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CASE DIGESTS Januar y 1, 2010

were employed on May 25, 1998 and until the expiration of their

TeachingContr acts on September 7, 2000. As the CA correctly found, their teachingstints only covered a

period of at least seven (7) consecutive trimesters ortwo (2) years and three (3) months of service.

This case, however, bringsto the fore the essential question of which, between the

two factorsaffec ting employment , should prevail given AMACCs

position that the teachers contracts expired and it had the right not to renewthem

. In other words,

should the teachers probation ary status bedisregar

ded simply because the contracts were

fixedterm?
On the one hand, employment on probationary status affords managementthe

chance to fully scrutinize the true worth of hired personnel before the full forceof the security of tenure guarantee of the

Constitution comes into play. Based onthe standards set at the start of the probationary period, management

is given thewidest opport unity during the probationary per iod to reject hire es who fail tome et

its own adopted but reasonable s tandards . These standard s, togetherwith the just and authorized causes for

termination of employment the Labor Codeexpressly provides , are the grounds available to terminate the

employment of ateacher on probationary status. For example, the school may impose reasonablystrict er attendance or

report complian ce records on te achers on proba tion, andreject a probationary te acher for failing in this regard, although the sa meattendance

or compliance record may not be required for a teacher already onpermanent status. At the same time, the same just an d authorizes

causes fordismissal under the Labor Code apply to probationary teachers, so that they may bethe first to be laidoff if the school

does not have enough students for a givensemester or trimester. Ter mination of employment on this basis is an

authorizedcause under the Labor Code.Labor, for its part, is given the protection during the probationary period of knowing the

company stand ards the new hi res have to me et during thepr obationary period, and to be judged on the basis of these standards

, aside fromthe usual st andards applica ble to employee s after they achi eve permanents tatus. Under the terms of the Labor Code,

these standards should be made knownto the teachers on probationary status at the start of their probationary period, or atthe

very least under the circumstances of the present case, at the start of thesemester or t he trimester dur ing which the pr

obationary stan dards are to be applied. Of critical impor tance in invokin g a failure to me et the probation ary standards, is

that the school should show as a matter of due process howthese standa rds have been ap plied

. This is effectiv ely the second notice in adismi ssal situation that the law requires as a due process guarantee supporting thesecurity of

tenure provision, and is in furtherance, too, of the basic rule in employeedismiss al that the employer carries the burden of

justifying a dismissal. These rulesensure compliance with the limited security of tenure guarantee the law extends toprobationary

employees.Whe n fixedterm employme nt is brought int o play under th e aboveprobatio nary period rules, the situation as in the present

case may at first blushlook muddled as fixed-term employment is in itself a valid employment mode underPhilippine

law and jurisprudence. Th e conflict, however, is more apparent than realwhen th e respective nat ure of fixedterm employmen

t and of employm ent onprobationa ry status is closely examined.By: Louie Limcolioc, Ramil Austria, Jai Castillo, Mikhail

Tumacder, Patrick Maglinao CASE DIGESTS Januar y 1, 2010 The fixedterm character of employment

essentially refe rs t o t h e perio d agreed upon between th e employer and the employee;

employment existsonly for the duration of the term and ends on its own when the term expires. In asense, employment on

probationary status also refers to a period because of thetechnical meaning probation carries in Philippine labor

law a maximum period of six months, o r in the academ e, a period of th ree years for th ose engaged int eaching jobs. Th eir similarity end

s there, however , because of the overridingmean ing that being on probation connotes, i.e., a process of te sting andobserv

ing the character or abilities of a person who is new to a role or job.Understood i n the above sen se, the essentially prote ctive character o

f probationary st atus for manage ment can readily be a ppreciated. But t his sameprotecti ve character gives rise to the countervailing

but equally protective rule thatthe probationary period can only last for a specific maximum period and

underreasonabl e, welllaid and properl y communicated standards. Othe rwise stated,with in the period of the probation,

any employer move based on the probationary stan dards and affecting the continuity of the employment must strictly

conform tothe probationary rules.Under the given facts where the school year is divided into trimesters, theschool appar ently utilizes

its fixed-term contracts as a co nvenient arrangementdict ated by the trimestral system and not because the workplace

parties reallyintended to limit the period of their relationship to any fixed term and to finish thisrelationship at the end of that term. If

we pierce the veil, so to speak, of theparties socalled fixed-term employment contracts, what undeniably comes out atthe

core is a fixedterm contract conveniently used by the school to define andregulate its relations with its teachers

during their probationary period . To be sure, nothing is illegitimate in defining the school-teacher relationshipin

this manner. The school, however, cannot forget that its system of fixedtermcontract is a system that operates du ring the probatio

nary period and for thisreason is subject to the t erms of Article 281 of the Labo r Code. Unless thisre conciliation is made, the

requirements of this Article on probationary status would be fully negated as the school

may freely choose not torenew contracts simply because their terms have expired. The

inevitableeff ect of course is to wreck the scheme that the Constitution and theLabor Co

de establish ed to balanc e relationshi ps between l abor and ma nagement. Given the clear constitu tional

and statutory intents, we cannot but concludethat in a situation wher e the probation ary status overl aps with a fixed -termcontract

not specifically u sed for the fixed term it offers ,

Article 281 shouldass ume

primacy and the fixedperiod character of the contract

must giveway
. This conclusion is immeasurably strengthened by the petitioners and

theAMACCs hardly concealed expectation that the employment on probation couldlead to per manent status, and that the con tracts are renew

able unless the petitioners fail to pass the schools standards.By: Louie Limcolioc, Ramil Austria, Jai Castillo, Mikhail Tumacder, Patrick Maglinao

CASE DIGESTS Januar y 1, 2010 To highlight what we mean by a fixed-term contract

specifically used for thefixed term it offers , a replacement teacher, for example, may be contracted for aperiod of one year to

temporarily take the place of a permanent teacher on a one-year study leave. The expiration of the replacement teachers

contracted term,under the circumstances, leads to no probationary status implications as she wasnever employed on

probationary basis; her employment is for a specific purposewith par ticular focus on the term and wit h every intent to end her teachin

grelationship with the school upon expiration of this term.If the school were to apply the probationary standards (as in fact it says it didin the present

case), these standards must not only be reasonable but must havealso been communicated to the teachers at the start of the

probationary period, orat the very least, at the start of the period when they were to be applied. Thesete rms,

in addition to those expressly provided by the Labor Code , would serve asthe just cause for the termination of the probationary

contract. As explained above,the details of this finding of just cause must be communicated to the affectedteachers

as a matter of due process.While w e can grant that the standards were duly com municated to th epetitioners and

could be applied beginning the 1


st

trimester of the school year 2000-2001, glaring and very basic gaps in the schools

evidence still exist. The exactterms of th e standards wer e never introduc ed as evidence; neither does th eevidence show how these

standards were applied to the petitioners. Witho ut thesepieces of evidence (effectively, the finding of just cause for the non-renewal

of thepetitioners contracts), we h ave nothing to c onsider and pass upon as va lid orinvalid for

each of the petitioners. Inevitably, the non-renewal (or effectively, thetermination o f employment of employees on probationary sta

tus) lacks thesu pporting finding of just cause that the law requires and, hence, is illegal. In thislight, the CA decision should be

reversed. Thus, the LAs decision, affirmed as tothe results by the NLRC, should stand as the decision to be enforced,

appropriatelyrecomputed to consider the period of appeal and review of the case up to ourlevel.Given the period that has lapsed and

the inevitable change of circumstancesth at must have taken place in the interim in the academic world and at AMACC,which

changes inevitably affect current school operations, we hold that - in lieu of reinstatement - the petitioners shoul d be paid separ

ation pay compu ted on atrimestr al basis from the time of separation from service up to the end of thecomplete trimester

preceding the finality of this Decision. The separation pay shallbe in addition to the other awards, properly recomputed,

that the LA originallydecree d.By: Louie Limcolioc, Ramil Austria, Jai Castillo, Mikhail Tumacder, Patrick Maglinao
Labor Case Digest
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