Cioco v. C. E. Construction Corporation
REITERATIONFacts
The Antecedents: Petitioners, comprising Isaac Cioco, Jr. and six others (WORKERS), were hired by respondent C.E. Construction Corporation (COMPANY) as carpenters and laborers for various construction projects from 1990 to 1999. Their employment contracts stipulated that their employment would be co-terminus with the completion of the project unless sooner terminated. In May and June 1999, the WORKERS, along with 66 others, were terminated, with the COMPANY citing the completion of phases of the GTI Tower project as the reason. Procedural History: The WORKERS filed complaints for illegal dismissal and claims for unpaid wages and benefits. The Labor Arbiter ruled in favor of the COMPANY, finding the WORKERS to be project employees with proper notice of termination and submission of reports to the DOLE. The NLRC affirmed this decision. The Court of Appeals (CA) reversed the NLRC, declaring the dismissal illegal despite finding them to be project employees, and ordered the COMPANY to pay back wages. Both parties filed motions for reconsideration, which were denied. The Petition: The Supreme Court consolidated two petitions for review. The WORKERS contended they were regular employees entitled to reinstatement and backwages. The COMPANY argued they were project employees, not illegally dismissed, and that the CA disregarded evidence of project completion.
Issue(s)
Whether the WORKERS were regular or project employees. Whether the WORKERS were illegally dismissed. Whether the COMPANY complied with the procedural and substantive requirements for termination.
Ruling
The Supreme Court modified the decision of the Court of Appeals. It declared the termination from employment of the project employees valid and legal, setting aside the award of backwages. The Court held that the COMPANY complied with the procedural and substantive requirements for termination.
Ratio Decidendi
On whether the WORKERS were regular or project employees: The Court affirmed the unanimous finding of the Labor Arbiter, NLRC, and CA that the WORKERS were project employees. It reiterated that employment with the COMPANY for several years on various projects, even up to nine years, did not automatically confer regular employment status. The re-hiring on a project-to-project basis was a practical consideration for experienced construction workers and did not change their status as project employees, consistent with the exception for project employment under Article 280 of the Labor Code. On whether the WORKERS were illegally dismissed and if the COMPANY complied with procedural and substantive requirements: The Court found that the COMPANY had complied with the necessary requirements. Individual notices of termination were sent, informing the WORKERS that their employment would cease due to the completion of a "phase of work" in the project. The Labor Arbiter and NLRC found that appropriate notices were sent to the WORKERS and reports were submitted to the DOLE. The Court emphasized that Section 215 (III), Rule XXIII, Book V of the Omnibus Rules Implementing the Labor Code does not require prior notice of termination if it is due to the completion of the contract or phase thereof, as completion automatically terminates the employment. The employer is only obliged to report the termination to the DOLE. On whether the COMPANY presented sufficient evidence of project completion: The Court found that the COMPANY had presented sufficient evidence. Progress Billing Reports were attached as annexes to the motion for reconsideration, showing the project's substantial accomplishment (80.9203% and 81.3747% as of May and June 1999, respectively). These reports, along with specific annexes detailing the completion of formwork, concreting, and masonry works for which the WORKERS were hired, were not questioned by the WORKERS. The Court concluded that the COMPANY had conclusively proven the completion of the project phases for which the WORKERS were engaged, thereby validating their termination.
Main Doctrine
The completion of a project or a phase thereof for which project employees were hired automatically terminates their employment. If proper notice was given and the project completion is duly proven, the termination is valid and legal. Re-hiring on a project-to-project basis does not confer regular employment status.