G.R. No. L-280 - People vs. Alejo Piabol

Petitioner Roy D. Pasos began working for the Philippine National Construction Corporation (PNCC) on April 26, 1996.
His initial appointment was as a Clerk II (Accounting) for the NAIA II Project, with a contract dated April 30, 1996 stating employment from April 26, 1996 to July 25, 1996, subject to termination “at any time for cause” or when no longer needed.
Despite the stated termination date, his employment was extended until August 4, 1998, as evidenced by a subsequent Personnel Action Form for Project Employment dated July 7, 1998.

On November 11, 1998, petitioner was rehired as an Accounting Clerk (Reliever) for the PCSO Q.I. Project with a contract term set to end on February 11, 1999, which was actually extended until February 19, 1999 via a Personnel Action Form dated February 17, 1999.
On February 23, 1999, he was again appointed as an Accounting Clerk for the SM-Project based on an Appointment for Project Employment dated February 18, 1999.
Although the initial appointment did not specify an exact termination date (other than being “co-terminus with the completion of the project”), a Personnel Action Form dated August 18, 1999 suggested termination on August 19, 1999.
His employment was extended immediately the next day (August 20, 1999) when he was again appointed as an Accounting Clerk for the SM Project (Package II), with a further Personnel Action Form dated October 17, 2000 indicating that his engagement would eventually end on October 19, 2000.

After his supposed termination on October 19, 2000, petitioner claimed that his superior directed him to report to work the following day, intimating further employment for succeeding SM projects.
For reemployment, petitioner underwent a medical examination and was advised to take a 14-day sick leave; subsequent examinations revealed that he had contracted Koch’s disease, necessitating a 60-day leave of absence.
Despite his presentation of a medical clearance on February 16, 2001, he was informed that his services had already been terminated on October 19, 2000 and that he was already replaced.

Based on the continuous and prolonged nature of his employment (in spite of recurring project-based contracts) and the extension beyond the original project duration, petitioner filed an illegal dismissal complaint on February 18, 2003.
He asserted that his prolonged service rendered him a regular employee with security of tenure, and that his termination was illegal as it occurred without the benefit of an administrative investigation.
PNCC, on the other hand, maintained that petitioner was hired strictly for fixed-duration project employment and had full knowledge of his temporary engagement, further supporting its position by submitting termination reports to the Department of Labor and Employment (DOLE).

The Labor Arbiter ruled in petitioner’s favor by finding that the repeated hiring and extension of employment effectively conferred regular employee status, and ordered:

Payment of back wages (initial computation of P460,292.41 with deductions for six months)
Awarding separation pay due to the strained relations between the parties.

PNCC argued that petitioner was a project employee whose termination was valid upon the completion of his projects.
Petitioner contended that his sustained service, including work beyond the original project scope, amounted to regular employment.

The NLRC reversed aspects of the Labor Arbiter’s decision by granting PNCC’s appeal and dismissing petitioner’s appeal, ordering instead the payment of a completion bonus of P25,000.
Petitioner elevated the case to the Court of Appeals (CA) via a petition for certiorari, which was dismissed for lack of merit.
Finally, the Supreme Court granted petitioner’s petition for review on certiorari, reversing the CA decision and reinstating (with modifications) the Labor Arbiter’s award.

Whether the filing of an appeal bond amounting to 90% of the adjudged monetary award constitutes “substantial compliance” even though it is less than the full adjudged amount.

Whether Mr. Felix M. Erece, Jr., as the head of PNCC’s Personnel Services Department, was adequately authorized to sign the verification and certification in the absence of a board resolution or secretary’s certificate.

Whether petitioner, despite being initially hired for project employment with specific termination dates, had in fact attained regular employment due to the prolonged and indefinite extensions of his service.
Whether the failure of PNCC to submit termination reports after every project completion vitiates the assertion that petitioner was merely a project employee.

Whether the appellate court erred in determining that petitioner was a project employee despite the evidence of continuous employment and inconsistency in reportorial requirements.
Whether the deduction of six months pay from the award back wages was proper.
Whether the denial of reinstatement (and the imposition of separation pay on the ground of strained relations) was justified in light of the evidence, given that PNCC neither alleged nor proved strained relations between the parties.
Whether damages and attorney’s fees should have been awarded to petitioner.