G.R. No. 107307 August 11, 1997
PHILIPPINE NATIONAL CONSTRUCTION CORPORATION, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and LORENZO MENDOZA, respondents.

FACTS

Lorenzo Mendoza was employed by PNCC as a Driver II in various projects from 1981 to 1989, with intervals between assignments. His last deployment was from August 17, 1988, to June 15, 1989. PNCC implemented a Retrenchment Program effective January 16, 1989, providing special separation benefits to all regular and project employees who had rendered at least one year of continuous service and were actively employed as of their separation date. Mendoza claimed benefits under this program upon his termination in June 1989.
PNCC denied his claim, arguing he was a project employee whose last assignment lasted only ten months, thus failing the one-year continuous service requirement. It also contended his money claim was barred by prescription, having been filed more than three years after a prior 1986 separation. The Labor Arbiter and the NLRC ruled in favor of Mendoza, ordering payment of separation pay. PNCC filed this petition for certiorari directly without a motion for reconsideration before the NLRC.

ISSUE

The primary issue is whether Mendoza is entitled to separation benefits under PNCC’s Retrenchment Program, considering the nature of his employment and the computation of his service.

RULING

The Supreme Court dismissed PNCC’s petition and affirmed Mendoza’s entitlement to benefits. On procedural grounds, the Court accepted the petition despite the lack of a motion for reconsideration, as the questions raised were pure questions of law already passed upon by the NLRC. On the merits, the Court applied the principle that in interpreting labor legislation and contracts, all doubts should be construed in favor of labor.
The Court held that the Retrenchment Program’s requirement of “at least one year of continuous service” did not specify that such service must be rendered immediately prior to separation. Mendoza’s total aggregate service with PNCC across multiple projects, which exceeded one year, qualified him. The Court rejected PNCC’s argument that each project employment was separate and distinct, noting that as a construction company, PNCC’s projects were seasonal and intermittent, and Mendoza was repeatedly rehired from a work pool, indicating a continuous employment relationship. The claim was not barred by prescription, as the cause of action accrued from his termination under the 1989 program, not from earlier project completions. The separation pay award was upheld with legal interest.