G.R. No.
154185 November 22, 2005 As narrated in the assailed decision of the Court of
AMELIA J. DELOS SANTOS, Petitioner,
vs.
JEBSEN MARITIME, INC., Respondent.
DECISION
GARCIA, J.:
Petitioner Amelia J. Delos Santos seeks in this
petition for review on certiorari under Rule 45 of the
Rules of Court to nullify and set aside the decision
and resolution dated 21 March 20021 and 03 July
20022, respectively, of the Court of Appeals in CA-
G.R. SP No. 62229.
From the petition and its annexes, the respondent’s
comment thereto, and the parties’ respective
memoranda, the Court gathers the following factual
antecedents:
On 10 August 1995, or thereabout, herein respondent
Jebsen Maritime, Inc., for and in behalf of Aboitiz
Shipping Co. (Aboitiz Shipping, for short), hired
petitioner’s husband, Gil R. Delos Santos
(hereinafter, Delos Santos) as third engineer of
MV Wild Iris. The corresponding contract of
employment, as approved by the Philippine Overseas
Employment Administration (POEA), was for a fixed
period of one (1) month and for a specific
undertaking of conducting said vessel to and from
Japan. It quoted Delos Santos’ basic monthly salary
and other monetary benefits in US currency. Under
POEA rules, all employers and principals are
required to adopt the POEA - standard employment
contract (POEA-SEC) without prejudice to their
adoption of terms and conditions over and above the
minimum prescribed by that agency.3
On the vessel’s return to the Philippines a month
after, Delos Santos remained on board, respondent
having opted to retain his services while the vessel
underwent repairs in Cebu. After its repair, MV Wild
Iris, this time renamed/registered as MV Super RoRo
100, sailed within domestic waters, having been
meanwhile issued by the Maritime Industry Authority
a Certificate of Vessel Registry and a permit to
engage in coastwise trade on the Manila-Cebu-
Manila-Zamboanga-General Santos-Manila
route.4 During this period of employment, Delos
Santos was paid by and received from respondent his
salary in Philippine peso thru a payroll-deposit
arrangement with the Philippine Commercial &
Industrial Bank.5
Some five months into the vessel’s inter-island
voyages, Delos Santos experienced episodes of chest
pain, numbness and body weakness which eventually
left him temporarily paralyzed. On 17 February 1996,
he was brought to the Manila Doctor’s Hospital – a
duly accredited hospital of respondent - where he
underwent a spinal column operation. Respondent
shouldered all operation-related expenses, inclusive
of his post operation confinement.
Appeals, the following events next transpired:
1. After his discharge from the Manila Doctor’s,
Delos Santos was made to undergo physical therapy
sessions at the same hospital, which compelled the
Batangas-based Delos Santoses to rent a room near
the hospital at P3,000.00 a month;
2. Delos Santos underwent a second spinal operation
at the non-accredited Lourdes Hospital at the cost of
P119, 536.00; and
3. After Lourdes, Delos Santos was confined in a
clinic in San Juan, Batangas where P20,000.00 in
hospitalization expenses was incurred.
It would appear that the spouses Delos Santos paid all
the expenses attendant the second spinal operation as
well as for the subsequent medical treatment.
Petitioner’s demand for reimbursement of these
expenses was rejected by respondent for the reason
that all the sickness benefits of Delos Santos under
the Social Security System (SSS) Law had already
been paid.
Thus, on 25 January 1997, petitioner filed a
complaint6 with the Arbitration Branch of the
National Labor Relations Commission (NLRC)
against respondent and Aboitiz Shipping for recovery
of disability benefits, and sick wage allowance and
reimbursement of hospital and medical expenses. She
also sought payment of moral damages and attorney’s
fees.
After due proceedings, the labor arbiter rendered, on
08 January 1999,7 judgment finding for petitioner and
ordering respondent and Aboitiz Shipping to jointly
and severally pay the former the following:
(1) P119,536.01, representing reimbursement of
medical, surgical and hospital expenses;
(2) P9,000, representing reasonable cost of board and
lodging;
(3) P500,000, representing moral damages;
(4) US$60,000, representing disability benefits
corresponding to Total Permanent Disability;
(5) US$2,452, representing Sick Wage allowance;
(6) P62,853.60, representing attorney’s fees; and,
(7) US$6,245.20, also representing attorney’s fees.
On appeal, the NLRC, in a decision8 dated 29 August
2000, modified that of the labor arbiter, as follows:
WHEREFORE, the decision appealed from is
MODIFIED to the extent that respondents Jebsen
Maritime, Inc., and Aboitiz Shipping Company are
hereby ordered jointly and severally liable to pay Gil
delos Santos through Amelia delos Santos the
Philippine peso equivalent at the time of actual
payment of US DOLLARS SIXTY THOUSAND
(US$60,000.00) and US DOLLARS TWO
THOUSAND FOUR HUNDRD (sic) FIFTY TWO
(US$2,452.00) representing total disability
compensation benefits and sickness wages, and the
amount of ONE HUNDRED THREE THOUSAND
EGHT (sic) HUNDRED FOUR AND 87/100
PHILIPPINE PESOS (P103,804.87) representing
reimbursement of surgical, medical and hospital
expenses, plus the equivalent of five percent (5%) of
the aggregate award as and for attorney’s fees.
All other dispositions are SET ASIDE.
SO ORDERED.
Like the labor arbiter, the NLRC predicated its ruling
mainly on the theory that the POEA-approved
contract of employment continued to govern Delos
Santos’ employment when he contracted his illness.
In specific terms, the NLRC states that the same
contract was still effective when Delos Santos fell ill,
thus entitling him to the payment of disability and
like benefits provided in and required under the
POEA-SEC.
Following the denial of its motion for reconsideration
per NLRC Resolution9 of 31 October 2000,
respondent went to the Court of Appeals on a petition
for certiorari, thereat docketed as CA-G.R. No.
62229, imputing on the NLRC grave abuse of
discretion. In its petition, respondent scored the
NLRC for, among other things, extending the
application of the expired POEA-approved
employment contract beyond the one-month limit
stipulated therein.
On 21 March 2002, the Court of Appeals rendered
judgment10, modifying the NLRC’s decision by
deleting altogether the award of disability
compensation benefits, sickness wages and attorney’s
fees, thus:
WHEREFORE, premises considered, the instant
petition for certiorari is hereby DENIED, finding no
grave abuse of discretion on the part of the NLRC.
The Decision of the National Labor Relations
Commission (NLRC) dated August 29, 2000 and the
Resolution of October 31, 2000 denying petitioner’s
Motion for Reconsideration are hereby AFFIRMED
with MODIFICATION, that the disability
compensation benefits of US$60,000.00 and the
sickness wages of US$2,452.00 are hereby deleted,
without prejudice to claiming the same from the
proper government agency. The award of attorney’s
fees is likewise deleted.
In time, petitioner moved for reconsideration, but the
appellate court denied the motion per its resolution of
03 July 2002.11
Hence, petitioner’s present recourse on the grounds
that the Court of Appeals seriously erred:12
I finding for the herein petitioner, and the Court of
IN DELETING THE AWARD OF US$60,000.00
REPRESENTING THE MAXIMUM DISABILITY
BENEFITS APPLYING THE PROVISIONS OF
THE POEA STANDARD EMPLOYMENT
CONTRACT.
(A) PRIOR TO HIS ACCIDENT, THE
EMPLOYMENT CONTRACT OF SEAFARER
DELOS SANTOS HAS NOT YET BEEN
TERMINATED, IN RELATION TO SECTION 2,
PARAGRAPHS (A) AND (B) AND SECTION 18
(A), POEA STANDARD EMPLOYMENT
CONTRACT.
(B) THE CONTRACT OF EMPLOYMENT AT
THE TIME OF SEAFARER DELOS SANTOS’
ACCIDENT HAS NOT YET EXPIRED BECAUSE
IT WAS MUTUALLY EXTENDED BY THE
PARTIES WHEN DELOS SANTOS WAS NOT
SIGNED OFF AND REPATRIATED PRIOR TO
SAID ACCIDENT.
II
IN CONCLUDING THAT NOTWITHSTANDING
THE CONTINUATION OF DELOS SANTOS’
EMPLOYMENT ON BOARD THE SAME VESSEL
AND UNDER THE SAME CONTRACT, IT IS THE
PROVISIONS OF THE LABOR CODE, AS
AMENDED, THAT SHALL GOVERN HIS
EMPLOYMENT RELATIONS.
III
IN DELETING THE AWARD OF SICKNESS
ALLOWANCE IN THE AMOUNT OF
US$2,452.00.
(A) THERE IS NO BASIS IN THE DELETION OF
THE AWARD OF SICKNESS ALOWANCE (sic)
SINCE PAYMENT OF SOCIAL SECURITY
SYSTEM SICK LEAVE BENEFIT IS
INDEPENDENT, SEPARATE AND DISTINCT
FROM THE SICKNESS ALLOWANCE
PROVIDED FOR UNDER THE POEA
STANDARD EMPLOYMENT CONTRACT.
The petition is devoid of merit.
As a rule, stipulations in an employment contract not
contrary to statutes, public policy, public order or
morals have the force of law between the contracting
parties.13 An employment with a period is generally
valid, unless the term was purposely intended to
circumvent the employee’s right to his security of
tenure.14 Absent a covering specific agreement and
unless otherwise provided by law, the terms and
conditions of employment of all employees in the
private sector shall be governed by the Labor
Code15 and such rules and regulations as may be
issued by the Department of Labor and Employment
and such agencies charged with the administration
and enforcement of the Code.
The differing conclusions arrived at by the NLRC,
Appeals, siding in part with the herein respondent, on
Delos Santos’ entitlement to disability benefits and
sickness allowance are veritably attributable to the
question of applicability, under the premises, of the
POEA-SEC. The principal issue to be resolved here,
therefore, boils down to: which, between the POEA-
SEC and the Labor Code, governs the employer-
employee relationship between Delos Santos and
respondent after MV Wild Iris, as later
renamed Super RoRo 100,returned to the country
from its one-month conduction voyage to and from
Japan.
The Court of Appeals ruled against the governing
applicability of the POEA-SEC and, on that basis,
deleted the NLRC’s award of US$60,000.00 and
US$2,452.00 by way of disability benefits and
sickness allowance, respectively. An excerpt of the
appellate court’s explanation:
xxx Both parties do not dispute the existence of the
POEA approved contract signed by the parties. The
said contract is the law between the contracting
parties and absent any showing that its provisions are
wholly or in part contrary to law, morals, good
policy, it shall be enforced to the letter by the
contracting parties (Metropolitan Bank and Trust Co.
vs. Wong, G.R. No. 120859, June 26, 2001). The
contract in question is for a duration of one (1)
month. Being a valid contract between Delos Santos
and the [respondent], the provisions thereof,
specifically with respect to the one (1) month period
of employment has the force of law between
them (D.M. Consunji vs. NLRC, G.R. No. 116572,
December 18, 2000). Perforce, the said contract has
already expired and is no longer in effect.
The fact that Delos Santos continued to work in the
same vessel which sailed within Philippine waters
does not mean that the POEA standard employment
contract continues to be enforced between the parties.
The employment of Delos Santos is within the
Philippines, and not on a foreign shore. As correctly
pointed out by [respondent], the provisions of the
Labor Code shall govern their employer-employee
relationship. xxx. (Words in bracket added.)
The Court agrees with the conclusion of the Court of
Appeals for two (2) main reasons. First, we the start
with something elementary, i.e., POEA was created
primarily to undertake a systematic program for
overseas employment of Filipino workers and to
protect their rights to fair and equitable employment
practices.16 And to ensure that overseas workers,
including seafarers on board ocean-going vessels, are
amply protected, the POEA is authorized to
formulate employment standards in accordance with
welfare objectives of the overseas employment
program.17 Given this consideration, the Court is at a
loss to understand why the POEA-SEC should be
made to continue to apply to domestic employment,
as here, involving a Filipino seaman on board an
inter-island vessel.
Just as basic as the first reason is the fact that Delos
Santos’ POEA-approved employment contract was
for a definite term of one (1) month only, doubtless
fixed to coincide with the pre-determined one-month
long Philippines-Japan-Philippines conduction-
voyage run. After the lapse of the said period, his
employment under the POEA-approved contract may
be deemed as functus oficio and Delos Santos’
employment pursuant thereto considered
automatically terminated, there being no mutually-
agreed renewal or extension of the expired
contract.18 This is as it should be. For, as we have
held in the landmark case of Millares v. National
Labor Relations Commission:19
From the foregoing cases, it is clear that seafarers
are considered contractual employees. … Their
employment is governed by the contracts they
sign every time they are rehired and their
employment is terminated when the contract
expires. Their employment is contractually fixed for
a certain period of time. They fall under the
exception of Article 280 [of the Labor Code] whose
employment has been fixed for a specific project or
undertaking . . . We need not depart from the rulings
of the Court in the two aforementioned cases which
indeed constitute stare decisis with respect to the
employment status of seafarers. (Underscoring and
words in bracket added)
Petitioner’s posture, citing Section 2 (A)20 in relation
to Section 1821 of the POEA-SEC about the POEA
approved contract still subsisting since Delos Santos
was never signed off from the vessel and repatriated
to Manila, the point of hire, is untenable. With the
view we have of things, Delos Santos is deemed to
have been signed off when he acceded to a new
employment arrangement offered by the respondent.
A seaman need not physically disembarked from a
vessel at the expiration of his employment contract to
have such contract considered terminated. And the
repatriation aspect of the contract assumes
significance only where the vessel remains in a
foreign port. For, repatriation presupposes a return to
one’s country of origin or citizenship.22 In the case at
bar, however, there can be quibbling that MV Wild
Iris returned to the port of Cebu with Delos Santos on
board. Parenthetically, while the parties are agreed
that their underlying contract was executed in the
country, the records do not indicate what city or
province of the Philippines is the specific point of
hire. While petitioner says it is Manila, she did not
bother to attach to her petition a copy of the contract
of employment in question.
Petitioner next submits, echoing the NLRC’s holding,
that the POEA-approved contract remained in full
force and effect even after the expiry thereof owing
to the interplay of the following circumstances: 1)
Delos Santos, after such contract expiration, did not
conclude another contract of employment with
respondent, but was asked to remain and work on
board the same vessel just the same; and 2) If the
parties intended their employer-employee
relationship to be under the aegis of a new contract,
such intention should have been embodied in a new
agreement.
Contract extension or continuation by mutual consent
appears to be petitioner’s thesis.
We are not persuaded.
The fact that respondent retained Delos Santos and
allowed him to remain on board the vessel cannot
plausibly be interpreted, in context, as evidencing an
intention on its part to continue with the POEA-SEC.
In the practical viewpoint, there could have been no
sense in consenting to renewal since the rationale for
the execution of the POEA-approved contract had
already been served and achieved.
At any rate, factors obtain arguing against the notion
that respondent consented to contract extension under
the same terms and conditions prevailing when the
original contract expired. Stated a bit differently,
there are compelling reasons to believe that
respondent retained the services of the acceding
Delos Santos, as the Court of Appeals aptly observed,
but under domestic terms and conditions. We refer
first to the reduced salary of Delos Santos payable in
Philippine peso23 which, significantly enough, he
received without so much of a protest. As respondent
stated in its Comment, without any controverting
response from petitioner, Delos Santos, for the period
ending October 31, 1995, was drawing a salary at the
rate of ₱8,475.00 a month, whereas the compensation
package stipulated under the POEA-approved
contract provided for a US$613 basic monthly salary
and a US$184 fixed monthly overtime pay. And
secondly, MV Super RoRo 100 was no longer
engaged in foreign trading as it was no longer
intended as an ocean-going ship. Accordingly, it does
not make sense why a seafarer of goodwill or a
manning agency of the same disposition would insist
on being regulated by an overseas employment
agency under its standard employment contract,
which governs employment of Filipino seamen on
board ocean-going vessels.24
Petitioner’s submission about the parties not having
entered into another employment contract after the
expiration of the POEA-approved employment
contract, ergo, the extension of the expired
agreement, is flawed by the logic holding it together.
For, it presupposes that an agreement to do or to give
does not bind, unless it is embodied in a written
instrument. It is elementary, however, that, save in
very rare instances where certain formal requisites go
into its validity, a contract, to be valid and binding
between the parties, need not be in writing. A
contract is perfected when the contracting minds
agree on the object and cause thereof.25 And, as
earlier discussed, several
circumstantial indicia tended to prove that a new
arrangement under domestic terms was agreed upon
by the principal players to govern the employment of
Delos Santos after the return of MV Wild Iris to the
country to engage in coastwise trading.
Given the foregoing perspective, the disallowance
under the decision subject of review of the
petitioner’s claim for maximum disability benefits
and sickness allowance is legally correct. As it were,
Delos Santos’ right to such benefits is predicated on
the continued enforceability of POEA-SEC when he
contracted his illness, which, needless to stress, was
not the case.
Likewise legally correct is the deletion of the award
of attorney’s fees, the NLRC having failed to explain
petitioner’s entitlement thereto. As a matter of sound
policy, an award of attorney’s fee remains the
exception rather than the rule. It must be stressed, as
aptly observed by the appellate court, that it is
necessary for the trial court, the NLRC in this case, to
make express findings of facts and law that would
bring the case within the exception. In fine, the
factual, legal or equitable justification for the award
must be set forth in the text of the decision.26 The
matter of attorney’s fees cannot be touched once and
only in the fallo of the decision, else, the award
should be thrown out for being speculative and
conjectural.27 In the absence of a stipulation,
attorney’s fees are ordinarily not recoverable;
otherwise a premium shall be placed on the right to
litigate.28 They are not awarded every time a party
wins a suit.
WHEREFORE, the petition is DENIED and the
assailed Decision and Resolution of the Court of
Appeals AFFIRMED.
No pronouncement as to costs.
G.R. No. 152427. August 9, 2005
INTEGRATED CONTRACTOR AND
PLUMBING WORKS, INC., Petitioners,
vs.
NATIONAL LABOR RELATIONS
COMMISSION and GLEN SOLON, Respondent.
DECISION
QUISUMBING, J.:
This petition for review assails the Decision1 dated
October 30, 2001 of the Court of Appeals and
its Resolution2dated February 28, 2002 in CA-G.R.
SP No. 60136, denying the petitioner’s motion for
reconsideration for lack of merit. The decision
affirmed the National Labor Relations Commission
(NLRC) which declared private respondent Glen
Solon a regular employee of the petitioner and
awarded him 13th month pay, service incentive leave
pay, reinstatement to his former position with full
backwages from the time his salary was withheld
until his reinstatement.
Petitioner is a plumbing contractor. Its business
depends on the number and frequency of the projects
it is able to contract with its clients.3
Private respondent Solon worked for petitioner. His
employment records is as follows:
December 14, 1994 up to January 14, 1995 St.
Charbel Warehouse
February 1, 1995 up to April 30, 1995 St. Charbel
Warehouse
May 23, 1995 up to June 23, 1995 St. Charbel
Warehouse
August 15, 1995 up to October 31, 1995 St. Charbel
Warehouse
November 2, 1995 up to January 31, 1996 St.
Charbel Warehouse
May 13, 1996 up to June 15, 1996 Ayala Triangle
August 27, 1996 up to November 30, 1996 St.
Charbel Warehouse4
July 14, 1997 up to November 1997 ICPWI
Warehouse
November 1997 up to January 5, 1998 Cathedral
Heights
January 6, 1998 Rockwell Center5
On February 23, 1998, while private respondent was
about to log out from work, he was informed by the
warehouseman that the main office had instructed
them to tell him it was his last day of work as he had
been terminated. When private respondent went to
the petitioner’s office on February 24, 1998 to verify
his status, he found out that indeed, he had been
terminated. He went back to petitioner’s office on
February 27, 1998 to sign a clearance so he could
claim his 13th month pay and tax refunds. However,
he had second thoughts and refused to sign the
clearance when he read the clearance indicating he
had resigned. On March 6, 1998, he filed a complaint
alleging that he was illegally dismissed without just
cause and without due process.6
In a Decision dated February 26, 1999, the Labor
Arbiter ruled that private respondent was a regular
employee and could only be removed for cause.
Petitioner was ordered to reinstate private respondent
to his former position with full backwages from the
time his salary was withheld until his actual
reinstatement, and pay him service incentive leave
pay, and 13th month pay for three years in the
amount of ₱2,880 and ₱14,976, respectively.
Petitioner appealed to the National Labor Relations
Commission (NLRC), which ruled:
WHEREFORE, prescinding from the foregoing and
in the interest of justice, the decision of the Labor
Arbiter is hereby AFFIRMED with a
MODIFICATION that the 13th month pay should be
given only for the year 1997 and portion of 1998.
Backwages shall be computed from the time he was
illegally dismissed up to the time of his actual
reinstatement. Likewise, service incentive leave pay
for three (3) years is also awarded to appellee in the
amount of P2,880.00.
SO ORDERED.7
Petitioner’s Motion for Reconsideration was denied.8
Petitioner appealed to the Court of Appeals, alleging
that the NLRC committed grave abuse of discretion
in finding that the private respondent was a regular
employee and in awarding 13th month pay, service
incentive leave pay, and holiday pay to the private
respondent despite evidence of payment. The said
petition was dismissed for lack of merit.9
Before us now, petitioner raises the following issues:
(1) Whether the respondent is a project employee of
the petitioner or a regular employee; and (2) Whether
the Court of Appeals erred seriously in awarding 13th
month pay for the entire year of 1997 and service
incentive leave pay to the respondent and without
taking cognizance of the evidence presented by
petitioner.10
The petitioner asserts that the private respondent was
a project employee. Thus, when the project was
completed and private respondent was not re-
assigned to another project, petitioner did not violate
any law since it was petitioner’s discretion to re-
assign the private respondent to other projects.11
Article 280 of the Labor Code states:
The provisions of written agreement of the contrary
notwithstanding and regardless of the oral agreement
of the parties, an employment shall be deemed to be
regular where the employee has been engaged to
perform activities which are usually necessary or
desirable in the usual business or trade of the
employer, except where the employment has been
fixed for a specific project or undertaking the
completion or termination of which has been
determined at the time of the engagement of the
employee or where the work or services to be
performed is seasonal in nature and the employment
is for the duration of the season… (Italics supplied.)
We held in Tomas Lao Construction v. NLRC12 that
the principal test in determining whether an employee
is a "project employee" or "regular employee," is,
whether he is assigned to carry out a "specific project
or undertaking," the duration (and scope) of which
are specified at the time the employee is engaged in
the project.13 "Project" refers to a particular job or
undertaking that is within the regular or usual
business of the employer, but which is distinct and
separate and identifiable from the undertakings of the
company. Such job or undertaking begins and ends at
determined or determinable times.14
In our review of the employment contracts of private
respondent, we are convinced he was initially a
project employee. The services he rendered, the
duration and scope of each project are clear
indications that he was hired as a project employee.
We concur with the NLRC that while there were
several employment contracts between private
respondent and petitioner, in all of them, private
respondent performed tasks which were usually
necessary or desirable in the usual business or trade
of petitioner. A review of private respondent’s work
assignments patently showed he belonged to a work
pool tapped from where workers are and assigned
whenever their services were needed. In a work pool,
the workers do not receive salaries and are free to
seek other employment during temporary breaks in
the business. They are like regular seasonal workers
insofar as the effect of temporary cessation of work is
concerned. This arrangement is beneficial to both the
employer and employee for it prevents the unjust
situation of "coddling labor at the expense of capital"
and at the same time enables the workers to attain the
status of regular employees.15Nonetheless, the pattern
of re-hiring and the recurring need for his services are
sufficient evidence of the necessity and
indispensability of such services to petitioner’s
business or trade.16
In Maraguinot, Jr. v. NLRC17 we ruled that once a
project or work pool employee has been: (1)
continuously, as opposed to intermittently, re-hired
by the same employer for the same tasks or nature of
tasks; and (2) these tasks are vital, necessary and
indispensable to the usual business or trade of the
employer, then the employee must be deemed a
regular employee.
In this case, did the private respondent become a
regular employee then?
The test to determine whether employment is regular
or not is the reasonable connection between the
particular activity performed by the employee in
relation to the usual business or trade of the
employer. Also, if the employee has been performing
the job for at least one year, even if the performance
is not continuous or merely intermittent, the law
deems the repeated and continuing need for its
performance as sufficient evidence of the necessity, if
not indispensability of that activity to the
business.18 Thus, we held that where the employment
of project employees is extended long after the
supposed project has been finished, the employees
are removed from the scope of project employees and
are considered regular employees.19
While length of time may not be the controlling test
for project employment, it is vital in determining if
the employee was hired for a specific undertaking or
tasked to perform functions vital, necessary and
indispensable to the usual business or trade of the
employer. Here, private respondent had been a
project employee several times over. His employment
ceased to be coterminous with specific projects when
he was repeatedly re-hired due to the demands of
petitioner’s business.20 Where from the circumstances
it is apparent that periods have been imposed to
preclude the acquisition of tenurial security by the
employee, they should be struck down as contrary to
public policy, morals, good customs or public order.21
Further, Policy Instructions No. 20 requires
employers to submit a report of an employee’s
termination to the nearest public employment office
every time his employment was terminated due to a
completion of a project. The failure of the employer
to file termination reports is an indication that the
employee is not a project employee.22 Department
Order No. 19 superseding Policy Instructions No. 20
also expressly provides that the report of termination
is one of the indications of project employment.23 In
the case at bar, there was only one list of terminated
workers submitted to the Department of Labor and
Employment.24 If private respondent was a project
employee, petitioner should have submitted a
termination report for every completion of a project
to which the former was assigned.
Juxtaposing private respondent’s employment
history, vis the requirements in the test to determine
if he is a regular worker, we are constrained to say he
is.
As a regular worker, private respondent is entitled to
security of tenure under Article 279 of the Labor
Code25 and can only be removed for cause. We found
no valid cause attending to private respondent’s
dismissal and found also that his dismissal was
without due process.
Additionally, Article 277(b) of the Labor Code
provides that
... Subject to the constitutional right of workers to
security of tenure and their right to be protected
against dismissal except for a just and authorized
cause and without prejudice to the requirement of
notice under Article 283 of this Code, the employer
shall furnish the worker whose employment is sought
to be terminated a written notice containing a
statement of the causes for termination and shall
afford the latter ample opportunity to be heard and to
defend himself with the assistance of his
representative if he so desires in accordance with
company rules and regulations promulgated pursuant
to guidelines set by the Department of Labor and
Employment…
The failure of the petitioner to comply with these
procedural guidelines renders its dismissal of private
respondent, illegal. An illegally dismissed employee
is entitled to reinstatement with full backwages,
inclusive of allowances, and to his other benefits
computed from the time his compensation was
withheld from him up to the time of his actual
reinstatement, pursuant to Article 279 of the Labor
Code.
However, we note that the private respondent had
been paid his 13th month pay for the year 1997. The
Court of Appeals erred in granting the same to him.
Article 95(a) of the Labor Code governs the award of
service incentive leave. It provides that every
employee who has rendered at least one year of
service shall be entitled to a yearly service incentive
leave of five days with pay, and Section 3, Rule V,
Book III of the Implementing Rules and Regulations,
defines the term "at least one year of service" to mean
service within 12 months, whether continuous or
broken reckoned from the date the employee started
working, including authorized absences and paid
regular holidays, unless the working days in the
establishment as a matter of practice or policy, or that
provided in the employment contract is less than 12
months, in which case said period shall be considered
as one year. Accordingly, private respondent’s
service incentive leave credits of five days for every
year of service, based on the actual service rendered
to the petitioner, in accordance with each contract of
employment should be computed up to the date of
reinstatement pursuant to Article 279 of the Labor
Code.26
WHEREFORE, the assailed Decision dated October
30, 2001 and the Resolution dated February 28, 2002
of the Court of Appeals in CA-G.R. SP No. 60136,
are AFFIRMED with MODIFICATION. The
petitioner is hereby ORDERED to (1) reinstate the
respondent with no loss of seniority rights and other
privileges; and (2) pay respondent his backwages,
13th month pay for the year 1998 and Service
Incentive Leave Pay computed from the date of his
illegal dismissal up to the date of his actual
reinstatement. Costs against petitioner.
In October 1996, the respondents filed separate
complaints for illegal dismissal, reinstatement,
backwages, damages and attorney’s fees against the
petitioners. The complaints were later consolidated.
On March 30, 1999, after due proceedings, the Labor
Arbiter rendered a decision in favor of the
respondents:
WHEREFORE, premises considered, judgment is
hereby rendered declaring that complainants have
indeed been illegally dismissed from their
employment.
Accordingly, respondents are hereby ordered to
reinstate individual complainants to their former
positions without loss of seniority rights and to pay
them their backwages as follows:

SO ORDERED.
Complainants Amount

1. Reynaldo Ararao ₱113,703.20

G.R. No. 164736 October 14, 2005 2. Carlos Ararao ₱100,372.48

UNIVERSAL ROBINA CORPORATION and/or 3. Resty Alcoran ₱100,372.48

RANDY GREGORIO, Petitioners,
vs.
BENITO CATAPANG, CARLOS ARARAO, 4. Richard Coronado ₱113,703.20
ALVIN ALCANTARA, RESTY ALCORAN,
REYNALDO ARARAO, JUAN ARISTADO, 5. Quirino Platero ₱113,703.20
LITO CABRERA, ONOFRE CASANO, BEN
CERVAS, JOSEPH CHUIDIAN, IRENEO 6. Benito Catapang ₱113,703.20
COMENDADOR, ANGELITO CONCHADA,
RICHARD CORONADO, ELMER HILING, 7. Jose Loria, Jr. ₱100,372.48
RAMON JOYOSA, JOSE LORIA, JR.,
VICTORIANO LORIA, RUEL MARIKIT,
8. Elpidio Villanueva ₱113,703.20
RODERICK PANG-AO, QUIRINO PLATERO,
PABLITO REDONDO, RAMIL ROXAS, RESTY
SALAZAR, NOEL TRINIDAD, FELICISIMO 9. Jonathan Villanueva ₱113,703.20
VARELA, BALTAZAR VILLANUEVA,
ELPIDIO VILLANUEVA, JOEL VILLANUEVA, 10. Baltazar Villanueva ₱113,703.20
JONATHAN VILLANUEVA, and JAIME
VILLEGAS,Respondents. 11. Victoriano Loria ₱144,881.10

DECISION 12. Roderick Pangao ₱100,372.48

CALLEJO, SR., J.: 13. Lito Cabrera ₱113,703.20

Petitioner Universal Robina Corporation is a 14. Elmer Hiling ₱113,703.20

corporation duly organized and existing under the
Philippine laws, while petitioner Randy Gregorio is 15. Jaime Villegas ₱113,703.20
the manager of the petitioner company’s duck farm in
Calauan, Laguna.1
16. Angelito Conchada ₱119,192.20
The individual respondents were hired by the
petitioner company on various dates from 1991 to 17. Juan Aristado ₱113,703.20
1993 to work at its duck farm in Barangay Sto.
Tomas, Calauan, Laguna. The respondents were hired 18. Joel Villanueva ₱113,703.20
under an employment contract which provided for a
five-month period. After the expiration of the said 19. Ben Cervas ₱113,703.20
employment contracts, the petitioner company would
renew them and re-employ the respondents. This 20. Ruel Marikit ₱113,703.20
practice continued until sometime in 1996, when the
petitioners informed the respondents that they were
21. Ireneo Comendador ₱113,703.20
no longer renewing their employment contracts.2
Total ------------------------ ₱2,339,933.44
Respondents are likewise ordered to pay fifteen
percent (15%) of the total amount due, or ₱
350,990.01, as and by way of attorney’s fees.
SO ORDERED.3
On May 17, 1999, the petitioners filed an Appeal
Memorandum with the National Labor Relations
Commission (NLRC) on the ground that the Labor
Arbiter erred in ruling that the respondents are the
petitioner company’s regular employees.
Meanwhile, on May 18, 1999, the respondents filed a
Motion for Enforcement of Reinstatement Order with
the Labor Arbiter. On June 3, 1999, the latter issued
an Order, which reads in full:
Finding the "Motion for Enforcement of
Reinstatement Order" dated 18 May 1999, filed by
the complainants to be in order, respondents are
hereby directed to immediately comply in good faith
to the reinstatement aspect of the Decision of this
Office dated 30 March 1999.
Furthermore, it appearing from the records that
several individuals in this case were inadvertently
omitted as party-complainants in the aforesaid
Decision, clarification is hereby made that the
complainants hereinbelow set forth are to be deemed
included in the coverage of the said decision with the
corresponding right(s) to their backwages, to wit:
1. Alvin Alcantara - ₱129,126.40
2. Onofre Casano - ₱106,917.20
3. Joseph Chuidian - ₱104,165.10
4. Ramon Joyosa - ₱128,029.20
5. Pablito Redondo - ₱105,409.20
6. Ramil Roxas - ₱109,330.00
7. Resty Salazar - ₱105,296.10
8. Noel Trinidad - ₱108,312.10
9. Felicisimo Varela - ₱119,358.20
TOTAL - ₱1,015,943.50
SO ORDERED.4
On June 21, 1999, the Labor Arbiter issued a Writ of
Execution enforcing the immediate reinstatement of
the respondents as mandated in the March 30, 1999
Decision.
On July 13, 1999, the petitioners manifested to the
Labor Arbiter that they can reinstate only 17 of the
30 employees in view of the phase out of the
petitioner company’s Agricultural Section as early as
1996. They averred that there were no other available
positions substantially similar to the positions
previously occupied by the other 13 respondents, but
that 10 of them could be accommodated at the farm’s
Duck Dressing Section which operates at an average
of three days a week only.5
On August 2, 1999, the Sheriff filed a Report stating
that the petitioners had not yet reinstated the
respondents.6The respondents then urged the Labor
Arbiter to order their physical or payroll
reinstatement and to cite the petitioners in contempt.
On November 26, 1999, the Labor Arbiter issued an
Order7 directing the petitioners, under pain of
contempt, to comply with the March 30, 1999
Decision.
On December 16, 1999, 17 employees were
reinstated to their former positions. Thereafter, the
respondents moved for the immediate reinstatement
of the remaining 13 respondents. In the meantime,
the petitioners manifested to the Labor Arbiter about
the closure of the duck farm effective March 15,
2000.8
On February 9, 2000, the Labor Arbiter issued an
Order9 directing the petitioners to immediately effect
the actual or payroll reinstatement of the remaining
13 respondents. In the said Order, the petitioners
were likewise directed to settle whatever financial
accountabilities they may have with the said
respondents due to the delay in complying with the
reinstatement aspect of the March 30, 1999 Decision.
On February 16, 2000, the respondents manifested
that the petitioners still failed and refused to comply
with the February 9, 2000 Order. That same day, the
Labor Arbiter issued an Alias Writ of Execution
commanding the Sheriff to cause the immediate
reinstatement of the 13 respondents and to collect
their withheld salaries.10
On February 21, 2000, the respondents moved for the
issuance of a notice of garnishment to collect the
accumulated withheld wages of the 17 respondents
who were reinstated on December 16, 1999
amounting to ₱649,400.00. The Labor Arbiter
granted the motion and issued a Second Alias Writ of
Execution directing the Sheriff to proceed to collect
the said amount plus execution fees.11
Thereafter, the petitioners filed an urgent motion to
reconsider the February 9, 2000 Order and to quash
the Alias Writ of Execution. They reiterated their
previous contention that they are unable to comply
with the order either because the section to which the
13 respondents were previously assigned had been
phased out or the positions previously held by them
have already been filled up.12
On March 1, 2000, the Labor Arbiter issued an
Order13 denying the petitioners’ motion to quash
insofar as the reinstatement aspect is concerned as
well as the motion to reconsider and set aside the
February 9, 2000 Order. In case of failure to comply
with the reinstatement of the 13 respondents, the
Labor Arbiter directed the petitioner company to pay
them separation pay instead.14
On March 13, 2000, the petitioners filed a
Memorandum and Notice of Appeal with Prayer for
the Issuance of a Temporary Restraining Order15 with
the NLRC, assailing the February 9, 2000 and March
1, 2000 Orders and the two Alias Writs of Execution
issued by the Labor Arbiter.
On November 22, 2000, the NLRC affirmed the
decision of the Labor Arbiter with the modification
that the award of attorney’s fees was reduced to 10%
of the total monetary award.16
Aggrieved, the petitioners filed a petition
for certiorari with the Court of Appeals (CA). On
August 21, 2003, the CA denied the petition for lack
of merit.17 The CA held that after rendering more
than one year of continuous service, the respondents
became regular employees of the petitioners by
operation of law. Moreover, the petitioners used the
five-month contract of employment as a convenient
subterfuge to prevent the respondents from becoming
regular employees and such contractual arrangement
should be struck down or disregarded as contrary to
public policy or morals. The petitioners’ act of
repeatedly and continuously hiring the respondents in
a span of three to five years to do the same kind of
work negates their assertion that the respondents
were hired for a specific project or undertaking only.
As to the issue of the failure to reinstate the 13
respondents pending appeal, the CA opined that the
petitioners should have at least reinstated them in the
payroll if there were indeed no longer any available
positions for which they could be
accommodated.18 Finally, the CA did not believe that
the petitioners’ counsel was not furnished with copies
of the assailed orders and the alias writs of execution
considering that, after the issuance of the said orders,
the petitioners were able to file several pleadings
questioning the same.19
On September 23, 2003, the petitioners filed a
Manifestation and Motion for Additional Time to File
a Motion for Reconsideration of the CA
Decision.20 They alleged therein that they received a
copy of the decision on September 8, 2003 and had
until September 23, 2003 to file a motion for
reconsideration. They then prayed for an extension of
10 days, or until October 3, 2003, to submit a motion
for reconsideration.
Realizing their error, the petitioners filed their
Motion for Reconsideration two days later. In a
Resolution21 dated September 30, 2003, the CA
denied the petitioners’ earlier motion for extension of
time for being a prohibited pleading. Subsequently,
the petitioners filed their Urgent Motion to Admit
Petitioners’ Motion for Reconsideration, but the CA
merely noted the petitioners’ motion for
reconsideration in its April 15, 2004 Resolution. This
prompted the petitioners to file a Motion to Resolve
Petitioners’ Motion for Reconsideration.22 Finding no
cogent reason to depart from its previous resolution
denying the motion for extension of time to file a
motion for reconsideration, the CA denied the said
motion for lack of merit on July 19, 2004.23
Hence, this petition for review wherein the
petitioners raise the following grounds:
I.
THE COURT OF APPEALS SERIOUSLY ERRED
WHEN IT RULED THAT THE RESPONDENTS
ATTAINED THE STATUS OF REGULAR
EMPLOYMENT AFTER THE LAPSE OF ONE
YEAR FROM THE DATE OF THEIR
EMPLOYMENT.
II.
THE COURT OF APPEALS SERIOUSLY ERRED
WHEN IT RULED THAT DESPITE THE
UNAVAILABILITY OF POSITIONS WHERE THE
THIRTEEN (13) RESPONDENTS ARE TO BE
REINSTATED THEY SHOULD STILL BE
REINSTATED THROUGH PAYROLL.
III.
THE COURT OF APPEALS SERIOUSLY ERRED
IN FAILING TO RESOLVE THE ISSUE OF
WHETHER OR NOT THE PETITIONERS
SHOULD BE HELD LIABLE FOR THE
PAYMENT OF THE ALLEGED WITHHELD
SALARIES OF THE RESPONDENTS FROM THE
DATE OF ISSUANCE OF THE WRIT DESPITE
THAT RESPONDENTS’ BELATED OR NON-
REINSTATEMENT CANNOT BE ATTRIBUTED
TO THE PETITIONERS.
IV.
THE COURT OF APPEALS SHOULD HAVE
RESOLVED PETITIONERS’ MOTION FOR
RECONSIDERATION CONSIDERING THAT THE
DELAY WAS ONLY FOR TWO (2) DAYS AND
WAS THE RESULT OF AN HONEST MISTAKE.24
The petitioners submit that the respondents are not
regular employees. They aver that it is of no moment
that the respondents have rendered service for more
than a year since they were covered by the five-
month individual contracts to which they duly
acquiesced. The petitioners contend that they were
free to terminate the services of the respondents at the
expiration of
their individual contracts. The petitioners maintain
that, in doing so, they merely implemented the terms
of the contracts.25
The petitioners assert that the respondents’ contracts
of employment were not intended to circumvent
security of tenure. They point out that the
respondents knowingly and voluntarily agreed to sign
the contracts without the petitioners having exercised
any undue advantage over them. Moreover, there is
no evidence showing that the petitioners exerted
moral dominance on the respondents.26
The petitioners further assert that they cannot be
compelled to actually reinstate, or merely reinstate in
the payroll the 13 respondents considering there are
no longer any available positions in the company.
They submit that reinstatement presupposes that the
previous positions from which the respondents had
been removed still exist or that there are unfilled
positions, more or less, of similar nature as the ones
previously occupied by the said employees.
Consequently, they cannot be made to pay the
salaries of these employees from the time the writ of
execution was issued.27
Finally, the petitioners aver that their motion for
reconsideration of the CA Decision should have been
admitted by the CA considering that the delay was
only for two days and such delay was due to an
honest mistake. They maintain that the ends of
substantial justice would have been better served if
the motion for reconsideration was resolved since it
raised critical issues previously raised in the petition
but not resolved by the CA.28
For their part, the respondents aver that the instant
petition should be dismissed outright because the CA
Decision has already become final since the
petitioners filed their motion for reconsideration
beyond the reglementary 15-day period. They also
aver that the motion for extension of time to file a
motion for reconsideration, a prohibited pleading, did
not suspend the running of the period to file a motion
for reconsideration, which is also the period for filing
an appeal with this Court. Hence, at the time the
present petition was filed with this Court, the period
for filing the appeal had already lapsed.29 The
respondents further aver that the petition should
likewise be dismissed for lack of a verified statement
of material dates. They assert that the Rules of Court
requires a separate verified statement of material
dates and its incorporation in the body of the petition
is not substantial compliance of such requirement.30
The respondents aver that they acquired the status as
regular employees after rendering one year of service
to the petitioner company. They contend that the
contracts providing for a fixed period of employment
should be struck down as contrary to public policy,
morals, good customs or public order as it was
designed to preclude the acquisition of tenurial
security.31
The respondents contend that the order directing their
payroll reinstatement was proper considering that the
petitioners have failed to actually reinstate
them.32 They assert that the delay in the reinstatement
of the 13 respondents could only be attributed to the
petitioners; hence, they are liable for withheld
salaries to these employees.33
It appears that the present petition has, indeed, been
filed beyond the reglementary period for filing a
petition for review under Rule 45 of the Rules of
Court. This period is set forth in Section 2, Rule 45,
which provides as follows:
SEC. 2. Time for filing; extension. — The petition
shall be filed within fifteen (15) days from notice of
the judgment or final order or resolution appealed
from, or of the denial of the petitioner’s motion for
new trial or reconsideration filed in due time after
notice of judgment. … (Emphasis supplied.)
In conjunction with the said provision, Section 1,
Rule 52 of the same Rules provides:
SEC. 1. Period for filing. — A party may file a
motion for reconsideration of a judgment or final
resolution within fifteen (15) days from notice threof,
with proof of service on the adverse party.
Clearly, the period for filing a motion for
reconsideration and a petition for review with this
Court are the same, that is, 15 days from notice of the
judgment. When an aggrieved party files a motion for
reconsideration within the said period, the period for
filing an appeal is suspended. If the motion is denied,
the aggrieved party is given another 15-day period
from notice of such denial within which to file a
petition for review under Rule 45. It must be stressed
that the aggrieved party will be given a fresh 15-day
period only when he has filed his motion for
reconsideration in due time – on or before the
expiration of the original 15-day period. Otherwise, if
the motion for reconsideration is filed out of time and
no appeal has been filed, the subject decision
becomes final and executory.34 As such, it becomes
immutable and can no longer be attacked by any of
the parties or be modified, directly or indirectly, even
by the highest court of the land.35
The petitioners received the CA Decision on
September 8, 2003; hence, they had until September
23, 2003 within which to file a motion for
reconsideration, or an appeal, through a petition for
review, with this Court. Instead, the petitioners filed a
motion for extension of time to file a motion for
reconsideration on September 23, 2003, which is a
prohibited pleading.36 Thus, it did not suspend the
running of the period for filing an appeal.
Consequently, the period to file a petition for review
with this Court also expired on September 23, 2003.
Instead of going straight to this Court to attempt to
file a petition for review (which had already expired),
the petitioners pursued recourse in the CA by filing
their motion for reconsideration two days later, or on
September 25, 2003. The CA merely noted the same.
Dissatisfied, the petitioners subsequently filed a
motion to resolve their motion for reconsideration.
The CA acted on this motion only on July 19, 2004
and denied the same for lack of merit.
In filing their petition for review with this Court, the
petitioners counted the 15-day period from their
receipt of the July 19, 2004 CA Resolution on August
4, 2004. Hence, according to their Motion for
Extension of Time to File Petition for Review which
they filed on August 19, 2004, they had until that day
within which to file a petition for review. They then
asked the Court that they be granted an extension of
30 days, or until September 21, 2004 within which to
file their petition. The Court granted the motion on
the belief that the petitioners’ motion for
reconsideration before the CA was duly filed and that
the assailed July 19, 2004 CA Resolution had denied
the said motion. Thereafter, the petitioners filed their
petition for review on September 20, 2004.
It is, therefore, evident from the foregoing that the
present petition was filed way beyond the
reglementary period. Hence, its outright dismissal
would be proper. The perfection of an appeal in the
manner and within the period prescribed by law is not
only mandatory but jurisdictional, and failure to
perfect an appeal has the effect of rendering the
judgment final and executory.37 Just as a losing party
has the privilege to file an appeal within the
prescribed period, so does the winner also have the
correlative right to enjoy the finality of the decision. 38
Anyone seeking exemption from the application of
the reglementary period for filing an appeal has the
burden of proving the existence of exceptionally
meritorious instances warranting such deviation.39 In
this case, the petitioners failed to prove the existence
of any fact which would warrant the relaxation of the
rules. In fact, they have not even acknowledged that
their petition was filed beyond the reglementary
period.
In any case, we find that the CA, the NLRC and the
Labor Arbiter correctly categorized the respondents
as regular employees of the petitioner company.
In Abasolo v. National Labor Relations
Commission,40 the Court reiterated the test in
determining whether one is a regular employee:
The primary standard, therefore, of determining
regular employment is the reasonable connection
between the particular activity performed by the
employee in relation to the usual trade or business of
the employer. The test is whether the former is
usually necessary or desirable in the usual business or
trade of the employer. The connection can be
determined by considering the nature of work
performed and its relation to the scheme of the
particular business or trade in its entirety. Also, if the
employee has been performing the job for at least a
year, even if the performance is not continuous and
merely intermittent, the law deems repeated and
continuing need for its performance as sufficient
evidence of the necessity if not indispensability of
that activity to the business. Hence, the employment
is considered regular, but only with respect to such
activity and while such activity exists.41
Thus, we quote with approval the following excerpt
from the decision of the CA:
It is obvious that the said five-month contract of
employment was used by petitioners as a convenient
subterfuge to prevent private respondents from
becoming regular employees. Such contractual
arrangement should be struck down or disregarded as
contrary to public policy or morals. To uphold the
same would, in effect, permit petitioners 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.
… Realty Incorporated, with Regional Arbitration
Petitioners’ act of repeatedly and continuously hiring
private respondents in a span of … 3 to 5 years to do
the same kind of work negates their contention that
private respondents were hired for a specific project
or undertaking only.42
Further, factual findings of labor officials who are
deemed to have acquired expertise in matters within
their respective jurisdiction are generally accorded
not only respect but even finality, and bind us when
supported by substantial evidence.43
WHEREFORE, premises considered, the petition
is DENIED DUE COURSE. The Decision of the
Court of Appeals is AFFIRMED.
SO ORDERED.
G.R. No. 79869 September 5, 1991
FORTUNATO MERCADO, SR., ROSA
MERCADO, FORTUNATO MERCADO, JR.,
ANTONIO MERCADO, JOSE CABRAL, LUCIA
MERCADO, ASUNCION GUEVARA, ANITA
MERCADO, MARINA MERCADO, JULIANA
CABRAL, GUADALUPE PAGUIO, BRIGIDA
ALCANTARA, EMERLITA MERCADO,
ROMEO GUEVARA, ROMEO MERCADO and
LEON SANTILLAN, petitioners,
vs.
NATIONAL LABOR RELATIONS
COMMISSION (NLRC), THIRD DIVISION;
LABOR ARBITER LUCIANO AQUINO, RAB-
III; AURORA L. CRUZ; SPOUSES
FRANCISCO DE BORJA and LETICIA DE
BORJA; and STO. NIÑO REALTY,
INCORPORATED, respondents.
Servillano S. Santillan for petitioners.
Luis R. Mauricio for private respondents.
PADILLA, J.:
Assailed in this petition for certiorari is the
decision * of the respondent national Labor Relations
Commission (NLRC) dated 8 August 1984 which
affirmed the decision of respondent Labor Arbiter
Luciano P. Aquino with the slight modification of
deleting the award of financial assistance to
petitioners, and the resolution of the respondent
NLRC dated 17 August 1987, denying petitioners'
motion for reconsideration.
This petition originated from a complaint for illegal
dismissal, underpayment of wages, non-payment of
overtime pay, holiday pay, service incentive leave
benefits, emergency cost of living allowances and
13th month pay, filed by above-named petitioners
against private respondents Aurora L. Cruz,
Francisco Borja, Leticia C. Borja and Sto. Niño
Branch No. III, National Labor Relations
Commission in San Fernando, Pampanga.1
Petitioners alleged in their complaint that they were
agricultural workers utilized by private respondents
in all the agricultural phases of work on the 7 1/2
hectares of ace land and 10 hectares of sugar land
owned by the latter; that Fortunato Mercado, Sr. and
Leon Santillan worked in the farm of private
respondents since 1949, Fortunato Mercado, Jr. and
Antonio Mercado since 1972 and the rest of the
petitioners since 1960 up to April 1979, when they
were all allegedly dismissed from their employment;
and that, during the period of their employment,
petitioners received the following daily wages:
From 1962-1963 — P1.50
1963-1965 — P2.00
1965-1967 — P3.00
1967-1970 — P4.00
1970-1973 — P5.00
1973-1975 — P5.00
1975-1978 — P6.00
1978-1979 — P7.00
Private respondent Aurora Cruz in her answer to
petitioners' complaint denied that said petitioners
were her regular employees and instead averred that
she engaged their services, through Spouses
Fortunato Mercado, Sr. and Rosa Mercado, their
"mandarols", that is, persons who take charge in
supplying the number of workers needed by owners
of various farms, but only to do a particular phase of
agricultural work necessary in rice production and/or
sugar cane production, after which they would be free
to render services to other farm owners who need
their services.2
The other private respondents denied having any
relationship whatsoever with the petitioners and state
that they were merely registered owners of the land in
question included as corespondents in this case.3
The dispute in this case revolves around the issue of
whether or not petitioners are regular and permanent
farm workers and therefore entitled to the benefits
which they pray for. And corollary to this, whether or
not said petitioners were illegally dismissed by
private respondents.
Respondent Labor Arbiter Luciano P. Aquino ruled
in favor of private respondents and held that
petitioners were not regular and permanent workers
of the private respondents, for the nature of the terms
and conditions of their hiring reveal that they were
required to perform phases of agricultural work for a
definite period of time after which their services
would be available to any other farm
owner.4 Respondent Labor Arbiter deemed
petitioners' contention of working twelve (12) hours a
day the whole year round in the farm, an
exaggeration, for the reason that the planting of lice
and sugar cane does not entail a whole year as
reported in the findings of the Chief of the NLRC
Special Task Force.5 Even the sworn statement of one
of the petitioners, Fortunato Mercado, Jr., the son of
spouses Fortunato Mercado, Sr. and Rosa Mercado,
indubitably show that said petitioners were hired only
as casuals, on an "on and off" basis, thus, it was
within the prerogative of private respondent Aurora
Cruz either to take in the petitioners to do further
work or not after any single phase of agricultural
work had been completed by them.6
Respondent Labor Arbiter was also of the opinion
that the real cause which triggered the filing of the
complaint by the petitioners who are related to one
another, either by consanguinity or affinity, was the
filing of a criminal complaint for theft against
Reynaldo Mercado, son of spouses Fortunate
Mercado, Sr. and Rosa Mercado, for they even asked
the help of Jesus David, Zone Chairman of the
locality to talk to private respondent, Aurora Cruz
regarding said criminal case.7 In his affidavit, Jesus
David stated under oath that petitioners were never
regularly employed by private respondent Aurora
Cruz but were, on-and-off hired to work and render
services when needed, thus adding further support to
the conclusion that petitioners were not regular and
permanent employees of private respondent Aurora
Cruz.8
Respondent Labor Arbiter further held that only
money claims from years 1976-1977, 1977-1978 and
1978-1979 may be properly considered since all the
other money claims have prescribed for having
accrued beyond the three (3) year period prescribed
by law.9 On grounds of equity, however, respondent
Labor Arbiter awarded petitioners financial
assistance by private respondent Aurora Cruz, in the
amount of Ten Thousand Pesos (P10,000.00) to be
equitably divided among an the petitioners except
petitioner Fortunato Mercado, Jr. who had manifested
his disinterest in the further prosecution of his
complaint against private respondent.10
Both parties filed their appeal with the National
Labor Relations Commissions (NLRC). Petitioners
questioned respondent Labor Arbiter's finding that
they were not regular and permanent employees of
private respondent Aurora Cruz while private
respondents questioned the award of financial
assistance granted by respondent Labor Arbiter.
The NLRC ruled in favor of private respondents
affirming the decision of the respondent Labor
Arbiter, with the modification of the deletion of the
award for financial assistance to petitioners. The
dispositive portion of the decision of the NLRC
reads:
WHEREFORE, the Decision of Labor
Arbiter Luciano P. Aquino dated March 3,
1983 is hereby modified in that the award of
P10,000.00 financial assistance should be
deleted. The said Decision is affirmed in all
other aspects.
SO ORDERED.11
Petitioners filed a motion for reconsideration of the
Decision of the Third Division of the NLRC dated 8
August 1984; however, the NLRC denied tills motion
in a resolution dated 17 August 1987.12
In the present Petition for certiorari, petitioners seek
the reversal of the above-mentioned rulings.
Petitioners contend that respondent Labor Arbiter and
respondent NLRC erred when both ruled that
petitioners are not regular and permanent employees
of private respondents based on the terms and
conditions of their hiring, for said findings are
contrary to the provisions of Article 280 of the Labor
Code.13 They submit that petitioners' employment,
even assuming said employment were seasonal,
continued for so many years such that, by express
provision of Article 280 of the Labor Code as
amended, petitioners have become regular and
permanent employees.14
Moreover, they argue that Policy Instruction No.
1215 of the Department of Labor and Employment
clearly lends support to this contention, when it
states:
PD 830 has defined the concept of regular
and casual employment. What determines
regularity or casualness is not the
employment contract, written or otherwise,
but the nature of the job. If the job is usually
necessary or desirable to the main business
of the employer, then employment is
regular. If not, then the employment is
casual. Employment for a definite period
which exceeds one (1) year shall be
considered re for the duration of the definite
period.
This concept of re and casual employment is
designed to put an end to casual
employment in regular jobs which has been
abused by many employers to prevent so-
called casuals from enjoying the benefits of
regular employees or to prevent casuals
from joining unions.
This new concept should be strictly enforced
to give meaning to the constitutional
guarantee of employment tenure.16
Tested under the laws invoked, petitioners submit
that it would be unjust, if not unlawful, to consider
them as casual workers since they have been doing
all phases of agricultural work for so many years,
activities which are undeniably necessary, desirable
and indispensable in the rice and sugar cane
production business of the private respondents.17
In the Comment filed by private respondents, they
submit that the decision of the Labor Arbiter, as
aimed by respondent NLRC, that petitioners were
only hired as casuals, is based on solid evidence
presented by the parties and also by the Chief of the
Special Task Force of the NLRC Regional Office
and, therefore, in accordance with the rule on
findings of fact of administrative agencies, the
decision should be given great weight.18 Furthermore,
they contend that the arguments used by petitioners
in questioning the decision of the Labor Arbiter were
based on matters which were not offered as evidence
in the case heard before the regional office of the
then Ministry of Labor but rather in the case before
the Social Security Commission, also between the
same parties.19
Public respondent NLRC filed a separate comment
prepared by the Solicitor General. It submits that it
has long been settled that findings of fact of
administrative agencies if supported by substantial
evidence are entitled to great weight.20 Moreover, it
argues that petitioners cannot be deemed to be
permanent and regular employees since they fall
under the exception stated in Article 280 of the Labor
Code, which reads:
The provisions of written agreements to the
contrary notwithstanding and regardless of
the oral agreements of the parties, an
employment shall be deemed to be regular
where the employee has been engaged to
perform activities which are usually
necessary or desirable in the usual business
or trade of the employer, except where the
employment has been fixed for a specific
project or undertaking the completion or
termination of which has been determined at
the time of the engagement of the employee
or where the work or services to be
performed is seasonal in nature and the
employment is for the duration of the
season.21(emphasis supplied)
The Court resolved to give due course to the petition
and required the parties to submit their respective
memoranda after which the case was deemed
submitted for decision.
The petition is not impressed with merit.
The invariable rule set by the Court in reviewing
administrative decisions of the Executive Branch of
the Government is that the findings of fact made
therein are respected, so long as they are supported
by substantial evidence, even if not overwhelming or
preponderant;22 that it is not for the reviewing court
to weigh the conflicting evidence, determine the
credibility of the witnesses or otherwise substitute its
own judgment for that of the administrative agency
on the sufficiency of the evidence;23 that the
administrative decision in matters within the
executive's jurisdiction can only be set aside upon
proof of gross abuse of discretion, fraud, or error of
law.24
The questioned decision of the Labor Arbiter reads:
Focusing the spotlight of judicious scrutiny
on the evidence on record and the arguments
of both parties, it is our well-discerned
opinion that the petitioners are not regular
and permanent workers of the respondents.
The very nature of the terms and conditions
of their hiring reveal that the petitioners
were required to perform p of cultural work
for a definite period, after which their
services are available to any farm owner.
We cannot share the arguments of the
petitioners that they worked continuously
the whole year round for twelve hours a day.
 This, we feel, is an exaggeration which does
not deserve any serious consideration
inasmuch as the plan of rice and sugar cane
does not entail a whole year operation, the
area in question being comparatively small.
It is noteworthy that the findings of the
Chief of the Special Task Force of the
Regional Office are similar to this.
In fact, the sworn statement of one of the
petitioners Fortunato Mercado, Jr., the son
of spouses Fortunato Mercado, Sr. and Rosa
Mercado, indubitably shows that said
petitioners were only hired as casuals, on-
and-off basis. With this kind of relationship
between the petitioners and the respondent
Aurora Cruz, we feel that there is no basis in
law upon which the claims of the petitioners
should be sustained, more specially their
complaint for illegal dismissal. It is within
the prerogative of respondent Aurora Cruz
either to take in the petitioners to do further
work or not after any single phase of
agricultural work has been completed by
them. We are of the opinion that the real
cause which triggered the filing of this
complaint by the petitioners who are related
to one another, either by consanguinity or
affinity was due to the filing of a criminal
complaint by the respondent Aurora Cruz
against Reynaldo Mercado, son of spouses
Fortunato Mercado, Sr. and Rosa Mercado.
In April 1979, according to Jesus David,
Zone Chairman of the locality where the
petitioners and respondent reside, petitioner
Fortunato Mercado, Sr. asked for help
regarding the case of his son, Reynaldo, to
talk with respondent Aurora Cruz and the
said Zone Chairman also stated under oath
that the petitioners were never regularly
employed by respondent Aurora Cruz but
were on-and-off hired to work to render
services when needed.25
A careful examination of the foregoing statements
reveals that the findings of the Labor Arbiter in the
case are ably supported by evidence. There is,
therefore, no circumstance that would warrant a
reversal of the questioned decision of the Labor
Arbiter as affirmed by the National Labor Relations
Commission.
The contention of petitioners that the second
paragraph of Article 280 of the Labor Code should
have been applied in their case presents an
opportunity to clarify the afore-mentioned provision
of law.
Article 280 of the Labor Code reads in full:
Article 280. Regular and Casual
Employment. — The provisions of written
agreement to the contrary notwithstanding
and regardless of the oral agreement of the
parties, an employment shall be deemed to
be regular where the employee has been
engaged to perform activities which are
usually necessary or desirable in the usual
business or trade of the employer, except
where the employment has been fixed for a
specific project or undertaking the
completion or termination of which has been
determined at the time of the engagement of
the employee or where the work or services
to be performed is seasonal in nature and the
employment is for the duration of the
season.
An employment shall be deemed to be
casual if it is not covered by the preceding
paragraph: Provided, That, any employee
who has rendered at least one year of service
whether such service is continuous or
broken, shall be considered a regular
employee with respect to the activity in
which he is employed and his employment
shall continue while such actually exists.
The first paragraph answers the question of who are
employees. It states that, regardless of any written or
oral agreement to the contrary, an employee is
deemed regular where he is engaged in necessary or
desirable activities in the usual business or trade of
the employer, except for project employees.
A project employee has been defined to be one whose
employment has been fixed for a specific project or
undertaking, the completion or termination of which
has been determined at the time of the engagement of
the employee, or where the work or service to be
performed is seasonal in nature and the employment
is for the duration of the season26 as in the present
case.
The second paragraph of Art. 280 demarcates as
"casual" employees, all other employees who do not
fan under the definition of the preceding paragraph.
The proviso, in said second paragraph, deems as
regular employees those "casual" employees who
have rendered at least one year of service regardless
of the fact that such service may be continuous or
broken.
Petitioners, in effect, contend that the proviso in the
second paragraph of Art. 280 is applicable to their
case and that the Labor Arbiter should have
considered them regular by virtue of said proviso.
The contention is without merit.
The general rule is that the office of a proviso is to
qualify or modify only the phrase immediately
preceding it or restrain or limit the generality of the
clause that it immediately follows.27 Thus, it has been
held that a proviso is to be construed with reference
to the immediately preceding part of the provision to
which it is attached, and not to the statute itself or to
other sections thereof.28 The only exception to this
rule is where the clear legislative intent is to restrain
or qualify not only the phrase immediately preceding
it (the proviso) but also earlier provisions of the
statute or even the statute itself as a whole.29
Policy Instruction No. 12 of the Department of Labor
and Employment discloses that the concept of regular
and casual employees was designed to put an end to
casual employment in regular jobs, which has been
abused by many employers to prevent called casuals
from enjoying the benefits of regular employees or to
prevent casuals from joining unions. The same
instructions show that the proviso in the second
paragraph of Art. 280 was not designed to stifle
small-scale businesses nor to oppress agricultural
land owners to further the interests of laborers,
whether agricultural or industrial. What it seeks to
eliminate are abuses of employers against their
employees and not, as petitioners would have us
believe, to prevent small-scale businesses from
engaging in legitimate methods to realize profit.
Hence, the proviso is applicable only to the
employees who are deemed "casuals" but not to the
"project" employees nor the regular employees
treated in paragraph one of Art. 280.
Clearly, therefore, petitioners being project
employees, or, to use the correct term, seasonal
employees, their employment legally ends upon
completion of the project or the season. The
termination of their employment cannot and should
not constitute an illegal dismissal.30
WHEREFORE, the petition is DISMISSED. The
decision of the National Labor Relations Commission
affirming that of the Labor Arbiter, under review, is
AFFIRMED. No pronouncement as to costs.
SO ORDERED.
G.R. No. 118475 November 29, 2000
ELVIRA ABASOLO, petitioners,
vs.
NATIONAL LABOR RELATIONS
COMMISSION, LABOR ARBITER RICARDO
N. OLAIREZ, LA UNION TOBACCO
REDRYING CORPORATION and SEE LIN
CHAN, respondents.
DECISION
DE LEON, JR., J.:
Before us is a petition for certiorari seeking to annul
two Resolutions of the National Labor Relations
Commission (NLRC), Third Division, dated July 6,
19941 and September 23, 19942 , in its affirmance of
the Decision3 of Labor Arbiter Ricardo N. Olairez
dated December 29, 1993 dismissing petitioners’
consolidated complaint for separation pay for lack of
merit.
The facts are as follows:
Private respondent La Union Tobacco Redrying
Corporation (LUTORCO), which is owned by private
respondent See Lin Chan, is engaged in the business
of buying, selling, redrying and processing of tobacco
leaves and its by-products. Tobacco season starts
sometime in October of every year when tobacco
farmers germinate their seeds in plots until they are
ready for replanting in November. The harvest season
starts in mid-February. Then, the farmers sell the
harvested tobacco leaves to redrying plants or do the
redrying themselves. The redrying plant of
LUTORCO receives tobacco for redrying at the end
of February and starts redrying in March until August
or September.
Petitioners have been under the employ of
LUTORCO for several years until their employment
with LUTORCO was abruptly interrupted sometime
in March 1993 when Compania General de Tabaccos
de Filipinas (also known as TABACALERA) took
over LUTORCO’s tobacco operations. New
signboards were posted indicating a change of
ownership and petitioners were then asked by
LUTORCO to file their respective applications for
employment with TABACALERA. Petitioners were
caught unaware of the sudden change of ownership
and its effect on the status of their employment,
though it was alleged that TABACALERA would
assume and respect the seniority rights of the
petitioners.
On March 17, 1993, the disgruntled employees
instituted before the NLRC Regional Arbitration
Branch No. 1, San Fernando, La Union a
complaint4 for separation pay against private
respondent LUTORCO on the ground that there was
a termination of their employment due to the closure
of LUTORCO as a result of the sale and turnover to
TABACALERA. Other equally affected employees
filed two additional complaints5 , also for separation
pay, which were consolidated with the first
complaint.
Private respondent corporation raised as its defense
that it is exempt from paying separation pay and
denied that it terminated the services of the
petitioners; and that it stopped its operations due to
the absence of capital and operating funds caused by
losses incurred from 1990 to 1992 and absence of
operating funds for 1993, coupled with adverse
financial conditions and downfall of prices.6 It
alleged further that LUTORCO entered into an
agreement with TABACALERA to take over
LUTORCO’s tobacco operations for the year 1993 in
the hope of recovering from its serious business
losses in the succeeding tobacco seasons and to
create a continuing source of income for the
petitioners.7 Lastly, it manifested that LUTORCO, in
good faith and with sincerity, is willing to grant
reasonable and adjusted amounts to the petitioners, as
financial assistance, if and when LUTORCO could
recover from its financial crisis.8
On December 29, 1993, Labor Arbiter Ricardo N.
Olairez rendered his decision dismissing the
complaint for lack of merit. In upholding private
respondent LUTORCO’s position, the Labor Arbiter
declared that the petitioners are not entitled to the
benefits under Article 2839 of the Labor Code since
LUTORCO ceased to operate due to serious business
losses and, furthermore, TABACALERA, the new
employer of the petitioner has assumed the seniority
rights of the petitioners and other employment
liabilities of the LUTORCO.10
Petitioners appealed11 then the decision of the Labor
Arbiter to the public respondent NLRC where it was
assigned to the Third Division.
In its Opposition to Appeal12 dated February 5, 1994
private respondent LUTORCO presented new
allegations and a different stand for denying
separation pay. It alleged that LUTORCO never
ceased to operate but continues to operate even after
TABACALERA took over the operations of its
redrying plaint in Aringay, La Union. Petitioners
were not terminated from employment but petitioners
instead refused to work with TABACALERA,
despite the notice to petitioners to return to work in
view of LUTORCO’s need for workers at its Agoo
plant which had approximately 300,000 kilos of
Virginia tobacco for processing and redrying.
Furthermore, petitioners are not entitled to separation
pay because petitioners are seasonal workers.
Adopting these arguments of private respondent, the
NLRC, in a Resolution13 dated July 6, 1994, affirmed
the dismissal of the consolidated complaints for
separation pay. Public respondent held that
petitioners are not entitled to the protection of Article
283 of the Labor Code providing for separation pay
since there was no closure of establishment or
termination of services to speak of. It declared that
there was no dismissal but a "non-hiring due mainly
to [petitioners] own volition." 14 Moreover, the
benefits of Article 283 of the Labor Code apply only
to regular employees, not seasonal workers like
petitioners.15 Inasmuch as public respondent in its
Resolution16 dated September 23, 1994 denied
petitioners’ motion for reconsideration, petitioners
now assail the correctness of the NLRC’s
resolution via the instant petition.
Petitioners anchor their petition on the following
grounds, to wit:
I. PUBLIC RESPONDENT NLRC
COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO
EXCESS OR LACK OF JURISDICTION
IN RULING THAT THERE WAS NO
DISMISSAL OR TERMINATION OF
SERVICES.
II. PUBLIC RESPONDENT NLRC
COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO
EXCESS OR LACK OF JURISDICTION
IN RULING THAT PETITIONERS
WERE NOT REGULAR EMPLOYEES.
III. PUBLIC RESPONDENT NLRC
COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO
EXCESS OR LACK OF JURISDICTION
IN NOT AWARDING SEPARATION
PAY TO THE PETITIONERS.
Petitioners vigorously maintain that they are regular
workers of respondent LUTORCO since they worked
continuously for many years with LUTORCO, some
of them even for over 20 years, and that they
performed functions necessary and desirable in the
usual business of LUTORCO.17 According to them,
the fact that some of them work only during the
tobacco season does not affect their status as regular
workers since they have been repeatedly called back
to work for every season, year after year.18 Thus,
petitioners take exception to the factual findings and
conclusions of the NLRC, stressing that the
conclusions of the NLRC were based solely on the
new theory advanced by private respondent
LUTORCO only on appeal, that is, that it was only
LUTORCO’s tobacco re-drying operation that was
sold, and hence, diametrically opposed to its theory
before the Labor Arbiter, i.e., that it is the entire
company (LUTORCO) itself that was sold.
Private respondent LUTORCO, on the other hand,
insists that petitioners’ employment was not
terminated; that it never ceased to operate, and that it
was petitioners themselves who severed their
employer-employee relationship when they chose
employment with TABACALERA because
petitioners found more stability working with
TABACALERA than with LUTORCO.19 It likewise
insists that petitioners are seasonal workers since
almost all of petitioners never continuously worked
in LUTORCO for any given year20 and they were
required to reapply every year to determine who
among them shall be given work for the season. To
support its argument that petitioners are seasonal
workers, private respondent LUTORCO cites the
case of Mercado, Sr. v. NLRC21 wherein this Court
held that "the employment of [seasonal workers]
legally ends upon the completion of the xxx season."
Clearly, the crux of the dispute boils down to two
issues, namely, (a) whether petitioners’ employment
with LUTORCO was terminated, and (b) whether
petitioners are regular or seasonal workers, as defined
by law. Both issues are clearly factual in nature as
they involved appreciation of evidence presented
before the NLRC whose finding of facts and
conclusions thereon are entitled to respect and
finality in the absence of proof that they were arrived
at arbitrarily or capriciously.22 In the instant case,
however, cogent reasons exist to apply the exception,
to wit:
First, upon a thorough review, the records speak of a
sale to TABACALERA in 1993 under conditions
evidently so concealed that petitioners were not
formally notified of the impending sale of
LUTORCO’s tobacco re-drying operations to
TABACALERA and its attendant consequences with
respect to their continued employment status under
TABACALERA. They came to know of the fact of
that sale only when TABACALERA took over the
said tobacco re-drying operations. Thus, under those
circumstances, the employment of petitioners with
respondent LUTORCO was technically terminated
when TABACALERA took over LUTORCO’s
tobacco re-drying operations in 1993.23
Moreover, private respondent LUTORCO’s
allegation that TABACALERA assured the seniority
rights of petitioners deserves scant consideration
inasmuch as the same is not supported by
documentary evidence nor was it confirmed by
TABACALERA. Besides, there is no law requiring
that the purchaser of an entire company should
absorb the employees of the selling company. The
most that the purchasing company can do, for reasons
of public policy and social justice, is to give
preference to the qualified separated employees of
the selling company, who in its judgment are
necessary in the continued operation of the business
establishment. In the instant case, the petitioner
employees were clearly required to file new
applications for employment. In reality then, they
were hired as new employees of TABACALERA.
Second, private respondent LUTORCO’s contention
that petitioners themselves severed the employer-
employee relationship by choosing to work with
TABACALERA is bereft of merit considering that its
offer to return to work was made more as an
afterthought when private respondent LUTORCO
later realized it still had tobacco leaves for processing
and redrying. The fact that petitioners ultimately
chose to work with TABACALERA is not adverse to
petitioners’ cause. To equate the more stable work
with TABACALERA and the temporary work with
LUTORCO is illogical. Petitioners’ untimely
separation in LUTORCO was not of their own
making and therefore, not construable as resignation
therefrom inasmuch as resignation must be voluntary
and made with the intention of relinquishing the
office, accompanied with an act of relinquishment.24
Third, the test of whether or not an employee is a
regular employee has been laid down in De Leon v.
NLRC,25 in which this Court held:
The primary standard, therefore, of determining
regular employment is the reasonable connection
between the particular activity performed by the
employee in relation to the usual trade or business of
the employer. The test is whether the former is
usually necessary or desirable in the usual business or
trade of the employer. The connection can be
determined by considering the nature of the work
performed and its relation to the scheme of the
particular business or trade in its entirety. Also if the
employee has been performing the job for at least a
year, even if the performance is not continuous and
merely intermittent, the law deems repeated and
continuing need for its performance as sufficient
evidence of the necessity if not indispensability of
that activity to the business. Hence, the employment
is considered regular, but only with respect to such
activity, and while such activity exists.
Thus, the nature of one’s employment does not
depend solely on the will or word of the
employer.1âwphi1 Nor on the procedure for hiring
and the manner of designating the employee, but on
the nature of the activities to be performed by the
employee, considering the employer’s nature of
business and the duration and scope of work to be
done.26
In the case at bar, while it may appear that the work
of petitioners is seasonal, inasmuch as petitioners
have served the company for many years, some for
over 20 years, performing services necessary and
indispensable to LUTORCO’s business, serve as
badges of regular employment.27 Moreover, the fact
that petitioners do not work continuously for one
whole year but only for the duration of the tobacco
season does not detract from considering them in
regular employment since in a litany of cases28 this
Court has already settled that seasonal workers who
are called to work from time to time and are
temporarily laid off during off-season are not
separated from service in said period, but are merely
considered on leave until re-employed.
Private respondent’s reliance on the case
of Mercardo v. NLRC is misplaced considering that
since in said case of Mercado, although the
respondent company therein consistently availed of
the services of the petitioners therein from year to
year, it was clear that petitioners therein were not in
respondent company’s regular employ. Petitioners
therein performed different phases of agricultural
work in a given year. However, during that period,
they were free to contract their services to work for
other farm owners, as in fact they did. Thus, the
Court ruled in that case that their employment would
naturally end upon the completion of each project or
phase of farm work for which they have been
contracted.
All the foregoing considered, the public respondent
NLRC in the case at bar erred in its total affirmance
of the dismissal of the consolidated complaint, for
separation pay, against private respondents
LUTORCO and See Lin Chan considering that
petitioners are regular seasonal employees entitled to
the benefits of Article 283 of the Labor Code which
applies to closures or cessation of an establishment or
undertaking, whether it be a complete or partial
cessation or closure of business operation.29
In the case of Philippine Tobacco Flue-Curing &
Redrying Corporation v. NLRC30 this Court, when
faced with the question of whether the separation pay
of a seasonal worker, who works for only a fraction
of a year, should be equated with the separation pay
of a regular worker, resolved that question in this
wise:
The amount of separation pay is based on two
factors: the amount of monthly salary and the number
of years of service. Although the Labor Code
provides different definitions as to what constitutes
"one year of service," Book Six31 does not
specifically define "one year of service" for purposes
of computing separation pay. However, Articles 283
and 284 both state in connection with separation pay
that a fraction of at least six months shall be
considered one whole year. Applying this case at bar,
we hold that the amount of separation pay which
respondent members xxx should receive is one-half
(1/2) their respective average monthly pay during the
last season they worked multiplied by the number of
years they actually rendered service, provided that
they worked for at least six months during a given
year.
Thus, in the said case, the employees were awarded
separation pay equivalent to one (1) month, or to one-
half (1/2) month pay for every year they rendered
service, whichever is higher, provided they rendered
service for at least six (6) months in a given year. As
explained in the text of the decision in the said case,
"month pay" shall be understood as "average monthly
pay during the last season they worked." 32 An award
of ten percent (10%) of the total amount due
petitioners as attorney’s fees is legally and morally
justifiable under Art. 111 of the Labor Code,33 Sec. 8,
Rule VIII, Book III of its Implementing Rules, 34 and
par. 7, Art. 220835 of the Civil Code.36
WHEREFORE, the petition is hereby GRANTED,
and the assailed Resolutions dated July 6, 1994 and
September 23, 1994 of public respondent NLRC are
REVERSED and SET ASIDE. Private respondent La
Union Tobacco Redrying Corporation is ORDERED:
(a) to pay petitioners separation pay equivalent to one
(1) month, or one-half (1/2) month pay for each year
that they rendered service, whichever is higher,
provided that they rendered service for at least six (6)
months in a given year, and; (b) to pay ten percent
(10%) of the total amount due to petitioners, as and
for attorney’s fees. Consequently, public respondent
NLRC is ORDERED to COMPUTE the total amount
of separation pay which each petitioner who has
rendered service to private respondent LUTORCO
for at least six (6) months in a given year is entitled
to receive in accordance with this decision, and to
submit its compliance thereon within forty-five (45)
days from notice of this decision.
SO ORDERED.
G.R. No. 151827. April 29, 2005
JOSEFINA BENARES, Petitioners,
vs.
Jaime pancho, Rodolfo pancho, jr., joselito
medalla, paquito magallanes, Alicia magallanes,
evelyn magallanes, violeta villacampa, maritess
pancho, rogelio pancho and arnolfo
pancho, Respondents.
DECISION
Tinga, J.:
Assailed in this Petition for Review on Certiorari1 is
the Decision2 of the Court of Appeals which affirmed
the National Labor Relations Commission’s (NLRC)
decision3 holding that respondents were illegally
dismissed and ordering petitioner to pay respondents
separation pay, backwages, 13th month pay, Cost of
Living Allowance (COLA), emergency relief
allowance (ERA), salary differentials and attorney’s
fees. The NLRC reversed the Labor Arbiter’s finding
that respondents failed to lay down the facts and
circumstances surrounding their dismissal and to
prove their entitlement to monetary awards.4
The antecedents, as narrated by the NLRC, follow.
Complainants alleged to have started working as
sugar farm workers on various dates, to wit:
1. Jaime Pancho November 15, 1964
2. Rodolfo Pancho, Jr. February 1, 1975
3. Joselito Medalla November 15, 1964
4. Paquito Magallanes March 10, 1973
5. Felomino Magallanes November 15, 1964
6. Alicia Magallanes January 15, 1964
7. Evelyn Magallanes January 1, 1974
8. Violeta Villacampa December 1, 1979
9. Maritess Pancho December 15, 1985
10. Rogelio Pancho December 1, 1979
11. Arnolfo Pancho February 1, 1975
Respondent Hda. Maasin II is a sugar cane plantation
located in Murcia, Negros Occidental with an area of
12-24 has. planted, owned and managed by Josefina
Benares, individual co-respondent.
On July 24, 1991, complainants thru counsel wrote
the Regional Director of the Department of Labor
and Employment, Bacolod City for intercession
particularly in the matter of wages and other benefits
mandated by law.
On September 24, 1991, a routine inspection was
conducted by personnel of the Bacolod District
Office of the Department of Labor and Employment.
Accordingly, a report and recommendation was
made, hence, the endorsement by the Regional
Director of the instant case to the Regional
Arbitration Branch, NLRC, Bacolod City for proper
hearing and disposition.
On October 15, 1991, complainants alleged to have
been terminated without being paid termination
benefits by respondent in retaliation to what they
have done in reporting to the Department of Labor
and Employment their working conditions viz-a-viz
(sic) wages and other mandatory benefits.
On July 14, 1992, notification and summons were
served to the parties wherein complainants were
directed to file a formal complaint.
On July 28, 1992, a formal complaint was filed for
illegal dismissal with money claims.
From the records, summons and notices of hearing
were served to the parties and apparently no amicable
settlement was arrived, hence, the parties were
directed to file their respective position papers.
On January 22, 1993, complainant submitted their
position paper, while respondent filed its position
paper on June 21, 1993.
On March 17, 1994, complainants filed their reply
position paper and affidavit. Correspondingly, a
rejoinder was filed by respondent on May 16, 1994.
On August 17, 1994, from the Minutes of the
scheduled hearing, respondent failed to appear, and
that the Office will evaluate the records of the case
whether to conduct a formal trial on the merits or not,
and that the corresponding order will be issued.
On January 16, 1996, the Labor Arbiter issued an
order to the effect that the case is now deemed
submitted for resolution.
On April 30, 1998, the Labor Arbiter a quo issued the
assailed decision dismissing the complaint for lack of
merit.
On June 26, 1998, complainants not satisfied with the
aforecited ruling interposed the instant appeal
anchored on the ground that:
THE HONORABLE LABOR ARBITER GRAVELY
ABUSED ITS DISCRETION AND SERIOUSLY
ERRED IN HOLDING THAT THE
COMPLAINANTS FAILED TO DISCUSS THE
FACTS AND CIRCUMSTANCES
SURROUNDING THEIR DISMISSAL, HENCE,
THERE IS NO DISMISSAL TO SPEAK OF AND
THAT COMPLAINANTS FAILED TO ALLEGE
AND PROVE THAT THEIR CLAIMS ARE
VALID, HENCE THE DISMISSAL OF THEIR
COMPLAINT WOULD CAUSE GRAVE AND
IRREPARABLE DAMAGE TO HEREIN
COMPLAINANTS.5
The NLRC held that respondents attained the status
of regular seasonal workers of Hda. Maasin II having
worked therein from 1964-1985. It found that
petitioner failed to discharge the burden of proving
that the termination of respondents was for a just or
authorized cause. Hence, respondents were illegally
dismissed and should be awarded their money claims.
Petitioner’s motion for reconsideration6 dated May
12, 1999 was denied in the resolution7 dated October
29, 1999.
The Court of Appeals affirmed the NLRC’s ruling,
with the modification that the backwages and other
monetary benefits shall be computed from the time
compensation was withheld in accordance with
Article 279 of the Labor Code, as amended by
Republic Act No. 6715.
In its Resolution8 dated November 28, 2001, the
appellate court denied petitioner’s motion for
reconsideration for lack of merit.
Petitioner is now before this Court averring that the
Court of Appeals erred in affirming the decision of
the NLRC. While petitioner concedes that the factual
findings of the NLRC are generally binding on the
appellate court, petitioner insists that the findings of
the NLRC are vague and contradictory, thereby
necessitating review.
According to petitioner, the fact that she was able to
present sufficient proof to rebut the claim of illegal
dismissal should be considered in light of the
NLRC’s admission that there are gray areas in the
case which require clarification. Petitioner avers that
the NLRC should have at least remanded the case to
the labor arbiter to thresh out these gray areas. She
further claims that the NLRC was overly zealous in
awarding COLA and ERA despite the fact that
respondents did not even pray for these awards in
their complaint. She also questions the NLRC’s
general statement to the effect that the payroll she
submitted is not convincing asserting that she
submitted 235 sets of payroll, not just one, and that
the NLRC did not even bother to explain why it
found the payroll unconvincing.
Respondents filed a Comment9 dated May 10, 2002
alleging that petitioner failed to submit certified true
copies of the assailed decisions and resolutions, and
that the petition lacks proof of service and raises
questions of fact.
In her Reply to Comment10 dated September 17, 2002,
petitioner points out that the Rules of Court do not
require that all copies of the petition contain certified
true copies of the questioned decisions and
resolutions. Further, all copies of the petition filed
with the Court contain an affidavit of service.
Respondents’ copy does not have an affidavit of
service because the sworn declaration can not be
executed before service of the petition is actually
made. Petitioner also maintains that the rule on
review of findings of fact by the Supreme Court
admits of certain exceptions such as when the
conclusions arrived at are grounded entirely on
speculation, surmises and conjectures as in this case.
The petition was given due course and the parties
were required to submit their respective memoranda
in the Resolution11 dated March 3, 2003. Petitioner
filed a Manifestation and Compliance12 dated April
22, 2003 adopting the allegations in her Petition for
Review on Certiorari and Reply to Comment as her
memorandum. For their part, respondents filed
a Memoranda For Private Respondents13 dated May
7, 2003 alleging that the Court of Appeals correctly
relied upon the factual findings of the NLRC after
having found the same to be supported by substantial
evidence. They insist that they are regular seasonal
employees of the sugar plantation. As such, petitioner
has the burden of proving that their dismissal was for
a just or authorized cause.
As regards the contention that the NLRC erroneously
awarded COLA and ERA, respondents cite Osias
Academy v. DOLE,14 which provides that the NLRC
can extend monetary awards even if these are not
prayed for if the monetary benefits are statutory
grants intended to alleviate the laborer’s plight like
the COLA and ERA.
The main question raised by the present petition is
whether respondents are regular employees of
Hacienda Maasin and thus entitled to their monetary
claims. Related to this is the issue of whether
respondents were illegally terminated.
This case presents a good opportunity to reiterate the
Court’s rulings on the subject of seasonal
employment. The Labor Code defines regular and
casual employment, viz:
Art. 280. REGULAR AND CASUAL
EMPLOYMENT.—The provisions of written
agreement to the contrary notwithstanding and
regardless of the oral agreement of the parties, an
employment shall be deemed to be regular where the
employee has been engaged to perform activities
which are usually necessary or desirable in the usual
business or trade of the employer, except where the
employment has been fixed for a specific project or
undertaking the completion or termination of which
has been determined at the time of the engagement of
the employee or where the work or service to be
performed is seasonal in nature and the employment
is for the duration of the season.
An employment shall be deemed to be casual if it is
not covered by the preceding paragraph: Provided,
That, any employee who has rendered at least one
year of service, whether such service is continuous or
broken, shall be considered a regular employee with
respect to the activity in which he is employed and
his employment shall continue while such activity
exists.
The law provides for three kinds of employees: (1)
regular employees or those who have been engaged
to perform activities which are usually necessary or
desirable in the usual business or trade of the
employer; (2) project employees or those whose
employment has been fixed for a specific project or
undertaking, the completion or termination of which
has been determined at the time of the engagement of
the employee or where the work or service to be
performed is seasonal in nature and the employment
is for the duration of the season; and (3) casual
employees or those who are neither regular nor
project employees.15
16
In Mercado v. NLRC, the Court ruled that seasonal
workers do not become regular employees by the
mere fact that they have rendered at least one year of
service, whether continuous or broken, because the
proviso in the second paragraph of Article 280
demarcates as "casual" employees, all other
employees who do not fall under the definition of the
preceding paragraph. It deems as regular employees
those "casual" employees who have rendered at least
one year of service regardless of the fact that such
service may be continuous or broken.
The factual circumstances obtaining in
the Mercado case, however, are peculiar. In that case,
the workers were engaged to do a particular phase of
agricultural work necessary for rice and/or sugarcane
production, after which they would be free to render
services to other farm workers who need their
services.
In contrast, in the case of Hacienda Fatima v.
National Federation of Sugarcane Workers-Food and
General Trade,17respondents performed the same
tasks for petitioners every season for several years.
Thus, they were considered the latter’s regular
employees for their respective tasks. The fact that
they do not work continuously for one whole year but
only for the duration of the season does not detract
from considering them in regular employment since
in a litany of cases this Court has already settled that
seasonal workers who are called to work from time to
time and are temporarily laid off during off-season
are not separated from service in that period, but
merely considered on leave until re-employed.18
Citing jurisprudence, the Court, in Hacienda Fatima,
condensed the rule that the primary standard for
determining regular employment is the reasonable
connection between the particular activity performed
by the employee vis-à-vis the usual trade or business
of the employer. This connection can be determined
by considering the nature of the work performed and
its relation to the scheme of the particular business or
trade in its entirety. If the employee has been
performing the job for at least a year, even if the
performance is not continuous and merely
intermittent, the law deems repeated and continuing
need for its performance as sufficient evidence of the
necessity if not indispensability of that activity to the
business. Hence, the employment is considered
regular, but only with respect to such activity and
while such activity exists.19
In this case, petitioner argues that respondents were
not her regular employees as they were merely
"pakiao" workers who did not work continuously in
the sugar plantation. They performed such tasks as
weeding, cutting and loading canes, planting cane
points, fertilizing, cleaning the drainage, etc. These
functions allegedly do not require respondents’ daily
presence in the sugarcane field as it is not everyday
that one weeds, cuts canes or applies fertilizer. In
support of her allegations, petitioner submitted
"cultivo" and milling payrolls.
The probative value of petitioner’s evidence,
however, has been passed upon by the labor arbiter,
the NLRC and the Court of Appeals. Although the
labor arbiter dismissed respondents’ complaint
because their "position paper is completely devoid of
any discussion about their alleged dismissal, much
less of the probative facts thereof," 20 the ground for
the dismissal of the complaint implies a finding that
respondents are regular employees.
The NLRC was more unequivocal when it
pronounced that respondents have acquired the status
of regular seasonal employees having worked for
more than one year, whether continuous or broken in
petitioner’s hacienda.
According to petitioner, however, the NLRC’s
conclusion is highly suspect considering its own
admission that there are "gray areas which requires
(sic) clarification." She alleges that despite these gray
areas, the NLRC "chose not to remand the case to the
Labor Arbiter….as this would unduly prolong the
agony of the complainants in particular." 21
Petitioner perhaps wittingly omitted mention that the
NLRC "opted to appreciate the merits of the instant
case based on available documents/pleadings." 22 That
the NLRC chose not to remand the case to the labor
arbiter for clarificatory proceedings and instead
decided the case on the basis of the evidence then
available to it is a judgment call this Court shall not
interfere with in the absence of any showing that the
NLRC abused its discretion in so doing.
The Court of Appeals, in fact, found no such grave
abuse of discretion on the part of the NLRC.
Accordingly, it dismissed the petition for certiorari
and affirmed with modification the findings of the
NLRC. It is well to note at this point that in quasi-
judicial proceedings, the quantum of evidence
required to support the findings of the NLRC is only
substantial evidence or that amount of relevant
evidence which a reasonable mind might accept as
adequate to justify a conclusion.23
The issue, therefore, of whether respondents were
regular employees of petitioner has been adequately
dealt with. The labor arbiter, the NLRC and the Court
of Appeals have similarly held that respondents were
regular employees of petitioner. Since it is a settled
rule that the factual findings of quasi-judicial
agencies which have acquired expertise in the matters
entrusted to their jurisdiction are accorded by this
Court not only respect but even finality,24we shall no
longer disturb this finding.
Petitioner next underscores the NLRC decision’s
mention of the "payroll" she presented despite the
fact that she allegedly presented 235 sets of payroll,
not just one payroll. This circumstance does not in
itself evince any grave abuse of discretion on the part
of the NLRC as it could well have been just an
innocuous typographical error.
Verily, the NLRC’s decision, affirmed as it was by
the Court of Appeals, appears to have been arrived at
after due consideration of the evidence presented by
both parties.
We also find no reason to disturb the finding that
respondents were illegally terminated. When there is
no showing of clear, valid and legal cause for the
termination of employment, the law considers the
matter a case of illegal dismissal and the burden is on
the employer to prove that the termination was for a
just or authorized cause.25 In this case, as found both
by the NLRC and the Court of Appeals, petitioner
failed to prove any such cause for the dismissal of
respondents.
WHEREFORE, the instant petition is DENIED. The
assailed Decision and Resolution of the Court of
Appeals respectively dated June 29, 2001 and
November 28, 2001 are hereby AFFIRMED. Costs
against petitioner.
SO ORDERED.
G.R. No. 149440 January 28, 2003
HACIENDA FATIMA and/or PATRICIO
VILLEGAS, ALFONSO VILLEGAS and
CRISTINE SEGURA, petitioners,
vs.
NATIONAL FEDERATION OF SUGARCANE
WORKERS-FOOD AND GENERAL
TRADE, respondents.
PANGANIBAN, J.:
Although the employers have shown that respondents
performed work that was seasonal in nature, they
failed to prove that the latter worked only for the
duration of one particular season. In fact, petitioners
do not deny that these workers have served them for
several years already. Hence, they are regular — not
seasonal — employees.
The Case
Before the Court is a Petition for Review under Rule
45 of the Rules of Court, seeking to set aside the
February 20, 2001 Decision of the Court of
Appeals 1 (CA) in CA-GR SP No. 51033. The
dispositive part of the Decision reads:
"WHEREFORE, premises considered, the
instant special civil action for certiorari is
hereby DENIED." 2
On the other hand, the National Labor
Relations Commission (NLRC)
Decision, 3 upheld by the CA, disposed in
this wise:
"WHEREFORE, premises considered, the
decision of the Labor Arbiter is hereby SET
ASIDE and VACATED and a new one
entered declaring complainants to have been
illegally dismissed. Respondents are hereby
ORDERED to reinstate complainants except
Luisa Rombo, Ramona Rombo, Bobong
Abriga and Boboy Silva to their previous
position and to pay full backwages from
September 1991 until reinstated.
Respondents being guilty of unfair labor
practice are further ordered to pay
complainant union the sum of P10,000.00 as
moral damages and P5,000.00 as exemplary
damages." 4
The Facts
The facts are summarized in the NLRC Decision as
follows:
"Contrary to the findings of the Labor
Arbiter that complainants [herein
respondents] refused to work and/or were
choosy in the kind of jobs they wanted to
perform, the records is replete with
complainants' persistence and dogged
determination in going back to work.
"Indeed, it would appear that respondents
did not look with favor workers' having
organized themselves into a union. Thus,
when complainant union was certified as the
collective bargaining representative in the
certification elections, respondents under the
pretext that the result was on appeal, refused
to sit down with the union for the purpose of
entering into a collective bargaining
agreement. Moreover, the workers including
complainants herein were not given work for
more than one month. In protest,
complainants staged a strike which was
however settled upon the signing of a
Memorandum of Agreement which
stipulated among others that:
'a) The parties will initially meet
for CBA negotiations on the 11th
day of January 1991 and will
endeavor to conclude the same
within thirty (30) days.
'b) The management will give
priority to the women workers who
are members of the union in case
work relative . . . or amount[ing] to
gahit and [dipol] arises.
'c) Ariston Eruela Jr. will be given
back his normal work load which is
six (6) days in a week.
'd) The management will provide
fifteen (15) wagons for the workers
and that existing workforce prior to
the actual strike will be given
priority. However, in case the said
workforce would not be enough,
the management can hire additional
workers to supplement them.
'e) The management will not
anymore allow the scabs,
numbering about eighteen (18)
workers[,] to work in the hacienda;
and
'f) The union will immediately lift
the picket upon signing of this
agreement.'
"However, alleging that complainants failed
to load the fifteen wagons, respondents
reneged on its commitment to sit down and
bargain collectively. Instead, respondent
employed all means including the use of
private armed guards to prevent the
organizers from entering the premises.
"Moreover, starting September 1991,
respondents did not any more give work
assignments to the complainants forcing the
union to stage a strike on January 2, 1992.
But due to the conciliation efforts by the
DOLE, another Memorandum of Agreement
was signed by the complainants and
respondents which provides:
'Whereas the union staged a strike against
management on January 2, 1992 grounded
on the dismissal of the union officials and
members;
'Whereas parties to the present dispute agree
to settle the case amicably once and for all;
'Now therefore, in the interest of
both labor and management, parties
herein agree as follows:
'1. That the list of the names of
affected union members hereto
attached and made part of this
agreement shall be referred to the
Hacienda payroll of 1990 and
determine whether or not this
concerned Union members are
hacienda workers;
'2. That in addition to the payroll of
1990 as reference, herein parties
will use as guide the subjects of a
Memorandum of Agreement
entered into by and between the
parties last January 4, 1990;
'3. That herein parties can use other
employment references in support
of their respective claims whether
or not any or all of the listed 36
union members are employees or
hacienda workers or not as the case
may be;
'4. That in case conflict or
disagreement arises in the
determination of the status of the
particular hacienda workers subject
of this agreement herein parties
further agree to submit the same to
voluntary arbitration;
'5. To effect the above, a
Committee to be chaired by Rose
Mengaling is hereby created to be
composed of three representatives
each and is given five working days
starting Jan. 23, 1992 to resolve the
status of the subject 36 hacienda
workers. (Union representatives:
Bernardo Torres, Martin Alas-as,
Ariston Arulea Jr.)"
"Pursuant thereto, the parties subsequently
met and the Minutes of the Conciliation
Meeting showed as follows:
 'The meeting started at 10:00 A.M.
A list of employees was submitted
by Atty. Tayko based on who
received their 13th month pay. The
following are deemed not
considered employees:
1. Luisa Rombo
2. Ramona Rombo
3. Bobong Abrega
4. Boboy Silva
'The name Orencio Rombo shall be
verified in the 1990 payroll.
'The following employees shall be
reinstated immediately upon
availability of work:
1. Jose Dagle
2. Rico Dagle
3. Ricardo Dagle
4. Jesus Silva
5. Fernando Silva
6. Ernesto Tejares
"When respondents again reneged on its
commitment; complainants filed the present
complaint.
"But for all their persistence, the risk they
had to undergo in conducting a strike in the
face of overwhelming odds, complainants in
an ironic twist of fate now find themselves
being accused of 'refusing to work and being
choosy in the kind of work they have to
perform'." 5 (Citations omitted)
Ruling of the Court of Appeals
The CA affirmed that while the work of respondents
was seasonal in nature, they were considered to be
merely on leave during the off-season and were
therefore still employed by petitioners. Moreover, the
workers enjoyed security of tenure. Any infringement
upon this right was deemed by the CA to be
tantamount to illegal dismissal.
The appellate court found neither "rhyme nor reason
in petitioner's argument that it was the workers
themselves who refused to or were choosy in their
work." As found by the NLRC, the record of this case
is "replete with complainants' persistence and dogged
determination in going back to work." 6
The CA likewise concurred with the NLRC's finding
that petitioners were guilty of unfair labor practice.
Hence this Petition. 7
Issues
Petitioners raise the following issues for the Court's
consideration:
"A. Whether or not the Court of Appeals
erred in holding that respondents, admittedly
seasonal workers, were regular employees,
contrary to the clear provisions of Article
280 of the Labor Code, which categorically
state that seasonal employees are not
covered by the definition of regular
employees under paragraph 1, nor covered
under paragraph 2 which refers exclusively
to casual employees who have served for at
least one year.
"B. Whether or not the Court of Appeals
erred in rejecting the ruling in Mercado, . . .
and relying instead on rulings which are not
directly applicable to the case at bench, viz,
Philippine Tobacco, Bacolod-Murcia, and
Gaco, . . .
7. Alejandro Tejares
"C Whether or not the Court of Appeals
8. Gaudioso Rombo
committed grave abuse of discretion in
9. Martin Alas-asupholding
Jr. the NLRC's conclusion that
private respondents were illegally dismissed,
10. Cresensio Abrega
that petitioner[s were] guilty of unfair labor
11. Ariston Eruela Sr.
practice, and that the union be awarded
12. Ariston Eruela Jr.' and exemplary damages." 8
moral
Consistent with the discussion in petitioners'
Memorandum, we shall take up Items A and B as the
first issue and Item C as the second.
The Court's Ruling
The Petition has no merit.
First Issue:
Regular Employment
At the outset, we must stress that only errors of law
are generally reviewed by this Court in petitions for
review on certiorari of CA decisions. 9 Questions of
fact are not entertained. 10 The Court is not a trier of
facts and, in labor cases, this doctrine applies with
greater force. 11 Factual questions are for labor
tribunals to resolve. 12 In the present case, these have
already been threshed out by the NLRC. Its findings
were affirmed by the appellate court.
Contrary to petitioners' contention, the CA did not err
when it held that respondents were regular
employees.
Article 280 of the Labor Code, as amended, states:
"Art. 280. Regular and Casual Employment.
— The provisions of written agreement to
the contrary notwithstanding and regardless
of the oral agreement of the parties, an
employment shall be deemed to be regular
where the employee has been engaged to
perform activities which are usually
necessary or desirable in the usual business
 or trade of the employer, except where the
employment has been fixed for a specific
project or undertaking the completion or
termination of which has been determined at
the time of the engagement of the employee
or where the work or services to be
performed is seasonal in nature and the
employment is for the duration of the
season.
"An employment shall be deemed to be
casual if it is not covered by the preceding
paragraph: Provided, That, any employee
who has rendered at least one year of
service, whether such service is continuous
or broken, shall be considered a regular
employee with respect to the activity in
which he is employed and his employment
shall continue while such activity exist."
(Italics supplied)
For respondents to be excluded from those classified
as regular employees, it is not enough that they
perform work or services that are seasonal in nature.
They must have also been employed only for the
duration of one season. The evidence proves the
existence of the first, but not of the second, condition.
The fact that respondents — with the exception of
Luisa Rombo, Ramona Rombo, Bobong Abriga and
Boboy Silva — repeatedly worked as sugarcane
workers for petitioners for several years is not denied
by the latter. Evidently, petitioners employed
respondents for more than one season. Therefore, the
general rule of regular employment is applicable.
In Abasolo v. National Labor Relations
Commission, 13 the Court issued this clarification:
"[T]he test of whether or not an employee is
a regular employee has been laid down in
De Leon v. NLRC, in which this Court held:
"The primary standard, therefore, of
determining regular employment is the
reasonable connection between the
particular activity performed by the
employee in relation to the usual trade or
business of the employer. The test is
whether the former is usually necessary or
desirable in the usual trade or business of the
employer. The connection can be
determined by considering the nature of the
work performed and its relation to the
scheme of the particular business or trade in
its entirety. Also if the employee has been
performing the job for at least a year, even if
the performance is not continuous and
merely intermittent, the law deems repeated
and continuing need for its performance as
sufficient evidence of the necessity if not
indispensability of that activity to the
business. Hence, the employment is
considered regular, but only with respect to
such activity and while such activity exists.
xxx xxx xxx
". . . [T]he fact that [respondents] do not
work continuously for one whole year but
only for the duration of the . . . season does
not detract from considering them in regular
employment since in a litany of cases this
Court has already settled that seasonal
workers who are called to work from time to
time and are temporarily laid off during off-
season are not separated from service in said
period, but merely considered on leave until
re-employed." 14
The CA did not err when it ruled that Mercado v.
NLRC 15 was not applicable to the case at bar. In the
earlier case, the workers were required to perform
phases of agricultural work for a definite period of
time, after which their services would be available to
any other farm owner. They were not hired regularly
and repeatedly for the same phase/s of agricultural
work, but on and off for any single phase thereof. On
the other hand, herein respondents, having performed
the same tasks for petitioners every season for several
years, are considered the latter's regular employees
for their respective tasks. Petitioners' eventual refusal
to use their services — even if they were ready, able
and willing to perform their usual duties whenever
these were available — and hiring of other workers to
perform the tasks originally assigned to respondents
amounted to illegal dismissal of the latter.
The Court finds no reason to disturb the CA's
dismissal of what petitioners claim was their valid
exercise of a management prerogative. The sudden
changes in work assignments reeked of bad faith.
These changes were implemented immediately after
respondents had organized themselves into a union
and started demanding collective bargaining. Those
who were union members were effectively deprived
of their jobs. Petitioners' move actually amounted to
unjustified dismissal of respondents, in violation of
the Labor Code.
"Where there is no showing of clear, valid and legal
cause for the termination of employment, the law
considers the matter a case of illegal dismissal and
the burden is on the employer to prove that the
termination was for a valid and authorized
cause." 16 In the case at bar, petitioners failed to
prove any such cause for the dismissal of respondents
who, as discussed above, are regular employees.
Second Issue:
Unfair Labor Practice
The NLRC also found herein petitioners guilty of
unfair labor practice. It ruled as follows:
"Indeed, from respondents' refusal to
bargain, to their acts of economic
inducements resulting in the promotion of
those who withdrew from the union, the use
of armed guards to prevent the organizers to
come in, and the dismissal of union officials
and members, one cannot but conclude that
respondents did not want a union in their
 hacienda—a clear interference in the right of
the workers to self-organization." 17
We uphold the CA's affirmation of the above
findings. Indeed, factual findings of labor officials,
who are deemed to have acquired expertise in matters
within their respective jurisdictions, are generally
accorded not only respect but even finality. Their
findings are binding on the Supreme Court. 18 Verily,
their conclusions are accorded great weight upon
appeal, especially when supported by substantial
evidence. 19 Consequently, the Court is not duty-
bound to delve into the accuracy of their factual
findings, in the absence of a clear showing that these
were arbitrary and bereft of any rational basis." 20
The finding of unfair labor practice done in bad faith
carries with it the sanction of moral and exemplary
damages." 21
WHEREFORE, the Petition is hereby DENIED and
the assailed Decision AFFIRMED. Costs against
petitioners.
SO ORDERED.
G.R. No. 152777 December 9, 2005
LOLITA R. LACUESTA, Petitioner,
vs.
ATENEO DE MANILA UNIVERSITY, DR.
LEOVINO MA. GARCIA and DR. MARIJO
RUIZ, Respondents.
DECISION
QUISUMBING, J.:
This petition for review on certiorari assails
the Decision1 dated October 12, 2001 of the Court of
Appeals in CA-G.R. SP No. 61173 and
its Resolution2 dated February 21, 2002, denying the
motion for reconsideration. The appellate court
affirmed the Decision3 dated February 24, 2000 of the
National Labor Relations Commission (NLRC),
which had reversed the Decision dated March 20,
1998 of the Labor Arbiter.
The facts are undisputed.
Respondent Ateneo de Manila University (Ateneo)
hired, on a contractual basis, petitioner Lolita R.
Lacuesta as a part-time lecturer in its English
Department for the second semester of school year
1988-1989. She was re-hired, still on a contractual
basis, for the first and second semesters of school
year 1989-1990.
On July 13, 1990, the petitioner was first appointed
as full-time instructor on probation, in the same
department effective June 1, 1990 until March 31,
1991. Thereafter, her contract as faculty on probation
was renewed effective April 1, 1991 until March 31,
1992. She was again hired for a third year effective
April 1, 1992 until March 31, 1993. During these
three years she was on probation status.
In a letter dated January 27, 1993, respondent Dr.
Leovino Ma. Garcia, Dean of Ateneo’s Graduate
School and College of Arts and Sciences, notified
petitioner that her contract would no longer be
renewed because she did not integrate well with the
English Department. Petitioner then appealed to the
President of the Ateneo at the time, Fr. Joaquin
Bernas, S.J.
In a letter dated February 11, 1993, Fr. Bernas
explained to petitioner that she was not being
terminated, but her contract would simply expire. He
also stated that the university president makes a
permanent appointment only upon recommendation
of the Dean and confirmation of the Committee on
Faculty Rank and Permanent Appointment. He added
that any appointment he might extend would be
tantamount to a midnight appointment.
In another letter dated March 11, 1993, Fr. Bernas
offered petitioner the job as book editor in the
University Press under terms comparable to that of a
faculty member.
On March 26, 1993, petitioner applied for clearance
to collect her final salary as instructor. Petitioner also
signed a Quitclaim, Discharge and Release on April
16, 1993.4
Petitioner worked as editor in the University Press
from April 1, 1993 to March 31, 1994 including an
extension of two months after her contract expired.
Upon expiry of her contract, petitioner applied for
clearance to collect her final salary as editor. Later,
she agreed to extend her contract from June 16, 1994
to October 31, 1994. Petitioner decided not to have
her contract renewed due to a severe back problem.
She did not report back to work, but she submitted
her clearance on February 20, 1995.
On December 23, 1996, petitioner filed a complaint
for illegal dismissal with prayer for reinstatement,
back wages, and moral and exemplary damages. Dr.
Leovino Ma. Garcia and Dr. Marijo Ruiz were sued
in their official capacities as the previous and present
deans of the College of Arts and Sciences,
respectively.
Labor Arbiter Manuel P. Asuncion held that
petitioner may not be terminated by mere lapse of the
probationary period but only for just cause or failure
to meet the employer’s standards. Moreover, said the
Labor Arbiter, the quitclaim, discharge and release
executed by petitioner was not a bar to filing a
complaint for illegal dismissal.5Thus, he ordered
reinstatement with payment of full back wages.
The NLRC upon appeal of respondents reversed the
Labor Arbiter’s decision and ruled that petitioner was
not illegally dismissed, and that her quitclaim was
valid. Petitioner sought reconsideration but it was
denied. She then filed a petition for certiorari before
the Court of Appeals assailing the NLRC decision.
The appellate court dismissed the petition saying
there was no grave abuse of discretion and affirmed
the NLRC decision. It ruled:
WHEREFORE, the petition is hereby denied and
accordingly DISMISSED.6
Hence, this instant petition where petitioner assigns
the following as errors:
1. The Court of Appeals erred in ruling that it is the
Manual of Regulations For Private Schools, not the
Labor Code, that determines the acquisition of
regular or permanent status of faculty members in an
educational institution;
2. The Court of Appeals erred in upholding the
Quitclaim that was signed by the Petitioner and in
taking that against her claims for illegal dismissal and
for moral and exemplary damages against the
respondents.7
Simply put, the issue in this case is whether the
petitioner was illegally dismissed.
Petitioner contends that Articles 280 and 281 of the
Labor Code,8 not the Manual of Regulations for
Private Schools, is the applicable law to determine
whether or not an employee in an educational
institution has acquired regular or permanent status.
She argues that (1) under Article 281, probationary
employment shall not exceed six (6) months from
date of employment unless a longer period had been
stipulated by an apprenticeship agreement; (2) under
Article 280, if the apprenticeship agreement
stipulates a period longer than one year and the
employee rendered at least one year of service,
whether continuous or broken, the employee shall be
considered as regular employee with respect to the
activity in which he is employed while such activity
exists; and (3) it is with more reason that petitioner
be made regular since she had rendered services as
part-time and full-time English teacher for four and a
half years, services which are necessary and desirable
to the usual business of Ateneo.9
Furthermore, the petitioner contends that her
clearance was granted and completed only after she
signed the quitclaim on April 16, 1993. She contends
also that the respondents failed to show that her
quitclaim was voluntary.
Respondents, for their part, contend that the Manual
of Regulations for Private Schools is controlling. In
the Manual, full-time teachers who have rendered
three consecutive years of satisfactory service shall
be considered permanent. Respondents also claim
that the petitioner was not terminated but her
employment contract expired at the end of the
probationary period. Further, institutions of higher
learning, such as respondent Ateneo, enjoy the
freedom to choose who may teach according to its
standards. Respondents also argue that the quitclaim,
discharge and release by petitioner is binding and
should bar her complaint for illegal dismissal.
After considering the contentions of the parties in the
light of the circumstances in this case, we find for
respondents.
The Manual of Regulations for Private Schools, and
not the Labor Code, determines whether or not a
faculty member in an educational institution has
attained regular or permanent status.10 In University
of Santo Tomas v. National Labor Relations
Commission the Court en banc said that under Policy
Instructions No. 11 issued by the Department of
Labor and Employment, "the probationary
employment of professors, instructors and teachers
shall be subject to the standards established by the
Department of Education and Culture." Said
standards are embodied in paragraph 7511 (now
Section 93) of the Manual of Regulations for Private
Schools.12
Section 9313 of the 1992 Manual of Regulations for
Private Schools provides that full-time teachers who
have satisfactorily completed their probationary
period shall be considered regular or
permanent.14 Moreover, for those teaching in the
tertiary level, the probationary period shall not be
more than six consecutive regular semesters of
satisfactory service.15 The requisites to acquire
permanent employment, or security of tenure, are (1)
the teacher is a full-time teacher; (2) the teacher must
have rendered three consecutive years of service; and
(3) such service must have been satisfactory.16
As previously held, a part-time teacher cannot
acquire permanent status.17 Only when one has served
as a full-time teacher can he acquire permanent or
regular status. The petitioner was a part-time lecturer
before she was appointed as a full-time instructor on
probation. As a part-time lecturer, her employment as
such had ended when her contract expired. Thus, the
three semesters she served as part-time lecturer could
not be credited to her in computing the number of
years she has served to qualify her for permanent
status.
Petitioner posits that after completing the three-year
probation with an above-average performance, she
already acquired permanent status. On this point, we
are unable to agree with petitioner.
Completing the probation period does not
automatically qualify her to become a permanent
employee of the university. Petitioner could only
qualify to become a permanent employee upon
fulfilling the reasonable standards for permanent
employment as faculty member.18 Consistent with
academic freedom and constitutional autonomy, an
institution of higher learning has the prerogative to
provide standards for its teachers and determine
whether these standards have been met.19 At the end
of the probation period, the decision to re-hire an
employee on probation, belongs to the university as
the employer alone.
We reiterate, however, that probationary employees
enjoy security of tenure, but only within the period of
probation. Likewise, an employee on probation can
only be dismissed for just cause or when he fails to
qualify as a regular employee in accordance with the
reasonable standards made known by the employer at
the time of his hiring. Upon expiration of their
contract of employment, academic personnel on
probation cannot automatically claim security of
tenure and compel their employers to renew their
employment contracts.20 In the instant case,
petitioner, did not attain permanent status and was
not illegally dismissed. As found by the NLRC, her
contract merely expired.
Lastly, we find that petitioner had already signed a
valid quitclaim, discharge and release which bars the
present action. This Court has held that not all
quitclaims are per se invalid or against public policy,
except (1) where there is clear proof that the waiver
was wangled from an unsuspecting or gullible
person, or (2) where the terms of settlement are
unconscionable on their face.21 In this case, there is
no showing that petitioner was coerced into signing
the quitclaim. In her sworn quitclaim, she freely
declared that she received to her full satisfaction all
that is due her by reason of her employment and that
she was voluntarily releasing respondent Ateneo
from all claims in relation to her
employment.22 Nothing on the face of her quitclaim
has been shown as unconscionable.
WHEREFORE, the petition is DENIED for lack of
merit. The Decision dated October 12, 2001 of the
Court of Appeals in CA-G.R. SP No. 61173 and its
Resolution dated February 21, 2002
are AFFIRMED.
SO ORDERED.
G.R. No. 159828 April 19, 2006
KASAPIAN NG MALAYANG MANGGAGAWA
SA COCA-COLA (KASAMMA-CCO)-CFW
LOCAL 245, Petitioner,
vs.
THE HON. COURT OF APPEALS and COCA-
COLA BOTTLERS’ PHILS., INC., Respondents.
DECISION
CHICO-NAZARIO, J.:
Before Us is a Petition for Review on Certiorari
under Rule 45 of the Rules of Civil Procedure
assailing the Decision1 of the Court of Appeals which
affirmed the Decision2 of public respondent National
Labor Relations Commission (NLRC) dismissing
petitioner’s complaint against private respondent for
violations of the Memorandum of Agreement
(MOA)/Collective Bargaining Agreement (CBA),
nonpayment of overtime pay and 13th month pay,
illegal dismissal, unfair labor practice, recovery of
moral and exemplary damages and attorney’s fees.
On 30 June 1998, the CBA for the years 1995-1998
executed between petitioner union and private
respondent company expired. As the duly certified
collective bargaining agent for the rank-and-file
employees of private respondent’s Manila and
Antipolo plants, petitioner submitted its demands to
the company for another round of collective
bargaining negotiations. However, said negotiations
came to a gridlock as the parties failed to reach a
mutually acceptable agreement with respect to certain
economic and non-economic issues.
Thereafter, petitioner filed a notice of strike on 11
November 1998 with the National Conciliation and
Mediation Board (NCMB), National Capital Region,
on the ground of CBA negotiation deadlock. With the
aim of resolving the impasse, several conciliation
conferences were conducted but to no avail as the
parties failed to reach a settlement. On 19 December
1998, petitioner held the strike in private
respondent’s Manila and Antipolo plants.
Subsequently, through the efforts of NCMB
Administrator Buenaventura Magsalin, both parties
came to an agreement settling the labor dispute.
Thus, on 26 December 1998, both parties executed
and signed a MOA providing for salary increases and
other economic and non-economic benefits. It
likewise contained a provision for the regularization
of contractual, casual and/or agency workers who
have been working with private respondent for more
than one year. Said MOA was later incorporated to
form part of the 1998-2001 CBA and was thereafter
ratified by the employees of the company.
Pursuant to the provisions of the MOA, both parties
identified 64 vacant regular positions that may be
occupied by the existing casual, contractual or
agency employees who have been in the company for
more than one year. Fifty-eight (58)3 of those whose
names were submitted for regularization passed the
screening and were thereafter extended regular
employment status, while the other five failed the
medical examination and were granted six months
within which to secure a clean bill of health. Within
the six-month period, three4 of the five employees
who have initially failed in the medical examination
were declared fit to work and were accorded regular
employment status. Consequently, petitioner
demanded the payment of salary and other benefits to
the newly regularized employees retroactive to 1
December 1998, in accord with the MOA. However,
the private respondent refused to yield to said
demands contending that the date of effectivity of the
regularization of said employees were 1 May 1999
and 1 October 1999. Thus, on 5 November 1999,
petitioner filed a complaint before the NLRC for the
alleged violations of the subject MOA by the private
respondent.
Meanwhile, a certification election was conducted on
17 August 1999 pursuant to the order of the
Department of Labor and Employment (DOLE)
wherein the KASAMMA-CCO Independent surfaced
as the winning union and was then certified by the
DOLE as the sole and exclusive bargaining agent of
the rank-and-file employees of private respondent’s
Manila and Antipolo plants for a period of five years
from 1 July 1999 to 30 June 2004. On 23 August
1999, the KASAMMA-CCO Independent demanded
the renegotiation of the CBA which expired on 30
June 1998. Such request was denied by private
respondent on the contention that there was no basis
for said demand as there was already an existing
CBA which was negotiated and concluded between
petitioner and private respondent, thus, it was
untimely to reopen the said CBA which was yet to
expire on 30 June 2001.
On 9 December 1999, despite the pendency of
petitioner’s complaint before the NLRC, private
respondent closed its Manila and Antipolo plants
resulting in the termination of employment of 646
employees. On the same day, about 500 workers
were given a notice of termination effective 1 March
2000 on the ground of redundancy. The affected
employees were considered on paid leave from 9
December 1999 to 29 February 2000 and were paid
their corresponding salaries. On 13 December 1999,
four days after its closure of the Manila and Antipolo
plants, private respondent served a notice of closure
to the DOLE.
As a result of said closure, on 21 December 1999,
petitioner amended its complaint filed before the
NLRC to include "union busting, illegal
dismissal/illegal lay-off, underpayment of salaries,
overtime, premium pay for holiday, rest day, holiday
pay, vacation/sick leaves, 13th month pay, moral and
exemplary damages and attorney’s fees."
On 14 January 2000, KASAMMA-CCO Independent
filed a notice of strike due to unfair labor practice
with the NCMB-NCR. Failing to arrive at an
amicable settlement of the labor dispute with the
private respondent, KASAMMA-CCO Independent
held a strike from 9 March 2000 to 4 May 2000. On 4
May 2000, the Secretary of Labor issued an order
assuming jurisdiction over the labor dispute subject
of the strike and certified the case to the NLRC for
compulsory arbitration.
On 9 July 2001, the NLRC rendered its Decision
dismissing the complaint for lack of merit. According
to the Commission:
Evaluating, with utmost caution, both parties’
contrasting factual version, supporting proofs, related
legal excerpts and applicable jurisprudential citations,
we discern that, under the Memorandum of
Agreement (MOA) dated December 26, 1998, the 61
regularized employees are not entitled to their claims
for the P60.00 per day salary increase, mid-year
gratuity pay of P5,000.00, one sack of rice, and
overtime and thirteenth month differentials effective
December 1, 1998 onward.
Initially, under the MOA, only the employees who
were regular on July 1998 and continued being such
upon the signing of the MOA on December 26, 1998
deserve retroactive payment of the MOA benefits
amounting to a lump sum of P35,000.00.
This entitlement springs from the following pertinent
provisions of the MOA:
"All covered employees who were regular as of July
1, 1998 and upon the signing of this Agreement
shall each be entitled to a lump sum in the amount
of THIRTY FIVE THOUSAND PESOS
(P35,000.00) which shall, subject to the ratification
of the employees within the bargaining unit, be
released on or before 31 December 1998.
"The aforesaid amount shall be in lieu of the wage
increase as well as THE Operation Performances
IncentiveDESCRIBED UNDER Item 11(B)
hereof, all premium pay, the 13th month and 14th
month pay differentials, sick leave and vacation
leave credits for the period July 1, 1998 to
December 31, 1999." Underscoring supplied)
In the case at bar, since the 61 regularized employees
were regularized only on May 1, 1999 and October 1,
1999, as the case may be, they therefore have no right
whatsoever to claim entitlement to the MOA benefits.
Moreover, CFW Local 245’s insistence that the 61
regularized employees became regular on December
1, 1998 is non sequitor. It merely flows from its
specious interpretation of the MOA provisions. The
MOA does not provide that non-regular employees
who would be deployed to fill up vacant plantilla
positions covered by the 1998 and 1999 manpower
budget of CCBPC should be automatically
considered regular effective December 1, 1998. What
the MOA stipulates are that: 1) effective December 1,
1998, non-regular employees who have been
occupying the position to be filled up for at least one
year shall be given priority in filling up the positions;
and 2) that in that case, they will not undergo the
company’s regular recruitment procedures, like
interviews and qualifying examinations.
The only importance of the date of December 1, 1998
is its being the reckoning date from which the one
year employment requirement should be computed.
Consequently, under the MOA, only the non-regular
employees who had worked with the company for at
least a year counted retroactively from December 1,
1998 should be given priority in the filling up of
vacant plantilla positions.
Anyway, even assuming ex gratia argumenti that the
61 regularized employees were regularized effective
December 1, 1998, they, still, are not entitled to the
MOA benefits. As discussed above, only employees
who were regular on July 1, 1998 and were still so
until the signing of the MOA on December 26, 1998
could be covered by the retroactivity clause.
Furthermore, entitling the 61 regularized employees
to the MOA benefits would certainly infringe the
well-entrenched principle of "no-work-no-pay".
Since such employees started becoming regular only
on May 1, 1999 and October 1, 1999, as the case may
be, it would thus be most unfair to require CCBPI to
pay them for their unworked period, for they would
certainly, be unjustly enriched at the expense of
CCBPI.
We also hold that the allegedly redundant six
hundred thirty-nine (639) employees were not
illegally dismissed.
Initially, there was just cause for the employees’
dismissal.
It bears to stress that, aimed at 1) attaining efficiency
and cost effectiveness, 2) maximizing its production
capacity and 3) ensuring that its customers obtain
products manufactured only under the most stringent
quality standards of CCBPI’s modern,
technologically advanced production plants, CCBPI
conducted an extensive study on the operational
mechanics of its Manila and Antipolo plants.
From this study, it was established that there was
inadequate water supply at CCBPI’s Manila and
Antipolo plants. As a consequence, the company was
constrained to transport water from several sources to
its production line in Manila in 1998 and 1999.
Worse, it was discovered that the quality of water
supply was fast deteriorating due to the rise of its salt
level. This reality prompted the company to reduce
its production capacity. Moreover, the bottling
process of treating this water of decadent quality
resulted in higher production costs. Under these twin
conditions, the company could not thus efficiently
continue on with its operations.
The study also reveals the decadent state of the
production equipment of CCBPI’s Manila and
Antipolo Plants. Their production lines were among
the oldest and hence, had very low line efficiency. In
comparison with the line efficiency of 71.18% of the
company’s other plants, the Manila and Antipolo
Plants had only efficiency ratings of 61.09% and
58.39%, respectively. Whereas the other production
lines had an average wastage rating of 1.01%, the
twin plants had a higher average wastage ratings of
2.05% and 1.77%, respectively. The company’s
production studies in 1998 and 1999 likewise reveal
substantial issues on Good Manufacturing Practice
(GMP) and process control for such plants.
From this study, the impracticability of rehabilitating
the twin plants was also found out. Although the
problems cited may be remedied by way of a major
reconstruction, this would, however, entail an
investment of huge capital. Further, the congestion of
the twin plants’ sites would render impracticable such
a major reconstruction. Besides, there was utter lack
of effective solution to the retrograding water supply.
The foregoing significant facts are substantially
evidenced by the Technical Evaluation of Production
Requirements, Annex "20", CCBPI’s Rejoinder;
Affidavit of its Operations Manager dated 3 March
2000, Annex "1", its Position Paper dated 20 July
2000; and Certification dated May 21, 2001 of Mr.
Bruce A. Herbert, its Sur-Rejoinder.
To solve the problems cited, however, CCBPI, as
soundly recommended by the study, integrated the
production capacities of the different CCBPI modern
and technologically advanced production facilities.
This imperative integration indispensably prompted
CCBPI to close, its production lines at the Manila
and Antipolo Plants.
This measure taken by CCBPI indeed draws
jurisprudential justification from the following sound
pronouncement of the Supreme Court:
"Business enterprises today are faced with the
pressures of economic recession, stiff competition
and labor unrest. Thus, businessmen are always
pressured to adopt certain changes and programs in
order to enhance their profits and protect their
investments. Such changes may take various forms.
Management may even choose to close a branch,
department, a plant, or a shop." (Philippine
Engineering Corp. vs. CR, 41 SCRA 89)
Urgently propelled by this closure, CCBPI inevitably
redundated the services of 639 employees based at
the Manila and Antipolo Plants. The fact that their
services became superfluous or in excess of what
were reasonably demanded by the actual
requirements of the company as a consequence of the
closure certainly shows the undertone of good faith
on CCBPI’s part in resorting to the redundation
measure.
Well in support of this urgent economic measure
taken is the following postulation of the Supreme
Court in the case of Wiltshire File Co., Inc. vs.
NLRC, et al., 193 SCRA 665:
"We believe that redundancy, for purposes of our
Labor Code, exists where the services of an
employee are in excess of what is reasonably
demanded by the actual requirements of the
enterprise. Succinctly put, a position is
redundant where it is a superfluity, and superfluity
of a position or positions may be the outcome of a
number of facets, such as over hiring of workers,
decreased volume of business, or dropping of a
particular product line or service activity previously
manufactured or undertaken by the enterprises. The
employer has no legal obligation to keep in its payroll
more employees than are necessary for the operation
of its business.
"x x x.
"x x x The characterization of (the employee’s)
service as no longer necessary or sustainable, and
therefore properly terminable, was an exercise of
business judgment on the part of (the employer). The
wisdom or soundness of such characterizing or
decision was not subject to discretionary review on
the part of the Labor Arbiter nor of the NLRC so
long, of course, as violation of law or merely
arbitrary and malicious action is not shown. X x x
The determination of the continuing necessity of a
particular officer or position in a business corporation
is management’s prerogative, and the courts will not
interfere with the exercise of such so long as no
abuse of discretion or merely arbitrary or malicious
action on the part of management is shown."
Another reason why the dismissal of the 639
employees was legal is that the same was attended by
the observance of the requirements of due process.
Indeed, as early as 9 December 1999, more than
thirty (30) days prior to their actual dismissal on 1
March 2000, CCBPI served on the affected
employees a written notice informing them of the
closure of the two plants and subsequent redundation.
Later, by 13 December 1999, CCBPI filed with the
DOLE the required written notice informing it of the
subject closure and consequent redundation.
This finding is perfectly in line with the following
applicable legal excerpts:
"ART. 283. Closure of establishment and reduction
of personnel. ---The employer may also terminate the
employment of any employee due to
….redundancy…. or the closing or cessation of
operation of the establishment or undertaking …by
serving a written notice on the workers and the
Department of Labor and Employment at least one
(1) month before the intended date
thereof."lawphil.net
"For termination of employment based on just causes
defined in Article 282 of the Labor Code:
(i) A written notice served [on] the
employee specifying the ground or grounds
for termination, and giving said employee
reasonable opportunity within which to
explain his side;
(ii) A hearing or conference during which
the employee concerned, with the assistance
of counsel if he so desires is given
opportunity to respond to the charge, present
his evidence or rebut the evidence presented
against him; and
(iii) a written notice of termination served
on the employee, indicating that upon, due
consideration of all the circumstances,
grounds have been established to justify his
termination.
"For termination of employment as defined in Article
283 of the Labor Code, the requirement of due
process shall be deemed complied with upon the
service of a written notice to the employee and the
appropriate Regional Office of the Department of
Labor and Employment at least thirty days before
[effectivity] of the termination, specifically the
ground or grounds for termination." (Par. D, Section
2, Rule 1, Book VI, Omnibus Rules Implementing
the Labor Code)
Needless to state, having been lawfully redundated,
as comprehensively discussed above, the affected
employees are entitled to payment of separation pay
equivalent to one (1) month pay for every year of
service, pursuant to Article 283 of the Labor Code
which provides:
"In case of termination due to the installation of labor
saving devices or redundancy, the worker affected
thereby shall be entitled to separation pay equivalent
to at least his one (1) month pay or to at least One (1)
month pay for every year of service, whichever is
higher."
However, due to the economic adversity besetting
our workers today brought about by the ever
increasing standards of living, CCBPI realized that
such a legal package was no longer conformable with
such on obtaining economic reality. Accordingly,
CCBPI granted the affected employees separation
package much bigger than that legal separation
package. Specifically, CCBPI paid affected
employees with less than fifteen (15) years of service
150% monthly salary for every year of service and
those with fifteen (15) years and above of service
195%.
xxxx
We, moreover, view that CCBPI is not guilty of
unfair labor practice.
Contrary to KASAMMA-CCO-Independent’s
contention, CCBPI did not resort to the closure of
Manila and Antipolo plants and resultant redundation
of their 637 employees just to prevent the
renegotiation of the CBA entered into between
CCBPI and CFW Local 245. First, there is no
substantial evidence on record supporting this claim.
Secondly, as exhaustively explained supra, CCBPI’s
decision to undertake the subject closure and
subsequent redundation was due to legitimate
business considerations, namely 1) the production
lines at the two plants had very low line efficiency; 2)
the quality of water supply at such plants was rapidly
deteriorating; and 3) the rehabilitation of such plants
was not feasible due to the huge capital investment
required as well as the congestion of their areas.
xxxx
WHEREFORE, premises considered, KASAMMA-
CCO Independent, and CFW Local 245’s charges in
the instant labor dispute for non-grant of the CBA
salary increase, mid-year gratuity, one sack of rice,
overtime pay and thirteenth (13th) month pay; illegal
dismissal; unfair labor practice; and recovery of
moral and exemplary damages and attorney’s fees are
hereby DISMISSED for lack of merit.
Petitioner Coca-Cola Bottlers Phils., Inc., however, is
directed to grant the separation package adverted
above to the affected employees who have not yet
received the same. Further, the company is ordered to
accord the affected employees priority in rehiring in
the event the company needs, in the future, additional
personnel.5
Petitioner’s motion for reconsideration was denied in
a resolution dated 24 September 2001, thus on 22
November 2001 petitioner filed a petition for
certiorari before the Court of Appeals, which was
disposed by the appellate court in this wise:
After painstaking efforts and a careful examination of
the records, we rule against the contention of the
petitioner. The conflicting factual submissions of the
parties in the case at bar cannot close our eyes to the
fact that the instant case pose upon an obligation on
this Court to review and re-examine the factual
findings and to re-evaluate the pieces of evidence
which supported the conclusion of the public
respondent in its disposition of the present
controversy. This issue has already been settled in
Deles, Jr. vs. NLRC [327 SCRA 540 (2000)], where
the Supreme Court ruled:
"On its face, petitioner’s contention would require the
Court to delve into the findings of fact a quo. This we
cannot do. In the review of NLRC decisions through
a special civil action for certiorari, we are confined
only to issues of want of jurisdiction and grave abuse
of discretion on the part of the labor tribunal. We are
precluded from inquiring unto the correctness of the
evaluation of that evidence that underpins the labor
tribunal’s conclusion on matters of fact. Nor could
we examine the evidence, re-evaluate the credibility
of the witnesses, nor substitute our findings of fact
for those of an administrative body which has the
authority and expertise in its specialized field.
Arguably, there may even be an error in judgment.
This however is not within the ambit of the
extraordinary remedy of certiorari."
Moreover, the pronouncement of the High Tribunal
in Dela Salle University v. Dela Salle University
Employees Association [330 SCRA 363 (2000)],
citing established jurisprudence, has clarified the
guidelines in the resolution of petitions for certiorari
involving labor cases in this wise:
"As we reiterated in the case of Caltex Refinery
Employees Association (CREA) vs. Jose S.
Brillantes, the following are the well-settled rules in a
petition for certiorari involving labor cases.
First, the factual findings of quasi-judicial agencies
(such as the DOLE), when supported by substantial
evidence, are binding on this Court and entitled to
great respect, considering the expertise of these
agencies in their respective fields. It is well
established that findings of these administrative
agencies are generally accorded not only respect but
even finality.
Second, substantial evidence in labor cases is such
amount of relevant evidence which a reasonable mind
will accept as adequate to justify a conclusion.
Third, in Flores vs. NLRC, we explained the role and
function of Rule 65 as an extraordinary remedy. It
should be noted, in the first place, that the instant
petition is a special civil action for certiorari under
Rule 65 of the Rules of Court. An extraordinary
remedy, its use is available only and restrictively in
truly exceptional cases – those wherein the action of
an inferior court, board or officer performing judicial
or quasi-judicial acts is challenged for being wholly
void on grounds of jurisdiction.
The sole office of the writ of certiorari is the
correction of errors of jurisdiction including the
commission of grave abuse of discretion amounting
to lack or excess of jurisdiction. It does not include
correction of public respondent NLRC’s evaluation
of the evidence and the factual findings based
thereon, which are generally accorded not only great
respect but even finality."
In the light of the rulings established under the
abovecited cases, we find no ground for disturbing
the factual findings of the public respondent vis-à-vis
its resolution with regard to the issue of the validity
of the claims of the newly-regularized members of
the petitioner union, as the same is supported by
substantial evidence and in accord with established
jurisprudence herein cited. It must be stressed that
factual findings of labor officials are conclusive and
binding on the Supreme Court when supported by
substantial evidence.
Anent the issue of the closure of the Manila and
Antipolo plants of the private respondent which
resulted in the termination from employment of 639
or 646 employees working under the said facilities,
we find the same in order and in accord with law.
xxxx
It must be noted that in sustaining the contention of
the private respondent on the said issue, the public
respondent has relied on the grounds asserted by the
private respondent as basis in effecting the closure
and the resultant cessation of business operations in
the aforesaid plants. The recent accretion to the
corpus of our jurisprudence is the principle
enunciated in National Federation of Labor vs.
NLRC [327 SCRA 158 (2000)] which holds the view
that:
The closure of establishment contemplated under
Article 283 of the Labor Code is a unilateral and
voluntary act on the part of the employer to close the
business establishment as may be gleaned from the
use of the word "may" – it does not contemplate a
situation where the closure of the business
establishment is forced upon the employer and
ultimately for the benefit of the employees.
Although the Constitution provides for protection to
labor, capital and management must also be protected
under a regime of justice and the rule of law.
Hence, the claim of the petitioner that the technical
evaluation of the private respondent which served as
basis for the closure of the said facilities must be
presented to the petitioner union first before the
private respondent can implement the said action is
bereft of legal basis. The same fate must suffer with
respect to the claim of the petitioner that a prior
consultation is a condition sine qua non as required
under the Labor Code vis-à-vis the provision on the
participation of the employees in the decision-making
processes of the employer private respondent, before
the latter can effectuate the said closure, is devoid of
legal and jurisprudential basis.
As aptly stated by an authority in labor laws [Cesario
A. Azucena, Jr., Everyone’s Labor Code, 2001
Edition, p. 302], the author opined that even if the
business is not losing but its owner, for reasons of his
own, wants to stop doing business, he can lawfully do
so anytime provided he is in good faith. He further
lamented in saying that "just as no law forces anyone
to go into business, no law compels anybody to stay
in business."
Moreover, the private respondent has complied with
the aforesaid requirements of the law when it decided
to close the said establishments. The records disclose
that the alleged redundant, or more appropriately,
separated employees affected by the said closure
were in fact individually served with a notice of
termination. All of the subject employees were
offered and given a separation package by the private
respondent more than what is provided by the law
and more than what is stipulated under their CBA,
although, some refused to accept the said benefits,
and insisted on their being reinstated. We take note
that as of the present, 546 of the 639 terminated or
separated employee-members of the petitioner union
were ale to receive the said separation benefits.
Moreover, the receipt of the said separation benefits
was admitted by the petitioner. The Department of
Labor and Employment (DOLE) was also notified of
such closure through a letter sent by the private
respondent dated December 10, 1999.
The petitioner claims that the private respondent
failed to comply with the one-month notice
requirement as required under the said legal provision
since the subject employees were no longer allowed
to report for work effective immediately upon receipt
of their termination notice. However, they were still
paid their salaries effective from December 9, 1999
until February 29, 2000, although they did not
anymore render service for the period. Significantly,
this peculiar fact which petitioner claims as an
indirect circumvention of the said law has already
been addressed, albeit by analogy, in the recent case
of Serrano v. NLRC [331 SCRA 341 (2000)]. In the
said case, the Supreme Court held:
In that case (Associate Labor Unions-VIMCONTU
vs. NLRC [204 SCRA 913]), the employees and the
then Ministry of Labor and Employment (MOLE)
were notified in writing on August 5, 1983 that the
employees’ services would cease on august 31, 1983
but that they would be paid their salaries and other
benefits until September 5, 1983. It was held that
such written notice was "more than substantial
compliance with the notice requirement of the Labor
Code."
Indeed, there was more than substantial compliance
with the law in that case because, in addition to the
advance written notice required under Art. 284 (now
Art. 283) of the Labor Code, the employees were
paid for five days, from September 1 to 5, 1993, even
if they rendered no service for the period.1avvphil.net
Had private respondent given a written notice to the
petitioner on October 1, 1991, at the latest, that
effective October 31, 1991 his employment would
cease although from October 1 he would no longer be
required to work, there would be basis for private
respondent’s boast that ‘[p]ayment of this salary even
[if he is] no longer working is effective notice and is
much better than 30 days formal notice but working
until the end of the 30 days period." This is not the
case here, however. What happened here was that on
October 11, 1991, petitioner was given a
memorandum terminating his employment effective
on the same day on the ground of retrenchment
(actually redundancy).
xxx
WHEREFORE, premises considered, the instant
petition is DISMISSED for lack of merit. The
assailed decision dated July 9, 2001 and the Order
dated September 24, 2001 issued by public
respondent National Labor Relations Commission
(NLRC) are hereby AFFIRMED. No costs.6
Petitioner’s motion for reconsideration was denied in
a resolution dated 5 September 2003. Hence, the
instant petition.
Petitioner presents before this Court two issues for
resolution, namely: 1) whether or not private
respondent violated the terms and conditions
contained in the MOA dated 26 December 1998
when it did not recognize the regularization of the 61
employees as effective on 1 December 1998; and 2)
whether or not the closure of private respondent’s
Manila and Antipolo plants, resulting in the
termination of employment of 646 employees, was
legal.
In dismissing the petition before it, the Court of
Appeals opined that the resolution of the validity of
the claims of the newly regularized employees would
entail a review and re-examination of the factual
findings and the re-evaluation of the pieces of
evidence which supported the conclusion of the
NLRC in the latter’s disposition of the instant
controversy. We do not agree with the Court of
Appeals. The said issue is not a question of fact
which will necessitate the appellate court to again
examine the evidence. It is, rather, a question of law.
There is a question of law when the issue does not
call for an examination of the probative value of
evidence presented, the truth or falsehood of facts
being admitted and the doubt concerns the correct
application of law and jurisprudence on the
matter.7 On the other hand, there is a question of fact
when the doubt or controversy arises as to the truth or
falsity of the alleged facts. When there is no dispute
as to fact, the question of whether or not the
conclusion drawn therefrom is correct is a question of
law.8
What is necessary in determining whether the private
respondent violated the provisions of the MOA with
respect to the date of regularization of the 61
employees is an interpretation of the pertinent
provision of the MOA as agreed upon by the parties.
It must be noted that both parties admit the existence
of said MOA and that they have voluntarily entered
into said agreement. Furthermore, neither of the
parties deny that the 61 employees have indeed been
regularized by private respondent. Clearly, as the
facts are admitted by the parties, the appellate court
does not have to inquire into the veracity of any fact
in order to establish the rights of the parties. All that
the Court of Appeals must do is to interpret the
provisions of the MOA and resolve whether said
regularization must be made retroactive to 1
December 1998, which according to petitioner is
provided for under the said MOA. The MOA, being a
contract freely entered into by the parties, now
constitute as the law between them, and the
interpretation of its contents purely involves an
evaluation of the law as applied to the facts herein.
Thus, the issue being a question of law, this Court
will now endeavor to resolve such matter. According
to the pertinent provision of the MOA:
1. Non-economic issues
A. Filling-up of vacant regular plantilla positions;
regularization
The company shall fill-up all vacant plantilla
positions covered by the 1998 manpower budget as
already identified by the Task Force created by the
parties for the purpose following the following
procedures:
1. Non-regular employee (casual, contractual or
agency worker) who has already served the company
and is presently occupying or has occupied the
position to be filled-up for at least one (1) year shall
be given priority in filling-up the position by
converting his non-regular employment status to
regular employment status, effective 01 December
1998 without need of undergoing through the
company’s regular recruitment procedures such as
interview and qualifying examination. x x x9
It is the contention of petitioner that the date 1
December 1998 refers to the effective date of
regularization of said employees, while private
respondent maintains that said date is merely the
reckoning date from which the one year employment
requirement shall be computed. We agree with
petitioner. It is erroneous for the NLRC to conclude
that the regularization of the 61 employees does not
retroact to 1 December 1998. A fastidious reading of
the above quoted provision will clearly point to the
conclusion that what is pertained to by the phrase
"effective December 1, 1998" is the phrase
immediately preceding it which is "converting his
non-regular employment status to regular
employment status." It will be defying logic to adopt
private respondent’s contention that the phrase
"effective December 1, 1998" designates the period
when the non-regular employees will be given
priority in filling-up the positions, simply because the
MOA was signed only on 26 December 1998.
Therefore, it is logically absurd that the company will
only begin to extend priority to these employees on a
date that has already passed, when in fact they have
already extended priority to these employees by
agreeing to the contents of the MOA and signing said
agreement. Consequently, we hold that the effectivity
date of the regularization of the 61 employees was 1
December 1998.
We, too, cannot agree with the NLRC’s rationale that
entitling the 61 regularized employees to the MOA
benefits would certainly infringe the well-entrenched
principle of "no-work-no-pay," since they only
became regular, according to private respondent, on 1
May 1999 and 1 October 1999. As stated in the
MOA, only those who have worked with the
company for one year as of 1 December 1998 and are
still working for the company as of the signing of the
MOA, will be considered for regularization.
Evidently, it is erroneous for the NLRC to conclude
that extending to them the benefits of the MOA
would violate the principle of "no-work-no-pay" as
they are actually rendering service to the company
even before 1 December 1998, and continued to do
so thereafter. Truly, they were accorded the status of
regular employees precisely because they were
rendering service to the company for the required
period.
Moreover, at this point it must be stressed that under
Article 280 of the Labor Code, any employee who
has rendered at least one year of service, whether
such service is continuous or broken, shall be
considered a regular employee with respect to the
activity in which he is employed and his employment
shall continue while such activity exists. Also, under
the law, a casual employee is only casual for one
year, and it is the passage of time that gives him a
regular status. Hence, even without the subject MOA
provision, the 61 employees must be extended
regular employment status after the lapse of one year.
Even if we were to follow private respondent’s
contention that the date 1 December 1998 provided in
the MOA is merely a reckoning date to determine
who among the non-regular employees have rendered
one year of service as of said date, all those who have
been with the company for one year by said date
must automatically be considered regular employees
by operation of law. Therefore, contrary to the
interpretation of the NLRC, private respondent
violated the provision of the MOA when it did not
consider the regularization of the 61 employees
effective 1 December 1998, and accorded to them the
full benefits of the MOA.
Relative to the issue of whether the closure of private
respondent’s Manila and Antipolo plants was legal,
we agree in the conclusions of the NLRC and the
Court of Appeals that the closure of said plants is for
an authorized cause.
As correctly pointed out by the NLRC, the Court has
already resolved that the characterization of the
employee’s service as no longer necessary or
sustainable, and therefore properly terminable, is an
exercise of business judgment on the part of the
employer.10 The wisdom or soundness of such
characterizing or decision is not subject to
discretionary review on the part of the Labor Arbiter
nor of the NLRC so long, of course, as violation of
law or merely arbitrary and malicious action is not
shown.11 The determination of the continuing
necessity of a particular officer or position in a
business corporation is management’s prerogative,
and the courts will not interfere with the exercise of
such so long as no abuse of discretion or merely
arbitrary or malicious action on the part of
management is shown.12 In the case at bar, the
closure of the Manila and Antipolo plants and the
resulting termination of the employment of 646
employees is not tainted with bad faith. As found by
the NLRC, the private respondent’s decision to close
the plant was a result of a study conducted which
established that the most prudent course of action for
the private respondent was to stop operations in said
plants and transfer production to other more modern
and technologically advanced plants of private
respondent.
Other than its mere allegations, petitioner union
failed to show that the closure of the two plants was
without factual basis and done in utter bad faith. No
evidence was presented by petitioner to prove its
assertion that private respondent resorted to the
closure of the Manila and Antipolo plants to prevent
the renegotiations of the CBA entered into between
the parties. As adequately explained by the NLRC,
the subject closure and the resulting termination of
the 639 employees was due to legitimate business
considerations, as evidenced by the technical study
conducted by private respondent.
WHEREFORE, premises considered, the assailed
Decisions of the Court of Appeals in CA-G.R. SP
No. 67775 and of the National Labor Relations
Commission in NLRC Case No. 30-11-00466-99 and
NLRC CC No. 000182-00 are hereby AFFIRMED
with MODIFICATION. The 61 subject employees
are hereby declared regular employees as of 1
December 1998 and are entitled to the CBA salary
increase, mid-year gratuity pay, one sack of rice,
overtime pay and thirteenth (13th) month pay as
provided for in the Memorandum of Agreement. No
costs.
SO ORDERED.

Anent the allegation that private respondent failed to

comply with the notice requirements as provided by
the Labor Code in the cessation of its operations, we
have already settled this matter in a similar case
which was accordingly cited by the appellate court.
In the case of Serrano v. National Labor Relations
Commission,13 we held that:

In that case [Associate Labor Unions-VIMCONTU v.

NLRC (204 SCRA 913)], the employees and the then
Ministry of Labor and Employment (MOLE) were
notified in writing on August 5, 1983 that the
employees’ services would cease on August 31, 1983
but that they would be paid their salaries and other
benefits until September 5, 1983. It was held that
such written notice was "more than substantial
compliance" with the notice requirement of the Labor
Code.

Indeed, there was "more than substantial compliance"

with the law in that case because, in addition to the
advance written notice required under Art. 284 (now
Art. 283) of the Labor Code, the employees were
paid for five days, from September 1 to 5, 1993, even
if they rendered no service for the period. x x x Had
private respondent given a written notice to the
petitioner on October 1, 1991, at the latest, that
effective October 31, 1991 his employment would
cease although from October 1 he would no longer be
required to work, there would be basis for private
respondent’s boast that ‘[p]ayment of this salary even
[if he is] no longer working is effective notice and is
much better than 30 days formal notice but working
until the end of the 30 days period." This is not the
case here, however. What happened here was that on
October 11, 1991, petitioner was given a
memorandum terminating his employment effective
on the same day on the ground of retrenchment
(actually redundancy).14

In the instant case, the employees were served notice

on 9 December 1999 that their employment were
being severed effective 1 March 2000; however they
were no longer required to report for work but they
will continue to receive their salary up to 29 February
2000. Therefore, as enunciated in the ruling
in Serrano v. NLRC, said act of private respondent
constitutes substantial compliance with the notice
requirement of the Labor Code.