GR 114671; (November, 1999) (Digest)
G.R. No. 114671 November 24, 1999
AURELIO SALINAS, JR., ARMANDO SAMULDE, ALEJANDRO ALONZO and AVELINO CORTEZ, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and ATLANTIC GULF AND PACIFIC CO. of MANILA, INC., respondents.
FACTS
The petitioners were employed by Atlantic Gulf and Pacific Company of Manila, Inc. (AG&P) for periods ranging from five to nine years, performing work such as carpenter, crane driver, and operator across various construction projects. Their employment was governed by successive contracts, each indicating they were hired for a specific project and period. Upon the termination of their engagements, they filed complaints for illegal dismissal, asserting they were regular employees. The Labor Arbiter and the National Labor Relations Commission (NLRC) dismissed their complaints, ruling they were project employees whose employment legally ended upon the completion of each project. The NLRC based its decision on the employment contracts and the assignment of petitioners to different projects.
The petitioners appealed to the Supreme Court, arguing that the continuous renewal of their contracts and the performance of work necessary and desirable to AG&P’s main business line made them regular employees. They emphasized that the respondent company failed to submit termination reports to the public employment office as required by Policy Instruction No. 20 for project employees, which they contended belied the claim of project employment. The Office of the Solicitor General supported the petitioners’ position.
ISSUE
Whether the petitioners are regular employees or project employees of AG&P.
RULING
The Supreme Court ruled in favor of the petitioners, declaring them regular employees. The legal logic centered on the application of Article 280 of the Labor Code, which defines regular employment. The Court held that the determinative factor is whether the employee has been performing activities that are usually necessary or desirable in the usual business or trade of the employer. The petitioners, despite being assigned to different projects, continuously performed the same type of work essential to AG&P’s construction business over several years. This continuity and necessity of their functions indicated that their employment was not coterminous with specific projects but was integral to the company’s regular operations.
Furthermore, the Court found the company’s failure to submit termination reports to the public employment office, as mandated by Policy Instruction No. 20 for project employees, to be a significant omission. This failure reinforced the conclusion that the petitioners were not true project employees. The Court also set aside procedural objections raised by the respondent, such as the mode of appeal and non-exhaustion of administrative remedies, emphasizing that technicalities should not hinder the resolution of substantive labor rights. Consequently, the NLRC resolution was annulled, and the petitioners were ordered reinstated with full backwages and without loss of seniority rights.