G.R. No.

227982, April 23, 2018

MARIO DIESTA BAJARO, Petitioner, v. METRO STONERICH CORP., AND/OR

IBRAHIM M. NUÑO, Respondents.

DECISION

REYES, JR., J.:

In view of the distinct nature of the construction industry, the Court recognizes the
right of an employer to hire a construction worker for a specific project, provided that
the latter is sufficiently apprised of the duration and scope of such undertaking. In this
instance, the worker's tenure shall be coterminous with the project. Notably, the
employee's performance of work that is necessary and desirable to the construction
business, as well as his repeated rehiring, do not bestow upon him regular employment
status.

Bajaro is a Project Employee of Metro Stonerich

Essentially, the Labor Code classifies four (4) kinds of employees, namely: (i) regular
employees or those who have been engaged to perform activities which are usually
necessary or desirable in the usual business or trade of the employer; (ii) project
employees or those whose employment has been fixed for a specific project or
undertaking, the completion or termination of which has been determined at the time of
the employees' engagement; (c) seasonal employees or those who perform services
which are seasonal in nature, and whose employment lasts during the duration of the
season; and (d) casual employees or those who are not regular, project, or seasonal
employees. Jurisprudence has added a fifth kind fixed-term employees or those hired
only for a definite period of time.32

Focusing on the first two kinds of employment, Article 294 of the Labor Code
distinguishes a regular from project-based employment as follows:

Art. 294. Regular and casual employment. - The provisions of written agreement to the
contrary notwithstanding and regardless of the oral agreement of the parties, an
employment shall be deemed to be regular where the employee has been engaged to
perform activities which are usually necessary or desirable in the usual business or
trade of the employer, except where the employment has been fixed for a specific
project or undertaking the completion or termination of which has been determined at
the time of the engagement of the employee or where the work or services to be
performed is seasonal in nature and the employment is for the duration of the season.
Parenthetically, in a project-based employment, the employee is assigned to a
particular project or phase, which begins and ends at a determined or determinable
time. Consequently, the services of the project employee may be lawfully terminated
upon the completion of such project or phase.33 For employment to be regarded as
project-based, it is incumbent upon the employer to prove that (i) the employee was
hired to carry out a specific project or undertaking; and (ii) the employee was notified
of the duration and scope of the project.34 In order to safeguard the rights of workers
against the arbitrary use of the word "project" as a means to prevent employees from
attaining regular status, employers must prove that the duration and scope of the
employment were specified at the time the employees were engaged, and prove the
existence of the project.35

In the case at bar, Bajaro was hired by Metro Stonerich as a concrete pump operator in
five different construction projects, to wit: (i) SM Cubao Expansion and Renovation
project located at Araneta Center, Cubao for five months, which began on June 3,
2008; (ii) Robinson's Place Ilocos Nmie for five months, which commenced on January
24, 2009; (iii) Robinson's Tacloban, Marasbaras for five months, which stmied on
December 14, 2010; (iv) KCC Mall Marbel Expansion, Koronadal City for 12 months,
which commenced on October 24, 2011; and (v) KCC Mall Zamboanga Project,
Zamboanga City for 12 months, which started on January 11, 2013.36

It is undisputed that Bajaro was adequately informed of his employment status (as a
project employee) at the time of his engagement. This is clearly substantiated by his
employment contracts (Kasunduan Para sa Katungkulang Serbisyo (Pamproyekto),
stating that: (i) he was hired as a project employee; and (ii) his employment was for
the indicated stmiing dates therein, and will end on the completion of the project. The
said contracts that he signed sufficiently apprised him that his security of tenure with
Metro Stonerich would only last as long as the specific phase for which he was
assigned. In fact, the target date of completion was even indicated in each individual
contract clearly warning him of the period of his employment.

Furthermore, pursuant to Department Order No. 19, Series of 1993, or the "Guidelines
Governing the Employment of Workers in the Construction Industry," Metro Stonerich
duly submitted the required Establishment Employment Report on April 23, 2014 to the
DOLE for the reduction of its workforce. Bajaro was included among the 10 workers
reported for termination as a consequence of the completion of the construction project
effective May 23, 2014.37 As aptly pointed out by the CA, the submission of the said
Establishment Employment Report is a clear indication of project employment.

Verily, being a project employee, Metro Stonerich was justified in terminating Bajaro's
employment upon the completion of the project for which the latter was hired.

Bajaro's Continuous Rehiring and His Performance of Work that was Necessary
and Desirable to Metro Stonerich's Business Did Not Confer Upon Him Regular
Employment Status

Remarkably, in Gadia, et al. v. Sykes Asia, Inc., et al.,38 the Court explained that the
"projects" wherein the project employee is hired may consist of "(i) a particular job or
undertaking that is within the regular or usual business of the employer company, but
which is distinct and separate, and identifiable as such, from the other undertakings of
the company; or (ii) a particular job or undertaking that is not within the regular
business of the corporation."39

Accordingly, it is not uncommon for a construction firm to hire project employees to

perform work necessary and vital for its business. Suffice it to say, in William Uy
Construction Corp. and/or Uy, et al. v. Trinidad,40 the Court acknowledged the unique
characteristic of the construction industry and emphasized that the laborer's
performance of work that is necessary and vital to the employer's construction
business, and the former's repeated rehiring, do not automatically lead to
regularization, viz.:

Generally, length of service provides a fair yardstick for determining when an

employee initially hired on a temporary basis becomes a permanent one,
entitled to the security and benefits of regularization. But this standard will
not be fair, if applied to the construction industry, simply because construction
firms cannot guarantee work and funding for its payrolls beyond the life of
each project. And getting projects is not a matter of course. Construction companies
have no control over the decisions and resources of project proponents or owners.
There is no construction company that does not wish it has such control but the reality,
understood by construction workers, is that work depended on decisions and
developments over which construction companies have no say.

For this reason, the Court held in Caseres v. Universal Robina Sugar Milling
Corporation that the repeated and successive rehiring of project employees do
not qualify them as regular employees, as length of service is not the
controlling determinant of the employment tenure of a project employee, but
whether the employment has been fixed for a specific project or undertaking,
its completion has been determined at the time of the engagement of the
employee.41 (Citations omitted and emphasis and underscoring Ours)
Additionally, in Malicdem, et al. v. Marulas Industrial Corporation, et al.,42 the Court
took judicial notice of the fact that in the construction industry, an employee's work
depends on the availability of projects. The employee's tenure "is not permanent but
coterminous with the work to which he is assigned."43 Consequently, it would be
extremely burdensome for the employer, who depends on the availability of projects, to
carry the employee on a permanent status and pay him wages even if there are no
projects for him to work on. An employer cannot be forced to maintain the employees
in the payroll, even after the completion of the project.44 "To do so would make the
employee a privileged retainer who collects payment from his employer for work not
done. This is extremely unfair to the employers and amounts to labor coddling at the
expense of management."45

Accordingly, it is all too apparent that the employee's length of service and repeated re-
hiring constitute an unfair yardstick for deter!nining regular employment in the
construction industry. Thus, Bajaro's rendition of six years of service, and his repeated
re-hiring are not badges of regularization.