROA.IN FINDING THAT ROA IS A REGULAR EMPLOYEE AND THAT
THE TERMINATION OF HIS SERVICES WAS ILLEGAL. CA LIKEWISE ERRED WHEN IT DECLARED THE
REINSTATEMENT OF ROA TO HIS FORMER POSITION OR BE GIVEN A SEPARATION PAY EQUIVALENT TO
ONE MONTH FOR EVERY YEAR OF SERVICE FROM SEPTEMBER 1999 UNTIL JULY 30, 1999 CONSIDERING
THE ABSENCE OF AN EMPLOYMENT RELATIONSHIP BETWEEN THE PARTIES.

WHEN IT DECLARED THAT ROA IS ENTITLED TO BACKWAGES, SERVICE INCENTIVE LEAVE AND OTHER
BENEFITS CONSIDERING THAT THERE IS NO EMPLOYER EMPLOYEE RELATIONSHIP BETWEEN THE
PARTIES.WHEN IT NULLIFIED THE DECISION DATED MAY 31, 2001 IN NLRC NCR CA NO. 023404-2000 OF
THE NLRC AS WELL AS ITS RESOLUTION DATED JUNE 29, 2001 IN FAVOR OF HEREIN PETITIONER HOTEL
WHEN HEREIN RESPONDENT ROA FAILED TO SHOW PROOF THAT THE NLRC AND THE LABOR ARBITER
HAVE COMMITTED GRAVE ABUSE OF DISCRETION OR LACK OF JURISDICTION IN THEIR RESPECTIVE
DECISIONS. WHEN IT OVERLOOKED THE FACT THAT THE PETITION WHICH ROA FILED IS IMPROPER SINCE
IT RAISED QUESTIONS OF FACT. VI. XXX WHEN IT GAVE DUE COURSE TO THE PETITION FILED BY ROA
WHEN IT IS CLEARLY IMPROPER AND SHOULD HAVE BEEN DISMISSED OUTRIGHT CONSIDERING THAT A
PETITION FORCERTIORARI UNDER RULE 65 IS LIMITED ONLY TO QUESTIONS OR ISSUES OF GRAVE ABUSE
OF DISCRETION OR LACK OF JURISDICTION COMMITTED BY THE NLRC OR THE LABOR ARBITER, WHICH
ISSUES ARE NOT PRESENT IN THE CASE AT BAR.
whether or not respondent was an employee of petitioner... if respondent was... petitioner's employee,
whether he was validly terminated.

Substantive Issue No. 1:

Employer-employee relationship... existed between the parties We next ascertain if the CA correctly
found that an employer- employee relationship existed between the parties.there is a conflict between
the factual findings of the Labor Arbiter and the NLRC, on the one hand, and those of the CA, on the
other hand, it... becomes proper for the Court, in the exercise of its equity jurisdiction, to review and re-
evaluate the factual issues and to look into the records of the case and re-examine the questioned
findings.

Substantive Issue No. 2:

Validity of the Termination

Having established that respondent was an employee whom petitioner terminated to prevent losses,
the conclusion that his termination was by reason of retrenchment due to an authorized cause under
the Labor Code is inevitable.

Ruling:

The appeal fails.

review of the circumstances reveals that respondent was, indeed, petitioner's employee. He was
undeniably employed as a pianist in petitioner's Madison Coffee Shop/Tanglaw Restaurant from
September 1992 until his services were terminated on July 9, 1999.

petitioner argues that whatever remuneration was given to respondent were only his talent fees that
were not included in the definition of wage under the Labor Code; and that such talent fees were but
the consideration for the service... contract entered into between them.

Respondent's remuneration, albeit denominated as talent fees, was still considered as included in the
term wage in the sense and context of the Labor Code, regardless of how petitioner chose to designate
the remuneration. Anent this, Article 97(f) of the Labor Code... clearly states:... xxx wage paid to any
employee shall mean the remuneration or earnings, however designated, capable of being expressed in
terms of money, whether fixed or ascertained on a time, task, piece, or commission basis, or other
method of calculating the same, which... is payable by an employer to an employee under a written or
unwritten contract of employment for work done or to be done, or for services rendered or to be
rendered, and includes the fair and reasonable value, as determined by the Secretary of Labor, of board,
lodging, or... other facilities customarily furnished by the employer to the employee.

There is no denying that whatever amounts he received for his... performance, howsoever designated
by petitioner, were his wages.Yet, petitioner did not present the payroll of its employees to bolster its
insistence of respondent not being its employee.
That respondent worked for less than eight hours/day was of no consequence and did not detract from
the CA's finding on the existence of the employer-employee relationship. In providing that the " normal
hours of work of any employee shall not exceed eight (8) hours a day,"

Article 83 of the Labor Code only set a maximum of number of hours as "normal hours of work" but did
not prohibit work of less than eight hours.

Thirdly, the power of the employer to control the work of the employee is considered the most
significant determinant of the existence of an employer-employee relationship.[18] This is the so-called
control test, and is premised on whether the person for... whom the services are performed reserves
the right to control both the end achieved and the manner and means used to achieve that end.

Petitioner submits that it did not exercise the power of control over respondent and cites the following
to buttress its submission, namely: (a) respondent could beg off from his nightly performances in the
restaurant for other engagements; (b) he had the sole... prerogative to play and perform any musical
arrangements that he wished; (c) although petitioner, through its manager, required him to play at
certain times a particular music or song, the music, songs, or arrangements, including the beat or tempo,
were under his... discretion, control and direction; (d) the requirement for him to wear barong Tagalog
to conform with the Filipiniana motif of the venue whenever he performed was by no means evidence
of control; (e) petitioner could not require him to do any other work in the... restaurant or to play the
piano in any other places, areas, or establishments, whether or not owned or operated by petitioner,
during the three hour period from 7:00 pm to 10:00 pm, three to six times a week; and (f) respondent
could not be required to sing, dance or play... another musical instrument.

A review of the records shows, however, that respondent performed his work as a pianist under
petitioner's supervision and control. Specifically, petitioner's control of both the end achieved and the
manner and means used to achieve that end was demonstrated by the following, to... wit:... a. He could
not choose the time of his performance, which petitioners had fixed from 7:00 pm to 10:00 pm, three to
six times a week;... b. He could not choose the place of his performance;... c. The restaurant's manager
required him at certain times to perform only Tagalog songs or music, or to wear barong Tagalog to
conform to the Filipiniana motif; and... d.He was subjected to the rules on employees' representation
check and chits, a privilege granted to other employees. Relevantly, it is worth remembering that the
employer need not actually supervise the performance of duties by the employee, for it sufficed... that
the employer has the right to wield that power.

Lastly, petitioner claims that it had no power to dismiss respondent due to his not being even subject to
its Code of Discipline, and that the power to terminate the working relationship was mutually vested in
the parties, in that either party might terminate at will, with or... without cause.

The claim is contrary to the records. Indeed, the memorandum informing respondent of the
discontinuance of his service because of the present business or financial condition of petitioner[20]
showed that the latter had the power to dismiss him from... employment.

Substantive Issue No. 2:

Validity of the Termination

Having established that respondent was an employee whom petitioner terminated to prevent losses,
the conclusion that his termination was by reason of retrenchment due to an authorized cause under
the Labor Code is inevitable.

The Court realizes that the lapse of time since the retrenchment might have rendered respondent's
reinstatement to his former job no longer feasible. If that should be true, then petitioner should instead
pay to him separation pay at the rate of one. month pay for every year of... service computed from
September 1992 (when he commenced to work for the petitioners) until the finality of this decision, and
full backwages from the time his compensation was withheld until the finality of this decision.

WHEREFORE, we DENY the petition for review on certiorari, and AFFIRM the decision of the Court of
Appeals promulgated on February 11, 2002, subject to the modification that should reinstatement be no
longer feasible, petitioner shall pay to respondent... separation pay of one month for every year of
service computed from September 1992 until the finality of this decision, and full backwages from the
time his compensation was withheld until the finality of this decision.

Costs of suit to be paid by the petitioners.

3. D.M. CONSUNJI v. ANTONIO GOBRES, GR No. 169170, 2010-08-08

Facts:

Respondents Antonio Gobres, Magellan Dalisay, Godofredo Paragsa, Emilio Aleta and Generoso Melo
worked as carpenters in the construction projects of petitioner D.M. Consunji, Inc., a construction
company, on several occasions and/or at various times.heir... termination from employment for each
project was reported to the Department of Labor and Employment (DOLE)

Respondents' last assignment was at Quad

4-Project in Glorietta, Ayala, Makati, where they started working on September 1, 1998. On October 14,
1998, respondents saw their names included in the Notice of Termination posted on the bulletin board
at the project premises.

Respondents filed a Complaint with the Arbitration Branch of the National Labor Relations Commission
(NLRC) against petitioner D.M. Consunji, Inc. and David M. Consunji for illegal dismissal, and non-
payment of 13th month pay, five (5) days service... incentive leave pay, damages and attorney's fees.

Petitioner D.M. Consunji, Inc. and David M. Consunji countered that respondents, being project
employees, are covered by Policy Instruction No. 20, as superseded by Department Order No. 19, series
of 1993 with respect to their separation or dismissal. Respondents were employed... per project
undertaken by petitioner company and within varying estimated periods indicated in their respective
project employment contracts... petitioner and David M. Consuji averred that respondents' services
were terminated... when their phases of work for which their services were engaged were completed or
when the projects themselves were complete

Moreover, petitioner claimed that respondents have been duly paid their service incentive leave pay
and 13th month pay through their respective bank accounts, as evidenced by bank remittances.[6]

Respondents replied that the Quad 4-Project at Glorietta, Ayala, Makati City was estimated to take two
years to finish, but they were dismissed within the two-year period.

They had no prior notice of their termination. Hence, granting that they were project... employees, they
were still illegally dismissed for non-observance of procedural due process.[7]

Labor Arbiter rendered a Decision[8] dismissing respondents' complaint. The Labor Arbiter found that
respondents were project employees, that they were dismissed from the last project they were assigned
to when their respective... phases of work were completed

NLRC affirmed... he Court of Appeals rendered a Decision, the dispositive portion of which reads:...
private respondents are ordered to pay each of the petitioners the sum of P20,000.00 as nominal
damages for non-compliance with the... statutory due process

The Court of Appeals sustained the findings of the NLRC that respondents are project employees

The CA stated that although respondents were project employees, they were entitled to know the
reason for their dismissal and to be heard on whatever claims they might have. It held that respondents'
right to statutory due process was violated for lack of advance notice of their... termination, even if they
were validly terminated for having completed the phases of work for which they were hired.

Petitioner and David M. Consunji filed a partial motion for reconsideration and prayed that the Decision
of the Court of Appeals be partially reconsidered by deleting the award of nominal damages to each
respondent

It pointed out that under Department Order No. 19, series of

1993, which is the construction industry's governing law, there is no provision requiring administrative
hearing/investigation before a project employee may be terminated on account of completion of phase
of work or the project itself.

In a Resolution[14] dated August 2, 2005, the Court of Appeals denied the partial motion for
reconsideration.

Petitioner D.M. Consunji, Inc. filed this petition raising this question of law:
WHETHER OR NOT THERE IS BASIS FOR THE COURT OF APPEALS IN ORDERING HEREIN PETITIONER TO
PAY RESPONDENTS EACH THE SUM OF P20,000.00 AS NOMINAL DAMAGES FOR "ALLEGED" NON-
COMPLIANCE WITH THE STATUTORY DUE PROCESS

Petitioner contends that the award of nominal damages in the amount of P20,000.00 to each
respondent is unwarranted under Section 2 (III), Rule XXIII, Book V of the Omnibus Rules Implementing
the Labor Code, which states, "If the termination is brought about by the... completion of the contract or
phase thereof, no prior notice is required."[1

Petitioner also contends that Agabon v. NLRC is not applicable to this case. The termination therein was
for just cause due to abandonment of work, while in this case, respondents were terminated due to the
completion of the phases of work.

Issues:

The main issue is whether or not respondents, as project employees, are entitled to nominal damages
for lack of advance notice of their dismissal.

Ruling:

The petition is meritorious.

Respondents were found to be project employees by the Labor Arbiter, the NLRC and the Court of
Appeals. Their unanimous finding that respondents are project employees is binding on the Court. It
must also be pointed out that respondents have not appealed from such finding by the

Court of Appeals. It is only the petitioner that appealed from the decision of the Court of Appeals.

A project employee is defined under Article 280 of the Labor Code as one 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 or where the work or services... to be performed is
seasonal in nature and the employment is for the duration of the season."[1

In this case, the Labor Arbiter, the NLRC and the Court of Appeals all found that respondents, as project
employees, were validly terminated due to the completion of the phases of work for which their
services were engaged. However, the Court of Appeals held that respondents were entitled to nominal
damages, because petitioner failed to give them advance notice of their termination. The appellate
court cited the case of Agabon v. NLRC as basis for the award of nominal damages.

Unlike in Agabon, respondents, in this case, were not terminated for just cause under Article 282 of the
Labor Code.

As project employees, respondents' termination is governed by Section 1 (c) and Section 2 (III), Rule XXIII
(Termination of Employment), Book V of the Omnibus Rules Implementing the Labor Code.
Section 1 (c), Rule XXIII, Book V of the Omnibus Rules Implementing the Labor Code states:

Section 1. Security of tenure. -- (a) In cases of regular employment, the employer shall not terminate
the services of an employee except for just or authorized causes as provided by law, and subject to the
requirements of due process.

(c) In cases of project employment or employment covered by legitimate contracting or sub-contracting

arrangements, no employee shall be dismissed prior to the completion of the project or phase thereof
for which the employee was engaged, or prior to... the expiration of the contract between the principal
and contractor, unless the dismissal is for just or authorized cause subject to the requirements of due
process or prior notice, or is brought about by the completion of the phase of the project or contract for
which... the employee was engaged.[24]

Records show that respondents were dismissed after the expiration of their respective project
employment contracts, and due to the completion of the phases of work respondents were engaged for.
Hence, the cited provision's requirements of due process or prior notice when an... employee is
dismissed for just or authorized cause (under Articles 282 and 283 of the Labor Code) prior to the
completion of the project or phase thereof for which the employee was engaged do not apply to this
case.

Further, Section 2 (III), Rule XXIII, Book V of the Omnibus Rules Implementing the Labor Code provides:

Section 2. Standard of due process: requirements of notice. -- In all cases of termination of employment,
the following standards of due process shall be substantially observed.

III. If the termination is brought about by the completion of the contract or phase thereof, no prior
notice is required. If the termination is brought about by the failure of an employee to meet the
standards of the employer in the case of probationary... employment, it shall be sufficient that a written
notice is served the employee within a reasonable time from the effective date of termination.

In sum, absent the requirement of prior notice of termination when the termination is brought about by
the completion of the contract or phase thereof for which the worker was hired, respondents are not
entitled to nominal damages for lack of advance notice of their... termination.

WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals in CA-G.R. SP No. 70708,
dated March 9, 2005, insofar as it upholds the validity of the dismissal of respondents is AFFIRMED, but
the award of nominal damages to respondents is

DELETED. The Resolution of the Court of Appeals, dated August 2, 2005, is SET ASIDE

4.DACUITAL V. L.M. CAMUS ENGINEERING CORP. AND CAMUS

FACTS:

Petitioners (LMCEC Employees) filed a complaint for illegal dismissal and non-payment of monetary
benefits against respondent LM Camus Engineering Corp. before the National Labor Relations
Commission (NLRC). The employees alleged that they were illegally dismissed from employment and
that their employer failed to pay them their holiday pay, premium pay for holiday, rest day, service
incentive leave pay, and 13th month pay during the existence and duration of their employment. They
also averred that they were not provided with sick and vacation leaves.

Respondents denied that petitioners were illegally dismissed from employment. They claimed that
petitioners were project employees and, upon the completion of each project, they were served notices
of project completion. They clarified that the termination of petitioners’ employment was due to the
completion of the projects for which they were hired.

Petitioners, however, countered that they were regular employees as they had been engaged to
perform activities which are usually necessary or desirable in the usual business or trade of LMCEC. They
denied that they were project or contractual employees because their employment was continuous and
uninterrupted for more than one (1) year. Finally, they maintained that they were part of a work pool
from which LMCEC drew its workers for its various projects.

The Labor Arbiter rendered a decision declaring the dismissal of the complainant-employees as illegal
and the complainants are entitled to reinstatement without back wages. The NLRC modified the decision
of the Labor Arbiter and ordered the reinstatement of the complainants with limited backwages. The
respondents appealed the decision to the Court of Appeals and the appellate court held that the
complainants are project employees and hence, there was no illegal dismissal.

ISSUE: Whether or not the Court of Appeals is correct in concluding that the petitioners are project
employees and that their dismissal from employment was legal

LABOR LAW: Principal test used to determine whether employees are project employees or regular
employees

HELD:

The Supreme Court, speaking through Justice Nachura, answered in the negative. Article 280 of the
Labor Code distinguishes a "project employee" from a "regular employee" in this wise:

Article 280. 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 services to be performed is seasonal in
nature and the employment is for the duration of the season.
The principal test used to determine whether employees are project employees is whether or not the
employees were assigned to carry out a specific project or undertaking, the duration or scope of which
was specified at the time the employees were engaged for that project.

Even though the absence of a written contract does not by itself grant regular status to petitioners, such
a contract is evidence that petitioners were informed of the duration and scope of their work and their
status as project employees.In this case, where no other evidence was offered, the absence of the
employment contracts raises a serious question of whether the employees were properly informed at
the onset of their employment of their status as project employees.

While it is true that respondents presented the employment contract of Dacuital, the contract does not
show that he was informed of the nature, as well as the duration of his employment. In fact, the
duration of the project for which he was allegedly hired was not specified in the contract.

Hence, the dismissal of the petitioners is declared illegal.

5. CASE DIGEST: GMA NETWORK, INC., Petitioner, vs. CARLOS P. PABRIGA, GEOFFREY F. ARIAS, KIRBY N.
CAMPO, ARNOLD L. LAGAHIT, and ARMANDO A. CATUBIG, Respondents.

FACTS: Private respondents were engaged by petitioner for the latters operations in the Technical
Operations Center as Transmitter/VTR men, as Maintenance staff and as Cameramen On July 19 1999
due to the miserable working conditions private respondents were forced to file a complaint against
petitioner before the NLRC Regional Arbitration Branch No. VII Cebu City.

Private respondents filed an amended complaint raising the following additional issues of 1) Unfair
Labor Practice; 2) Illegal dismissal; and 3) Damages and Attorneys fees.

An amicable settlement between the parties was set but the same proved to be futile.The Labor Arbiter
dismissed the complaint of respondents for illegal dismissal and unfair labor practice, but held petitioner
liable for 13th month pay.

The NLRC reversed the Decision of the Labor Arbiter, and held that;

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; and

c) They are entitled to 13th month pay, night shift differential and service incentive leave pay.
When Petitioner elevated the case to the CA via a Petition for Certiorari, it rendered its Decision denying
the petition for lack of merit. Hence, this present Petition for Review on Certiorari.

ISSUES: [1] Did the CA err in finding the respondents as regular employees of the petitioner?

[2] Did the CA err in awarding separation pay to the respondents absent a finding that respondents were
illegally dismissed?

HELD: Respondents claim that they are regular employees of petitioner GMA Network, Inc. The latter, on
the other hand, interchangeably characterize respondents employment as project and fixed period/fixed
term employment.

ARTICLE 280. 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 services to be performed is seasonal in
nature and 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 activity actually exist.

Pursuant to the above-quoted Article 280 of the Labor Code, employees performing activities which are
usually necessary or desirable in the employers usual business or trade can either be regular, project or
seasonal employees, while, as a general rule, those performing activities not usually necessary or
desirable in the employers usual business or trade are casual employees. The consequence of the
distinction is found in Article 279 of the Labor Code, which provides:

ARTICLE 279. 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 of 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.

On the other hand, the activities of project employees may or may not be usually necessary or desirable
in the usual business or trade of the employer.

The term "project" could also refer to, secondly, a particular job or undertaking that is not within the
regular business of the corporation. Such a job or undertaking must also be identifiably separate and
distinct from the ordinary or regular business operations of the employer. The job or undertaking also
begins and ends at determined or determinable times. ALU-TUCP v. National Labor Relations
Commission, G.R. No. 109902, August 2, 1994

The jobs and undertakings are clearly within the regular or usual business of the employer company and
are not identifiably distinct or separate from the other undertakings of the company. There is no
denying that the manning of the operations center to air commercials, acting as transmitter/VTR men,
maintaining the equipment, and acting as cameramen are not undertakings separate or distinct from the
business of a broadcasting company.

In sum, we affirm the findings of the NLRC and the Court of Appeals that respondents are regular
employees of petitioner. As regular employees, they are entitled to security of tenure and therefore
their services may be terminated only for just or authorized causes. Since petitioner failed to prove any
just or authorized cause for their termination, we are constrained to affirm the findings of the NLRC and
the Court of Appeals that they were illegally dismissed.

Since the respondents were illegally dismissed, they entitled to separation pay in lieu of
reinstatement.As regards night shift differential, the Labor Code provides that every employee shall be
paid not less than ten percent (10%) of his regular wage for each hour of work performed between ten
o'clock in the evening and six o'clock in the morning.

As employees of petitioner, respondents are entitled to the payment of this benefit in accordance with
the number of hours they worked from 10:00 p.m. to 6:00 a.m., if any.

The matter of attorney's fees cannot be touched once and only in the fallo of the decision, else, the
award should be thrown out for being speculative and conjectural. In the absence of a stipulation,
attorney's fees are ordinarily not recoverable; otherwise a premium shall be placed on the right to
litigate. They are not awarded every time a party wins a suit.

In the case at bar, the factual basis for the award of attorney's fees was not discussed in the text of NLRC
Decision. Thus, the Court constrained to delete the same.

5.

On July 19, 1999 due to the miserable working conditions private respondents, television technicians,
were forcedto file a complaint against GMA before the NLRC Regional Arbitration Branch No. VII Cebu
City. On August 4,

1999, GMA received a notice of hearing of the complaint. The following day, petitioner’s Engineering
Manager,

Roy Villacastin, confronted the private respondents about said complaint.

-On August 9, 1999, private respondents were summoned to the office of GMA’s Area Manager, Mrs.
Susan Alino,and they were made to explain why they filed the complaint. The next day, private
respondents were barred fromentering and reporting for work without any notice stating the reasons
therefor. On August 13, 1999, private respondents, through their counsel, wrote a letter to Alino,
requesting that they berecalled back to work

- On August 23, 1999, a reply from Mr. Bienvenido Bustria, GMA’s head of Personal and Labor Relations
Division, admitted the non-payment of benefits but did not mention the request of private respondents
to be allowed toreturn to work. On 15 September 1999, private respondents sent another letter to Mr.
Bustria reiterating theirrequest to work but the same was totally ignored. On 8 October 1999, private
respondents filed an amendedcomplaint raising the following additional issues: 1) Unfair Labor Practice;
2) Illegal dismissal; and 3) Damagesand Attorney’s fees.

On 23 September 1999, a mandatory conference was set to amicably settle the dispute between the
parties,however, the same proved to be futile. As a result, both of them were directed to file their
respective positionpapers. On 10 November 1999, private respondents filed their position paper and on
2 March 2000, they receiveda copy of petitioner’s position paper. The following day, the Labor Arbiter
issued an order considering the casesubmitted for decision. LA dismissed the complaint for illegal
dismissal and unfair labor practice, but held petitioner liable for 13

th

monthpay. Respondents appealed to NLRC.

NLRC reversed LA

, saying a) All complainants are regular employeeswith respect to the particular activity to which they
were assigned, until it ceased to exist. As such, they areentitled to payment of separation pay computed
at one (1) month salary for every year of service; b) They are notentitled to overtime pay and holiday
pay; and c) They are entitled to 13th month pay, night shift differential andservice incentive leave pay.
For purposes of accurate computation, the entire records are REMANDED to theRegional Arbitration
Branch of origin which is hereby directed to require from respondent the production ofadditional
documents where necessary.ISSUE:

WON respondents are regular employees and not project employees

WON the requisites of a valid fixed term employment are metHELD:1.

The principal test for determining whether particular employees are properly characterized as "project
employees"as distinguished from "regular employees," is whether or not the "project employees" were
assigned to carry out a"specific project or undertaking," the duration (and scope) of which were
specified at the time the employees wereengaged for that project.

-
 Employers claiming that their workers are project employees should not only prove that the duration
and scope ofthe employment was specified at the time they were engaged, but also that there was
indeed a project. Theproject could either be (1) a particular job or undertaking that is within the regular
or usual business of theemployer company, but which is distinct and separate, and identifiable as such,
from the other undertakings of thecompany; or (2) a particular job or undertaking that is not within the
regular business of the corporation.

In the case at bar, respondents’ jobs and undertakings are clearly within the regular or usual business of
GMA,

and are not identifiably distinct or separate from the other undertakings of the company.

Petitioner’s allegation that respondents were merely substitutes or what they call pinch

-hitters (which means thatthey were employed to take the place of regular employees of petitioner who
were absent or on leave) does notchange the fact that their jobs cannot be considered projects within
the purview of the law. Every industry, evenpublic offices, has to deal with securing substitutes for
employees who are absent or on leave. Such tasks,whether performed by the usual employee or by a
substitute, cannot be considered separate and distinct from the

other undertakings of the company. While it is management’s prerogative to device a method to deal
with this

6. TAMSON’S ENTERPRISES v. CA, GR No. 192881, 2011-11-16

Facts:

Executive Labor Arbiter

This case stemmed from a complaint for illegal dismissal with money claims filed by respondent
Rosemarie L. Sy (Sy) before the Arbitration Branch, National Capital Region, NLRC, against petitioners
Tamson's Enterprises, Inc. (Tamson's), Nelson Lee (Lee), the... company President; and Lilibeth Ong
(Ong) and Johnson Ng (Ng), her co-employees.

Sy was hired by Tamson's as Assistant to the President. Despite the title, she did not act as such
because, per instruction of Lee, she was directed to act as payroll officer, though she actually worked as
a payroll... clerk.
On February 24, 2007,[6] four days before she completed her sixth month of working in Tamson's, Ng,
the Sales Project Manager, called her to a meeting with him and Lee. During the meeting, they informed
Sy that her services would be terminated due to... inefficiency. She was asked to sign a letter of
resignation and quitclaim. She was told not to report for work anymore because her services were no
longer needed. On her last day of work, Ong humiliated her in front of her officemates by shouting at
her and... preventing her from getting her personal things or any other document from the office.

Sy claimed that the remarks of her superiors about her alleged inefficiency were ill-motivated and made
without any basis. She had been rendering services for almost six (6) months before she was arbitrarily
and summarily dismissed. Her dismissal was highly... suspicious as it took place barely four (4) days prior
to the completion of her six-month probationary period. The petitioners did not show her any
evaluation or appraisal report regarding her alleged inefficient performance. As she was terminated
without an evaluation on... her performance, she was deprived of the opportunity to be regularly part of
the company and to be entitled to the benefits and privileges of a regular employee. Worse, she was
deprived of her only means of livelihood.

the petitioners asserted that before Sy was hired, she was apprised that she was being hired as a
probationary employee for six months from September 1, 2006 to February 28, 2007, subject to
extension as a regular employee conditioned on her meeting the standards... of permanent employment
set by the company. Her work performance was thereafter monitored and evaluated. On February 1,
2007, she was formally informed that her employment would end on February 28, 2007 because she
failed to meet the company's standards. From then... on, Sy started threatening the families of the
petitioners with bodily harm. They pointed out that the unpredictable attitude of Sy was one of the
reasons for her not being considered for regular employment.

The foregoing circumstances prompted Sy to file a case for illegal dismissal with claims for back wages,
unpaid salary, service incentive leave, overtime pay, 13th month pay, and moral and exemplary
damages, and attorney's fees.the ELA rendered a decision in favor of Sy, stating that a termination,
notwithstanding the probationary status, must be for a just cause. As there was an absence of evidence
showing just cause and due process, he... found Sy's termination to be arbitrary and illegal.

Dissatisfied, the petitioners appealed to the NLRC on the ground that the ELA gravely abused his
discretion in finding that Sy was illegally dismissed and in ordering her reinstatement and payment of
backwages.

On appeal, the NLRC reversed the ELA's finding that Sy was terminated without just cause and without
due process and dismissed the case.

the NLRC reasoned out that pursuant to Article 281 of the Labor Code, there are two general grounds
for the services of a probationary employee to be terminated, just cause or failure to qualify as a regular
employee. In effect,... failure to qualify for regular employment is in itself a just cause for termination of
probationary employment. To the NLRC, the petitioners were in compliance with the mandate of the
said provision when Sy was notified one month in advance of the expiration of her... probationary
employment due to her non-qualification for regular employment.
Sy elevated her case to the CA via a petition for certiorari... the CA rendered the assailed decision
reversing the NLRC. It explained that at the time Sy was engaged as a probationary employee she was
not informed of the standards that she should meet to become a regular employee. Citing the ruling in
Clarion

Printing House, Inc v. NLRC,[9] the CA stated that where an employee hired on probationary basis was
not informed of the standards that would qualify her as a regular employee, she was deemed to have
been hired from day one as a regular employee.

As a regular employee, she was entitled to security of tenure and could be dismissed only for a just
cause and after due compliance with procedural due process.

The petitioners sought reconsideration of the said decision. The CA, however, denied the motion

Hence, the petitioners interpose the present petition

The petitioners pray for the reversal of the CA decision arguing that Sy was a probationary employee
with a limited tenure of six months subject to regularization conditioned on her satisfactory
performance. They insist that they substantially complied with the... requirements of the law having
apprised Sy of her status as probationary employee. The standard, though not written, was clear that
her continued employment would depend on her over-all performance of the assigned tasks, and that
the same was made known to her since day... one of her employment. According to the petitioners,
reasonable standard of employment does not require written evaluation of Sy's function. It is enough
that she was informed of her duties and that her performance was later rated below satisfactory by the
Management.

Citing Alcira v. NLRC[12] and Colegio San Agustin v. NLRC,[13] the petitioners further argue that Sy's
constitutional protection to security of tenure ended on the last day of her probationary tenure or on
February 28,... 2007. It is unfair to compel regularization of an employee who was found by the
Management to be unfit for the job.

Issues:

whether the termination of Sy, a probationary employee, was valid or not.

Ruling:

The pertinent law governing the present case is Article 281 of the Labor Code which provides as follows:

Art. 281. Probationary employment. Probationary employment shall not exceed six months from the
date the employee started working, unless it is covered by an apprenticeship agreement stipulating a
longer period. The services of an employee who has... been engaged in a probationary basis may be
terminated for a just cause or when he fails to qualify as a regular employee in accordance with
reasonable standards made known by the employer to the employee at the time of his engagement. An
employee who is allowed to work... after a probationary period shall be considered a regular employee.
There is probationary employment where the employee upon his engagement is made to undergo a trial
period during which the employer determines his fitness to qualify for regular employment based on
reasonable standards made known to him at the time of engagement.[14] The probationary
employment is intended to afford the employer an opportunity to observe the fitness of a probationary
employee while at work, and to ascertain whether he will become an efficient and productive employee.
While the employer observes the fitness,... propriety and efficiency of a probationer to ascertain
whether he is qualified for permanent employment, the probationer, on the other hand, seeks to prove
to the employer that he has the qualifications to meet the reasonable standards for permanent
employment. Thus, the word... probationary, as used to describe the period of employment, implies the
purpose of the term or period, not its length.

Sy's employment with Tamson's on September 1, 2006 was probationary in character. As a probationary
employee, her employment status was only temporary. Although a probationary or temporary...
employee with a limited tenure, she was still entitled to a security of tenure.

It is settled that even if probationary employees do not enjoy permanent status, they are accorded the
constitutional protection of security of tenure. This means they may only be terminated for a just cause
or when they otherwise fail to qualify as regular employees in... accordance with reasonable standards
made known to them by the employer at the time of their engagement.

Consistently, in Mercado v. AMA Computer College-Paranaque City, Inc.,[17] this Court clearly stressed...
that:

Labor, for its part, is given the protection during the probationary period of knowing the company
standards the new hires have to meet during the probationary period, and to be judged on the basis of
these standards, aside from the usual standards applicable to... employees after they achieve
permanent status. Under the terms of the Labor Code, these standards should be made known to the
[employees] on probationary status at the start of their probationary period, or xxx during which the
probationary standards are to be applied. Of... critical importance in invoking a failure to meet the
probationary standards, is that the [employer] should show as a matter of due process how these
standards have been applied.

In this case, the justification given by the petitioners for Sy's dismissal was her alleged failure to qualify
by the company's standard. Other than the general allegation that said standards were made known to
her at the time of her employment, however, no evidence,... documentary or otherwise, was presented
to substantiate the same. Neither was there any performance evaluation presented to prove that
indeed hers was unsatisfactory.

Sy's employment was unjustly terminated to prevent her from acquiring a regular status in
circumvention of the law on security of tenure.

this is a common and convenient practice of unscrupulous employers to circumvent the law on security
of tenure. Security of tenure, which is a right of paramount value guaranteed by the Constitution, should
not be denied to the workers by such a... stratagem. The Court can not permit such a subterfuge, if it is
to be true to the law and social justice.

Indeed, the Court recognizes the employer's power to terminate as an exercise of management
prerogative. The petitioners, however, must be reminded that such right is not without limitations.

As Article 281 clearly states, a probationary employee can be legally terminated either: (1) for a just
cause; or (2) when the employee fails to qualify as a regular employee in accordance with the
reasonable standards made known to him by the employer at the start... of the employment.
Nonetheless, the power of the employer to terminate an employee on probation is not without
limitations. First, this power must be exercised in accordance with the specific requirements of the
contract. Second, the dissatisfaction on the part of... the employer must be real and in good faith, not
feigned so as to circumvent the contract or the law; and third, there must be no unlawful discrimination
in the dismissal. In termination cases, the burden of proving just or valid cause for dismissing an
employee rests on... the employer.

Here, the petitioners failed to convey to Sy the standards upon which she should measure up to be
considered for regularization and how the standards had been applied in her case. As correctly pointed
out by Sy, the dissatisfaction on the part of the petitioners was at... best self-serving and dubious as they
could not present concrete and competent evidence establishing her alleged incompetence. Failure on
the part of the petitioners to discharge the burden of proof is indicative that the dismissal was not
justified.

The law is clear that in all cases of probationary employment, the employer shall make known to the
employee the standards under which he will qualify as a regular employee at the time of his
engagement. Where no standards are made known to the employee at that time, he shall be... deemed
a regular employee.[24] The standards under which she would qualify as a regular employee not having
been communicated to her at the start of her probationary period, Sy qualified as a regular employee.

As held by this Court in the very recent... case of Hacienda Primera Development Corporation v.
Villegas,:[25]

In this case, petitioner Hacienda fails to specify the reasonable standards by which respondent's alleged
poor performance was evaluated, much less to prove that such standards were made known to him at
the start of his employment. Thus, he is deemed to have... been hired from day one as a regular
employee. Due process dictates that an employee be apprised beforehand of the condition of his
employment and of the terms of advancement therein.

Even on the assumption that Sy indeed failed to meet the standards set by them and made known to
the former at the time of her engagement, still, the termination was flawed for failure to give the
required notice to Sy.

In this case, the petitioners failed to comply with the requirement of a written notice. Notably, Sy was
merely verbally informed that her employment would be terminated on February 28, 2007, as admitted
by the petitioners.[26] Considering that the... petitioners failed to observe due process in dismissing her,
the dismissal had no legal sanction. It bears stressing that a worker's employment is property in the
constitutional sense

WHEREFORE, the petition is DENIED.

7.