G.R. No. 117983 . September 6, 1996.
RIZALINO P. UY, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION (Fourth Division), FELIPE O. MAGBANUA, et al., respondents.

FACTS

Private respondents, employees of petitioner Rizalino P. Uy’s construction business, filed complaints for illegal dismissal, back wages, and various monetary claims. They alleged they performed work not only on specific construction projects but also in petitioner’s other enterprises like a gasoline station and lumber yard, working regular hours six days a week. They claimed dismissal and replacement with lower-paid workers. Petitioner contended the workers were project employees, hired per specific construction contract on a “pakyaw” or daily wage basis, free to seek other work after each project’s completion. He asserted they had other primary livelihoods like farming or fishing and were hired only intermittently.
The Labor Arbiter dismissed the complaints, ruling the employees were project employees. The National Labor Relations Commission (NLRC) reversed this, finding them to be regular employees. It ordered petitioner to pay back wages, separation pay, and specific wage differentials. Petitioner’s motion for reconsideration and request to admit additional construction contracts as evidence were denied, prompting this petition for certiorari.

ISSUE

Whether the NLRC committed grave abuse of discretion in ruling that private respondents were regular employees, not project employees, and in computing their wage differentials.

RULING

The Supreme Court affirmed the NLRC decision with modification on the computation of wage differentials. The Court found no grave abuse of discretion in the NLRC’s classification of the employees as regular. The legal logic hinges on Article 280 of the Labor Code. The employees were engaged in activities necessary and desirable to petitioner’s usual trade or business (construction). Their repeated and successive rehiring over several years, performing the same tasks, indicated they were part of a work pool from which petitioner drew workers for his various projects. This continuous engagement, regardless of the projects being distinct, made them regular employees. The nature of the construction industry does not automatically make all workers project employees; the decisive factor is the continuous necessity of their services to the employer’s business.
Regarding wage differentials, the Court modified the NLRC computation. The NLRC erroneously used a 30-day multiplier. Since the employees worked six days a week, the correct multiplier for converting daily wage to monthly rate is 26 days, not 30. The Labor Arbiter was ordered to recompute the differentials using the applicable statutory minimum daily wages and the 26-day factor. The petition was dismissed, and the NLRC’s finding of illegal dismissal and entitlement to back wages and separation pay was upheld.