G.R. No. 234691 - Leonil Manallo Santor, Joseph Sangalang, Paul Giray, Rodolfo Ceair, Sr., Jerson C. Velasco, Leo Hadap vs. Arlo Aluminum Comp., Inc. and Galo Y. Lim, Jr.

Petitioners: Leonil M. Santor, Joseph M. Sangalang, Paul O. Giray, Rodolfo C. CeAir, Sr., Jerson C. Velasco, and Leo C. Hadap.
Respondents: Arlo Aluminum Company, Inc. and Galo Y. Lim, Jr.
Nature of Business: Arlo Aluminum is engaged in fabricating customized aluminum moldings for construction companies, which undertake projects based on secured contracts.

The designated project or phase (e.g., Texas Instruments Project, Sonata project, Trag-3 project, etc.).
The duration of their employment, tied to the commencement and completion of the particular project or phase.

Specific projects, periods of assignment, and functions (fabricators, survey aide, helpers) were clearly delineated in their respective employment contracts.
The contracts explicitly stated that the employment was temporary and coterminous with project completion.

Sangalang was terminated in November 2014 while the remaining employees were dismissed in December 2014 upon the project’s expiration.
On January 7, 2015, all petitioners filed a complaint before the labor arbiter alleging:

Unfair labor practice
Union busting
Illegal dismissal
Nonpayment of benefits such as pro-rated 13th month pay, service incentive leave, etc.
Claiming that they were regular employees due to their continuous engagement exceeding one year.

Dismissed the complaint on the ground that the petitioners were project employees terminated upon project completion.
Awarded only prorated 13th month pay.

Reversed the labor arbiter’s decision, ruling that the employees were regular employees due to insufficient evidence that they were notified of a fixed project duration.
Ordered reinstatement and payment of backwages in addition to 13th month pay.

Reversed the NLRC ruling, reinstating the labor arbiter’s decision.
Held that the employees knowingly entered into contracts as project employees and that repeated rehiring did not alter that status.
Emphasized that the contracts clearly defined the projects’ duration and scope.

Arlo Aluminum, along with Galo Y. Lim, Jr., filed a petition before the Supreme Court alleging grave abuse of discretion by the NLRC.
The central contention was whether the employees should be considered project employees with contractual termination or regular employees entitled to security of tenure.

The case touches on the applicable provisions of Article 295 of the Labor Code which distinguishes:

Regular employment – for activities ordinarily necessary or desirable in the employer’s business.
Project employment – fixed for a specific project or undertaking with a determined duration.

The employment contracts and practices, including the issuance of termination reports and absence of completion bonuses, were consistent with the indicators provided in Department Order No. 19.

Whether the petitioners, engaged as project employees under contracts specifying the duration and scope of project work, should instead be classified as regular employees.

The impact of the repeated rehiring for different projects on the classification of employees.
Whether the absence of certain administrative filings (e.g., termination reports) affects the determination of the nature of employment.
The proper interpretation of the employment contract provisions regarding the limited duration and termination mechanism.
The balancing of interests between labor protection and the operational realities of a construction company reliant on project-specific engagements.