Case Summary (G.R. No. 96078)
Facts of Employment Contracts
- July 7, 1977: First definite-period contract (24 months) co-terminous with MNEE Stage 2’s initial phase.
- July 1, 1979 – April 30, 1980: Second contract (10 months).
- May 1, 1980 – November 30, 1981: Third contract (19 months), subsequently extended through October 1 – December 31, 1985.
- December 9, 1985: Petitioner applied for clearance, received cash for unused leave, and executed a release and quitclaim.
Procedural History and Labor Arbiter’s Ruling
- May 20, 1987: Rada filed before the NLRC a complaint for illegal dismissal, non-payment of separation pay, and overtime pay.
- Philnor contended that Rada was a project employee, bound to the MNEE Stage 2 project, with no entitlement to separation benefits; it denied overtime obligations.
- July 2, 1987: Petitioner amended complaint, claiming regular-employee status under Article 278(c) of the Labor Code and entitlement to overtime for three hours daily from 1983 to 1985.
- August 31, 1989: Labor Arbiter Cruz ruled that petitioner was a regular employee, unlawfully dismissed, entitled to reinstatement with full backwages and overtime for three hours daily.
NLRC’s Ruling on Appeal
- Philnor’s appeal was accepted despite delayed supersedeas bond payment, in the interest of justice and under the NLRC’s discretion (Article 221, Labor Code).
- November 19, 1990: NLRC reversed the labor arbiter, holding that Rada was a project employee whose employment terminated validly upon project completion. Reliance was placed on prior NLRC and Supreme Court rulings (e.g., Quiwa v. Philnor, Sandoval Shipyards, Cartagenas v. Romago Electric). All claims were dismissed.
Issues on Appeal
- Whether the NLRC erred in entertaining Philnor’s belated payment of the supersedeas bond.
- Whether petitioner attained regular-employee status despite successive definite-period contracts.
- Entitlement to overtime pay for pre- and post-office transport services to and from the project site.
Supreme Court Analysis
Supersedeas Bond
- Although timely filing of bond is essential, delayed payment was allowed under the NLRC’s inherent authority and Article 221’s mandate to resolve disputes on merits without procedural undue technicalities.
Regular vs. Project Employee Status
- Article 281 and Policy Instructions No. 20 distinguish project employees (hire coterminous with a specific project) from regular (non-project) employees.
- Successive fixed-term contracts for the same project, without assignment to other projects or a “work pool,” do not convert project employees into regular employees (cf. Sandoval Shipyards; Cartagenas; contrast with Fegurin, where workers rotated among projects).
- Petitioner’s duties remained tied to MNEE Stage 2; his termination upon project completion was lawful and did not co
Case Syllabus (G.R. No. 96078)
Facts
- Petitioner Hilario Rada was engaged by Philnor Consultants and Planners, Inc. (“Philnor”) under successive contracts of employment for definite periods, all relating to the Manila North Expressway Extension, Second Stage (MNEE Stage 2) construction supervision project.
- First contract: July 1, 1977 to June 30, 1979 as Driver, automatically terminating upon completion of that phase.
- Second contract: July 1, 1979 to April 30, 1980, following satisfactory performance and project extension.
- Third contract: May 1, 1980 to November 30, 1981, later extended multiple times, the last covering October 1, 1985 to December 31, 1985.
- Petitioner acknowledged receipt of cash equivalent for unused leave credits and executed a Release, Waiver and Quitclaim upon clearance on December 9, 1985.
- Project remained unfinished until late 1985; petitioner’s services ceased when his last contract expired with no further work in his position.
Procedural History
- May 20, 1987: Petitioner filed with NLRC a complaint for non-payment of separation pay and overtime pay.
- June 3, 1987: Philnor submitted its Position Paper, asserting petitioner was a project employee, not illegally dismissed, no overtime rendered, and bound by a release.
- July 2, 1987: Petitioner amended his complaint to allege illegal dismissal and overtime work of three extra hours daily over three years.
- July 7, 1987: Petitioner’s Position Paper claimed regular-employee status under Labor Code Articles 278(c) and 280, and contended the fixed-term contracts were contrary to public policy.
- Labor Arbiter assigned by NLRC conducted hearings; parties exchanged supplemental pleadings, documentary evidence, and affidavits regarding work schedule and release letters.
Labor Arbiter’s Decision
- August 31, 1989: Labor Arbiter Cruz ruled that:
- Petitioner had acquired regular-employee status after nearly eight years of continuous service under successive con