CLASSES OF EMPLOYEES (PROBATIONARY EMPLOYEES)
Abbott Laboratories v. Alcaraz 2013 RULING+RATIO:
Digest Author: FABI
DOCTRINE: If the employer fails to inform the probationary employee of the reasonable
standards upon which the regularization would be based on at the time of the engagement, then
the said employee shall be deemed a regular employee.
FACTS:
1. Abbott Laboratories, Philippines published in major broadsheet that it is in need of
Medical and Regulatory Affairs Manager stating therein the responsibilities and
qualifications of said position.
2. Abbott formally offered Alcaraz the abovementioned position which was an item
under the company’s Hospira Affiliate Local Surveillance Unit (ALSU) department.
3. Alcaraz signed an employment contract which stated, inter alia, that she was to
be placed on probation for a period of six (6) months beginning February 15, 2005
to August 14, 2005.
4. She underwent pre-employment orientation where she was briefed on her duties and
responsibilities.
5. Alcaraz received an e-mail from the HR Director explaining the procedure for
evaluating the performance of probationary employees and further indicated that
Abbott had only one evaluation system for all of its employees.
6. Alcaraz was also given copies of Abbott’s Code of Conduct and Probationary
Performance Standards and Evaluation and Performance Excellence Orientation
Modules which she had to apply in line with her task of evaluating the Hospira ALSU
staff.
7. Alcaraz received an e-mail from Misa requesting immediate action on the staff’s
performance evaluation as their probationary periods were about to end.
8. Alcaraz was called to a meeting with her immediate supervisor and the former
HR Director where she was informed that she failed to meet the regularization
standards for the position of Regulatory Affairs Manager.
9. Thereafter she was asked to tender her resignation, else they be forced to
terminate her services.
10. She filed a case of illegal dismissal against Abott and its officers.
DECISIONS:
1. Labor Arbiter dismissed her complaint for lack of merit.
2. NLRC reversed and set aside the LA’s ruling and ordered Abott to reinstate and pay
Alcaraz moral and exemplary damages.
3. CA affirmed NLRC decision.
ISSUES:
1. W/N Alcaraz was sufficiently informed of the reasonable standards to qualify her
as a regular employee.
2. W/N Alcaraz was validly terminated from her employment.
1.) YES, Alcaraz was sufficiently informed of the reasonable standards.
LB: The employer is made to comply with two (2) requirements when dealing with a
probationary employee:
• first, the employer must communicate the regularization standards to the
probationary employee; and
• second, the employer must make such communication at the time of the
probationary employee’s engagement.
If the employer fails to comply with either, the employee is deemed as a regular and not a
probationary employee.
AP: In this case, Abbott complied with the above-stated requirements.
• This conclusion is largely impelled by the fact that Abbott clearly conveyed to
Alcaraz her duties and responsibilities as Regulatory Affairs Manager prior to,
during the time of her engagement, and the incipient stages of her employment.
2.) YES, Alcaraz was validly terminated from her employment.
LB: A probationary employee, like a regular employee, enjoys security of tenure. However, in
cases of probationary employment, aside from just or authorized causes of termination, an
additional ground is provided under Article 295 of the Labor Code, i.e., the probationary
employee may also be terminated for failure to qualify as a regular employee in accordance
with the reasonable standards made known by the employer to the employee at the time of
the engagement.
A different procedure is applied when terminating a probationary employee; the usual two-notice
rule does not govern.
Section 2, Rule I, Book VI of the Implementing Rules of the Labor Code states that "if the
termination is brought about by the failure of an employee to meet the standards of the
employer in case of probationary employment, it shall be sufficient that a written notice is
served the employee, within a reasonable time from the effective date of termination."
AP: As the records show, Alcaraz's dismissal was effected through a letter dated May 19, 2005
which she received on May 23, 2005 and again on May 27, 2005.
• Stated therein were the reasons for her termination, i.e., that after proper
evaluation, Abbott determined that she failed to meet the reasonable standards
for her regularization considering her lack of time and people management and
decision-making skills, which are necessary in the performance of her functions
as Regulatory Affairs Manager.
• This written notice sufficiently meets the criteria set forth above, thereby
legitimizing the cause and manner of Alcaraz’s dismissal as a probationary
employee under the parameters set by the Labor Code.
DISPOSITION: Petition Granted
 CLASSES OF EMPLOYEES (PROBATIONARY EMPLOYEES)
Abbott Laboratories v. Alcaraz 2014
Digest Author: FABI
DOCTRINE: Probationary Employees; Termination of Employment; As the Supreme Court
observed, an employee’s failure to perform the duties and responsibilities which have been
clearly made known to him constitutes a justifiable basis for a probationary employee’s non-
regularization.
If the probationary employee had been fully apprised by his employer of these duties and
responsibilities, then basic knowledge and common sense dictate that he must adequately
perform the same, else he fails to pass the probationary trial and may therefore be subject to
termination.
Aliling v. Feliciano not applicable
Respondent’s contention: By way of example, Alcaraz cites the case of a probationary
salesperson and asks how does such employee achieve regular status if he does not know how
much he needs to sell to reach the same.
LB: The employee in Aliling, a sales executive, was belatedly informed of his quota requirement.
Thus, considering the nature of his position, the fact that he was not informed of his sales quota
at the time of his engagement changed the complexion of his employment.
AP: Contrarily, the nature of Alcaraz’s duties and responsibilities as Regulatory Affairs Manager
negates the application of the foregoing.

Standards for regularization; conceptual under pinnings. Records show that Alcaraz was terminated because she

(a) did not manage her time effectively;

Respondent’s contention: Alcaraz posits that, contrary to the Court’s Decision, one’s job (b) failed to gain the trust of her staff and to build an effective rapport with them;
description cannot by and of itself be treated as a standard for regularization as a standard (c) failed to train her staff effectively; and
denotes a measure of quantity or quality. (ISSUE) (d) was not able to obtain the knowledge and ability to make sound judgments
on case processing and article review which were necessary for the proper
RULING: performance of her duties.

(1) D: it is not the probationary employee’s job description but the adequate performance of his
duties and responsibilities which constitutes the inherent and implied standard for regularization
(2) If the probationary employee had been fully apprised by his employer of these duties and
responsibilities, then basic knowledge and common sense dictate that he must adequately
perform the same, else he fails to pass the probationary trial and may therefore be subject to
termination.
AP: The determination of “adequate performance” is not, in all cases, measurable by
quantitative specification, such as that of a sales quota in Alcaraz’s example. It is also hinged
on the qualitative assessment of the employee’s work; by its nature, this largely rests on the
reasonable exercise of the employer’s management prerogative.
Due to the nature and variety of these managerial functions, the best that Abbott could have
done, at the time of Alcaraz’s engagement, was to inform her of her duties and responsibilities,
the adequate performance of which, to repeat, is an inherent and implied standard for
regularization; this is unlike the circumstance in Aliling where a quantitative regularization
standard, in the term of a sales quota, was readily articulable to the employee at the
outset.
CONCLUSION: Hence, since the reasonableness of Alcaraz’s assessment clearly appears from
the records, her termination was justified.
DISPOSITION: MR denied, decision is affirmed.

The employer cannot bear out in exacting detail at the beginning of the engagement what
he deems as “quality work” especially since the probationary employee has yet to submit
the required output.

The same logic applies to a probationary managerial employee who is tasked to supervise a
particular department, as Alcaraz in this case.

It is hardly possible for the employer, at the time of the employee’s engagement, to map into
technical indicators, or convey in precise detail the quality standards by which the latter should
effectively manage the department.

Factors which gauge the ability of the managerial employee to either deal with his
subordinates (e.g., how to spur their performance, or command respect and obedience from
them), or to organize office policies, are hardly conveyable at the outset of the engagement
since the employee has yet to be immersed into the work itself.
 CLASSES OF EMPLOYEES (PROBATIONARY EMPLOYEES)
Umali v. Hobbywing Solutions Inc.
Digest Author: FABI
DOCTRINE: A probationary employee is defined as one who is on trial by an employer during
which the employer determines whether or not he is qualified for permanent employment.
Aside from just and authorized causes, a probationary employee may also be dismissed due to
failure to qualify in accordance with the standards of the employer made known to him at the
time of his engagement.
FACTS:
1. Petitioner started working for the respondent, an online casino gaming establishment,
as a Pitboss Supervisor.
2. Her main duties and responsibilities involve, among others, supervising online casino
dealers as well as the operations of the entire gaming area or studio of the respondent
company. She, however, never signed any employment contract before the
commencement of her service but regularly received her salary every month.
3. After seven (7) months since she started working for the respondent, the petitioner
was asked to sign two employment contracts. The first employment contract was for a
period of five (5) months. On the other hand, the second contract was for a period of
three (3) months. She signed both contracts as directed.
4. However, the petitioner was informed by the respondent that her employment has
already ended and was told to just wait for advice whether she will be rehired or
regularized.
5. She was also required to sign an exit clearance from the company apparently to clear
her from accountabilities. She was no longer allowed to work thereafter. Thus, the
filing of a complaint for illegal dismissal against the respondent.
ISSUES: W/N Umali had already attained the status of regular employment after she was
suffered to work for more than six months of probationary employment and was
terminated without just cause.
RULING+RATIO: YES.
LB: ART. 281. Probationary Employment. - Probationary employment shall not exceed six
(6) months from the date the employee started working, unless it is covered by an
apprenticeship agreement stipulating a longer period. The services of an employee who has
been engaged on a probationary basis may be terminated for a just cause or when he fails to
qualify as a regular employee in accordance with reasonable standards made known by the
employer to the employee at the time of his engagement. An employee who is allowed to
work after a probationary period shall be considered a regular employee.
In Dusit Hotel vs. Gatbonton, the Court held that a probationary employee engaged to
work beyond the probationary period of six months, as provided under Article 281 of the
Labor Code, or for any length of time set forth by the employer (in this case, three
months), shall be considered a regular employee.
AP: In this case, the petitioner commenced working fur the respondent on June 19, 2012 until
February 18, 2013. By that time, however, she has already become a regular employee, a status
which accorded her protection from arbitrary termination.
RULES IN EXTENDING PROBATIONARY EMPLOYMENT
CA RULING: The CA, however, believes that the probationary period of employment was validly
extended citing Mariwasa vs. Leogardo. In the said case, the Court upheld as valid the
extension of the probationary period for another three (3) months in order to give the
employee a chance to improve his performance and qualify for regular employment, upon
agreement of the parties. Upon conclusion of the period of extension, however, the employee
still failed to live up to the work standards of the company and was thereafter terminated.
AP: The mentioned case, however, finds no application in the instant case for two reasons:
1. there was no evaluation upon the expiration of the period of probationary
employment;
2. the supposed extension of the probationary period was made after the lapse of
the original period agreed by the parties.
Based on the evidence on record, the respondent only evaluated the performance of the
petitioner for the period of June 2012 to November 2013 on February 1, 2013, wherein she
garnered a rating of 88.3%, which translates to a satisfactory performance according to
company standards.
At the time of the evaluation, the original period of probationary employment had already
lapsed on November 18, 2012 and the petitioner was allowed to continuously render
service without being advised that she failed to qualify for regular employment.
Clearly then, there is no reason to justify the extension since the petitioner had a
commendable rating and, apart from this, there is no more period to be extended since
the probationary period had already lapsed.
LB: Buiser vs. Leogardo,the Court stated, thus:
Generally, the probationary period of employment is limited to six (6) months. The
exception to this general rule is when the parties to an employment contract may
agree otherwise, such as when the same is established by company policy or when
the same is required by the nature of work to be performed by the employee.
Since extension of the period is the exception, rather than the rule, the employer has the
burden of proof to show that the extension is warranted and not simply a stratagem to
preclude the worker's attainment of regular status. Without a valid ground, any extension of
the probationary period shall be taken against the employer especially since it thwarts the
attainment of a fundamental right, that is, security of tenure.
AP: Here, there was no valid extension of the probationary period since the same had
lapsed long before the company thought of extending the same. More significantly, there is
no justifiable reason for the extension since, on the basis of the Performance Evaluation
dated February 1, 2013, the petitioner had a commendable performance all throughout the
probationary period.
Having rendered service even after the lapse of the probationary period, the petitioner had
attained regular employment, with all the rights and privileges pertaining thereto. Clothed with
security of tenure, she may not be terminated from employment without just or
authorized cause and without the benefit of procedural due process. Since the petitioner's
case lacks both, she is entitled to reinstatement with payment of full backwages, as correctly
held by the NLRC.
DISPOSITION: CA decision reversed.
 CLASSES OF EMPLOYEES (REGULAR AND CASUAL EMPLOYEES)
Kimberly-Clark (Phils.), Inc. vs. Secretary of Labor
Digest Author: FABI
DOCTRINE: The law (thus) provides for two kinds of regular employees, namely: (1) those who
are engaged to perform activities which are usually necessary or desirable in the usual business
or trade of the employer, and (2) those who have rendered at least one year of service, whether
continuous or broken, with respect to the activity in which they are employed.
FACTS:
1. The CBA executed by and between Kimberly and United Kimberly-Clark Employees
Union (UKCEO-PTGWO) expired.
2. Within the freedom period, KILUSAN-OLALIA, a newly formed labor organization,
challenged the incumbency of UKCEO-PTGWO, by filing a petition for certification
election.
3. UKCEO-PTGWO won. KILUSAN filed a protest. The former was declared as the
exclusive bargaining representative of Kimberly Corp.
4. KILUSAN filed a petition for certiorari against the order of the Ministry of Labor.
5. During the pendency of G.R. No. 77629, Kimberly dismissed from service several
employees and refused to heed the workers grievances, impelling KILUSAN-OLALIA
to stage a strike
6. Kimberly, in this case, contends that the reckoning point in determining who among its
casual employees are entitled to regularization should be April 21, 1986, the date
KILUSAN-OLALIA filed a petition for certification election to challenge the incumbency
of UKCEO-PTGWO
7. Kimberly also argues that the employees who are not parties in G.R. No. 77629
should not be included in the implementation orders.
ISSUES: W/N the contentions of Kimberly-Clark Phils are correct.
RULING+RATIO: NO.
LB: The law (thus) provides for two kinds of regular employees, namely: (1) those who are
engaged to perform activities which are usually necessary or desirable in the usual business or
trade of the employer, and (2) those who have rendered at least one year of service, whether
continuous or broken, with respect to the activity in which they are employed.
AP: Considering that an employee becomes regular with respect to the activity in which he is
employed one year after he is employed, the reckoning date for determining his
regularization is his hiring date. Therefore, it is error for petitioner Kimberly to claim that it
is from April 21, 1986 that the one-year period should be counted. While it is a fact that the
issue of regularization came about only when KILUSAN-OLALIA filed a petition for certification
election, the concerned employees attained regular status by operation of law.
Further, the grant of the benefit of regularization should not be limited to the employees
who questioned their status before the labor tribunal/court and asserted their rights; it
should also extend to those similarly situated. There is, thus, no merit in petitioner's
contention that only those who presented their circumstances of employment to the courts are
entitled to regularization.
DISPOSITION: Petition for review Denied.
CLASSES OF EMPLOYEES (REGULAR AND CASUAL EMPLOYEES)
Rowell Industrial Corporation vs. Court of Appeals
Digest Author: FABI
DOCTRINE: The primary standard of determining regular employment is the reasonable connection between
the particular activity performed by the employee in relation to the casual business or trade of the employer.
FACTS:
1. Rowell Industrial is engaged in manufacturing tin cans for use in packaging of consumer products,
e.g., foods, paints, among other things.
2. Taripe was employed by petitioner on November 8, 1999 as a “rectangular power press machine
operator”.
3. Taripe alleged that upon employment, he was made to sign a document, which was not explained
to him but which was made a condition for him to be taken in and for which he was not furnished a
copy.
ISSUES: W/N Respondent Taripe is a regular employee and thus illegally dismissed.
RULING+RATIO: YES.
LB: Under Art 280 regular employees are classified into:
(1) regular employees by nature of work - those employees who perform a particular activity which is
necessary or desirable in the usual business or trade of the employer, regardless of their length of service;
(2) regular employees by years of service - those employees who have been performing the job, regardless
of the nature thereof, for at least a year.
Article 280 of the Labor Code, as amended, however, does not proscribe or prohibit an employment
contract with a fixed period. There is nothing essentially contradictory between a definite period of
employment and the nature of the employee’s duties.
AP: In the case at bar, Taripe signed a contract of employment good only for a period of five months
unless the said contract is renewed by mutual consent. Along with other contractual employees, he was
hired only to meet the increase in demand for packaging materials for the Christmas season and to
build up stock levels for the early part of the year.
LB: Standards for valid fixed term employment:
1. the fixed period of employment was knowingly and voluntarily agreed upon by the parties,
without any force, duress or improper pressure being brought to bear upon the employee and
absent any other circumstances vitiating his consent; or
2. it satisfactorily appears that the employer and employee dealt with each other on more or less
equal terms with no moral dominance whatever being exercised by the former on the latter.
AP: 1) The employment contract signed by respondent Taripe did not mention that he was hired only
for a specific undertaking, the completion of which had been determined at the time of his engagement. The
said employment contract neither mentioned that respondent Taripe’s services were seasonal in nature
and that his employment was only for the duration of the Christmas season as purposely claimed by
petitioner RIC. What was stipulated in the said contract was that Taripe’s employment was contractual for the
period of five months.
2) Also RIC failed to controvert the claim that Taripe was made to sign the contract of employment,
prepared by RIC, as a condition for his hiring. Such contract in which the terms are prepared by only one
party and the other party merely affixes his signature signifying his adhesion thereto is called contract of
adhesion. It is an agreement in which the parties bargaining are not on equal footing, the weaker party’s
participation being reduced to the alternative “to take it or leave it.” In the present case, respondent Taripe, in
need of a job, was compelled to agree to the contract, including the five-month period of employment,
just so he could be hired.
3) As a power press operator, a rank and file employee, he can hardly be on equal terms with petitioner RIC.
As the Court of Appeals said, “almost always, employees agree to any terms of an employment contract just to
get employed considering that it is difficult to find work given their ordinary qualifications.” He was a regular
employee, As a rectangular power press machine operator, a position which is necessary and
desirable in the usual business or trade of petitioner RIC, which was the manufacture of tin cans.