Romares vs. NLRC

An employee engaged to perform activities which are usually necessary or desirable in the usual business of the employer is deemed a regular employee entitled to security of tenure, notwithstanding fixed-term employment contracts to the contrary, where such periods are imposed to preclude the acquisition of tenurial security. Because Romares performed tasks vital to Pilmico's business and rendered aggregate service exceeding one year, the Court ruled that the fixed-term contracts were a convenient subterfuge to prevent his regularization and were thus void as contrary to public policy.

Artemio Romares was hired by Pilmico Foods Corporation in its Maintenance/Projects/Engineering Department as a mason for three separate periods between September 1, 1989, and January 15, 1993. His tasks included painting, maintenance, cleaning, and operating equipment. Each engagement was covered by a contract specifying a fixed period, after which his employment was terminated. After his last contract expired on January 15, 1993, and was not renewed, Romares filed a complaint for illegal dismissal.

• Nature: Petition for certiorari and prohibition assailing the NLRC's reversal of the Executive Labor Arbiter's decision finding illegal dismissal.
• Employment History: Romares was hired by Pilmico in three separate stints: (1) September 1, 1989 to January 31, 1990; (2) January 16, 1991 to June 15, 1991; and (3) August 16, 1992 to January 15, 1993. Total service exceeded one year.
• Duties: Assigned to the Maintenance/Projects/Engineering Department as a mason. Performed painting of company buildings, maintenance chores, cleaning, operating company equipment, and assisting regular employees.
• The Contracts: Pilmico maintained Romares was a contractual employee hired for specific projects under fixed-period contracts (ranging from two to three months), which expressly stated his temporary job would terminate at the end of the period or upon project completion.
• Intervening Employment: Romares worked for International Pharmaceuticals, Inc. from January to April 1992.
• Termination: When Romares's last contract expired on January 15, 1993, it was not renewed. Romares subsequently filed a complaint for illegal dismissal.

Petitioner maintained that he had become a regular employee by operation of law having rendered a total service of more than one year. Petitioner argued that he performed tasks and functions necessary and desirable to Pilmico's business, including painting, maintenance, and repair. He contended that his repeated hiring for the same tasks proved the necessity of his work, making the fixed-term contracts a subterfuge to circumvent his right to security of tenure. Finally, petitioner asserted that he was terminated without legal cause and without notice or opportunity to be heard.

Respondent countered that petitioner was a former contractual employee whose engagements were covered by fixed-period contracts for specific projects. Respondent argued that petitioner's services as a mason were not continuous, citing his employment with another company from January to April 1992. Respondent maintained that when petitioner's last contract expired on January 15, 1993, his termination was valid due to the expiration of the contract, not illegal dismissal.

• Procedural Issues: N/A
• Substantive Issues:
  • Whether petitioner was a regular employee despite fixed-term employment contracts stipulating a temporary period.
  • Whether the expiration of the fixed-term contract constituted valid termination.

• Procedural: N/A
• Substantive: The Court ruled that petitioner was a regular employee and his termination was illegal. Under Article 280 of the Labor Code, an employee engaged to perform activities necessary or desirable to the employer's business is a regular employee. Romares's work as a mason in the maintenance department was necessary to Pilmico's flour production business. Furthermore, the repeated rehiring for the same tasks over a period exceeding one year demonstrated the continuing need for his services, converting his status to regular under the second paragraph of Article 280. The Court found that the fixed-term contracts were a convenient subterfuge utilized to prevent his regularization and circumvent his right to security of tenure. Applying the Brent School, Inc. v. Zamora criteria, the Court held that term employment is valid only if (1) the fixed period was knowingly and voluntarily agreed upon without force, duress, or improper pressure, and (2) the parties dealt on more or less equal terms with no moral dominance. Because neither requisite was present, the fixed periods were struck down as contrary to public policy. Consequently, his termination without valid cause and due process was illegal.

• Regular and Casual Employment (Article 280, Labor Code) — There are two kinds of regular employees: (1) those engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer; and (2) those casual employees who have rendered at least one year of service, whether continuous or broken, with respect to the activity in which they are employed. The Court applied this by finding Romares fell under both categories: his maintenance work was necessary to the business, and his broken service exceeded one year, thereby attaching the status of regular employment notwithstanding the contractual stipulations.
• Validity of Fixed-Term Employment — Fixed-term employment is valid if the decisive determinant is the day certain agreed upon for commencement and termination, not the activities performed. However, if the periods are imposed to preclude acquisition of tenurial security, they are contrary to public policy and must be disregarded. The Court applied the two criteria from Brent School, Inc. v. Zamora for valid term employment: (1) the fixed period was knowingly and voluntarily agreed upon without force, duress, or improper pressure; or (2) the employer and employee dealt on more or less equal terms with no moral dominance. Because neither requisite was present, the contracts were deemed a subterfuge.

• "Where an employee has been engaged to perform activities which are usually necessary or desirable in the usual business of the employer, such employee is deemed a regular employee and is entitled to security of tenure notwithstanding the contrary provisions of his contract of employment."
• "Succinctly put, in rehiring petitioner, employment contracts ranging from two (2) to three (3) months with an express statement that his temporary job/service as mason shall be terminated at the end of the said period or upon completion of the project was obtrusively a convenient subterfuge utilized to prevent his regularization."
• "The limited period specified in petitioner's employment contract having been imposed precisely to circumvent the constitutional guarantee on security of tenure should, therefore, be struck down or disregarded as contrary to public policy or morals."

• Brent School, Inc. v. Zamora, 181 SCRA 702 (1990) — Controlling precedent on fixed-term employment. Followed and applied to establish the criteria for valid term employment and to determine when fixed periods are a subterfuge to evade security of tenure.
• Baguio Country Club Corporation v. NLRC, 206 SCRA 643 (1992) — Followed. Held that if an employee performs a job for at least one year, even intermittently, the repeated need for the performance is sufficient evidence of the necessity of that activity to the business, making the employment regular.
• Purefoods Corporation v. NLRC, G.R. No. 122653 (December 12, 1997) — Followed. Cited for the two kinds of regular employees under Article 280 and the rule that written agreements contrary to the concept of regular employment are ruled out by the Labor Code.

• Article 280, Labor Code — Defines regular and casual employment. Applied as the statutory basis for ruling that Romares was a regular employee because his work was necessary/desirable and his service exceeded one year, notwithstanding the fixed-term contracts to the contrary.

Melo, Puno, and Mendoza, JJ. Regalado, J., was on leave.