VIVIAN Y. IMBUIDO, Petitioner, v.
NATIONAL LABOR RELATIONS
COMMISSION, INTERNATIONAL INFORMATION SERVICES, INC. and GABRIEL
LIBRANDO, Respondents.
D E C I S I O N
BUENA, J.:
This special civil action for certiorari seeks to set aside the
Decision 1 of the National Labor Relations Commission (NLRC)
promulgated on September 27, 1993 and its Order dated January
11, 1994, which denied petitioner’s motion for reconsideration.
Petitioner was employed as a data encoder by private respondent
International Information Services, Inc., a domestic corporation
engaged in the business of data encoding and keypunching, from
August 26, 1988 until October 18, 1991 when her services were
terminated. From August 26, 1988 until October 18, 1991,
petitioner entered into thirteen (13) separate employment
contracts with private respondent, each contract lasting only
for a period of three (3) months. Aside from the basic hourly
rate, specific job contract number and period of employment,
each contract contains the following terms and
conditions:chanrobles virtuallawlibrary:red
"a. This Contract is for a specific project/job contract only
and shall be effective for the period covered as above-mentioned
unless sooner terminated when the job contract is completed
earlier or withdrawn by client, or when employee is dismissed
for just and lawful causes provided by law The happening of any
of these events will automatically terminate this contract of
employment.chanrobles.com.ph : red
"b. Subject shall abide with the Company’s rules and regulations
for its employees attached herein to form an integral part
hereof.
"c. The nature of your job may require you to render overtime
work with pay so as not to disrupt the Company’s commitment of
scheduled delivery dates made on said job contract." 2
In September 1991, petitioner and twelve (12) other employees of
private respondent allegedly agreed to the filing of a petition
for certification election involving the rank-and-file employees
of private Respondent. 3 Thus, on October 8, 1991, Lakas
Manggagawa sa Pilipinas (LAKAS) filed a petition for
certification election with the Bureau of Labor Relations (BLR),
docketed as NCR-OD-M-9110-128 . 4
Subsequently, on October 18, 1991, petitioner received a
termination letter from Edna Kasilag, Administrative Officer of
private respondent, allegedly "due to low volume of work." 5
Thus, on May 25, 1992, petitioner filed a complaint for illegal
dismissal with prayer for service incentive leave pay and 13th
month differential pay, with the National Labor Relations
Commission, National Capital Region, Arbitration Branch,
docketed as NLRC-NCR Case No. 05--02912-92. 6
In her position paper dated August 3, 1992 and filed before
labor arbiter Raul T. Aquino, petitioner alleged that her
employment was terminated not due to the alleged low volume of
work but because she "signed a petition for certification
election among the rank and file employees of respondents," thus
charging private respondent with committing unfair labor
practices. Petitioner further complained of non-payment of
service incentive leave benefits and underpayment of 13th month
pay. 7
On the other hand, private respondent, in its position paper
filed on July 16, 1992, maintained that it had valid reasons to
terminate petitioners employment and disclaimed any knowledge of
the existence or formation of a union among its rank-and-file
employees at the time petitioner’s services were terminated. 8
Private respondent stressed that its business." . . relies
heavily on companies availing of its services. Its retention by
client companies with particular emphasis on data encoding is on
a project to project basis," 9 usually lasting for a period of
"two (2) to five (5) months." Private respondent further argued
that petitioner’s employment was for a "specific project with a
specified period of engagement." According to private
respondent,." . . the certainty of the expiration of
complainant’s engagement has been determined at the time of
their (sic) engagement (until 27 November 1991) or when the
project is earlier completed or when the client withdraws," as
provided in the contract. 10 "The happening of the second event
[completion of the project] has materialized, thus, her contract
of employment is deemed terminated per the Brent School ruling."
11 Finally, private respondent averred that petitioner’s "claims
for non-payment of overtime time (sic) and service incentive
leave [pay] are without factual and legal basis." 12chanrobles
virtual lawlibrary
In a decision dated August 25, 1992, labor arbiter Raul T.
Aquino, ruled in favor of petitioner and accordingly ordered her
reinstatement without loss of seniority rights and privileges,
and the payment of backwages and service incentive leave pay.
The dispositive part of the said decision
reads:jgc:chanrobles.com.ph
"WHEREFORE, responsive to the foregoing, judgment is hereby
rendered ordering respondents to immediately reinstate
complainant [petitioner herein] as a regular employee to her
former position without loss of seniority rights and privileges
and to pay backwages from the time of dismissal up to the date
of this decision, the same to continue until complainant [’s]
[petitioner herein] actual reinstatement from (sic) the service.
Respondents are likewise ordered to pay complainant [petitioner
herein] service incentive leave pay computed as
follows:chanrobles.com : law library
Backwages:chanrob1es virtual 1aw library
10/18/91 - 8/25/92 = 10.23 mos.
P118.00 x 26 x 10.23 mos. = P31, 385.64
Service Incentive Leave Pay
1989=P89.00 x 5 days=P445.00
1990 =106 x 5 days = P530.00
1991 =118 x 5 days = P590 00
————
P1,565.00
Total P32,950.64
=========
SO ORDERED." 13
In his decision, the labor arbiter found petitioner to be a
regular employee, ruling that [e]ven if herein complainant
[petitioner herein] had been obstensively (sic) hired for a
fixed period or for a specific undertaking, she should be
considered as [a] regular] employee of the respondents in
conformity with the provisions (sic) laid down under Article 280
of the Labor Code," 14 after finding that." . . [i]t is crystal
clear that herein complainant [petitioner herein] performed a
job which are (sic) usually necessary or desirable in the usual
business of respondent [s]." 15 The labor arbiter further
denounced" ...the purpose behind the series of contracts which
respondents required complainant to execute as a condition of
employment was to evade the true intent and spirit of the labor
laws for the working men . . ." 16 Furthermore, the labor
arbiter concluded that petitioner was illegally dismissed
because the alleged reason for her termination, that is, low
volume of work, is "not among the just causes for termination
recognized by law," 17 hence, he ordered her immediate
reinstatement without loss of seniority rights and with full
backwages. With regard to the service incentive leave pay, the
labor arbiter decided . . . to grant the same for failure of the
respondents to fully controvert said claims." 18 Lastly, the
labor arbiter rejected petitioner’s claim for 13th month pay"
...since complainant [petitioner herein] failed to fully
substantiate and argued (sic) the same." 19chanrobles.com :
virtuallawlibrary
On appeal, the NLRC reversed the decision of the labor arbiter
in a decision 20 promulgated on September 27, 1993, the
dispositive part of which reads:jgc:chanrobles.com.ph
"WHEREFORE, the appealed decision is hereby set aside. The
complaint for illegal dismissal is hereby dismissed for being
without merit. Complainant’s [petitioner herein] claim for
service incentive leave pay is hereby remanded for further
arbitration.
SO ORDERED." 21
The NLRC ruled that" [t]here is no question that the complainant
[petitioner herein], viewed in relation to said Article 280 of
the [Labor] Code, is a regular employee judging from the
function and/or work for which she was hired. . . . But this
does not necessarily mean that the complainant [petitioner
herein] has to be guaranteed a tenurial security beyond the
period for which she was hired." 22 The NLRC held that ‘. . .
the complainant [petitioner herein], while hired as a regular
worker, is statutorily guaranteed, in her tenurial security,
only up to the time the specific project for which she was hired
is completed." 23 Hence, the NLRC concluded that" [w]ith the
specific project "at RCBC 014" admittedly completed, the
complainant [petitioner herein] has therefore no valid basis in
charging illegal dismissal for her concomitant (sic)
dislocation." 24chanrobles virtua| |aw |ibrary
In an Order dated January 11, 1994, the NLRC denied petitioner’s
motion for reconsideration.25cralaw:red
In this petition for certiorari, Petitioner, for and in her
behalf, argues that (1) the public respondent "committed grave
abuse of discretion when it ignored the findings of Labor
Arbiter Raul Aquino based on the evidence presented directly
before him, and when it made findings of fact that are contrary
to or not supported by evidence," 26 (2)" [p]etitioner was a
"regular employee," NOT a "project employee" as found by public
respondent NLRC," 27 (3)" [t]he termination of petition (sic)
was tainted with unfair labor practice," 28 and (4) the public
respondent "committed grave abuse of discretion in remanding the
awarded service incentive leave pay for further arbitration."
29
The petition is impressed with merit.
We agree with the findings of the NLRC that petitioner is a
project employee. The principal test for determining whether an
employee is a project employee or a regular employee is whether
the project employee was assigned to carry out a specific
project or undertaking, the duration and scope of which were
specified at the time the employee was engaged for that project.
30 A project employee is 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 service to be performed is
seasonal in nature and the employment is for the duration of the
season. 31 In the instant case, petitioner was engaged to
perform activities which were usually necessary or desirable in
the usual business or trade of the employer, as admittedly,
petitioner worked as a data encoder for private respondent a
corporation engaged in the business of data encoding and
keypunching, and her employment was fixed for a specific project
or undertaking the completion or termination of which had been
determined at the time of her engagement, as may be observed
from the series of employment contracts 32 between petitioner
and private respondent, all of which contained a designation of
the specific job contract and a specific period of employment.
However, even as we concur with the NLRC’s findings that
petitioner is a project employee, we have reached a different
conclusion. In the recent case of Maraguinot, Jr. v. NLRC, 33 we
held that" [a] project employee or a member of a work pool may
acquire the status of a regular employee when the following
concur:chanrobles virtua| |aw |ibrary
1) There is a continuous rehiring of project employees even
after [the] cessation of a project; 34 and
2) The tasks performed by the alleged "project employee" are
vital, necessary and indispensable to the usual business or
trade of the employer. 35"
The evidence on record reveals that petitioner was employed by
private respondent as a data encoder, performing activities
which are usually necessary or desirable in the usual business
or trade of her employer, continuously for a period of more than
three (3) years, from August 26, 1988 to October 18, 1991 36 and
contracted for a total of thirteen (13) successive projects. We
have previously ruled that" [h]owever, the length of time during
which the employee was continuously re-hired is not controlling,
but merely serves as a badge of regular employment." 37 Based on
the foregoing, we conclude that petitioner has attained the
status of a regular employee of
private Respondent.chanroblesvirtual|awlibrary
At this point, we reiterate with emphasis
that:jgc:chanrobles.com.ph
"x x x
"At this time, we wish to allay any fears that this decision
unduly burdens an employer by imposing a duty to re-hire a
project employee even after completion of the project for which
he was hired. The import of this decision is not to impose a
positive and sweeping obligation upon the employer to re-hire
project employees. What this decision merely accomplishes is a
judicial recognition of the employment status of a project or
work pool employee in accordance with what is fait accompli,
i.e., the continuous re-hiring by the employer of project or
work pool employees who perform tasks necessary or desirable to
the employers usual business or trade. Let it not be said that
this decision "coddles" labor, for as Lao 38 has ruled, project
or work pool employees who have gained the status of regular
employees are subject to the "no work-no pay" principle, to
repeat:chanrobles.com : virtuallawlibrary
"A work pool may exist although the workers in the pool do not
receive salaries and are free to seek other employment during
temporary breaks in the business, provided that the worker shall
be available when called to report for a project. Although
primarily applicable to regular seasonal workers, this set-up
can likewise be applied to project workers insofar as the effect
of temporary cessation of work is concerned. This is beneficial
to both the employer and employee for it prevents the unjust
situation of "coddling labor at the expense of capital" and at
the same time enables the workers to attain the status of
regular employees.
"The Court’s ruling here is meant precisely to give life to the
constitutional policy of strengthening the labor sector, but, we
stress, not at the expense of management. Lest it be
misunderstood, this ruling does not mean that simply because an
employee is a project or work pool employee even outside the
construction industry, he is deemed, ipso jure, a regular
employee. All that we hold today is that once a project or work
pool employee has been: 1) continuously, as opposed to
intermittently, re-hired by the same employer for the same tasks
or nature of tasks; and (2) these tasks are vital, necessary and
indispensable to the usual business or trade of the employer,
then the employee must be deemed a regular employee, pursuant to
Article 280 of the Labor Code and jurisprudence. To rule
otherwise would allow circumvention of labor laws in industries
not falling within the ambit of Policy Instruction No.
20/Department Order No. 19, hence allowing the prevention of
acquisition of tenurial security by project or work pool
employees who have already gained the status of regular
employees by the employer’s conduct." 39 (Emphasis
supplied).chanrobles virtuallawlibrary
Being a regular employee, petitioner is entitled to security of
tenure and could only be dismissed for a just or authorized
cause, as provided in Article 279 of the Labor Code, as
amended:jgc:chanrobles.com.ph
"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."cralaw
virtua1aw library
The alleged causes of petitioner’s dismissal (low volume of
work: and belatedly, completion of project) are not valid causes
for dismissal under Articles 282 and 283 of the Labor Code.
Thus, petitioner is entitled to reinstatement without loss of
seniority rights and other privileges, and to her full
backwages, inclusive of allowances, and to her other benefits or
their monetary equivalent computed from the time her
compensation was withheld from her up to the time of her actual
reinstatement. However, complying with the principles of
"suspension of work’’ and "no work, no pay" between the end of
one project and the start of a new one, in computing
petitioner’s backwages, the amounts corresponding to what could
have been earned during the periods from the date petitioner was
dismissed until her reinstatement when private respondent was
not undertaking any project, should be deductedchanrobles
virtual lawlibrary
With regard to petitioner’s claim for service incentive leave
pay, we agree with the labor arbiter that petitioner is entitled
to service incentive leave pay, as provided in Article 95 of the
Labor Code, which reads:jgc:chanrobles.com.ph
"ARTICLE 95. Right to service incentive leave. —
(a) Every employee who has rendered at least one year of service
shall be entitled to a yearly service incentive leave of five
days with pay.
x x x"
Having already worked for more than three (3) years at the time
of her unwarranted dismissal, petitioner is undoubtedly entitled
to service incentive leave benefits, computed from 1989 until
the date of her actual reinstatement. As we ruled in the recent
case of Fernandez v. NLRC, 40" [s]ince a service incentive leave
is clearly demandable after one year of service — whether
continuous or broken — or its equivalent period, and it is one
of the "benefits" which would have accrued if an employee was
not otherwise illegally dismissed, it is fair and legal that
its; computation should be up to the date of reinstatement as
provided under Section [Article] 279 of the Labor Code, as
amended, which reads:chanrobles.com : virtual law library
"ARTICLE 279. Security of Tenure. — 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 is withheld from him up to the time of his actual
reinstatement." (Emphasis supplied).
WHEREFORE, the instant petition is GRANTED. The assailed
decision of the National Labor Relations Commission in NLRC NCR
CA No. 003845-92 dated September 27, 1993, as well as its Order
dated January 11, 1994, are hereby ANNULLED and SET ASIDE for
having been rendered with grave abuse of discretion and the
decision of the Labor Arbiter in NLRC NCR Case No. 05-02912-92
is REINSTATED) with MODIFICATION as above-stated, with regard to
the computation of back wages and service incentive leave
pay.chanrobles.com : virtual law library
SO ORDERED.
