gma v. pabriga

6/6/2015 SUPREME COURT REPORTS ANNOTATED VOLUME 710

http://www.central.com.ph/sfsreader/session/0000014dc64d0c8947c80d43000a0094004f00ee/p/ANP331/?username=Guest 1/26

G.R. No. 176419.November 27, 2013.*

GMA NETWORK, INC., petitioner, vs. CARLOS P.PABRIGA, GEOFFREY F. ARIAS, KIRBY N. CAMPO,ARNOLD L. LAGAHIT and ARMAND A. CATUBIG,respondents.

Labor Law; Fixed Term Employment; The Supreme Courtruled in Brent School, Inc. v. Zamora, 181 SCRA 702 (1990), thata fixed term employment contract, which specifies that employmentwill last only for a definite period, is not per se illegal or againstpublic policy.A fifth classification, that of a fixed termemployment, is not expressly mentioned in the Labor Code.Nevertheless, this Court ruled in Brent School, Inc. v. Zamora,181 SCRA 702 (1990), that such a contract, which specifies thatemployment will last only for a definite period, is not per se illegalor against public policy.

Same; Employees performing activities which are usuallynecessary or desirable in the employers usual business or tradecan either be regular, project or seasonal employees, while, as ageneral rule, those performing activities not usually necessary ordesirable in the employers usual business or trade are casualemployees.Employees performing activities which are usuallynecessary or

_______________

*FIRST DIVISION.

691

VOL. 710, NOVEMBER 27, 2013 691

GMA Network, Inc. vs. Pabriga

desirable in the employers usual business or trade can either beregular, project or seasonal employees, while, as a general



rule, those performing activities not usually necessary ordesirable in the employers usual business or trade are casualemployees. The reason for this distinction may not be readilycomprehensible to those who have not carefully studied theseprovisions: only employers who constantly need the specifiedtasks to be performed can be justifiably charged to uphold theconstitutionally protected security of tenure of the correspondingworkers.

Same; Project Employees; The activities of project employeesmay or may not be usually necessary or desirable in the usualbusiness or trade of the employer.The activities of projectemployees may or may not be usually necessary or desirable inthe usual business or trade of the employer, as we have discussedin ALUTUCP v. National Labor Relations Commission, 234SCRA 678 (1994), and recently reiterated in Leyte GeothermalPower Progressive Employees UnionALUTUCP v. PhilippineNational Oil CompanyEnergy Development Corporation, 646SCRA 658 (2011). In said cases, we clarified the term project inthe test for determining whether an employee is a regular orproject employee.

Same; Same; In order to safeguard the rights of workersagainst the arbitrary use of the word project to prevent employeesfrom attaining the status of regular employees, employers claimingthat their workers are project employees should not only prove thatthe duration and scope of the employment was specified at the timethey were engaged, but also that there was indeed a project.Inorder to safeguard the rights of workers against the arbitrary useof the word project to prevent employees from attaining thestatus of regular employees, employers claiming that theirworkers are project employees should not only prove that theduration and scope of the employment was specified at the timethey were engaged, but also that there was indeed a project. Asdiscussed above, the project could either be (1) a particular job orundertaking that is within the regular or usual business of theemployer company, but which is distinct and separate, andidentifiable as such, from the other undertakings of the company;or (2) a particular job or undertaking that is not within theregular business of the corporation. As it was with regard to thedistinction between a regular and casual employee, the purpose ofthis requirement is to delineate whether or not the employer

692

692 SUPREME COURT REPORTS ANNOTATED




is in constant need of the services of the specified employee. If theparticular job or undertaking is within the regular or usualbusiness of the employer company and it is not identifiablydistinct or separate from the other undertakings of the company,there is clearly a constant necessity for the performance of thetask in question, and therefore said job or undertaking should notbe considered a project.

Same; Same; The employers failure to report the terminationof employees upon project completion to the Department of Laborand Employment (DOLE) Regional Office having jurisdiction overthe workplace within the period prescribed militates against theemployers claim of project employment, even outside theconstruction industry.We are not unaware of the decisions ofthe Court in Philippine Long Distance Telephone Company v.Ylagan, 508 SCRA 31 (2006), and ABSCBN BroadcastingCorporation v. Nazareno, 503 SCRA 204 (2006), which held thatthe employers failure to report the termination of employees uponproject completion to the DOLE Regional Office havingjurisdiction over the workplace within the period prescribedmilitates against the employers claim of project employment,even outside the construction industry. We have also previouslystated in another case that the Court should not allowcircumvention of labor laws in industries not falling within theambit of Policy Instruction No. 20/Department Order No. 19,thereby allowing the prevention of acquisition of tenurial securityby project employees who have already gained the status ofregular employees by the employers conduct.

Same; Fixed Term Employment; The Supreme Court laiddown indications or criteria under which term employmentcannot be said to be in circumvention of the law on security oftenure, namely: 1) The fixed period of employment was knowinglyand voluntarily agreed upon by the parties without any force,duress, or improper pressure being brought to bear upon theemployee and absent any other circumstances vitiating his consent;or 2) It satisfactorily appears that the employer and the employeedealt with each other on more or less equal terms with no moraldominance exercised by the former or the latter.Cognizant of thepossibility of abuse in the utilization of fixedterm employmentcontracts, we emphasized in Brent that where from thecircumstances it is apparent that the periods have been imposedto preclude acquisition of tenurial security by the employee, theyshould be struck down as contrary to public policy or



693

VOL. 710, NOVEMBER 27, 2013 693


morals. We thus laid down indications or criteria under whichterm employment cannot be said to be in circumvention of thelaw on security of tenure, namely: 1) The fixed period ofemployment was knowingly and voluntarily agreed upon by theparties without any force, duress, or improper pressure beingbrought to bear upon the employee and absent any othercircumstances vitiating his consent; or 2) It satisfactorily appearsthat the employer and the employee dealt with each other onmore or less equal terms with no moral dominance exercised bythe former or the latter. (Citation omitted.) These indications,which must be read together, make the Brent doctrine applicableonly in a few special cases wherein the employer and employeeare on more or less in equal footing in entering into the contract.The reason for this is evident: when a prospective employee, onaccount of special skills or market forces, is in a position to makedemands upon the prospective employer, such prospectiveemployee needs less protection than the ordinary worker. Lesserlimitations on the parties freedom of contract are thus requiredfor the protection of the employee.

Same; Termination of Employment; It is doctrinallyentrenched that in illegal dismissal cases, the employer has theburden of proving with clear, accurate, consistent, and convincingevidence that the dismissal was valid.To recall, it is doctrinallyentrenched that in illegal dismissal cases, the employer has theburden of proving with clear, accurate, consistent, and convincingevidence that the dismissal was valid. It is therefore the employerwhich must satisfactorily show that it was not in a dominantposition of advantage in dealing with its prospective employee.Thus, in Philips Semiconductors (Phils.), Inc. v. Fadriquela, 427SCRA 408 (2004), this Court rejected the employers insistence onthe application of the Brent doctrine when the sole justification ofthe fixed terms is to respond to temporary albeit frequent need ofsuch workers: We reject the petitioners submission that itresorted to hiring employees for fixed terms to augment orsupplement its regular employment for the duration of peakloads during shortterm surges to respond to cyclical demands;hence, it may hire and retire workers on fixed terms, adinfinitum, depending upon the needs of its customers, domesticand international. Under the petitioners submission, any worker



hired by it for fixed terms of months or years can never attainregular employment status. x x x.

694

694 SUPREME COURT REPORTS ANNOTATED


Same; Night Shift Differential; As regards night shiftdifferential, the Labor Code provides that every employee shall bepaid not less than ten percent (10%) of his regular wage for eachhour of work performed between ten oclock in the evening and sixoclock in the morning.As regards night shift differential, theLabor Code provides that every employee shall be paid not lessthan ten percent (10%) of his regular wage for each hour of workperformed between ten oclock in the evening and six oclock in themorning. As employees of petitioner, respondents are entitled tothe payment of this benefit in accordance with the number ofhours they worked from 10:00 p.m. to 6:00 a.m., if any. In theDecision of the NLRC affirmed by the Court of Appeals, therecords were remanded to the Regional Arbitration Branch oforigin for the computation of the night shift differential and theseparation pay. The Regional Arbitration Branch of origin waslikewise directed to require herein petitioner to produceadditional documents where necessary. Therefore, while we areaffirming that respondents are entitled to night shift differentialin accordance with the number of hours they worked from 10:00p.m. to 6:00 a.m., it is the Regional Arbitration Branch of originwhich should determine the computation thereof for each of therespondents, and award no night shift differential to those ofthem who never worked from 10:00 p.m. to 6:00 a.m.

PETITION for review on certiorari of the decision andresolution of the Court of Appeals.

The facts are stated in the opinion of the Court.Belo, Gozon, Elma, Parel, Asuncion & Lucila for

petitioner.Armando M. Alforque for respondents.

LEONARDODE CASTRO,J.:

This is a Petition for Review on Certiorari filed bypetitioner GMA Network, Inc. assailing the Decision1 of theCourt



_______________1Rollo, pp. 923; penned by Associate Justice Priscilla BaltazarPadilla

with Associate Justices Isaias P. Dicdican and Romeo F. Barza,concurring.

695

VOL. 710, NOVEMBER 27, 2013 695GMA Network, Inc. vs. Pabriga

of Appeals dated September 8, 2006 and the subsequentResolution2 dated January 22, 2007 denyingreconsideration in CAG.R. SP No. 73652.

The Court of Appeals summarized the facts of the caseas follows:

On July 19, 1999, due to the miserable workingconditions, private respondents were forced to file acomplaint against petitioner before the National LaborRelations Commission, Regional Arbitration Branch No.VII, Cebu City, assailing their respective employmentcircumstances as follows:

NAME DATE HIRED POSITIONCarlos Pabriga 2 May 1997 Television TechniciansGeoffrey Arias 2 May 1997 Television TechniciansKirby Campo 1 Dec. 1993 Television TechniciansArnold Laganit 11 Feb. 1996 Television TechniciansArmand Catubig 2 March 1997 Television Technicians

Private respondents were engaged by petitioner to perform thefollowing activities, to wit:

1)Manning of Technical Operations Center:(a)Responsible for the airing of local commercials; and(b)Logging/monitoring of national commercials

(satellite)2)Acting as Transmitter/VTR men:

(a)Prepare tapes for local airing;(b)Actual airing of commercials;(c)Plugging of station promo;(d)Logging of transmitter reading; and(e)In case of power failure, start up generator set to

resume program;

_______________2Id., at pp. 2526.



696

696 SUPREME COURT REPORTS ANNOTATEDGMA Network, Inc. vs. Pabriga

3)Acting as Maintenance staff;(a)Checking of equipment;(b)Warming up of generator;(c)Filling of oil, fuel, and water in radiator; and

4)Acting as CameramenOn 4 August 1999, petitioner received a notice of hearing of the

complaint. The following day, petitioners Engineering Manager,Roy Villacastin, confronted the private respondents about the saidcomplaint.

On 9 August 1999, private respondents were summoned to theoffice of petitioners Area Manager, Mrs. Susan Alio, and theywere made to explain why they filed the complaint. The next day,private respondents were barred from entering and reporting forwork without any notice stating the reasons therefor.

On 13 August 1999, private respondents, through theircounsel, wrote a letter to Mrs. Susan Alio requesting that they berecalled back to work.

On 23 August 1999, a reply letter from Mr. BienvenidoBustria, petitioners head of Personnel and Labor RelationsDivision, admitted the nonpayment of benefits but did notmention the request of private respondents to be allowed to returnto work.

On 15 September 1999, private respondents sent another letterto Mr. Bustria reiterating their request to work but the same wastotally ignored. On 8 October 1999, private respondents filed anamended complaint raising the following additional issues: 1)Unfair Labor Practice; 2) Illegal dismissal; and 3) Damages andAttorneys fees.

On 23 September 1999, a mandatory conference was set toamicably settle the dispute between the parties, however, thesame proved to be futile. As a result, both of them were directed tofile their respective position papers.

On 10 November 1999, private respondents filed their positionpaper and on 2 March 2000, they received

697




a copy of petitioners position paper. The following day, theLabor Arbiter issued an order considering the casesubmitted for decision.3

In his Decision dated August 24, 2000, the Labor Arbiterdismissed the complaint of respondents for illegal dismissaland unfair labor practice, but held petitioner liable for 13thmonth pay. The dispositive portion of the Labor ArbitersDecision reads:

WHEREFORE, the foregoing premises considered,judgment is hereby rendered dismissing the complaints forillegal dismissal and unfair labor practice.

Respondents are, however, directed to pay the followingcomplainants their proportionate 13th month pay, to wit:

1.Kirby Campo P 7,716.04 2.Arnold Lagahit 7,925.98 3.Armand Catubig 4,233.68 4.Carlos Pabriga 4,388.19 5.Geoffrey Arias 4,562.01 P28,826.14 10% Attorneys fees 2,882.61 GRAND TOTAL P31,708.75

All other claims are, hereby, dismissed for failure tosubstantiate the same.4

Respondents appealed to the National Labor RelationsCommission (NLRC). The NLRC reversed the Decision ofthe Labor Arbiter, and held thus:

WHEREFORE, we make the following findings:a)All complainants are regular employees with respect

to the particular activity to which they were assigned, untilit ceased to exist. As such, they are entitled

_______________3Id., at pp. 1012.4Id., at pp. 188189.

698


to payment of separation pay computed at one (1) monthsalary for every year of service;



b)They are not entitled to overtime pay and holidaypay; and

c)They are entitled to 13th month pay, night shiftdifferential and service incentive leave pay.

For purposes of accurate computation, the entire recordsare REMANDED to the Regional Arbitration Branch oforigin which is hereby directed to require from respondentthe production of additional documents where necessary.

Respondent is also assessed the attorneys fees of tenpercent (10%) of all the above awards.5

Petitioner elevated the case to the Court of Appeals via aPetition for Certiorari. On September 8, 2006, the appellatecourt rendered its Decision denying the petition for lack ofmerit.

Petitioner filed the present Petition for Review onCertiorari, based on the following grounds:

I.THE COURT OF APPEALS GRAVELY ERREDFINDING RESPONDENTS ARE REGULAREMPLOYEES OF THE PETITIONER AND ARE NOTPROJECT EMPLOYEES.

II.THE COURT OF APPEALS GRAVELY ERRED INAWARDING SEPARATION PAY TO RESPONDENTSABSENT A FINDING THAT RESPONDENTS WEREILLEGALLY DISMISSED.

III.THE COURT OF APPEALS GRAVELY ERRED INAWARDING NIGHT SHIFT DIFFERENTIAL PAY

_______________5Id., at pp. 175176.

699


CONSIDERING THE ABSENCE OF EVIDENCEWHICH WOULD ENTITLE THEM TO SUCH ANAWARD.

IV.THE COURT OF APPEALS GRAVELY ERRED INAWARDING ATTORNEYS FEES TO



RESPONDENTS.6

The parties having extensively elaborated on theirpositions in their respective memoranda, we proceed todispose of the issues raised.Five Classifications of Employment

At the outset, we should note that the nature of theemployment is determined by law, regardless of anycontract expressing otherwise. The supremacy of the lawover the nomenclature of the contract and the stipulationscontained therein is to bring to life the policy enshrined inthe Constitution to afford full protection to labor. Laborcontracts, being imbued with public interest, are placed ona higher plane than ordinary contracts and are subject tothe police power of the State.7

Respondents claim that they are regular employees ofpetitioner GMA Network, Inc. The latter, on the otherhand, interchangeably characterize respondentsemployment as project and fixed period/fixed termemployment. There is thus the need to clarify the foregoingterms.

The terms regular employment and projectemployment are taken from Article 280 of the Labor Code,which also speaks of casual and seasonal employment:

_______________6Id., at pp. 4243.7Leyte Geothermal Power Progressive Employees UnionALUTUCP v.

Philippine National Oil CompanyEnergy Development Corporation, G.R.No. 170351, March 30, 2011, 646 SCRA 658, 665.

700


ARTICLE280.Regular and casual employment.Theprovisions of written agreement to the contrarynotwithstanding and regardless of the oral agreement of theparties, an employment shall be deemed to be regularwhere the employee has been engaged to perform activitieswhich are usually necessary or desirable in the usualbusiness or trade of the employer, except where theemployment has been fixed for a specific project orundertaking the completion or termination of which has



been determined at the time of the engagement of theemployee or where the work or services to be performed isseasonal in nature and employment is for the duration ofthe season.

An employment shall be deemed to be casual if it is notcovered by the preceding paragraph: Provided, That, anyemployee who has rendered at least one year of service,whether such service is continuous or broken, shall beconsidered a regular employee with respect to the activity inwhich he is employed and his employment shall continuewhile such activity actually exist.

A fifth classification, that of a fixed term employment,is not expressly mentioned in the Labor Code.Nevertheless, this Court ruled in Brent School, Inc. v.Zamora,8 that such a contract, which specifies thatemployment will last only for a definite period, is not per seillegal or against public policy.Whether respondents are regular or project employees

Pursuant to the abovequoted Article 280 of the LaborCode, employees performing activities which are usuallynecessary or desirable in the employers usual business ortrade can either be regular, project or seasonalemployees, while, as a general rule, those performingactivities not usually necessary or desirable in theemployers usual business or trade are casual employees.The reason for this distinction may not be readilycomprehensible to those who have not

_______________8260 Phil. 747; 181 SCRA 702 (1990).

701


carefully studied these provisions: only employers whoconstantly need the specified tasks to be performed can bejustifiably charged to uphold the constitutionally protectedsecurity of tenure of the corresponding workers. Theconsequence of the distinction is found in Article 279 of theLabor Code, which provides:

ARTICLE279.Security of tenure.In cases of regular



employment, the employer shall not terminate the servicesof an employee except for a just cause or when authorizedby this Title. An employee who is unjustly dismissed fromwork shall be entitled to reinstatement without loss ofseniority rights and other privileges and to his fullbackwages, inclusive of allowances, and to his other benefitsor their monetary equivalent computed from the time hiscompensation was withheld from him up to the time of hisactual reinstatement.

On the other hand, the activities of project employeesmay or may not be usually necessary or desirable in theusual business or trade of the employer, as we havediscussed in ALUTUCP v. National Labor RelationsCommission,9 and recently reiterated in Leyte GeothermalPower Progressive Employees UnionALUTUCP v.Philippine National Oil CompanyEnergy DevelopmentCorporation.10 In said cases, we clarified the term projectin the test for determining whether an employee is aregular or project employee:

It is evidently important to become clear about themeaning and scope of the term project in the presentcontext. The project for the carrying out of which projectemployees are hired would ordinarily have somerelationship to the usual business of the employer.Exceptionally, the project undertaking might not have anordinary or normal relationship to the usual business of theemployer. In this latter case, the determination of the

_______________9 G.R. No. 109902, August 2, 1994, 234 SCRA 678, 684686.10Supra note 7 at pp. 668669.

702


scope and parameters of the project becomes fairly easy. Itis unusual (but still conceivable) for a company toundertake a project which has absolutely no relationship tothe usual business of the company; thus, for instance, itwould be an unusual steelmaking company which wouldundertake the breeding and production of fish or thecultivation of vegetables. From the viewpoint, however, of



the legal characterization problem here presented to theCourt, there should be no difficulty in designating theemployees who are retained or hired for the purpose ofundertaking fish culture or the production of vegetables asproject employees, as distinguished from ordinary orregular employees, so long as the duration and scope ofthe project were determined or specified at the time ofengagement of the project employees. For, as is evidentfrom the provisions of Article 280 of the Labor Code, quotedearlier, the principal test for determining whetherparticular employees are properly characterized asproject employees as distinguished from regularemployees, is whether or not the project employeeswere assigned to carry out a specific project orundertaking, the duration (and scope) of which werespecified at the time the employees were engaged forthat project.

In the realm of business and industry, we note thatproject could refer to one or the other of at leasttwo (2) distinguishable types of activities. Firstly, aproject could refer to a particular job or undertakingthat is within the regular or usual business of theemployer company, but which is distinct andseparate, and identifiable as such, from the otherundertakings of the company. Such job or undertakingbegins and ends at determined or determinable times. Thetypical example of this first type of project is a particularconstruction job or project of a construction company. Aconstruction company ordinarily carries out two or more[distinct] identifiable construction projects: e.g., a twentyfivestorey hotel in Makati; a residential condominiumbuilding in Baguio City; and a domestic air terminal inIloilo City. Employees who are hired for the carrying out ofone of these separate projects, the scope

703


and duration of which has been determined and madeknown to the employees at the time of employment, areproperly treated as project employees, and their servicesmay be lawfully terminated at completion of the project.

The term project could also refer to, secondly, a



particular job or undertaking that is not within theregular business of the corporation. Such a job orundertaking must also be identifiably separate and distinctfrom the ordinary or regular business operations of theemployer. The job or undertaking also begins and ends atdetermined or determinable times. x x x.11 (Emphasessupplied, citation omitted.)

Thus, in order to safeguard the rights of workers againstthe arbitrary use of the word project to prevent employeesfrom attaining the status of regular employees, employersclaiming that their workers are project employees shouldnot only prove that the duration and scope of theemployment was specified at the time they were engaged,but also that there was indeed a project. As discussed above,the project could either be (1) a particular job orundertaking that is within the regular or usual business ofthe employer 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 notwithin the regular business of the corporation. As it waswith regard to the distinction between a regular and casualemployee, the purpose of this requirement is to delineatewhether or not the employer is in constant need of theservices of the specified employee. If the particular job orundertaking is within the regular or usual business of theemployer company and it is not identifiably distinct orseparate from the other undertakings of the company,there is clearly a constant necessity for the performance ofthe task in

_______________11ALUTUCP v. National Labor Relations Commission, supra note 9

at pp. 684685.

704


question, and therefore said job or undertaking should notbe considered a project.

Brief examples of what may or may not be consideredidentifiably distinct from the business of the employer arein order. In Philippine Long Distance Telephone Company



v. Ylagan,12 this Court held that accounting duties werenot shown as distinct, separate and identifiable from theusual undertakings of therein petitioner PLDT. Althoughessentially a telephone company, PLDT maintains its ownaccounting department to which respondent was assigned.This was one of the reasons why the Court held thatrespondent in said case was not a project employee. On theother hand, in San Miguel Corporation v. National LaborRelations Commission,13 respondent was hired to repairfurnaces, which are needed by San Miguel Corporation tomanufacture glass, an integral component of its packagingand manufacturing business. The Court, finding thatrespondent is a project employee, explained that SanMiguel Corporation is not engaged in the business ofrepairing furnaces. Although the activity was necessary toenable petitioner to continue manufacturing glass, thenecessity for such repairs arose only when a particularfurnace reached the end of its life or operating cycle.Respondent therein was therefore considered a projectemployee.

In the case at bar, as discussed in the statement of facts,respondents were assigned to the following tasks:

1)Manning of Technical Operations Center:(a)Responsible for the airing of local commercials; and(b)Logging/monitoring of national commercials (satellite)

_______________

12537 Phil. 840; 508 SCRA 31 (2006).

13357 Phil. 954; 293 SCRA 13 (1998).

705


2)Acting as Transmitter/VTR men:(a)Prepare tapes for local airing;(b)Actual airing of commercials;(c)Plugging of station promo;(d)Logging of transmitter reading; and(e)In case of power failure, start up generator set to resume

program;3)Acting as Maintenance staff;

(a)Checking of equipment;(b)Warming up of generator;(c)Filling of oil, fuel, and water in radiator; and



4)Acting as Cameramen14

These jobs and undertakings are clearly within theregular or usual business of the employer company and arenot identifiably distinct or separate from the otherundertakings of the company. There is no denying that themanning of the operations center to air commercials, actingas transmitter/VTR men, maintaining the equipment, andacting as cameramen are not undertakings separate ordistinct from the business of a broadcasting company.

Petitioners allegation that respondents were merelysubstitutes or what they call pinchhitters (which meansthat they were employed to take the place of regularemployees of petitioner who were absent or on leave) doesnot change the fact that their jobs cannot be consideredprojects within the purview of the law. Every industry,even public offices, has to deal with securing substitutes foremployees who are absent or on leave. Such tasks, whetherperformed by the usual employee or by a substitute, cannotbe considered separate and distinct from the otherundertakings of the company. While it is managementsprerogative to device a method to deal with this issue, suchprerogative is not absolute and is limited to systemswherein employees are not ingeniously and methodi

_______________14Rollo, pp. 1011.

706


cally deprived of their constitutionally protected right tosecurity of tenure. We are not convinced that a bigcorporation such as petitioner cannot device a systemwherein a sufficient number of technicians can be hiredwith a regular status who can take over when theircolleagues are absent or on leave, especially when itappears from the records that petitioner hires socalledpinchhitters regularly every month.

In affirming the Decision of the NLRC, the Court ofAppeals furthermore noted that if respondents were indeedproject employees, petitioner should have reported thecompletion of its projects and the dismissal of respondents



in its finished projects:

There is another reason why we should rule in favor ofprivate respondents. Nowhere in the records is there anyshowing that petitioner reported the completion of itsprojects and the dismissal of private respondents in itsfinished projects to the nearest Public Employment Officeas per Policy Instruction No. 2015 of the Department ofLabor and Employment [DOLE]. Jurisprudence aboundswith the consistent rule that the failure of an employer toreport to the nearest Public Employment Office thetermination of its workers services everytime a project or aphase thereof is completed indicates that said workers arenot project employees.

In the extant case, petitioner should have filed as manyreports of termination as there were projects actuallyfinished if private respondents were indeed projectemployees, considering that the latter were hired and againrehired from 1996 up to 1999. Its failure to submit reportsof termination cannot but sufficiently convince us furtherthat private respondents are truly regular employees.Important to note is the fact that private re

_______________15This has been superseded by Department Order No. 19, series of 1993, which

likewise imposed on the employer a duty to report terminations of projectemployment in the construction industry to the DOLE.

707


spondents had rendered more than one (1) year of service atthe time of their dismissal which overturns petitionersallegations that private respondents were hired for aspecific or fixed undertaking for a limited period of time.16(Citations omitted.)

We are not unaware of the decisions of the Court inPhilippine Long Distance Telephone Company v. Ylagan17and ABSCBN Broadcasting Corporation v. Nazareno18which held that the employers failure to report thetermination of employees upon project completion to theDOLE Regional Office having jurisdiction over theworkplace within the period prescribed militates against



the employers claim of project employment, even outsidethe construction industry. We have also previously statedin another case that the Court should not allowcircumvention of labor laws in industries not falling withinthe ambit of Policy Instruction No. 20/Department OrderNo. 19, thereby allowing the prevention of acquisition oftenurial security by project employees who have alreadygained the status of regular employees by the employersconduct.19

While it may not be proper to revisit such pastpronouncements in this case, we nonetheless find thatpetitioners theory of project employment fails the principaltest of demonstrating that the alleged project employee wasassigned to carry out a specific project or undertaking, theduration and scope of which were specified at the time theemployee is engaged for the project.20

The Court of Appeals also ruled that even if it isassumed that respondents are project employees, theywould neverthe

_______________16Rollo, p. 17.17Supra note 12.18534 Phil. 306; 503 SCRA 204 (2006).19Maraguinot, Jr. v. National Labor Relations Commission, 348 Phil.

580, 606; 284 SCRA 539, 561 (1998).20 Pasos v. Philippine National Construction Corporation, G.R. No.

192394, July 3, 2013, 700 SCRA 608.

708


less have attained regular employment status because oftheir continuous rehiring:

Be that as it may, a project employee may also attain thestatus of a regular employee if there is a continuous rehiring ofproject employees after the stoppage of a project; and the activitiesperformed are usual [and] customary to the business or trade ofthe employer. The Supreme Court ruled that a project employee ora member of a work pool may acquire the status of a regularemployee when the following concur:

1)There is a continuous rehiring of project employees even



after cessation of a project; and2)The tasks performed by the alleged project employee are

vital, necessary and indispensable to the usual business ortrade of the employer.

The circumstances set forth by law and the jurisprudence ispresent in this case. In fine, even if private respondents are to beconsidered as project employees, they attained regularemployment status, just the same.21 (Citation omitted.)

Anent this issue of attainment of regular status due tocontinuous rehiring, petitioner advert to the fixed periodallegedly designated in employment contracts and reflectedin vouchers. Petitioner cites our pronouncements in Brent,St. Theresas School of Novaliches Foundation v. NationalLabor Relations Commission,22 and Fabela v. San MiguelCorporation,23 and argues that respondents were fullyaware and freely entered into agreements to undertake aparticular activity for a specific length of time.24 Petitionerapparently confuses project employment from fixed termemployment.

_______________21Rollo, pp. 1718.22351 Phil. 1038; 289 SCRA 110 (1998).23544 Phil. 223; 515 SCRA 288 (2007).24Rollo, pp. 378382.

709


The discussions cited by petitioner in Brent, St. Theresasand Fabela all refer to fixed term employment, which issubject to a different set of requirements.Whether the requisites of a valid fixedterm employment are met

As stated above, petitioner interchangeablycharacterizes respondents service as project and fixed termemployment. These types of employment, however, are notthe same. While the former requires a project asrestrictively defined above, the duration of a fixedtermemployment agreed upon by the parties may be any daycertain, which is understood to be that which mustnecessarily come although it may not be known when.25



The decisive determinant in fixedterm employment is notthe activity that the employee is called upon to perform butthe day certain agreed upon by the parties for thecommencement and termination of the employmentrelationship.26

Cognizant of the possibility of abuse in the utilization offixedterm employment contracts, we emphasized in Brentthat where from the circumstances it is apparent that theperiods have been imposed to preclude acquisition oftenurial security by the employee, they should be struckdown as contrary to public policy or morals.27 We thus laiddown indications or criteria under which termemployment cannot be said to be in circumvention of thelaw on security of tenure, namely:

1)The fixed period of employment was knowingly andvoluntarily agreed upon by the parties without any force,duress, or improper pressure being brought to bear

_______________25Brent School, Inc. v. Zamora, supra note 8 at p. 757; p. 710.26Philips Semiconductors (Phils.), Inc. v. Fadriquela, 471 Phil. 355, 372; 427

SCRA 408, 421 (2004).27Id.

710


upon the employee and absent any other circumstancesvitiating his consent; or

2)It satisfactorily appears that the employer and theemployee dealt with each other on more or less equal termswith no moral dominance exercised by the former or thelatter.28 (Citation omitted.)

These indications, which must be read together, makethe Brent doctrine applicable only in a few special caseswherein the employer and employee are on more or less inequal footing in entering into the contract. The reason forthis is evident: when a prospective employee, on account ofspecial skills or market forces, is in a position to makedemands upon the prospective employer, such prospectiveemployee needs less protection than the ordinary worker.Lesser limitations on the parties freedom of contract are



thus required for the protection of the employee. Theseindications were applied in Pure Foods Corporation v.National Labor Relations Commission,29 where wediscussed the patent inequality between the employer andemployees therein:

[I]t could not be supposed that private respondents and allother socalled casual workers of [the petitioner]KNOWINGLY and VOLUNTARILY agreed to the 5monthemployment contract. Cannery workers are never on equalterms with their employers. Almost always, they agree toany terms of an employment contract just to get employedconsidering that it is difficult to find work given theirordinary qualifications. Their freedom to contract is emptyand hollow because theirs is the freedom to starve if theyrefuse to work as casual or contractual workers. Indeed, tothe unemployed, security of tenure has no value. It couldnot then be said that petitioner and private respondentsdealt with each other on

_______________28Romares v. National Labor Relations Commission, 355 Phil. 835, 847; 294

SCRA 411, 422 (1998); Philips Semiconductors (Phils.), Inc. v. Fadriquela, id., atpp. 372373; p. 422.

29347 Phil. 434, 444; 283 SCRA 133, 142 (1997).

711


more or less equal terms with no moral dominancewhatever being exercised by the former over the latter.

To recall, it is doctrinally entrenched that in illegaldismissal cases, the employer has the burden of provingwith clear, accurate, consistent, and convincing evidencethat the dismissal was valid.30 It is therefore the employerwhich must satisfactorily show that it was not in adominant position of advantage in dealing with itsprospective employee. Thus, in Philips Semiconductors(Phils.), Inc. v. Fadriquela,31 this Court rejected theemployers insistence on the application of the Brentdoctrine when the sole justification of the fixed terms is torespond to temporary albeit frequent need of such workers:



We reject the petitioners submission that it resorted tohiring employees for fixed terms to augment or supplementits regular employment for the duration of peak loadsduring shortterm surges to respond to cyclical demands;hence, it may hire and retire workers on fixed terms, adinfinitum, depending upon the needs of its customers,domestic and international. Under the petitionerssubmission, any worker hired by it for fixed terms ofmonths or years can never attain regular employmentstatus. x x x.

Similarly, in the case at bar, we find it unjustifiable toallow petitioner to hire and rehire workers on fixed terms,ad infinitum, depending upon its needs, never attainingregular employment status. To recall, respondents wererepeatedly rehired in several fixed term contracts from1996 to 1999. To prove the alleged contracts, petitionerpresented cash disbursement vouchers signed byrespondents, stating that they were merely hired as pinchhitters. It is apparent that re

_______________30Dacuital v. L.M. Camus Engineering Corporation, G.R. No. 176748,

September 1, 2010, 629 SCRA 702, 716.31Supra note 25 at p. 373.

712


spondents were in no position to refuse to sign thesevouchers, as such refusal would entail not getting paid fortheir services. Plainly, respondents as pinchhitterscannot be considered to be in equal footing as petitionercorporation in the negotiation of their employmentcontract.

In sum, we affirm the findings of the NLRC and theCourt of Appeals that respondents are regular employees ofpetitioner. As regular employees, they are entitled tosecurity of tenure and therefore their services may beterminated only for just or authorized causes. Sincepetitioner failed to prove any just or authorized cause fortheir termination, we are constrained to affirm the findingsof the NLRC and the Court of Appeals that they were



illegally dismissed.Separation Pay, Night Shift Differentialand Attorneys Fees

Petitioner admits that respondents were not givenseparation pay and night shift differential. Petitioner,however, claims that respondents were not illegallydismissed and were therefore not entitled to separationpay. As regards night shift differential, petitioner claimsthat its admission in its August 23, 1999 letter as to thenonpayment thereof is qualified by its allegation thatrespondents are not entitled thereto. Petitioner points outthat respondents failed to specify the period when suchbenefits are due, and did not present additional evidencebefore the NLRC and the Court of Appeals.32

In light, however, of our ruling that respondents wereillegally dismissed, we affirm the findings of the NLRC andthe Court of Appeals that respondents are entitled toseparation pay in lieu of reinstatement. We quote withapproval the discussion of the Court of Appeals:

_______________32Rollo, pp. 384387.

713


However, since petitioner refused to accept privaterespondents back to work, reinstatement is no longerpracticable. Allowing private respondents to return to theirwork might only subject them to further embarrassment,humiliation, or even harassment.

Thus, in lieu of reinstatement, the grant of separationpay equivalent to one (1) month pay for every year of serviceis proper which public respondent actually did. Where therelationship between private respondents and petitionerhas been severely strained by reason of their respectiveimputations of accusations against each other, to orderreinstatement would no longer serve any purpose. In suchsituation, payment of separation pay instead ofreinstatement is in order.33 (Citations omitted.)

As regards night shift differential, the Labor Codeprovides that every employee shall be paid not less than



ten percent (10%) of his regular wage for each hour of workperformed between ten oclock in the evening and sixoclock in the morning.34 As employees of petitioner,respondents are entitled to the payment of this benefit inaccordance with the number of hours they worked from10:00 p.m. to 6:00 a.m., if any. In the Decision of the NLRCaffirmed by the Court of Appeals, the records wereremanded to the Regional Arbitration Branch of origin forthe computation of the night shift differential and theseparation pay. The Regional Arbitration Branch of originwas likewise directed to require herein petitioner toproduce additional documents where necessary. Therefore,while we are affirming that respondents are entitled tonight shift differential in accordance with the number ofhours they worked from 10:00 p.m. to 6:00 a.m., it is theRegional Arbitration Branch of origin which shoulddetermine the computation thereof for each of therespondents, and award no night shift differential to thoseof them who never worked from 10:00 p.m. to 6:00 a.m.

_______________33Id., at p. 20.34LABOR CODE, Article 86.

714


It is also worthwhile to note that in the NLRC Decision,it was herein petitioner GMA Network, Inc. (respondenttherein) which was tasked to produce additional documentsnecessary for the computation of the night shiftdifferential. This is in accordance with our ruling inDansart Security Force & Allied Services Company v.Bagoy,35 where we held that it is entirely within theemployers power to present such employment records thatshould necessarily be in their possession, and that failureto present such evidence must be taken against them.

Petitioner, however, is correct that the award ofattorneys fees is contrary to jurisprudence. In De lasSantos v. Jebsen Maritime, Inc.,36 we held:

Likewise legally correct is the deletion of the award ofattorneys fees, the NLRC having failed to explain



petitioners entitlement thereto. As a matter of sound policy,an award of attorneys fees remains the exception ratherthan the rule. It must be stressed, as aptly observed by theappellate court, that it is necessary for the trial court, theNLRC in this case, to make express findings of facts andlaw that would bring the case within the exception. In fine,the factual, legal or equitable justification for the awardmust be set forth in the text of the decision. The matter ofattorneys fees cannot be touched once and only in the falloof the decision, else, the award should be thrown out forbeing speculative and conjectural. In the absence of astipulation, attorneys 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.(Citations omitted.)

In the case at bar, the factual basis for the award ofattorneys fees was not discussed in the text of NLRCDecision. We are therefore constrained to delete the same.

_______________35G.R. No. 168495, July 2, 2010, 622 SCRA 694.36512 Phil. 301, 315316; 475 SCRA 656, 670 (2005).

715


WHEREFORE, the Decision of the Court of Appealsdated September 8, 2006 and the subsequent Resolutiondenying reconsideration dated January 22, 2007 in CAG.R. SP No. 73652, are hereby AFFIRMED, with theMODIFICATION that the award of attorneys fees in theaffirmed Decision of the National Labor RelationsCommission is hereby DELETED.

SO ORDERED.

Sereno (CJ., Chairperson), Bersamin, Villarama, Jr.and Reyes, JJ., concur.

Judgment and resolution affirmed with modification.

Notes.A contract of employment stipulating a fixedterm, even if clear as regards the existence of a period, is



invalid if it can be shown that the same was executed withthe intention of circumventing an employees right tosecurity of tenure, and should thus be ignored. (San MiguelCorporation vs. Teodosio, 602 SCRA 197 [2009])

The principal test used to determine whether employeesare project employees is whether or not the employees wereassigned to carry out a specific project or undertaking, theduration or scope of which was specified at the time theemployees were engaged for that project. (Pasos vs.Philippine National Construction Corporation, 700 SCRA608 [2013])

o0o

Copyright 2015 Central Book Supply, Inc. All rights reserved.

gma v. pabriga

Documents

term project

employers usual business

seasonal employees

word project

status of regular employees

employers claimingthat

activities of projectemployees

supreme courtruled