GR 106654; (December, 1994) (Digest)
G.R. No. 106654 December 16, 1994
PANTRANCO NORTH EXPRESS, INC., and/or ABELARDO DE LEON, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, Second Division, and RODOLFO PERONILA, respondents.
FACTS
Private respondent Rodolfo Peronila was employed as a driver by petitioner Pantranco North Express, Inc. in 1971. In 1973, he was dismissed for being absent without leave for over 100 days. This dismissal was affirmed by the NLRC Mediator-Factfinder. Fifteen years later, in 1988, Peronila pleaded for reconsideration. Pantranco rehired him under a one-month fixed-term contract, explicitly stating there was no employer-employee relationship and that the contract would automatically terminate on May 5, 1988. Barely fifteen days into this contract, Peronila was involved in a vehicular accident. After investigation, his contract was terminated and not renewed upon its expiry.
ISSUE
Whether the fixed-term employment contract validly prevented Peronila from attaining regular employment status, thereby making his non-renewal not tantamount to illegal dismissal.
RULING
The Supreme Court granted the petition and set aside the NLRC ruling, dismissing the complaint. The Court held that the fixed-term contract was valid. The legal logic centered on the exception under Article 280 of the Labor Code, which states that an employment is deemed regular except where it has been fixed for a specific project, undertaking, or season. The Court found that Peronila’s re-employment was a distinct, new contract for a fixed period of one month, entered into freely and voluntarily, as evidenced by his conformity to its terms. This was not a case of using a fixed-term contract to circumvent security of tenure, as the contract was intended to address a specific, temporary need. The termination of his services upon the contract’s expiry was a lawful expiration, not a dismissal requiring just cause. The Court emphasized that while labor contracts are subject to police power and special laws, fixed-term contracts are not automatically invalid if they meet the exceptions under Article 280 and are not used to deprive employees of security of tenure. Here, the contract’s terms were clear, and Peronila, having been previously dismissed and rehired only upon his plea, could not claim a renewed expectation of permanent employment.