University of Santo Tomas v. Samahang Manggagawa
REITERATIONFacts
The Antecedents: Respondents, Samahang Manggagawa ng UST and Fernando Pontesor, et al., filed a complaint for regularization and illegal dismissal against petitioner University of Santo Tomas (UST). Respondents alleged that Pontesor, et al. were repeatedly hired from 1990 to 1999 for various maintenance duties within UST's campus, performing tasks necessary and desirable to UST's operation as an educational institution, and thus should be deemed regular employees. Procedural History: The Labor Arbiter (LA) ruled in favor of respondents, declaring Pontesor, et al. as regular employees who were illegally dismissed. The National Labor Relations Commission (NLRC) reversed the LA, classifying Pontesor, et al. as fixed-term casual employees whose employment validly terminated upon completion of their projects. The Court of Appeals (CA) reinstated the LA's decision, holding that Pontesor, et al. were regular employees because they performed necessary and desirable work and the project descriptions in their contracts were vague. UST filed a petition for review on certiorari. The Petition: UST assailed the CA's decision and resolution, arguing that the CA erred in ruling that Pontesor, et al. were regular employees and were illegally dismissed.
Issue(s)
Whether the Court of Appeals correctly ruled that Pontesor, et al. are regular employees and whether they were project employees or under valid fixed-term employment contracts. Whether Pontesor, et al. were illegally dismissed by petitioner.
Ruling
The petition is without merit. The Decision dated June 12, 2008 and the Resolution dated August 22, 2008 of the Court of Appeals in CA-G.R. SP No. 85464 are affirmed.
Ratio Decidendi
On whether Pontesor, et al. are regular employees, project employees, or under valid fixed-term employment contracts: The Court affirmed the CA's ruling that Pontesor, et al. are regular employees. Article 295 of the Labor Code distinguishes regular and casual employment. Regular employees are those engaged to perform activities usually necessary or desirable in the employer's usual business or trade, or those who have rendered at least one year of service. While the nature of Pontesor, et al.'s work as maintenance personnel might not be directly related to UST's primary business of education, their repeated rehiring for various maintenance tasks spanning from 1990 to 1999 clearly indicates a continuous need for their services. This prolonged service, exceeding one year cumulatively, places them under the second category of regular employees by operation of law. The Court emphasized that the primary standard for determining regular employment is the reasonable connection between the activity performed and the employer's usual trade or business, or the repeated and continuing need for the performance of the activity. The Court clarified that Pontesor, et al. were not project employees. For an employment to be considered project-based, the employees must be assigned to a specific project or undertaking with a determined or determinable duration and scope, which must be specified at the time of engagement. In this case, the project descriptions in their Contractual Employee Appointments (CEAs) were vague and general, such as "to assist" in carpentry, electrical, and masonry work. Piecing together their various CEAs, it appeared that they were engaged in all-around maintenance services throughout the campus. This vagueness and the nature of their work suggest that UST merely attempted to compartmentalize their tasks into purported "projects" to circumvent the security of tenure of regular employees. The Court cannot countenance such practice as it violates the employees' security of tenure. The Court reiterated that while fixed-term or project employment may be valid if knowingly and voluntarily agreed upon without vitiated consent, such contracts are disregarded if it is apparent that the periods were imposed to preclude the acquisition of tenurial security. In this case, the repeated imposition of CEAs for maintenance work, which is necessary and desirable for the operation of an educational institution, was deemed contrary to public policy. The Court found that the CEAs were contrived to prevent Pontesor, et al. from obtaining security of tenure. The Court found that the NLRC committed grave abuse of discretion in its ruling. The NLRC's conclusion that Pontesor, et al. were not regular employees patently deviated from the evidence on record and settled legal principles. The NLRC's classification of them as mere fixed-term casual employees was found to be unsupported by substantial evidence and contrary to law and jurisprudence. On the issue of illegal dismissal: Since Pontesor, et al. were declared regular employees, they are entitled to security of tenure and cannot be terminated without just or authorized cause. The Court found that UST failed to provide any just or authorized cause for their dismissal. Therefore, their termination was considered illegal. The LA's order for reinstatement with full backwages and without loss of seniority rights was upheld.
Main Doctrine
Employees performing activities usually necessary or desirable in the usual business or trade of the employer, or those who have rendered at least one year of service, are considered regular employees. Project or fixed-term employment contracts that are used to circumvent security of tenure are disregarded.