G.R. No. 226920 - Pacific Metals Co., Ltd. vs. Tamayo

Petitioner Pacific Metals Co., Ltd. (PAMCO) is a foreign company engaged in the importation of nickel ore mined in the Philippines. It operates a Philippine Representative Office since April 2008, represented locally by its general manager and liaison officer, Chitaru Okamura.
Respondents include Edgar Allan Tamayo, a licensed geologist; Eramen Minerals, Inc. (ERAMEN), the exclusive contractor operating under a Mineral Production and Sharing Agreement (MPSA No. 209-2005-III) over a 4,619 hectare land in Sta. Cruz and Candelaria, Zambales; and Enrique Fernandez, ERAMEN’s president.

In September 2010, PAMCO engaged respondent Tamayo under a two-month service contract to perform geological services, agreeing to pay him ₱90,000 per month. This contract was allegedly extended for another two months until January 31, 2011.
On January 17, 2011, PAMCO and ERAMEN entered into an Exploration Agreement under which PAMCO would provide financial and technical assistance for mineral exploration and have an option to participate in the subsequent mining.
Tamayo was designated manager of the ERAMEN/PAMCO Exploration Project, preparing project reports, budget requests, and updates, but there is no evidence that this engagement was covered by a formal employment contract.

By letter dated November 29, 2011, Tamayo was informed that his services as exploration manager would be terminated effective December 31, 2011, supposedly because the exploration phase of the project was completed.
Tamayo was requested to submit his final exploration report and turn over documents and equipment. He corresponded with ERAMEN/Fernandez via emails regarding clearance and alleged workplace hostility.
He sent emails expressing suspicion of internal conspiracies against him and warned of filing a complaint if his demands—including backwages and moral damages—were unmet.

Tamayo filed a complaint for illegal dismissal against PAMCO and ERAMEN on December 12, 2012, claiming regular employment status and security of tenure.
He alleged he was hired as Mineral Exploration and Drilling Manager and that his duties were necessary to the business, including hiring locals, managing operations, and coordinating with local government units.
He argued that his employment was not a project employment with a definite term but a regular job, and that termination without due process and valid cause was illegal.

PAMCO maintained Tamayo was hired as a consultant under a fixed-term contract, later hired by ERAMEN, and thus not a regular employee of PAMCO. It denied liability for claims under illegal dismissal.
ERAMEN contended that Tamayo was a project employee whose employment terminated upon project completion, proper notice was given, and there was no illegal dismissal or bad faith. They denied grounds for damages and attorney’s fees.

Labor Arbiter ruled Tamayo was a project employee aware of his fixed-term engagement and not illegally dismissed; however, ordered ERAMEN to pay salary for December 2011 and 13th month pay.
NLRC affirmed the labor arbiter’s ruling, modifying the 13th month pay to pro-rated amount.
The Court of Appeals reversed the NLRC, holding Tamayo was a regular employee of PAMCO illegally dismissed and ordered reinstatement, backwages, and attorney’s fees. PAMCO’s motion for reconsideration was denied.

PAMCO petitioned the Supreme Court, challenging the CA’s ruling emphasizing factual findings by NLRC and Labor Arbiter.
PAMCO also argued ERAMEN should be solely liable if any money claims arise, being Tamayo’s real employer.
Tamayo and ERAMEN filed comments supporting the CA decision and clarifying the nature of the employment relationship and control exerted by PAMCO.

Whether Edgar Allan Tamayo was a regular employee or project employee.
If Tamayo is deemed a regular employee, which employer—PAMCO or ERAMEN—is liable to pay his backwages, 13th month pay, damages, and attorney’s fees.