Servidad v.

NLRC
1998 March 18, GR No 128682
Facts: Servidad was employed on 9 May 1994 by respondent INNODATA as Data Control
Clerk, under a contract of employment. Section 2 of such contract states: This Contract
shall be effective for a period of one (1) year commencing on 10 May1994 until 10 May 1995
unless sooner terminated pursuant to the provisions hereof.
Petitioner was a contractual employee for six months or from the period of May 10, 1994 to
November 10, 1994 during which, the employer can terminate with due notice. The contract
also states that should the employee continue his employment beyond the 6-month period,
he shall become a regular employee upon demonstration of sufficient skill. On November 9,
1995 or one day before his contractual terms ends, he was made to sign a three-month
probationary employment and later, an extended three-month employment good until 9 May
1995.Petitioner was terminated on May 9, 1995 and filed an illegal dismissal complaint
before the Labor Arbiter.
The Labor Arbiter found the respondent INNODATA guilty of the charge and was ordered to
pay backwages and reinstatement of petitioner. On appeal thereto by INNODATA, the NLRC
reversed the decision declaring that the contract between petitioner and private
complainant was for a fixed term and the dismissal, at the end of one year, was valid.
Issue: WON the contract entered into by the petitioner and respondent is valid and
enforceable.
Held: NO.
The NLRC found that the contract in question is for a fixed term. The said contract provides
for two periods. The first period was for six months terminable at the option of private
respondent, while the second period was also for six months but probationary in character.
In both cases, the private respondent did not specify the criteria for the termination or
retention of the services of petitioner. It is violative of the right of the employee against
unwarranted dismissal. By the provisions of the very contract itself, petitioner has become a
regular employee of private respondent.
As to the private respondent statement that the one-year period stipulated in subject
contract was to enable petitioner to acquire the skill necessary for the job. In effect, what
respondent employer theorized upon is that the one-year term of employment is
probationary. If the nature of the job did actually necessitate at least one year for the
employee to acquire the requisite training and experience, the same could not be a valid
probationary employment as it falls short of the requirement of Article 281[10] of the Labor
Code. It was not brought to light that the petitioner was duly informed at the start of his
employment, of the reasonable standards under which he could qualify as a regular
employee.
WHEREFORE, the petition is GRANTED, the questioned decision of NLRC is SET ASIDE, and
the decision of the Labor Arbiter, dated August 20, 1996, in NLRC-NCR-00-055-03471-95
REINSTATED, with the modification that the award of backwages be computed from the time
of the dismissal of petitioner to his actual or payroll reinstatement. Costs against the private
respondent.

Caparoso vs CA
Facts:
Composite is a supplier of confectioneries Caparoso and Quindipan were Composites
deliverymen. Petitioners were dismissed from the service and subsequently filed illegal
dismissal complaint. Respondents alleged that petitioners were both hired as deliverymen,
initially for three months and then on a month-to-month basis and the termination from
employment resulted from the expiration of their contracts of employment on 8 October
1999. Labor Arbiter - petitioners are regular employees of respondents NLRC- Reversed LA
decision CA- affirmed the NLRCs decision. The Court of Appeals held that respondents
manpower requirement varies from month to month depending on the demand from their
clients for their products. Respondents manpower requirement determines the period of
their employees services. Respondents employed petitioners for the purpose of addressing
a temporary manpower shortage.
Issues :
1. Whether petitioners are regular employees of respondents
2. Whether respondents are guilty of illegal dismissal.
Held:
Petitioners are Not Regular Employees Under Article 280 of the Labor Code, a regular
employee is (1) one who is engaged to perform activities that are necessary or desirable in
the usual trade or business of the employer, or (2) a casual employee who has rendered at
least one year of service, whether continuous or broken, with respect to the activity in which
he is employed. However, even if an employee is engaged to perform activities that are
necessary or desirable in the usual trade or business of the employer, it does not preclude
the fixing of employment for a definite period.
We agree with the Court of Appeals that in this case, the fixed period of employment was
knowingly and voluntarily agreed upon by the parties. The Court of Appeals noted that there
was no indication of force, duress, or improper pressure exerted on petitioners when they
signed the contracts. Further, there was no proof that respondents were regularly engaged
in hiring workers for work for a minimum period of five months to prevent the regularization
of their employees. Petitioners Employment is akin to Probationary Employment At most,
petitioners employment for less than six months can be considered probationary.
Article 281 of the Labor Code provides: Art. 281. Probationary Employment. - Probationary
employment shall not exceed six (6) months from the date the employee started working,
unless it is covered by an apprenticeship agreement stipulating a longer period. The services
of an employee who has been engaged on a probationary basis may be terminated for a just
cause or when he fails to qualify as a regular employee in accordance with reasonable
standards made known by the employer to the employee at the time of his engagement.
An employee who is allowed to work after a probationary period shall be considered a
regular employee. Petitioners were hired on 11 May 1999, initially for three months. After the
expiration of their contracts, petitioners were hired on a month-to-month basis. Their
contracts of employment ended on 8 October 1999. Hence, they were employed for a total
of five months. Their employment did not even exceed six months to entitle them to become
regular employees. . Petitioners were not Illegally Dismissed from Employment Petitioners
terms of employment are governed by their fixed-term contracts. Petitioners fixed-term
employment contracts had expired. They were not illegally dismissed from employment.

AMA Computer College v. Rolando Austria

Facts:
Rolando Austria was hired by AMA on probationary employment as a college dean, and was
confirmed as such by AMAs Officer-in-Charge of Academic Affairs.
On the same month that he was confirmed, Austria was charged with violating AMAs
Employees Conduct and Discipline provided in its orientation handbook. He was then placed
on preventive suspension, and was eventually dismissed. Austria filed an illegal dismissal
complaint against AMA.
Issue:
Whether Austria was a regular employee, or an employee with a fixed term.
W/N Austria was lawfully dismissed.
Held:
Austria was an employee with a FIXED TERM. The position of dean is normally an
employment for a fixed term.
NO. True, AMA erred in dismissing Austria, acting on the mistaken belief that he was liable
for the charges leveled against him. But he cannot also claim entitlement to any benefit
flowing from employment after 17 September 2000, because the employment, which is the
source of the benefits, had, by then, already ceased to exist.
When the findings of the National Labor Relations Commission contradict those of the Labor
Arbiter, the Supreme Court, in the exercise of its equity jurisdiction, may look into the
records of the case and reexamine the questioned findings.
The decisive determinant in term employment should not be the activities that the
employee is called upon to perform, but the day certain agreed upon by the parties for the
commencement and termination of their employment relationship.
A contract of employment for a definite period terminates on its own force at the end of such
period. The lack of notice of termination is of no consequence because when the contract
specifies the length of its duration, it comes to an end upon the expiration of such period.
While the Court adheres to the principle of social justice and protection to labor, the
constitutional policy to provide such protection to labor is not meant to be an instrument to
oppress employers. The commitment under the fundamental law is that the cause of labor
does not prevent us from sustaining the employer when the law is clearly on its side.

INTERNATIONAL CATHOLIC MIGRATION COMMISSION vs NATIONAL LABOR

RELATIONS COMMISSION
Facts:
Petitioner International Catholic Migration Commission (ICMC), a non-profit organization
dedicated to
refugee service at the Philippine Refugee Processing Center in Morong, Bataan engaged the
services of private respondent Bernadette Galang on January 24, 1983 as a probationary
cultural orientation teacher with a monthly salary of P2,000.00.
Three (3) months thereafter, private respondent was informed, orally and in writing, that her
services
were being terminated for her failure to meet the prescribed standards of petitioner as
reflected in the
performance evaluation of her supervisors during the teacher evaluation program she
underwent along with other newly-hired personnel.
On August 1983, private respondent filed a complaint for illegal dismissal, unfair labor
practice and
unpaid wages against petitioner with the then Ministry of Labor and Employment, praying
for reinstatement with backwages, exemplary and moral damages.
On October 1983, after the parties submitted their respective position papers and other
pleadings, the
Labor Arbiter rendered his decision dismissing the complaint for illegal dismissal as well as
the complaint for moral and exemplary damages but ordering the petitioner to pay private
respondent the sum of P6,000.00 as payment for the last three (3) months of the agreed
employment period pursuant to her verbal contract of employment.
Dissatisfied, petitioner filed the instant petition. Petitioner maintains that private respondent
is not
entitled to the award of salary for the unexpired three-month portion of the probationary
period since her
services were terminated during such period when she failed to qualify as a regular
employee in accordance with the reasonable standards prescribed by petitioner.
Issue:
Whether or not private respondent is a probationary employee?
Held:
The Court held, There is no dispute that private respondent was terminated during her
probationary
period of employment for failure to qualify as a regular member of petitioner's teaching staff
in accordance with its reasonable standards. Records show that private respondent was
found by petitioner to be deficient in classroom management, teacher-student relationship
and teaching techniques. Failure to qualify as a regular employee in accordance with the
reasonable standards of the employer is a just cause for terminating a probationary
employee specifically recognized under Article 282 (now Article 281) of the Labor Code
which provides thus:

ART. 281. Probationary employment. Probationary employment shall not exceed six
months from
the date the employee started working, unless it is covered by an apprenticeship agreement
stipulating a longer period. The services of an employer who has been engaged in a
probationary basis
may be terminated for a just cause or when he fails to qualify as a regular employer in
accordance
with reasonable standard made known by the employer to the employee at the time of his
engagement. An employee who is allowed to work after a probationary period shall be
considered a
regular employee.
A probationary employee, as understood under Article 282 (now Article 281) of the Labor
Code, is one
who is on trial by an employer during which the employer determines whether or not he is
qualified for
permanent employment. A probationary appointment is made to afford the employer an
opportunity to
observe the fitness of a probationer while at work, and to ascertain whether he will become
a proper and
efficient employee. The word "probationary", as used to describe the period of employment,
implies the
purpose of the term or period, but not its length.
Being in the nature of a "trial period" the essence of a probationary period of employment
fundamentally lies in the purpose or objective sought to be attained by both the employer
and the employee during said period. The length of time is immaterial in determining the
correlative rights of both in dealing with each other during said period. While the employer,
as stated earlier, observes the fitness, propriety and efficiency of a probationer to ascertain
whether he is qualified for permanent employment, the probationer, on the other, seeks to
prove to the employer, that he has the qualifications to meet the reasonable standards for
permanent employment.
It is well settled that the employer has the right or is at liberty to choose who will be hired
and who will be denied employment. In that sense, it is within the exercise of the right to
select his employees that the employer may set or fix a probationary period within which the
latter may test and observe the conduct of the former before hiring him permanently.

Escorpizo vs University of Baguio

Esperanza Escorpizo was a high school teacher in the University of Baguio contracted to be
a probationary teacher from 1989-1991. The terms of her employment stipulate that in order
for her to be regularized, she should get a satisfactory rating and she should pass the board
examination for teachers. After the lapse of her probationary period, UB was not supposed to
re-sign her because she failed the board exam but upon her pleading she was re-signed for
one year but still a probationary. She took the board exam again but she failed during the
same school year. So when UB was considering the list of teachers for next year, Escopizo
was no longer considered. Meanwhile, Escorpizo again took the exam this time she passed.
But UB no longer took her in to teach. Her labor union assisted her in suing UB averring that
in the CBA, passing the board is not a requisite to be regularized.
ISSUE: Whether or not Escorpizo should be reinstated as a teacher.
HELD: No. Escorpizo was not illegally dismissed. UB was well within its right to require its
teachers to pass the board before teaching, The Department of Education also rolled out an
order requiring that teachers should pass the board before teaching. This is to ensure the
quality of education in the country. As between the CBA and the DECS order, what should
prevail is the requirements so provided by the government.