TItle: C. PLANAS COMMERCIAL and MARCIAL COHU, Petitioner, vs.

NATIONAL LABOR
RELATIONS COMMISSION and RAMIL DE LOS REYES, Respondents

G.R. No. 121696 February 11, 1999

Bellosillo, J.

Facts of the Case:

In September 1993, Morente, Allauigan and Ofialda and others filed a complaint for
underpayment of wages, nonpayment of overtime pay, holiday pay, service incentive leave pay,
and premium pay for rest day and holiday and night shift differential against petitioners in the
Arbitration Branch of NLRC. It alleged that Cohu is engaged in the business of wholesale of
plastic products and fruits of different kinds with more than 24 employees. Respondents were
hired on January 1990, May 1990 and July 19991 as laborers and were paid below the minimum
wage for the past 3 years. They were required to work for more than 8 hours a day and never
enjoyed the minimum benefits. Petitioners filed their comment stating that the respondents
were their helpers.

The Labor Arbiter rendered a decision dismissing the money claims. Respondents filed
an appeal with the NLRC where it granted the money claims. Petitioners appealed with the CA
but it was denied. It said that the company having claimed of exemption of the coverage of the
minimum wage shall have the burden of proof to the claim.

Petitioners insist that C. Planas Commercial is a retail establishment principally engaged

in the sale of plastic products and fruits to the customers for personal use, thus exempted from
the application of the minimum wage law; that it merely leases and occupies a stall in the
Divisoria Market and the level of its business activity requires and sustains only less than ten
employees at a time. Petitioners contend that private respondents were paid over and above
the minimum wage required for a retail establishment, thus the Labor Arbiter is correct in
ruling that private respondents’ claim for underpayment has no factual and legal basis.
Petitioners claim that since private respondents alleged that petitioners employed 24 workers,
it was incumbent upon them to prove such allegation which private respondents failed to do.
Issue of the Case:

 Whether or not private respondent is illegally dismissed and

entitled to backwages and other benefits.
 WON petitioner is exempted from the application of minimum
wage law.

Ruling:

Petitioners have not successfully shown that they had applied for the exemption. R.A.
No. 6727 known as the Wage Rationalization Act provides for the statutory minimum wage rate
of all workers and employees in the private sector. Section 4 of the Act provides for exemption
from the coverage, thus: Sec. 4. (c) Exempted from the provisions of this Act are household or
domestic helpers and persons employed in the personal service of another, including family
drivers. Also, retail/service establishments regularly employing not more than ten (10) workers
may be exempted from the applicability of this Act upon application with and as determined by
the appropriate Regional Board in accordance with the applicable rules and regulations issued
by the Commission. Whenever an application for exemption has been duly filed with the
appropriate Regional Board, action on any complaint for alleged non-compliance with this Act
shall be deferred pending resolution of the application for exemption by the appropriate
Regional Board.

In the event that applications for exemptions are not granted, employees shall receive
the appropriate compensation due them as provided for by this Act plus interest of one percent
(1%) per month retroactive to the effectivity of this Act.
 Title: REYMAN G. MINSOLA, Petitioner vs. NEW CITY BUILDERS, INC. AND ENGR. ERNEL
FAJARDO, Respondents

G.R. No. 207613, SECOND DIVISION, January 31, 2018

Reyes, Jr., J.

Facts of the Case:

New City Builders, Inc. (New City) is a corporation duly organized under the laws of the

Philippines engaged in the construction business, specializing in structural and design works.

New City hired Minsola as a laborer for the structural phase of its Avida Tower 3 Project
Subsequently, the structural phase of the Avida 3 was completed. Thus, Minsola received a
notice of termination. New City re-hired Minsola as a mason for the architectural phase of the
Avida 3.

Meanwhile, upon reviewing Minsola's employment record, New City noticed that
Minsola had no appointment paper as a mason for the architectural phase. Consequently, New
City instructed Minsola to update his employment record. However, the latter ignored New
City's instructions, and continued to work without an appointment paper. Minsola was again
summoned to the office of New City to sign his appointment paper. Minsola adamantly refused
to comply with the directive. He stormed out of the office, and never reported back for work.

Minsola filed a Complaint for Illegal Dismissal, claiming that he was a regular employee
of New City as he rendered work for more than one year and that his work as a laborer/mason
is necessary and desirable to the former's business. He claimed that he was constructively
dismissed by Ne

The Labor Arbiter (LA) dismissed the complaint for illegal dismissal. The LA found that
Minsola was a project employee who was hired for specific projects by New City. The NLRC
reversed the LA's ruling. The NLRC found that Minsola was a regular employee. The Court of
Appeals (CA) reversed the NLRC's decision. The CA ruled that Minsola was a project employee.

Issue of the Case:

 Was Minsola constructively dismissed by New City?

Ruling:

NO. Minsola is a Project Employee of New City. Essentially, the Labor Code classifies four

(4) kinds of employees, namely:

(i) regular employees or those who have been engaged to perform activities which are usually
necessary or desirable in the usual business or trade of the employer;

(ii) project employees or those whose employment has been fixed for a specific project
or undertaking, the completion or termination of which has been determined at the
time of the employees' engagement;

(iii) seasonal employees or those who perform services which are seasonal in nature,
and whose employment lasts during the duration of the season; and

(iv) casual employees or those who are not regular, project, or seasonal employees.
Jurisprudence has added a fifth kind — fixed-term employees or those hired only for a
definite period of time.

In a project-based employment, the employee is assigned to a particular project or

phase, which begins and ends at a determined or determinable time. Consequently, the
services of the project employee may be lawfully terminated upon the completion of such
project or phase.

For employment to be regarded as project-based, it is incumbent upon the employer to prove

that

(i) the employee was hired to carry out a specific project or undertaking, and

(ii) the employee was notified of the duration and scope of the project.

In order to safeguard the rights of workers against the arbitrary use of the word
"project" as a means to prevent employees from attaining regular status, employers must prove
that the duration and scope of the employment were specified at the time the employees were
engaged, and prove the existence of the project.

In the case at bar, Minsola was hired by New City Builders to perform work for two
different phases in the construction of the Avida 3. The records show that he was hired as a
laborer for the structural phase of the Avida 3 from December 16, 2008 until August 24, 2009.
Upon the completion of the structural phase, he was again employed on August 25, 2009, by
New City, this time for the architectural phase of the same project. There is no quibbling that
Minsola was adequately informed of his employment status (as a project employee) at the time
of his engagement. This is clearly substantiated by the latter's employment contracts, stating
that:

(i) he was hired as a project employee; and

(ii) his employment was for the indicated starting dates therein, and will end on the
completion of the project.

The said contract sufficiently apprised Minsola that his security of tenure with New City
would only last as long as the specific phase for which he was assigned.

In Gadia v. Sykes Asia, Inc., the Court explained that the "projects" wherein the project
employee is hired may consist of:

(i) a particular job or undertaking that is within the regular or usual business of the
employer company, but which is distinct and separate, and identifiable as such, from
the other undertakings of the company; or

(ii) a particular job or undertaking that is not within the regular business of the
corporation."

Accordingly, it is not uncommon for a construction firm to hire project employees to

perform work necessary and vital for its business. Suffice it to say, in William Uy Construction
Corp. and/or Uy, et al. v. Trinidad, the Court acknowledged the unique characteristic of the
construction industry and emphasized that the laborer's performance of work that is necessary
and vital to the employer's construction business, and the former's repeated rehiring, do not
automatically lead to regularization.

Accordingly, it is all too apparent that the employee's length of service and repeated re-
hiring constitutes an unfair yardstick for determining regular employment in the construction
industry. Thus, Minsola's rendition of more than one year of service and his repeated re-hiring
are not badges of regularization.

In labor law, constructive dismissal, also known as a dismissal in disguise, exists "where
there is cessation of work, because continued employment is rendered impossible,
unreasonable or unlikely, as an offer involving a demotion in rank or a diminution in pay" and
other benefits. There must be an act amounting to dismissal but made to appear as if it were
not. It may likewise, exist if an act of clear discrimination, insensibility, or disdain by an
employer becomes so unbearable on the part of the employee that it could foreclose any
choice by him except to forego his continued employment."
 In the case at bar, Minsola failed to advert to any particular act showing that he was
actually dismissed or terminated from his employment. Neither was there any single allegation
that he was prevented or barred from returning to work. On the contrary, it was actually
Minsola who stormed out of New City's office and refused to report for work. It cannot be
gainsaid that there is no illegal dismissal to speak of where the employee was not notified that
he had been dismissed from employment nor was he prevented from returning to his work.