LABOR LAW REFRESHER

Atty. Paciano F. Fallar Jr,

SSCR-College of law

Lecture 3

(Classification of Employees)

Bar Questions

1. The owners of FALCON Factory, a company engaged in the assembling of automotive

components, decided to have their building renovated. Fifty (50) persons, composed of
engineers, architects and other construction workers, were hired by the company for this
purpose. The work was estimated to be completed in three (3) years. The employees
contended that since the work would be completed after more than one (1) year, they should
be subject to compulsory coverage under the Social Security Law. Do you agree with their
contention? Explain your answer fully.
(2002 Bar)

A: No. Under Section 8 (j) of RA 1161, as

amended, employment of purely casual and

not for the purpose of the occupation or

business of the employer are excepted from

compulsory coverage. An employment is

purely casual if it is not for the purpose of

occupation or business of the employer.

In the problem given, Falcon Factory is a

company engaged in the assembling of

automotive components.

The fifty (50) persons (engineers, architects

and construction workers) were hired by

Falcon Factory to renovate its building. The

work to be performed by these fifty (50)

people is not in connection with the purpose

of the business of the factory. Hence, the

employ of these fifty (50) persons is purely

casual. They are, therefore, exempted from

the compulsory coverage of the SSS law.

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I agree with the contention that the employees

hired by the owners of FALCON factory as

construction workers in the renovation of its

building should be under the compulsory

coverage of the Social Security Law. It is true

that in connection with FALCON Factory,

which is engaged in the assembling of

automotive components, the construction

workers may be considered casual employees

because their employment is not for the

purpose of occupation of business of FALCON

Factory. As such, In accordance with Section 8

(j) of the Social Security Law, they are

excepted form the compulsory coverage of the

Social Security System.

But they could also be considered project

employees of FALCON Factory and as such

could be under the compulsory coverage of the

SSS, applying Art 4 of the Labor Code that

provides that all doubts in the implementation

and interpretation of the provisions of Labor

Law shall be resolved in favor of labor. The

employees here therefore, should be

considered as under the compulsory coverage

of the SSS.

2. The services of an employee were terminated upon the completion of the probationary
period of employment for failure to qualify for the position. The employee filed a complaint for
Illegal Dismissal on the ground that the employer failed to inform him in writing the
reasonable standards for regular employment. Will the complaint for Illegal Dismissal
prosper? Yes
Art 281

A probationary employee is provided for in Article 281 of the Labor

Code of the Philippines:

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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.

What is the correct legal procedure for terminating a probationary employee?

The process actually begins early in the employment of the probationary employee. It begins
with informing the new hire of the standards by which he is to be judged during the
probationary period. The Supreme Court discusses this in Mercado vs. AMA Computer College-
Paranaque City, Inc., G.R. No. 183572, April 13, 2010, 618 SCRA 218:

Labor, for its part, is given the protection during the probationary period of knowing the
company standards the new hires have to meet during the probationary period, and to be
judged on the basis of these standards, aside from the usual standards applicable to employees
after they achieve permanent status. Under the terms of the Labor Code, these standards
should be made known to the [employees] on probationary status at the start of their
probationary period, or xxx during which the probationary standards are to be applied. Of
critical importance in invoking a failure to meet the probationary standards, is that the
[employer] should show as a matter of due process how these standards have been applied.
This is effectively the second notice in a dismissal situation that the law requires as a due
process guarantee supporting the security of tenure provision, and is in furtherance, too, of the
basic rule in employee dismissal that the employer carries the burden of justifying a dismissal.
These rules ensure compliance with the limited security of tenure guarantee the law extends to
probationary employees.

The process is different in the case of a probationary employee dismissed because of his failure
to qualify as a regular employee in accordance with reasonable standards made known to him
at the time of engagement.

3. Ms. A is a volleyball coach with five (5) years of experience in her field. Before the start of the
volleyball season of 2015, she was hired for the sole purpose of overseeing the training and
coaching of the University’s volleyball team. During her hiring, the Vice-President for Sports
expressed to Ms. A the University’s expectation that she would bring the University a
championship at the end of the year.

In her first volleyball season, the University placed ninth (9 th) our of 10 participating teams.
Soon after the end of the season, the Vice-President for Sports informed Ms. A that she was a
mere probationary employee and hence, she need not come back for the next season because
of the poor performance of the team. In any case, the Vice-President for Sports claimed that
Ms. A was a fixed-term employee who contract has ended at the close of the year.

 Is Ms. A a probationary, fixed-term, or regular employee? Explain your reasons as to why she is
or she is not such kind of an employee for each of the types of employment given.

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 2019 Bar Exam

For types of employees, please refer to Chan Reviewer pp 41-43.

3. Marciano was hired as Chief Engineer on board the vessel MN Australia. His contract of
employment was for nine months. After nine months, he was re-hired. He was hired a third
time after another nine months. He now claims entitlement to the benefits of a regular
employee based on his having performed tasks usually necessary and desirable to the
employer's business for a continuous period of more than one year. Is Marciano's claim
tenable? Explain your answer.

2017 Bar Exam

No, Marciano's claim is not tenable. Seafarers are contractual employees for a fixed term,
governed by the contracts they sign. We should not depart from the rulings of the Supreme
Court in Brent School, hic. v. Zamora (GSR. No. L-48494, February 5, 1990, 181 SCRA 702);
Coyoca v. NLRC (G.R. No. 113658, March 31, 1995, 243 SCRA 190); and Millares v. NLRC (G.R.
No. 110524, July 29, 2002, 385 SCRA 306), which constitute stare decisis with respect to the
employment status of seafarers as contractual employees, not regular employees,
notwithstanding performance of-usually necessary and desirable functions which exceed one
year or continuous rehiring.

5. Inday was employed by mining company X to perform laundry service at its staff house.
While attending to her assigned task, she slipped and hit her back on a stone. Unable to
continue with her work, she was permitted to go on leave for medication, but thereafter she
was not allowed to return to work. She filed a complaint for illegal dismissal but her employer X
contended that Inday was not a regular employee but a mere house help. Decide.

2007 Bar Exam

Inday was NOT illegally dismissed.

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Inday is a regular employee. Under Rule XIII, Section 1(b), Book 3 of the Labor Code, as
amended, the terms ―househelper‖ or ―domestic servant‖ are defined as follows:
―The term ―househelper as used herein is synonymous to the term ―domestic
servant‖ and shall refer to any person, whether male or female, who renders services in and
about the employer‘s home and which services are usually necessary and desirable for the
maintenance and enjoyment thereof, and ministers exclusively to the personal
comfort and enjoyment of the employer‘s family.‖

The foregoing definition clearly contemplates such househelper or domestic servant who is
employed in the employer‘s home to minister exclusively to the personal comfort and
enjoyment of the employer‘s family.

The definition cannot be interpreted to include househelp or laundrywomen working in

staffhouses of a company, like Inday who attends the needs of the company‘s guest and other
persons availing of the said facilities. The criteria is the personal comfort and enjoyment of
the family of the employer in the home of said employer. While it may be true that the
nature of the work of a house helper, domestic servant or laundrywoman in a
home or in a company staffhouse may be similar in nature, the difference in their
circumstances is that in the former instance they are actually serving the
family while in the latter case, whether it is a corporation or a single proprietorship engaged
in business or industry or any other agricultural or similar pursuit, service is being rendered
in the staffhouses or within the premises of the business of the employer. In such instance,
they are employees of the company or employed in the business concerned entitled to the
privileges of a regular employee. The mere fact that the househelper or domestic servant is
working within the premises of the business of the employer and in relation to or in
connection with its officers and employees, warrants the conclusion that such househelper or
domestic servant is and should be considered as a regular employee of the employer and not
considered as a mere family househelper or domestic servant as contemplated in Rule XIII,
Section 1(b), Book 3 of the Labor Code, as amended

(Apex Mining Company, Inc. v. NLRC, 196 SCRA 251 [1991]).

6. Albert, a 40-year old employer, asked his domestic helper, Inday, to give him a private
massage. When Inday refused, Albert showed her Article 141 of the Labor Code, which says
that one of the duties of a domestic helper is to minister to the employer’s personal comfort
and convenience. Is Inday’s refusal tenable? Explain.

2009 Bar Exam

Yes, Inday’s refusal is tenable. Inday’s refusal to give her employer a “private massage” is in
accordance with law because the nature of the work of a domestic worker must be in
connection with household chores. Massaging is not a domestic work.

B. Outline

See pages 41-43 of Chan Reviewer

1.Regular

2. Probationary

3.Casual

4.Fixed term

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5.Project

6.Seasonal