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Name: Cabahug, Sheila Mae

Topic: Contract with fixed period/ fixed term Employment Case Title: BRENT SCHOOL, INC., and REV. GABRIEL DIMACHE vs. RONALDO ZAMORA, the Presidential Assistant for Legal Affairs, Office of the President, and DOROTEO R. ALEGRE G.R No.: L-48494 Date of Judgement: February 5, 1990 Petitioner: BRENT SCHOOL, INC., and REV. GABRIEL DIMACHE Respondent: RONALDO ZAMORA, the Presidential Assistant for Legal Affairs, Office of the President, and DOROTEO R. ALEGRE Ponente: NARVASA, J. Facts: Doroteo R. Alegre was the athletic director at Brent, at a yearly compensation of 20, 000. His contract fixed a specific term of 5 years for its existence, from July, 1971, to July, 1976. Subsequent subsidiary a g r e e m e n t s i n M a r c h 1 9 7 3 , A u g u s t 1 9 7 3 , a n d S e p t . 1 9 7 4 reiterated the same terms and conditions, including the expiry date, as those contained in the original contract of July, 1971. 3 months before the expiration of the stipulated period, in April 1976, he was given a copy of the report filed by Brent w i t h t h e D e p a r t m e n t o f L a b o u r a d v i s i n g o f t h e termination of his s e r v i c e s , e f f e c t i v e J u l y 1 6 , 1 9 7 6 . T h e s t a t e d g r o u n d f o r termination was completion of contract, expiration of the definite period of employment. He p r o t e s t e d the announced t e r m i n a t i o n o f h i s employment. He argued that although his contract did stipulate t h a t t h e s a m e w o u l d t e r m i n a t e o n J u l y 1 7 , 1 9 7 6 , s i n c e h i s services were necessary and desirable in the usual business of his employer, and his employment had lasted for five years, he had acquired the status of regular employee and could not be removed except for valid cause. The employment contract of 1971 was executed when the Labor Code of the Philippines had not yet been promulgated, which came into effect some 3 years after the perfection of the contract. Issue: Whether or not the provisions of the Labour Code regarding probationary and regular employees have anathematized fixed period employment or employment for a term?

Held: YES. Before the Labor Code, there was no doubt about the validity of term employment. It was impliedly but clearly recognized by the Termination Pay law (RA 1052). The Civil Code, which has always recognized, and continues to recognize, the validity and propriety of contracts and obligations with a fixed or definite period, and imposes no restraints on the freedom of the parties to fix the duration of a contract, whatever its object, be it specie, goods or services, except the general admonition against stipulations contrary to law, morals, good customs, public order or public policy. Under the Civil Code, therefore, and as a general proposition, fixed-term employment contracts are not limited, as they are under the present Labor Code, to those by nature seasonal or for specific projects with pre-determined dates of completion; they also include those to which the parties by free choice have assigned a specific date of termination. Where from the circumstances it is apparent that periods have been imposed to preclude acquisition of tenurial security by the employee, they should be struck down or disregarded as contrary to public policy, morals good customs, public order or public policy. But where no such intent to circumvent the law is shown, where the reason for the law does not exist, e.g., where it is indeed the employee himself who insists upon a period or where the nature of the engagement is such that, without being seasonal or for a specific project, a definite date of terminations a sine qua non, would an agreement fixing a period be essentially evil or illicit, therefore anathema. Article 280 of the Labor Code, under a narrow and literal interpretation would appear to restrict, without reasonable distinctions, the right of an employee to freely stipulate with his employer the duration of his engagement, it logically follows that such a literal interpretation should be eschewed or avoided. The law must be given a reasonable interpretation, to preclude absurdity in its application. Outlawing the whole concept of term employment and subverting to boot the principle of freedom of contract to remedy the evil of employer's using it as a means to prevent their employees from obtaining security of tenure is like cutting off the nose to spite the face or, more relevantly, curing headache by lopping off the head. Familiar examples of employment contracts which may be neither for seasonal work nor for specific projects, but to which fixed term is essential. Overseas employment contracts to which, the concept of regular employment will all that it implies does not appear ever to have been applied, Article 280 of the Labor Code not withstanding; appointments to the positions of dean, assistant dean, college secretary, principal, and other administrative offices in educational institutions, which are by practice or tradition rotated among the faculty members, and where fixed terms are a necessity, without which no reasonable rotation would be possible. Despite the provisions of Article 280, Policy, Instructions No. 8 of the Minister of Labor implicitly recognize that certain company officials may be elected for what would amount to fixed periods, at the expiration of which they would have to stand

down, in providing that these officials may lose their jobs as president, executive vicepresident or vice-president and the like because the stockholders or the board of directors for one reason or another did not re-elect them. Since the entire purpose behind the development of legislation culminating in the present Article 280 of the Labor Code clearly appears to have been to prevent circumvention of the employee's right to be secure in his tenure, the clause in said article indiscriminately and completely ruling out all written or oral agreements conflicting with the concept of regular employment as defined therein should be construed to refer to the substantive evil that the Code itself has singled out.

Name: Cabahug, Sheila Mae

Topic: Contract with fixed period/ fixed term Employment Case Title: ZOSIMO CIELO vs. THE HONORABLE NATIONAL LABOR RELATIONS COMMISSION, HENRY LEI and/or HENRY LEI TRUCKING G.R No.: 78693 Date of Judgement: Petitioner: ZOSIMO CIELO Respondent: THE HONORABLE NATIONAL LABOR RELATIONS COMMISSION, HENRY LEI and/or HENRY LEI TRUCKING Ponente: CRUZ, J.:p Facts: The petitioner is a truck driver who claims he was illegally dismissed by the private respondent, the Henry Lei Trucking Company. The Labor Arbiter found for him and ordered his reinstatement with back wages. On appeal, the decision was reversed by the National Labor Relations Commission, which held that the petitioner's employment had expired under a valid contract. The petitioner then came to us on certiorari under Rule 65 of the Rules of Court. The Solicitor General defended the public respondent and agreed that the contract between the petitioner and the private respondent was a binding agreement not contrary to law, morals or public policy. The petitioner's services could be legally terminated upon the expiration of the period agreed upon, which was only six months. The petitioner could therefore not complain that he had been illegally dismissed. As an examination of the claimed agreement was necessary to the resolution of this case, the Court required its production by the petitioner. But he could not comply because he said he had not been given a copy by the private respondent. In his position paper, the petitioner claimed he started working for the private respondent on June 16, 1984, and having done so for more than six months had acquired the status of a regular employee. As such, he could no longer be dismissed except for lawful cause. He also contended that he had been removed because of his refusal to sign, as required by the private respondent, an affidavit. Issue: Whether or not the petitioner's employment had expired under a valid contract? Held:

NO. Because while insisting that it is the agreement that regulates its relations with the petitioner, the private respondent is ensnared by its own words. The agreement specifically declared that there was no employer-employee relationship between the parties. Yet the affidavit the private respondent prepared required the petitioner to acknowledge that "I have received my salary and allowances from Mr. Henry Lei," suggesting an employment relationship. Under these arrangements, the private respondent hoped to be able to terminate the services of the drivers without the inhibitions of the Labor Code. All it had to do was refuse to renew the agreements, which, significantly, were uniformly limited to a six-month period. No cause had to be established because such renewal was subject to the discretion of the parties. In fact, the private respondent did not even have to wait for the expiration of the contract as it was there provided that it could be "earlier terminated at the option of either party." By this clever scheme, the private respondent could also prevent the drivers from becoming regular employees and thus be entitled to security of tenure and other benefits, such as a minimum wage, cost-of-living allowances, vacation and sick leaves, holiday pay, and other statutory requirements. The private respondent argues that there was nothing wrong with the affidavit because all the affiant acknowledged therein was full payment of the amount due him under the agreement. Viewed in this light, such acknowledgment was indeed not necessary at all because this was already embodied in the vouchers signed by the payee-driver. But the affidavit, for all its seeming innocuousness, imported more than that. What was insidious about the document was the waiver the affiant was unwarily making of the statutory rights due him as an employee of the trucking company.The Court looks with stern disapproval at the contract entered into by the private respondent with the petitioner (and who knows with how many other drivers). The agreement was a clear attempt to exploit the unwitting employee and deprive him of the protection of the Labor Code by making it appear that the stipulations of the parties were governed by the Civil Code as in ordinary private transactions. They were not, to be sure. The agreement was in reality a contract of employment into which were read the provisions of the Labor Code and the social justice policy mandated by the Constitution. It was a deceitful agreement cloaked in the habiliments of legality to conceal the selfish desire of the employer to reap undeserved profits at the expense of its employees. The fact that the drivers are on the whole practically unlettered only makes the imposition more censurable and the avarice more execrable.

Name: Cabahug, Sheila Mae G.R. No. 106331 March 9, 1998 INTERNATIONAL PHARMACEUTICALS, INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION (NLRC), FOURTH DIVISION, and DR. VIRGINIA CAMACHO QUINTIA, respondents. MENDOZA, J.: Topic: Contract with fixed period/ Fixed term Employment Case Title: INTERNATIONAL PHARMACEUTICALS, INC. vs. NATIONAL LABOR RELATIONS COMMISSION (NLRC), FOURTH DIVISION, and DR. VIRGINIA CAMACHO QUINTIA G.R No.: 106331 Date of Judgement: March 9, 1998 Petitioner: INTERNATIONAL PHARMACEUTICALS, INC. Respondent: NATIONAL LABOR RELATIONS COMMISSION (NLRC), FOURTH DIVISION, and DR. VIRGINIA CAMACHO QUINTIA Ponente: MENDOZA, J. Facts: Petitioner International Pharmaceuticals, Inc. (IPI) is a corporation engaged in the manufacture, production and sale of pharmaceutical products. In March 1983, it employed private respondent Virginia Camacho Quintia as Medical Director of its Research and Development department, replacing one Diana Villaraza. The government, in that year, launched a program encouraging the development of herbal medicine and offering incentives to interested parties. Petitioner decided to venture into the development of herbal medicine, although it is now alleged that this was merely experimental, to find out if it would be feasible to include herbal medicine in its business. One of the government requirements was the hiring of a pharmacologist. Petitioner avers that it was only for this purpose that private respondent was hired, hence its contention that private respondent was a project employee. The contract of employment provided for a term of one year from the date of its execution on March 19, 1983, subject to renewal by mutual consent of the parties at least thirty days before its expiration. It provided for a monthly compensation of P4,000.00.

It was agreed that Quintia could continue teaching at the Cebu Doctor's Hospital, where she was, at that time, a full-time member of the faculty. Quintia claimed that when her contract of employment was about to expire, she was invited by Xavier University in Cagayan de Oro City to be the chairperson of its pharmacology department. However, Pio Castillo, the president and general manager, prevailed upon her to stay, assuring her of security of tenure. Because of this assurance, she declined the offer of Xavier University. Indeed, after her contract expired on March 19, 1984, she remained in the employ of petitioner where she not only performed the work of Medical Director of its Research and Development department but also that of company physician. This continued until her termination on July 12, 1986. In her complaint, private respondent alleges that the reason for her termination "was her taking up the cudgels for the rank and file employees when she felt they were given a raw deal by the officers of their own Savings and Loan Association." She claimed that sometime in June 1986, while Pio Castillo was in China, the Association declared dividends to its members. Due to complaints of the employees, meetings were held during which private respondent pointed out the "inequality in the imposition of interest rate to the low-salaried employees" and led them in the demand for a full disclosure of the association's financial status. Her participation was resented by the association's officers, all of whom were appointed by management, so that when Castillo arrived, private respondent was summoned to Castillo's office where she was berated for her acts and humiliated in front of some laborers. When she sought permission to explain her side, she was arrogantly turned down and told to leave. On July 10, 1986, Quintia was replaced as head of the Research and Development department by Paz Wong. Two days later, on July 12, 1986, she received an inter-office memorandum officially terminating her services allegedly because of the expiration of her contract of employment. Issue: Whether or not there is clearly no legal or factual basis to support respondent NLRC's reliance on the absence of a new written contract as indicating that respondent Quintia became a regular employee? Held: No, because it is argued that "the mere fact that there was no subsequent written contract does not mean that the original agreement was abandoned and/or that respondent became a regular employee due to the absence thereof and/or that the parties had executed a new agreement, in the absence of evidence showing intent to abandon and/or novate the same." It posits that, based on the acts of the parties, an implied renewal was entered into, or, at the very least, petitioner claims, the absence of a written contract only indicates that the parties impliedly agreed to extend their written contract. There is absolutely no principle of law to support the proposition urged by petitioner. On the other hand the written contract in this case provided that it was

subject to renewal by mutual consent of the parties at least thirty days before its expiration on March 18, 1984. There is no evidence to show that the parties mutually agreed to renew their contract. On the other hand, to sustain petitioner's contention that there was an implied extension after the expiration of the original contract would make it possible for employers like petitioner to circumvent Art. 280 of the Labor Code and thus prevent an employee from becoming regular through the simple expedient of making him sign a contract for a term and then extend to him a contract term, after term, after term. Moreover, assuming that petitioner is correct that there was at least an implied renewal of the written contract containing the same terms and conditions, then Quintia's termination should have been effective in March of 1986 or March of 1987 rather than July of 1986. It should be noted that the fixed term stated in the written contract allegedly renewed is one year. Considering that the said contract was executed on March 19, 1983, then if there really were implied renewals with the same terms and conditions, private respondent's employment should not have been terminated in July of 1986. As discussed earlier, the decision of the NLRC is based not alone on inference drawn from the expiration of the contract but on facts which, in light of Art. 280, show that private respondent's work was in pursuance of the business of petitioner.

Name: Cabahug, Sheila Mae

Topic : Contract with fixed period/ Fixed term Employment

Case Title: ST. THERESA'S SCHOOL OF NOVALICHES FOUNDATION and ADORACION ROXAS vs. NATIONAL LABOR RELATIONS COMMISSION and ESTHER REYES G.R No.: 122955 Date of Judgement: April 15, 1998 Petitioner: ST. THERESA'S SCHOOL OF NOVALICHES FOUNDATION and ADORACION ROXAS Respondent: NATIONAL LABOR RELATIONS COMMISSION and ESTHER REYES Ponente: PURISIMA, J. Facts: Petitioner Adoracion Roxas is the president of St. Theresa's School of Novaliches Foundation. She hired private respondent, Esther Reyes, on a contract basis, for the period from June 1, 1991 to March 31, 1992. However, private respondent commenced work on May 2, 1991. During the said period of employment, private respondent became ill. She went on a leave of absence from February 17 to 21 and from February 24 to 28, 1992, such leave of absence having been duly approved by petitioner Roxas. On March 2, 1992, private respondent reported for work, but she only stayed in her place of work from 6:48 to 9:38 a.m. Thereafter, she never returned. For what reason did private respondent stop working? Petitioners theorize that the private respondent abandoned her work. On the other hand, the latter maintains that she was replaced. When she went back to work on February 20, 1992, she found out that her table, chair, and other belongings were moved to a corner of their office, and she was replaced by Annie Roxas, daughter of petitioner Adoracion Roxas. She tried to contact her employer but the latter could not be found within the school premises. On March 25, 1992, petitioners sent private respondent a letter by registered mall, informing her that her contract, due to expire on March 31, 1992, would not be

renewed. Prior thereto, or on March 3, 1992, to be precise, the private respondent instituted NLRC NCR Case No. 00-033-01481-92 against the herein petitioners for unfair labor practice based on harassment, illegal dismissal, 13th month pay, allowances, removal of desk and chair form place of work, and refusal to communicate, moral and exemplary damages. Issue: Whether or not the award of backwages in favor of private respondent, is proper in light of the finding that her dismissal was valid? Held: No. The term "backwages" has been defined as that for earnings lost by a worker due to his illegal dismissal. Backwages are generally granted on grounds of equity. Payment thereof is a form of relief that restores the income lost by reason of such unlawful dismissal. It is not private compensation or damages, but is awarded in furtherance and effectuation of the public objectives of the labor Code. Nor is it a redress of a private right but, rather, in the nature of a command to the employer to make public reparation for dismissing an employee, either due to the former's unlawful act or bad faith. Jurisprudence is filled to the brim with cases wherein backwages were awarded to an employee illegally dismissed. But where, as in this case of a pitiful employee rendered hapless by her lawyer's inaction or ignorance, the dismissal has been adjudged valid and lawful, the challenged award of backwages is decidedly improper and contrary to law and jurisprudence.

Name: Cabahug, Sheila Mae

Topic: Contract with fixed period/ Fixed term Employment

Case Title: JOAQUIN T. SERVIDAD vs. NATIONAL LABOR RELATIONS COMMISSION, INNODATA PHILIPPINES, INC./ INNODATA CORPORATION, TODD SOLOMON G.R No.: 128682 Date of Judgement: March 18, 1999 Petitioner: JOAQUIN T. SERVIDAD Respondent: NATIONAL LABOR RELATIONS COMMISSION, INNODATA PHILIPPINES, INC. / INNODATA CORPORATION, TODD SOLOMON Ponente: PURISIMA, J. Facts: Petitioner Joaquin T. Servidad was employed on May 9, 1994 by respondent INNODATA as a "Data Control Clerk", under a contract of employment. On November 9, 1995, or after working for six (6) months, he was made to sign a three-month probationary employment and later, an extended three-month probationary employment good until May 9, 1995. On July 7, 1994, the petitioner was given an overall rating of 100% and 98% in the work evaluations conducted by the company. In another evaluation, petitioner received a rating of 98.5% given by the private respondent. On May 9, 1995, petitioner was dismissed from the service on the ground of alleged termination of contract of employment. Such happening prompted petitioner to institute a case for illegal dismissal against the private respondent. Issue: Whether or not the contract of employment of petitioner is to be for a definite or fixed period? Held:

No because the private respondent did not specify the criteria for the termination or retention of the services of petitioner. Such a wide leeway for the determination of the tenure of an employee during a one year period of employment is a violation of the right of the employee against unwarranted dismissal. Certainly, favorable interpretation of the contract in the case under scrutiny should be for petitioner and not for the private respondent which caused the preparation of said contract. If the contract was really for a fixed term, the private respondent should not have been given the discretion to dismiss the petitioner during the one year period of employment for reasons other than the just and authorized causes under the Labor Code. Settled is the rule that an employer can terminate the services of an employee only for valid and just causes which must be shown by clear and convincing evidence. According to the private respondent, the one-year period stipulated in subject contract was to enable petitioner to acquire the skill necessary for the job. In effect, what respondent employer theorized upon is that the one-year term of employment is probationary. If the nature of the job did actually necessitate at least one year for the employee to acquire the requisite training and experience, still, the same could not be a valid probationary employment as it falls short of the requirement of Article 281 of the Labor Code. It was not brought to light that the petitioner was duly informed at the start of his employment, of the reasonable standards under which he could qualify as a regular employee. The rudiments of due process demand that an employee should be apprised before hand of the conditions of his employment and the basis for his advancement. The language of the contract in dispute is truly a double-bladed scheme to block the acquisition of the employee of tenurial security. Thereunder, private respondent has two options. It can terminate the employee by reason of expiration of contract, or it may use "failure to meet work standards" as the ground for the employee's dismissal. In either case, the tenor of the contract jeopardizes the right of the worker to security of tenure guaranteed by the Constitution.

Name: Cabahug, Sheila Mae

Topic: Contract with fixed period/ fixed term Employment

Case Title: PURE FOODS CORPORATION vs. NATIONAL LABOR RELATIONS COMMISSION, RODOLFO CORDOVA, VIOLETA CRUSIS, ET AL. G.R No.: 122653 Date of Judgement: December 12, 1997 Petitioner: PURE FOODS CORPORATION Respondent: NATIONAL LABOR RELATIONS COMMISSION, RODOLFO CORDOVA, VIOLETA CRUSIS, ET AL. Ponente: DAVIDE, JR., J. Facts: The private respondents (numbering 906) were hired by petitioner Pure Foods Corporation to work for a fixed period of five months at its tuna cannery plant in Tambler, General Santos City. After the expiration of their respective contracts of employment in June and July 1991, their services were terminated. They forthwith executed a "Release and Quitclaim" stating that they had no claim whatsoever against the petitioner. On 29 July 1991, the private respondents filed before the National Labor Relations Commission (NLRC) Sub-Regional Arbitration Branch No. XI, General Santos City, a complaint for illegal dismissal against the petitioner and its plant manager, Marciano Aganon. Issue:

Whether or not the contracts with a specific period of employment may be given legal effect provided, however, that they are not intended to circumvent the constitutional guarantee on security of tenure? Held: Yes. This scheme of the petitioner was apparently designed to prevent the private respondents and the other "casual" employees from attaining the status of a regular employee. It was a clear circumvention of the employees' right to security of tenure and to other benefits like minimum wage, cost-of-living allowance, sick leave, holiday pay, and 13th month pay. Indeed, the petitioner succeeded in evading the application of labor laws. Also, it saved itself from the trouble or burden of establishing a just cause for terminating employees by the simple expedient of refusing to renew the employment contracts. The five-month period specified in private respondents' employment contracts having been imposed precisely to circumvent the constitutional guarantee on security of tenure should, therefore, be struck down or disregarded as contrary to public policy or morals. To uphold the contractual arrangement between the petitioner and the private respondents would, in effect, permit the former to avoid hiring permanent or regular employees by simply hiring them on a temporary or casual basis, thereby violating the employees' security of tenure in their jobs. The execution by the private respondents of a "Release and Quitclaim" did not preclude them from questioning the termination of their services. Generally, quitclaims by laborers are frowned upon as contrary to public policy and are held to be ineffective to bar recovery for the full measure of the workers' rights. The reason for the rule is that the employer and the employee do not stand on the same footing. Notably, the private respondents lost not time in filing a complaint for illegal dismissal. This act is hardly expected from employees who voluntarily and freely consented to their dismissal. The NLRC was, thus, correct in finding that the private respondents were regular employees and that they were illegally dismissed from their jobs. Under Article 279 of the Labor Code and the recent jurisprudence, the legal consequence of illegal dismissal is reinstatement without loss of seniority rights and other privileges, with full back wages computed from the time of dismissal up to the time of actual reinstatement, without deducting the earnings derived elsewhere pending the resolution of the case. However, since reinstatement is no longer possible because the petitioner's tuna cannery plant had, admittedly, been close in November 1994, the proper award is separation pay equivalent to one month pay or one-half month pay for every year of service, whichever is higher, to be computed from the commencement of their employment up to the closure of the tuna cannery plant.

Name: Cabahug, Sheila Mae

Topic: Seasonal Employees Case Title: PHILIPPINE TOBACCO FLUE-CURING & REDRYING CORPORATION, vs. NATIONAL LABOR RELATIONS COMMISSION, LIGAYA LUBAT, MARY JANE ESTARIS, EUFRECINA JAVIER, OFELIA PLANDEZ, EDGARDO FORMENTO, CRESCENCIA TIU, MA. VICTORIA LEON, GELLEN EULALIA, AIDA LICUDO, LUCINA LURIS, ERLINDA BORCE, DOMINGA AYALA, CARMELITA APANTO, AIDA ALBANIEL, SALVACION SORIO, PETRONILA SAMSON, ERLINDA CARANAY, ROSALIE TIU, MILAGROS QUISMUNDO, LUZ DELA CRUZ, VIVIAN DERLA, IRENE ENIEGO, VICENTA GARCIA, YOLANDA IGNACIO, ADORACION LADERA, GLORIA MENDEZ, LEONILA MENDOZA, REBECCA MORALES, TERESITA TIU, EMELITA QUILANO, JULIETA PEDRIGAL, ANTONIA REYES, JOSEFA ROSALES, FRANCISCA TISMO, NORMA AGUIRRE, CAROLINA AVISO, AMELIA BAUTISTA, ROSA BORJA, APOLONIA CASTILLO, CARMELITA CAYETANO, ROSELFIDA CENTINA, PATRIA BUSTILLO, FELICIAD CIPRIANO, MARINA CORPUZ, MATILDE CORPUZ, JOSEFINA CUENZA, BIENVENIDA DE GUZMAN, EUGENIA DELA CRUZ, MARIA PINEDA, PANCHITA NARCA, CRISANTA MULAWIN, VIRGINIA MENGOLIO, ROSARIO OSMA, ARCELI MADRILEJO, CRISTOPHER LABADOR, CANDELARIA LAZONA, ANGELITA LESTINGYO, CARMELITA ESPIRITU, HELEN ESTARIS, ROSA JAPSON, ARDIONELA LAZONA, ARIEL ULTRA, REYNANTE TUMBUCON, ANTENOR REMOLLINO, ALEXANDER REMOLLINO, ARNALDO NAPALIT, MACARIO MORIEL, JOSELITO LICUDO, PATERNO LAVALLA, JERRY LICUDO, CESAR SAMSON, EDUARDO ESGUERRA JR., RAMISES CENTARAN, JUAN BUSTILLO, ROLANDO ALBANIEL, REYNALDO AQUINO, JAIME ESGUERRA, ARMANDO JAPSON, FERNANDO ESGUERRA, CARLITO ENIEGO, REYNALDO DAYOT, MARCELO DAYOT, RODOLFO CERBITE, ARTEMIO BOQUILLA, PASCUAL AGUJA, ERIC AGUJA, CELESTINA AQUINO, REYNALDO BARQUIN, FELOMENA BEGONIA, ROSITA BAGONIA, REGINA BENITEZ, EDGARDO BERGANO, RODOLFO BORROMEO, LUDIVICO DALAY, ASCILIPIADES GOYENA, REMEDIO GOYENA, OSCAR EMNACE,

GERTRUDES GUIAO, LOLITA MUSNE, ALBERTO PARAMA, LUNINGNING PERALTA, AMELIA RANCHES, ERNESTO SAN JUAN, LIWAYWAY SAN JUAN, RICARDO TRIUMFANTE, LORENA TORCIDO, PRISCILLA VILLASIN, LUZVIMINDA VILLEGAS, ROSILE VERSOZA, \CHARITO ISIDRO, PETER LABAYNE, and SHIRLEY LUBAT G.R No.: 127395 Date of Judgement: December 10, 1998 Petitioner: PHILIPPINE TOBACCO FLUE-CURING & REDRYING CORPORATION, Respondent: NATIONAL LABOR RELATIONS COMMISSION, LIGAYA LUBAT, MARY JANE ESTARIS, EUFRECINA JAVIER, OFELIA PLANDEZ, EDGARDO FORMENTO, CRESCENCIA TIU, MA. VICTORIA LEON, GELLEN EULALIA, AIDA LICUDO, LUCINA LURIS, ERLINDA BORCE, DOMINGA AYALA, CARMELITA APANTO, AIDA ALBANIEL, SALVACION SORIO, PETRONILA SAMSON, ERLINDA CARANAY, ROSALIE TIU, MILAGROS QUISMUNDO, LUZ DELA CRUZ, VIVIAN DERLA, IRENE ENIEGO, VICENTA GARCIA, YOLANDA IGNACIO, ADORACION LADERA, GLORIA MENDEZ, LEONILA MENDOZA, REBECCA MORALES, TERESITA TIU, EMELITA QUILANO, JULIETA PEDRIGAL, ANTONIA REYES, JOSEFA ROSALES, FRANCISCA TISMO, NORMA AGUIRRE, CAROLINA AVISO, AMELIA BAUTISTA, ROSA BORJA, APOLONIA CASTILLO, CARMELITA CAYETANO, ROSELFIDA CENTINA, PATRIA BUSTILLO, FELICIAD CIPRIANO, MARINA CORPUZ, MATILDE CORPUZ, JOSEFINA CUENZA, BIENVENIDA DE GUZMAN, EUGENIA DELA CRUZ, MARIA PINEDA, PANCHITA NARCA, CRISANTA MULAWIN, VIRGINIA MENGOLIO, ROSARIO OSMA, ARCELI MADRILEJO, CRISTOPHER LABADOR, CANDELARIA LAZONA, ANGELITA LESTINGYO, CARMELITA ESPIRITU, HELEN ESTARIS, ROSA JAPSON, ARDIONELA LAZONA, ARIEL ULTRA, REYNANTE TUMBUCON, ANTENOR REMOLLINO, ALEXANDER REMOLLINO, ARNALDO NAPALIT, MACARIO MORIEL, JOSELITO LICUDO, PATERNO LAVALLA, JERRY LICUDO, CESAR SAMSON, EDUARDO ESGUERRA JR., RAMISES CENTARAN, JUAN BUSTILLO, ROLANDO ALBANIEL, REYNALDO AQUINO, JAIME ESGUERRA, ARMANDO JAPSON, FERNANDO ESGUERRA, CARLITO ENIEGO, REYNALDO DAYOT, MARCELO DAYOT, RODOLFO CERBITE, ARTEMIO BOQUILLA, PASCUAL AGUJA, ERIC AGUJA, CELESTINA AQUINO, REYNALDO BARQUIN, FELOMENA BEGONIA, ROSITA BAGONIA, REGINA BENITEZ, EDGARDO BERGANO, RODOLFO BORROMEO, LUDIVICO DALAY, ASCILIPIADES GOYENA, REMEDIO GOYENA, OSCAR EMNACE, GERTRUDES GUIAO, LOLITA MUSNE, ALBERTO PARAMA, LUNINGNING PERALTA, AMELIA RANCHES, ERNESTO SAN JUAN, LIWAYWAY SAN JUAN, RICARDO TRIUMFANTE, LORENA TORCIDO,

PRISCILLA VILLASIN, LUZVIMINDA VILLEGAS, ROSILE VERSOZA, CHARITO ISIDRO, PETER LABAYNE, and SHIRLEY LUBAT

Ponente: PANGANIBAN, J. Facts: This case involves two groups of seasonal workers who claimed separation benefits after the closure of petitioner's tobacco processing plant in Balintawak, Metro Manila and the transfer of its tobacco operations to Candon, Ilocos Sur. Petitioner refuses to grant separation pay to the workers belonging to the first batch (referred to as the Lubat group), because they had not been given work during the preceding year and, hence, were no longer in its employ at the time it closed its Balintawak plant. Likewise, it claims exemption from awarding separation pay to the second batch (the Luris group), because the closure of its plant was due to "serious business losses," as defined in Article 283 of the Labor Code. Issue: Whether or not the Luris and Lubat group has been illegally dismissed? Held: Yes, serious business losses were not proven. To justify retrenchment: (1) losses expected should be substantial and not merely de minimise. (2) Substantial loss must be reasonably imminent. (3) Retrenchment must be reasonably necessary. Employer should have taken other measures. (4) Alleged losses must be proven by sufficient and convincing evidence. Here, we consider the fact that the petitioner did not actually close its operations but merely transferred its processing and redrying operations. It was also engaged in corn and rental operations. Notice of termination, though issued, violated the one month prior notice requisite. Seasonal workers who are called from time to time and are temporary laid off during off-season are not separated from service in said period, but are merely considered on leave until reemployed. The employer-employee relationship between petitioner and Lubat group was not terminated at the end of 1993 season.

Name: Cabahug, Sheila Mae

Topic: Seasonal Employees Case Title: SAN MIGUEL CORPORATION vs. NATIONAL LABOR RELATIONS COMMISSION and RUSTICO VEGA G.R No.: 80774 Date of Judgement: May 31, 1988 Petitioner: SAN MIGUEL CORPORATION Respondent: NATIONAL LABOR RELATIONS COMMISSION and RUSTICO VEGA Ponente: FELICIANO, J. Facts: In line with an Innovation Program sponsored by petitioner San Miguel Corporation ("Corporation;" "SMC") and under which management undertook to grant cash awards to all SMC employees except [ED-HO staff, Division Managers and higherranked personnel who submit to the Corporation Ideas and suggestions found to be beneficial to the Corporation, private respondent Rustico Vega submitted on 23 September 1980 an innovation proposal. Mr. Vega's proposal was entitled "Modified Grande Pasteurization Process," and was supposed to eliminate certain alleged defects in the quality and taste of the product, San Miguel Beer Grande. Mr. Vega at that time had been in the employ of petitioner Corporation for thirteen (1 3) years and was then holding the position of mechanic in the Bottling Department of the SMC Plant Brewery situated in Tipolo, Mandaue City. Petitioner Corporation, however, did not find the aforequoted proposal acceptable and consequently refused Mr. Vega's subsequent demands for a cash award under the Innovation Program. On 22 February 1983, a Complaint was filed against petitioner Corporation with Regional Arbitration Branch No. VII (Cebu City) of the then Ministry of Labor and Employment. Private respondent Vega alleged there that his proposal [had] been accepted by the methods analyst and implemented by the Corporation [in] October 1980, and that the same ultimately and finally solved the problem of the Corporation in the production of Beer Grande. Private respondent thus

claimed entitlement to a cash prize of P60, 000.00 (the maximum award per proposal offered under the Innovation Program) and attorney's fees. Issue: Whether or not the the money claim of private respondent Vega arose out of or in connection with his employment relation with petitioner Corporation? Held: Yes. The SMC Innovation Program was essentially an invitation from petitioner Corporation to its employees to submit innovation proposals, and that petitioner Corporation undertook to grant cash awards to employees who accept such invitation and whose innovation suggestions, in the judgment of the Corporation's officials, satisfied the standards and requirements of the Innovation Program and which, therefore, could be translated into some substantial benefit to the Corporation. Such undertaking, though unilateral in origin, could nonetheless ripen into an enforceable contractual (facio ut des) obligation on the part of petitioner Corporation under certain circumstances. Thus, whether or not an enforceable contract, albeit implied arid innominate, had arisen between petitioner Corporation and private respondent Vega in the circumstances of this case, and if so, whether or not it had been breached, are preeminently legal questions, questions not to be resolved by referring to labor legislation and having nothing to do with wages or other terms and conditions of employment, but rather having recourse to our law on contracts.

Name: Cabahug, Sheila Mae

Topic: Employees Right to Set Period/ Obligation Case Title: GRAND MOTOR PARTS CORPORATION vs. THE MINISTER OF LABOR, THE REGIONAL DIRECTOR, MINISTRY OF LABOR, REGION VI, and NARCISO BELICENA, JR. G.R No.: L-58958 Date of Judgement: July 16, 1984 Petitioner: GRAND MOTOR PARTS CORPORATION Respondent: THE MINISTER OF LABOR, THE REGIONAL DIRECTOR, MINISTRY OF LABOR, REGION VI, and NARCISO BELICENA, JR. Ponente: GUERRERO, J. Facts: Respondent Balicena was the Branch Manager of the petitioners company in Iloilo Branch. He was the Finance Officer of Warner, Barnes, & Co. (no.2 of the company) when allegedly, Mr. Alfredo Cisneros (the then acting branch manager of the c o m p a n y i n I l o i l o ) i n d u c e d h i m t o a p p l y f o r t h e p o s i t i o n o f Branch Manager, as their company (petitioner) was looking for a C P A . H e a p p l i e d f o r t h e j o b a n d w a s a c c e p t e d . H e s t a r t e d working for the petitioner company on April 1 but resigned from his position in Warner, Barnes, & Co. only on April 28. H o w e v e r , h e w a s t e r m i n a t e d o n l y a f t e r w o r k i n g f o r t h e company for 4 months (April to August). Petitioner company a l l e g e d t h a t h e f a i l e d t o s u b m i t p r o m p t l y t h e m o n t h l y Income and Loss Statement, Comparative Projections & Actual Sales Report and the Comparative Performance Report dated July 8, 1980 on the operation of the Iloilo Branch for the month of June and May, 1980, the Cash Sales of the Iloilo Branch went down to 91, 318.41 for June, 1980, as compared with the sales f o r t h e m o n t h o f M a y , 1 9 8 0 i n t h e s u m o f 1 7 4 , 6 9 7 . 7 7 . Balicena in violation of company policy and without clearance from the head office in Cebu, extended personal accounts in f l a t o r o f 1 5 p e r s o n s w h i c h a s o f N o v e m b e r , 1 9 8 0 p r o d u c e d delinquent accounts amounting to 18, 435.80. He claimed lack of knowledge of the vehicular accident caused by a s u b o r d i n a t e a n d f a i l e d t o p r o v i d e p r o m p t a d m i n i s t r a t i v e disciplinary action against the erring

employee. They claimed that he is only a probationary employee, who would be observed by the company for 4-6 months and that he knew that there is a possibility that he would not get the job. He o n t h e o t h e r h a n d a l l e g e d t h a t h e i s a r e g u l a r employee, although he was not able to present any contract establishing his status as a regular employee. That the mishap involving the company's vehicle which was used without his permission and knowledge could not be blamed upon him and that the alleged reports which he failed to send were not reminded to him, verbally or in writing that his sales for the period April to August, 1980 is higher compared to that for the same period in 1979, also that the alleged accounts remaining unpaid as of November 6, 1980 would have been collected in full if he were still the Manager, among other things. R e g i o n a l D i r e c t o r a n d M i n i s t e r of Labour ruled in favour of B a l i c e n a , ordering his r e i n s t a t e m e n t , p a y m e n t o f h i s back wages, and other privileges. Issue: Whether or not the private respondent's employment as Branch Manager was probationary? Held: For the first issue, the SC ruled in affirmative. The employer has the right or is at liberty to choose as to who will be hired and who will be declined. It is within the exercise of this right to select his employees that the employer may set or fix a probationary period within which the latter may test and observe the conduct of the former before hiring him permanently. The right of a labourer to sell his labour to such persons as he may choose is, in its essence, the same as the right of an employer to purchase labour from any person whom it chooses. The employer and the employee have thus an e q u a l i t y o f r i g h t g u a r a n t e e d b y t h e C o n s t i t u t i o n . I f t h e employer can compel the employee to work against the latters will, this is servitude. If the employee can compel the employer t o g i v e h i m w o r k a g a i n s t t h e e m p l o y e r ' s w i l l , t h i s i s oppression. F i r s t , B a l i c e n a c o u l d n o t p r e s e n t a n y w r i t t e n p r o o f o f h i s appointment or employment as regular and permanent Branch Manager of Petitioners Corporation. Then there was the fact that h e a s s u m e d h i s w o r k a s o f A p r i l 1 b u t r e s i g n e d f r o m h i s previous company only on April 28, meaning that if he was really appointed as regular and permanent then he would have resigned immediately from his old company. But since he was n o t y e t s u r e o f h i s s t a t u s i n t h e p e t i t i o n e r c o r p o r a t i o n , h e resigned late. Second, he claims that there was no written contract because the contracts were given only to those who will pass the probationary period and the rank-and-file employees, not to those managerial ones. This practice is not supported and contrary to usual business practice. Also, being a CPA and Finance Officer in his former company, he should have insisted on a written contract for the security of his tenure in his new position. In short, he already had a stable position in his former company and in not insisting on a written contract, he took the risk of being jobless for he may be terminated as Branch Manager. Third, he had never been hired as manager, and the p e t i t i o n e r c o m p a n y a n d he s f o r m e r

c o m p a n y a r e engaged in different kinds of business so it was necessary for h i m t o u n d e r g o a p e r i o d o f p r o b a t i o n t o t e s t h i s qualifications, skills and experience since managing is a new experience for him.

Name: Cabahug, Sheila Mae

Topic: Employees Right to Set Period/ Obligation Case Title: ORIENT EXPRESS PLACEMENT PHILIPPINES vs. NATIONAL LABOR RELATIONS COMMISSION, PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION and ANTONIO F. FLORES G.R No.:113713 Date of Judgement: June 11, 1997 Petitioner: ORIENT EXPRESS PLACEMENT PHILIPPINES Respondent: NATIONAL LABOR RELATIONS COMMISSION, PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION and ANTONIO F. FLORES Ponente: BELLOSILLO, J. Facts: Antonio Flores was hired as crane operator with a monthly salary of US$500 for 1year subject to a 3month probationary p e r i o d . A f t e r 1 m o n t h a n d 5 d a y s , h e w a s r e p a t r i a t e d t o t h e Philippines. He filed a complaint to POEA for having been terminated for no valid reason. His employers Orient Express a n d N a d r i c o t h e f o r e i g n p r i n c i p a l c l a i m e d t h a t h e w a s terminated for poor job performance as shown in his performance evaluation sheet. POEA decided in favour of Flores held that when the ground invoked for dismissal of an employee was incompetence or poor j o b p e r f o r m a n c e , i t m u s t b e s h o w n t h a t t h e r e a s o n a b l e standards of work prescribed by the employer were made known to the employee. The dismissal was unwarranted because the employers failed to point o u t t h e r e a s o n a b l e standards of work required. NLRC affirmed POEA decision on appeal. It also ruled that the designation of Flores as floor man instead of crane operator for which he was hired violated his employment contract. Orient Express and Nadrico filed for motion for reconsideration but it was denied.

Issue: Whether or not NLRC and POEA committed grave abuse of discretion for ruling that poor job performance and uncooperative work attitude did not justify his dismissal?

Held: NO, Flores was not validly dismissed, the petition is denied. The services of an employee hired on probationary basis may be terminated 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 the engagement. The Court cannot sustain dismissal on this ground because petitioner failed to specify the reasonable standards by which Flores was alleged to have been evaluated to have poor performance. Neither of the 2 original petitioners provided ever made mention that he must first take and pass a Crane Operators License Examination before he would be allowed to touch a crane. Neither did he know that he was to be assigned as floor man pending the release of the exam results. He also did not know that if he failed the exam, he would be subject to a performance evaluation 1 month after his hiring to determine whether the company was amenable in continuing misemployment. Flores could not be faulted for harbouring the impression that he was hired as crane operator for a definite period of 1 year to commence upon his arrival at the work-site and to terminate at the end of 1 year. No other condition was laid out except that he was to be on probation for 3 months. Due process dictates that an employee be apprised beforehand of the condition of his employment and of the terms of advancement therein. Even if unsatisfactory performance was true, it is not one of the just causes for dismissal under the Labor Code. There was no standard by which such probationary period was made known to him.