E. GANZON, INC. (EGI) and EULALIO GANZON, Petitioners vs. FORTUNATO B. ANDO, JR., Respondent
G.R. No. 214183
February 20, 2017
Facts:
On May 16, 2011, respondent Fortunato B. Ando, Jr. (Ando) filed a complaint against petitioner E. Ganzon, Inc. (EGI) and its President, Eulalio Ganzon, for illegal dismissal and money claims for: underpayment of salary, overtime pay, and 13th month pay; non-payment of holiday pay and service incentive leave; illegal deduction; and attorneys fees. He alleged that he was a regular employee working as a finishing carpenter in the construction business of EGI; he was repeatedly hired from January 21, 2010 until April 30, 2011 when he was terminated without prior notice and hearing; his daily salary of ₱292.00 was below the amount required by law; and wage deductions were made without his consent, such as rent for the barracks located in the job site and payment for insurance premium.
On the other hand, EGI countered his contention that, as proven by the three (3) project employment contract, Ando was engaged as a project worker (Formworker-2) in Bahay Pamulinawen Project in Laoag, Ilocos Norte from June 1, 2010 to September 30, 20107and from January 3, 2011 to February 28, 20118 as well as in EGI-West Insula Project in Quezon City, Metro Manila from February 22, 2011 to March 31, 2011; he was paid the correct salary based on the Wage Order applicable in the region; he already received the 13th month pay for 2010 but the claim for 2011 was not yet processed at the time the complaint was filed; and he voluntarily agreed to pay ₱500.00 monthly for the cost of the barracks, beds, water, electricity, and other expenses of his stay at the job site.
The Labor Arbiter declared Ando a project employee of EGI but granted some of his money claims. Both parties elevated the case to the NLRC, which dismissed the appeals filed and affirmed in toto the Decision of the Labor Arbiter. Ando filed a motion for reconsideration, but it was denied. He then filed a Rule 65 petition before the CA, which granted the same annuling the assailed NLRC resolutions dated May 25, 2012 and July 17, 2012, . EGI's motion for reconsideration was denied.
Issue:
Whether or not respondent Fortunato B. Ando, Jr., is a regular or a project worker of E. GANZON, INC., (EIG).
Ruling:
Yes, respondent Fortunato B. Ando, Jr., is a project worker of E. GANZON, INC., (EIG). In the case at bar, The Court held that the CA erred in ruling that the NLRC gravely abused its discretion when it sustained the Labor Arbiter's finding that Ando is not a regular employee but a project employee of EGI.
The terms regular, project, seasonal and casual employment are taken from Article 280 of the Labor Code, as amended. Under Art. 280, project employment is one which "has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee." To be considered as project-based, the employer has the burden of proof to show that: (a) the employee was assigned to carry out a specific project or undertaking and (b) the duration and scope of which were specified at the time the employee was engaged for such project or undertaking. It must be proved that the particular work/service to be performed as well as its duration are defined in the employment agreement and made clear to the employee who was informed thereof at the time of hiring.
As the assigned project or phase begins and ends at determined or determinable times, the services of the project employee may be lawfully terminated at its completion. In this case, the three project employment contracts signed by Ando explicitly stipulated the agreement "to engage [his] services as a Project Worker" and that:
5. [His] services with the Project will end upon completion of the phase of work for which [he was] hired for and is tentatively set on (written date). However, this could be extended or shortened depending on the work phasing.
Further, Ando was adequately notified of his employment status at the time his services were engaged by EGI for its projects.. The contracts he signed consistently stipulated that his services as a project worker were being sought. There was an informed consent to be engaged as such. His consent was not vitiated. As a matter of fact, Ando did not even allege that force, duress or improper pressure were used against him in order to agree. His being a carpenter does not suffice.
There was no attempt to frustrate Ando's security of tenure. His employment was for a specific project or undertaking because the nature of EGI's business is one which will not allow it to employ workers for an indefinite period. As a corporation engaged in construction and residential projects, EGI depends for its business on the contracts it is able to obtain. Since work depends on the availability of such contracts, necessarily the duration of the employment of its work force is not permanent but coterminous with the projects to which they are assigned and from whose payrolls they are paid. It would be extremely burdensome for EGI as an employer if it would have to carry them as permanent employees and pay them wages even if there are no projects for them to work on.
The foregoing considered, EGI did not violate any requirement of procedural due process by failing to give Ando advance notice of his termination. Prior notice of termination is not part of procedural due process if the termination is brought about by the completion of the contract or phase thereof for which the project employee was engaged.Such completion automatically terminates the employment and the employer is, under the law, only required to render a report to the Department of Labor and Employment (DOLE) on the termination of employment.
Therefore, the petition is granted and the February 28, 2014 Decision and September 4, 2014 Resolution of the Court of Appeals are reversed and set aside. The decision of the labor arbiter is reinstated.
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