Case Summary (G.R. No. 170384-85)
Employment and Labor Dispute Background
Respondent hired hundreds of employees on a contractual, project-based basis, their employment intended to last only up to the completion or termination of specific geothermal projects or their phases. Most of these contractual employees were members of petitioner Union. When the project neared completion in 1998, respondent served Notices of Termination to union members. Petitioner then filed a Notice of Strike with DOLE, alleging unfair labor practices including refusal to bargain collectively, union busting, and mass termination, followed by an actual strike declaration on December 28, 1998.
Secretary of Labor’s Intervention and Institutional Proceedings
Secretary of Labor Bienvenido E. Laguesma intervened, issuing an Order on January 4, 1999, certifying the labor dispute to compulsory arbitration before the National Labor Relations Commission (NLRC) and directing the striking workers to return to work under prior terms and conditions. Despite efforts for amicable resolution, negotiations failed. Petitioner Union defied the assumption order, leading respondent to file complaints for strike illegality, declaration of loss of employment, and damages, and a petition for cancellation of the union’s certificate of registration.
NLRC Findings and Decision
The NLRC ruled in favor of respondent, declaring: (1) petitioners as project employees; (2) termination upon project completion as valid and legal; (3) the strike illegal due to failure to observe essential legal requisites; (4) loss of employment for union officers and members who led the illegal strike; and (5) dismissal of petitioner’s unfair labor practice claims and other demands due to lack of merit or factual basis.
Court of Appeals’ Ruling and Appeal to the Supreme Court
The Court of Appeals (CA) affirmed the NLRC decision, dismissing the petition for certiorari filed by petitioner Union. The Supreme Court was subsequently appealed to, focusing on six main legal questions concerning the validity of project contracts, characterization of employment status, work stoppage and strike legality, and allegations of union busting.
Legal Issue 1: Project Employees versus Regular Employees
The core issue was whether the Union’s officers and members were project employees or regular employees. Petitioner argued their work was normally necessary or desirable to respondent’s usual business, implying regular employee status, especially since there were no intervals between contracts, implying continuous employment.
Legal Framework: Article 280 of the Labor Code
Article 280 clearly distinguishes between four principal employee categories:
- Regular employees – engaged to perform activities usually necessary or desirable in the usual business or trade of the employer;
- Project employees – hired for a specific project or undertaking with a fixed term determined at engagement;
- Seasonal employees – employed for seasonal work for the duration of the season;
- Casual employees – those not covered by the foregoing definitions.
The Labor Code’s provisions take precedence over contractual nomenclature, pursuant to the Constitution’s mandate to afford full protection to labor.
Validity and Nature of Project Employment Contracts
Project employment contracts remain valid if they specify a fixed employment period linked to a specific project or phase. Such contracts duly understood and voluntarily accepted by employees do not contravene law or public policy. The Court emphasized that project employment contracts are not inherently biased or unfair and protect both employer and employee interests.
Application to the Case at Bar
Evidence showed petitioner’s officers and members freely executed contracts expressly fixing employment for specific project phases. There was no proof of coercion or invalidity. Both NLRC and CA found the employees were project employees, supported by substantial evidence, binding on the Supreme Court under the rule that factual findings of quasi-judicial bodies are accorded respect and finality.
Inapplicability of the “One Year Continuous Service” Rule to Project Employees
Petitioner’s argument that continuous service without interval converted project employees into regular employees under the proviso in Article 280 was rejected. Jurisprudence clarifies that the one-year continuous service rule applies only to casual employees, not project employees, whose employment legally terminates on project completion or phase conclusion. Thus, the employees’ collective bargaining rights and security of tenure protections are consistent with their project employment status.
Dismissal and Union Busting Allegations
Since the employees were project employees, their termination upon project completion was lawful. Consequently, allegations of union busting by dismissing union members were dismissed as unfounded.
Legal Issue 2: Strike Legality and Work Stoppage
Petitioner contended that no strike occurred but only peaceful picketing or protest activities without work stoppage. However, petitioner had filed a Notice of Strike with DOLE, declared and staged an actual strike, and the Secretary of Labor’s Return-to-Work Order acknowledged the strike’s disruptive impact on vital power supply.
Requisites for a Legal Strike Under Article 263 of the Labor Code
The law requires, among others, proper filing of notice w
...continue reading
Case Syllabus (G.R. No. 170384-85)
Procedural History
- This case concerns the decision dated June 30, 2005 by the Court of Appeals (CA) in CA-G.R. SP No. 65760, which dismissed a petition for certiorari filed by the petitioner Leyte Geothermal Power Progressive Employees Union-ALU-TUCP (the Union).
- The petition sought to annul the December 10, 1999 decision of the National Labor Relations Commission (NLRC) in Certified Case No. V-02-99.
- The NLRC decision declared the Union's strike illegal, affirmed the project employment status of its officers and members, and upheld the validity of their termination upon project completion.
- The CA affirmed the NLRC's decision and the Union subsequently filed an appeal to the Supreme Court.
Factual Background
- The respondent, Philippine National Oil Company - Energy Development Corporation (PNOC-EDC), is a government-owned entity engaged in geothermal energy projects, including the Leyte Geothermal Power Project comprising Tongonan 1 Geothermal Project and Leyte Geothermal Production Field Project supplying power to Visayas and Luzon.
- Respondent employed hundreds of employees on a contractual basis tied to the completion of specific projects or phases.
- Majority of these employees became members of the petitioner Union, which demanded recognition as the collective bargaining agent and sought collective bargaining agreement (CBA) negotiations.
- Respondent rejected such demands. When the project neared completion, respondent served Notices of Termination on Union members.
- On December 28, 1998, the Union filed a Notice of Strike with DOLE and declared a strike alleging unfair labor practices such as refusal to bargain collectively, union busting, and mass termination.
- The Department of Labor and Employment (DOLE) Secretary intervened, issued a Return-to-Work Order certifying the labor dispute to the NLRC for compulsory arbitration, directing employees to return to work within 12 hours, and directing parties to cease acts exacerbating the dispute.
- The Union did not comply, prompting respondent to file complaints for strike illegality, loss of employment declarations, and cancellation of the Union’s Certificate of Registration.
- The NLRC and CA ultimately ruled in favor of respondent.
Issues Presented for Resolution
- Whether the officers and members of the petitioner Union are project employees or regular employees.
- Whether the officers and members of the petitioner Union engaged in an illegal strike.
Legal Framework on Project and Regular Employees
- Article 280 of the Labor Code defines four types of employees:
- Regular employees: Engaged to perform activities usually necessary