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Analyn Beter Type Reader September 18, 1995 to September 18, 1996

26. ALUMAMAY O. JAMIAS, JENNIFER C. MATUGUINAS and JENNIFER F. CRUZ, petitioners, vs. Jerry Soldevilla Production Personnel September 18, 1995 to September 18, 1996
NATIONAL LABOR RELATIONS COMMISSION (SECOND DIVISION), HON. COMMISSIONERS: Ma. Concepcion dela Production Personnel September 18, 1995 to September 18, 1996
RAUL T. AQUINO, VICTORIANO R. CALAYCAY and ANGELITA A. GACUTAN; HON. LABOR Cruz
ARBITER VICENTE R. LAYAWEN; INNODATA PHILIPPINES, INC., INNODATA PROCESSING Jennifer Cruz Data Encoder November 20, 1995 to November 20, 1996
CORPORATION, (INNODATA CORPORATION), and TODD SOLOMON, respondents Jennifer Matuguinas Data Encoder November 20, 1995 to November 20, 1996
G.R. No. 159350, March 9, 2016 3. After the respective contracts expired, the abovementioned individuals filed a complaint
Ivan Zapanta for illegal dismissal claiming that Innodata had made it appear that they had been hired as
project employees in order to prevent them from becoming regular employees.
NATURE Review on Certiorari of the CA Decision 4. The LA dismissed the complaint of petitioners.
Plaintiff Alumamay Jamias, et. al. 5. The NLRC affirmed the NLRC’s decision.
Defendant National Labor Relations Commission 6. The CA affirmed the decision of the NLRC.
Ponente J., Bersamin 7. Only three of the original complainants appealed to the SC.
8. The petitioners maintain that the nature of employment in Innodata had been settled in
EMPLOYER: Villanueva v. National Labor Relations Commission and Servidad v. National Labor
Innodata Philippines Inc., is a domestic corporation engaged in the business of data Relations Commission, whereby the Court accorded regular status to the employees
processing and conversion for foreign clients. because the work they performed were necessary and desirable to the business of data
encoding, processing and conversion;
EMPLOYEES: 9. That Innodata engaged in "semantic interplay of words" by introducing the concept of
See number 2 of Facts. "fixed term employment” or “project employment” that were not founded in law; and
10. That Article 280 of the Labor Code guarantees the right of workers to security of tenure,
which rendered the contracts between the petitioners and Innodata meaningless.
DOCTRINE:
Article 280 of the Labor Code:
LABOR ARBITER
Art. 280. Regular and Casual Employment. — The provisions of written agreement to the
On September 8, 1998, Labor Arbiter (LA) Vicente Layawen rendered his decision
contrary notwithstanding and regardless of the oral agreements of the parties, an
dismissing the complaint for lack of merit. He found and held that the petitioners had
employment shall be deemed to be regular where the employee has been engaged to
knowingly signed their respective contracts in which the durations of their engagements were
perform activities which are usually necessary or desirable in the usual business or trade of
clearly stated; and that their fixed term contracts, being exceptions to Article 280 of the Labor
the employer except
Code, precluded their claiming regularization.
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
NLRC
of the employee or where the work or service to be performed is seasonal in nature and the
NLRC affirmed the decision of the LA, opining that Article 280 of the Labor
employment is for the duration of the season.
Code did not prohibit employment contracts with fixed periods provided the contracts had
An employment shall be deemed casual if it is not covered by the preceding paragraph:
been voluntarily entered into by the parties
Provided, That, any employee who has rendered at least one year of service, whether such
service is continuous or broken, shall be considered a regular employee with respect to the
COURT OF APPEALS
activity in which he is employed and his employment shall continue while such actually
The CA affirmed the decision of the NLRC. It observed that the desirability and
exists.
necessity of the functions being discharged by the petitioners did not make them regular
employees; that Innodata and the employees could still validly enter into their contracts of
FACTS. employment for a fixed period provided they had agreed upon the same at the time of the
1. Respondent Innodata Philippines Inc., is a domestic corporation engaged in the business employees' engagement; that Innodata's operations were contingent on job orders or
of data processing and conversion for foreign clients. undertakings for its foreign clients; and that the availability of contracts from foreign clients,
2. Innodata hired Alumamay Jamias et al. on various dates and under the following terms: and the duration of the employments could not be treated as permanent, but coterminous with
Name Position Duration of Contract the projects.
Alumamay Jamias Manual Editor August 7, 1995 to August 7, 1996
Marietha delos Santos Manual Editor August 7, 1995 to August 7, 1996
Lilian Guamil Manual Editor August 16, 1995 to August 16, 1996 ISSUE/S and RULING:
Rina Duque Manual Editor August 7, 1995 to August 7, 1996 1. WON the principle of Stare Decisis apply to the case? – NO.
Marilen Agbayani Manual Editor August 23, 1995 to August 23, 1996 Contrary to the petitioners' insistence, the doctrine of stare decisis, by which the
Alvin Patnon Production Personnel September 1, 1995 to September 1, 1996 pronouncements in Villanueva and Servidad would control the resolution of this case, had

LABOR LAW 1 | DIGEST GROUP NAME | ATTY. QUAN


no application herein. Servidad and Villanueva involved contracts that contained employee is assigned to carry out a specific project or undertaking, the duration or scope of
stipulations not found in the contracts entered by the petitioners. which was specified at the time of his engagement. There must be a determination of, or a
A cursory examination of the facts would reveal that while all the cases mentioned clear agreement on, the completion or termination of the project at the time the employee is
involved employment contracts with a fixed term, the employment contract subject of engaged.
contention in the Servidad and Villanueva cases provided for double probation, meaning,
that the employees concerned, by virtue of a clause incorporated in their contracts, were 3. WON the petitioners are Regular Employees. – NO.
made to remain as probationary employees even if they continue to work beyond the six- The Court considers the workers as project employees. Their contracts indicated the
month probation period set by law. one-year duration of their engagement as well as their respective project assignments (e.g.,
It ought to be underscored that unlike in the Servidad and Villanueva cases, the Jamias being assigned to the CD-ROM project; Cruz and Matuguinas to the TSET project).
written contracts governing the relations of the respondent company and the petitioners Since there is no indication that they signed their respective contracts against their will, the
herein do not embody such illicit stipulation. Court concludes that they knowingly and voluntarily agreed with the terms of their contract.
The SC also disagrees with the petitioners' manifestation that the Court struck down Just because Innodata drafted the contracts with its business interest as the
in Innodata Philippines, Inc. v. Quejada-Lopez a contract of employment that was similarly overriding consideration, it does not automatically mean, as the Court argues, that the
worded as their contracts with Innodata. What the Court invalidated in Innodata Philippines, contracts show Innodata’s intention to circumvent Article 280 of the Labor Code. In order to
Inc. v. Quejada-Lopez was the purported fixed-term contract that provided for two periods presume that the employer intends to evade their security of tenure, the employees must first
— a fixed term of one year under paragraph 1 of the contract, and a three-month period show (1) some aspect of the agreement other than the indication of the fixed term, or (2) other
under paragraph 7.4 of the contract — that in reality placed the employees under probation. evidence besides the employment contract showing the intent to evade.
In contrast, the petitioners' contracts did not contain similar stipulations, but stipulations to The Court also rejects the employees’ position that they should be considered regular
the effect that their engagement was for the fixed period of 12 months. employees because their duties are usually necessary to Innodata’s business of data processing.
The Court notes that “the necessity and desirability of the work performed by the employees
2. WON Innodata circumvented Art. 280 of the Labor Code by providing a fixed term? – are not the determinants in term employment, but rather the “day certain” voluntarily agreed
NO. upon by the parties.”
Article 280 contemplates three kinds of employees, namely: (a) regular employees;
(b) project employees; and (c) casuals who are neither regular nor project employees. The NOTES.
nature of employment of a worker is determined by the factors provided in Article 280 of The case itself lacks a lot of information. Like in the discussion of the SC, the ponente did not
the Labor Code, regardless of any stipulation in the contract to the contrary. mention in the facts that the petitioners raised the said case as part of their argument. Also, the
According to this article, the SC explains that a worker is considered a project ponente didn’t mention that Jamias, et al., was assigned at the CD-ROM project or TSET
employee—in contrast to a regular employee—if he/she is assigned to carry out a specific project not until in the discussion part of the case.
project or undertaking, the duration or scope of which was specified at the time of his/her
engagement. To be valid, both the employer and the employee must knowingly and DISPOSITIVE PORTION
voluntarily agree to this fixed period of employment. There must be a determination of, or a WHEREFORE, we DENY the petition for review on certiorari; AFFIRM the decision
clear agreement on, the completion or termination of the project at the time the employee is promulgated on July 31, 2002; and ORDER the petitioners to pay the costs of suit.
engaged. There must be a determination of, or a clear agreement on, the completion or
termination of the project at the time the employee is engaged. Otherwise put, the fixed
period of employment must be 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 circumstances vitiating his consent, or it must satisfactorily appear that the
employer and employee dealt with each other on more or less equal terms with no moral
dominance whatsoever being exercised by the former on the latter.
Likewise, the contract of the petitioners contains the following terms:
“The EMPLOYER shall employ the EMPLOYEE and the EMPLOYEE shall serve the
EMPLOYER in the EMPLOYER'S business as a MANUAL EDITOR on a fixed term only
and for a fixed and definite period of twelve months, commencing on August 7, 1995 and
terminating on August 7, 1996,…”
There is no indication that petitioners signed the contract against their will. Hence,
petitioners knowingly agreed to the terms and conditions and voluntarily signed their
contracts.
A fixed term agreement, to be valid, must strictly conform with the requirements and
conditions provided in Article 280 of the Labor Code. The test to determine whether a
particular employee is engaged as a project or regular employee is whether or not the

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