6. RIGHT TO SECURITY OF TENURE

6.1 SECURITY OF TENURE; CONCEPT; CONSTITUTIONAL (Art. XIII, Sec. 3) & Statutory basis (Art 279)

ConceptThe policy of the state is to assure the right of workers to “security of tenure.” The guaranty is an act of social justice.

The great mass of the population is almost wholly dependent on their employment for their livelihood. The alternative of returning or turning to farming as a secondary occupation is no longer feasible. When a worker loses his job, his family faces deprivation, if not starvation. Hence, the demand for job security. Responding to popular demand, the Constitutional Convention [1973] has expressly provided for State recognition of the right of workers to security of tenure.

Both the Constitution (Sec. 3, Article XIII) and the Labor Code (Article 279) enunciate this right as available to an employee. In a host of cases, the Court has upheld the employee’s right to security of tenure in the face of oppressive management behavior and management prerogative. Security of tenure is a right which may not be denied on mere speculation of any unclear and nebulous basis.

When a person has no property, his job may possibly be his only possession or means of livelihood. Therefore, he should be protected against any arbitrary deprivation of his job. Article 279 [now 293] of the Labor Code has construed security of tenure as meaning that “the employer shall not terminate the services of an employee except for a just cause or when authorized by” the Code.

Constitutional Basis: Article XIII Sec. 3 (2) of the 1987 Constitution

It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and decision-making processes affecting their rights and benefits as may be provided by law.

Statutory Basis:ART. 293 [279]. SECURITY OF TENURE - In cases of regular employment, the employer shall not terminate the

services of an employee except for a just cause or when authorized by this Tide. An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full back wages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement.

6.2 Four kinds of ees under Art 286 (280)1. Regular employment;2. Casual employment;3. Project employment;4. Seasonal employment.

Other classifications1. Workers in the construction industry (DO. 19, Series of 1993);2. Personnel in private educational institution (academic &non academic, full time and part time) (Manual of Regulationss for Private Schools in Basic Education)

Regular employment – employment arrangement where the eea. Has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of

the er;b. Has rendered at least 1 year of service, whether such service is continuous or broken, with respect to the activity in

which he is employed; orc. When an ee is allowed to work after a probationary period (287 formerly 281)

Test of regularity i. Nature of work – WON there is reasonable connection between particular activity performed by the ee in relation to the usual business or trade of the er. If usually necessary or desirable in the usual business or trade of the er, the employment is deemed regular employment.

Note: Whether the work undertaken by the ee is necessary or desirable can be determined by looking at the services rendered and its relation to general scheme under which the business or trade is pursued in the usual course.

Examples of Regular Employment by Nature of WorkMoises’ work consisted mainly of painting company building and equipment and other odd jobs relating to

maintenance. Held: x the painting and maintenance work of Moises manifests a treatment consistent with a maintenance man

and not just a painter for if his job was only to paint a bldg, there would be no basis for giving him other work assignments in-between painting activities. (De Leon v NLRC, 1989)

ii. Period of Service Test - WON the ee has rendered at least 1 year of service. An ee, who is allowed to work for at least 2 year, whether the same is continuous or broken, shall be considered regular ee.

iii. Probationary Employment Test – WON the ee is allowed to work after the lapse of the probationary period. An ee who is allowed to work after the lapse of the probationary period shall be considered a regular ee.

May Regular Jobs be Contracted Out? Yes (Serrano v Isetann 2000)

Contracting Out Almost All Regular Jobs Yes. (Wackwack Golf v NLRC 2005) Where the person making the waiver has done so voluntarily, with a full understanding thereof, and the consideration for the quitclaim is credible and reasonable, the transaction must be recognized as being valid and binding undertaking. As in contracts, these quitclaims amount to a valid and binding compromise agreement between the parties which deserve to be respected.

Casual employment – where an ee is engaged to perform activities which are not necessary or desirable in the usual trade or business of the era. The status of regular employment attaches to the casual ee who has rendered at least 1 year of service, whether such service is continuous or broken, with respect to the activity in which he is employed and his employment shall continue while such activity exists.b. A casual ee is only casual for 1 year, and it is the passage of time that gives him a regular status

Purpose: To give meaning to the constitutional guarantees of security of tenure and right to self-organization.

Project employment – when the employment has been fixed for a specific project or undertaking, the completion or termination of which has been determined at the time of engagement of the ee.

Where the employment of project ees is extended long after the supposed project has been finished, the ees are removed from the scope of project ees and considered regular ees.

When may a project ee become a regular eea. There is continuous rehiring of project ees even after the cessation of a project for the same tasks or nature of tasks (the ee must be continuously rehired without gaps and intervals); andb. The tasks performed by the alleged project ee are vital, necessary and indispensable to the usual business or trade of the er.

Note: Project has reference to a particular job or undertaking that may or may not be within the regular or usual business of er. In either case, the project must be distinct, separate and identifiable from the main business of the er and its duration must be determined or determinable.

Members of a work pool from which a construction company draws its project ees, if considered ees of the construction company while in the work pool, are non-project ee or ees for an indefinite period. If they are employed in a particular project, the completion of the project or any phase thereof will not mean severance of er-ee relationship.

Unless the workers in the work pool are free to leave any time and offer their services to other ers.

Note: Project es are not regular ees, their services being needed only when there are projects to be undertaken.

Requirements: 1. Specific project phase thereof stated in the employment contract;2. Estimated date of completion of project or phase thereof likewise stated in the contract;3. Ee must have been dismissed every after completion of his project of phase (gaps must be shown in his length of service); and4. There must be a report to the DOLE of his dismissal on account of completion of contract

Indicators of Project EmploymentEither one or more of the ff circumstances, among others, may be considered as indicators that an ee is a project ee.

1. The duration of the specific/identified undertaking for which the worker is engaged is reasonably determinable;2. Such duration, as well as the specific work/service to be performed, is defined in an employment agreement and is made clear to the ee at the time of hiring;3. The work/service performed by the ee is in connection with the particular project/undertaking for which he is engaged;4. The ee, while not employed and awaiting engagement, is free to offer his services to any other er;5. The termination of his employment in the particular project/undertaking is reported to the DOLE Regional Office having jurisdiction over the workplace within 30 days following the date of his separation from work, using the prescribed from on ees’ terminations/dismissals/suspensions;6. An undertaking in the employment contract by the er to pay completion bonus to the project ee as practiced by most construction companies. (DO. 19, 1997)

Principal Test to Determine Whether EEs are Project Ees as distinguished from Regular EesWON the project ees are assigned to carry out a specific project or undertaking the duration or scope of which are specified at the time the ees are engaged for that project.

The predetermination of the duration or period of a project employment is important in resolving whether one is a project ee or not. On this score, the term period has been defined to be “a length of existence; duration. A point of time marking a termination as of a cause or an activity; an end, a limit, a bound; conclusion; termination. A series of years, months or days in which something is completed. A time of definite length or period from one fixed date to another fixed date. (Violeta v NLRC, 1997)

The ee in Violetais clearly hired for a specified project. But the absence of definite duration of the project led the court to conclude that the ee was regular. The court noted that “the records are barren of any definite period or duration for the expiration of the assigned items of work of petitioners at the time of their engagement. Xx the lines for “DATE OF COVERAGE” in the appointments are left blank.

Moreover, the court reiterates, security of workers in their job is a fundamental objective of Philippine labor laws. This is why the law and the court decisions incline toward regular instead of nonregularee status. In fact Art 280 manifests a bias for regularity status. Any other arrangement us an unpreferred deviation from that presumption.

To be exempt from the presumption of regularity of employment therefore, the agreement between a project ee and his er must 1. Strictly conform with the requirements and conditions provided in Art 280 (now 294).It is not enough that an ee is hired for a specific project or phase of work. 2. There must also be a determination of or a clear agreement on the completion or termination of the project at the time the ee is engaged if the object of 280 (now 294) is to achieved. (2ndreq was absent in Violeta)

Entitlement to Separation PayGeneral Rule: Project ees are not entitled to separation pay if they are terminated as a result of the project or any phase thereof in which they have been employed.

XPN: If the projects they are working on have not yet been completed when their services are terminated; project ees also enjoy security of tenure during the limited time of their employment.

Note: If the termination is brought about by the completion of the contract or phase thereof, no prior notice is required; Er is under the law, only obliged to render report to the DOLE on termination of the employment

Seasonal employment – is an employment arrangement where an ee is engaged to work during a particular season on an activity that is usually necessary or desirable in the usual business or trade of the er.

During off-season, the relationship of er and ee is not severed; the seasonal ee is merely considered on leave of absence without pay.

When are Seasonal Ees considered as Regular Ees1. When there is reasonable connection between the particular activity performed by the ee in relation to the usual trade or business of the er; and2. Seasonal workers who are repeatedly engaged to perform the same tasks for more than one season

Note: 1-yr duration on the job is pertinent in deciding whether a casual ee has become regular or not, but it is not pertinent to a seasonal or project ee. Passage of time does not make a seasonal worker regular or permanent.

When the business establishment is sold which effectively terminated the employment of the seasonal ees, the latter would be entitled to separation pay.

Other forms of employment under Book VI1. Fixed-Period Employment; and2. Probationary

6. 3 Exception to Regular Employment a. Project Employee – Employment has been fixed for a specific project or undertaking, the completion or termination of which has been determined at the time of engagement of the employee. They are NOT entitled to separation pay if they are terminated as a result of completion of the project/phase thereof in which they have been employed, UNLESS when the projects they are working on have not yet been completed when their services are terminated. They enjoy security of tenure during the limited time of their employment.

TEST to determine WON employees are Project Employees: WON the project employees are assigned to carry out a specific project or undertaking the duration or scope of which are specified at the time employees are engaged for that project.

Requisites according to Policy Instruction No. 20 and D.O. No. 19 Series of 1997:Specific project phase thereof stated in the employment contract.Estimated date of completion of project or phase thereof likewise stated in the contract.Employee must have been dismissed every after completion of his project or phase.There must be a report to the DOLE of his dismissal on account of completion of contracts.

Reason: Their services being needed only when there are projects to be undertaken.

Exception: Where the employment of project employee is extended long after the supposed project has been finished, the employees are considered regular employees.Requisites for the exception to apply: 1. There is continuous rehiring, without gaps and intervals, of project employees even after the cessation of a project for the same tasks or nature of tasks.2. The task performed by the alleged project employee are vital, necessary and indispensable to the usual business or trade of the employer.

b. Seasonal Employee – An employment arrangement where an employee is engaged to work during a particular season on an activity that is usually necessary or desirable in the usual business or trade of the employer. They are entitled to separation pay when the business establishment is sold which effectively terminates the employment of the seasonal employees. When can they be considered as a regular employee?1. When there is reasonable connection between the particular activity performed by the employee in relation to the usual trade or business of the employer2. Seasonal workers who are repeatedly engaged to perform the same tasks for more than one season.

c. Fixed Term Employee – An employment arrangement where an employee is engaged to work on a specific project or undertaking which is usually necessary or desirable in the usual business or trade of the employer, the completion of which has been determined at the time of the engagement of the employee.

Is this form of employment valid? Yes. Parties have the freedom to contract so long as the stipulations thereof are not contrary to law, morals, public order, and public policy. Requisites for Fixed-Period Employment may be valid:1. The fixed period of employment was knowingly and voluntarily agreed upon by the parties without any force, duress, or improper pressure being brought to bear upon the employee and absent any other circumstance vitiating his consent.2. It is satisfactorily appears that the employer and the employee dealt with each other on more or less equal terms with no moral dominance exercised by the former or the latter.Exception: Where from the circumstances it is apparent that the periods have been imposed to preclude acquisition of security of tenure by the employee, they should be struck down or disregarded as contrary to public policy.When can they be considered as a regular employee?1. The employees were allowed to work beyond the fixed-term without the benefit of a new contract.2. The employees were allowed to work for more than one year and there is a reasonable connection between the particular activity performed by the employees in relation to the usual business or trade of the employer.3. In cases of successive renewals of fixed period contracts and there is a reasonable connection between the particular activity performed by the employees in relation to the usual business or trade of the employer.