G.R. No. 264439 , February 26, 2024
RAMON O. SAMPANA, PETITIONER, VS. THE MARITIME TRAINING CENTER OF THE PHILIPPINES, CAPTAIN ALEJANDRO C. AQUINO, JR., AND NORMANDY E. GUALBERTO, RESPONDENTS.

FACTS

Petitioner Ramon O. Sampana was hired by respondent The Maritime Training Center of the Philippines (TMTCP) as an Instructor under a consultancy agreement from March 21, 2011, to June 21, 2011, renewed every three months until March 20, 2014. From March 21, 2014, his contract was changed to “Employment with a Fixed Term,” also renewed every three months until December 21, 2016. On November 8, 2016, Sampana inquired about his retirement benefits, noting he had served for five years and seven months and had turned 60. On November 24, 2016, he notified TMTCP of his preference to retire. His last contract expired on December 21, 2016, and he was not re-hired. Sampana filed a complaint for illegal dismissal and payment of retirement benefits, among others. The Labor Arbiter ruled he was a regular employee entitled to retirement pay. The National Labor Relations Commission (NLRC) reversed, deleting the retirement award, holding he was a fixed-term employee from 2014-2016 and his prior consultancy period should be excluded from the five-year service requirement for retirement. The Court of Appeals affirmed the NLRC.

ISSUE

1. Is Sampana a regular employee of TMTCP?
2. Was Sampana illegally dismissed?
3. Is Sampana entitled to backwages and retirement benefits?

RULING

1. Yes, Sampana is a regular employee of TMTCP. The Supreme Court found that an employer-employee relationship existed during his entire engagement from 2011 to 2016. The four-fold test (selection and engagement of employee, payment of wages, power of dismissal, and power of control) was satisfied. The repeated renewals of his contracts for over five years, performing duties necessary and desirable to TMTCP’s business, made him a regular employee under Article 280 of the Labor Code. The fixed-term contracts were a scheme to prevent regularization and were therefore invalid.
2. No, Sampana was not illegally dismissed. The Court found that Sampana voluntarily opted to retire, as evidenced by his letters inquiring about and notifying TMTCP of his retirement. His non-rehire after his last contract expired was a consequence of his election to retire.
3. Yes, Sampana is entitled to retirement benefits but not to backwages. Having reached the age of 60 and completed at least five years of service (from March 21, 2011, to December 21, 2016) as a regular employee, he is entitled to retirement pay under Article 287 of the Labor Code. The consultancy period was included in the service computation as an employer-employee relationship existed throughout. He is entitled to retirement pay equivalent to one-half month salary for every year of service. He is not entitled to backwages as there was no illegal dismissal. The Court also awarded attorney’s fees equivalent to 10% of the total monetary award.