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In this case, Alltel Communications (Alltel), a
United States-based telecommunications firm, contracted Sykes Asia to accommodate
the needs and demands of Alltel clients for its postpaid and prepaid services (Alltel
Project). Services for the said project went on smoothly until Alltel sent two
(2) letters to Sykes Asia dated August 7, 2009 and September 9, 2009 informing
the latter that it was terminating all support services provided by Sykes Asia
related to the Alltel Project. In view of this development, Sykes Asia sent
each of the petitioners end-of-life notices, informing them of their dismissal
from employment due to the termination of the Alltel Project.
Aggrieved, petitioners (there are 23
employees-petitioners) filed separate complaints for illegal dismissal against respondents
Sykes Asia, Chuck Sykes, the President and Chief Operating Officer of Sykes
Enterprise, Inc., and Mike Hinds and Michael Henderson, the President and Operations
Director, respectively, of Sykes Asia (respondents), praying for reinstatement,
backwages, 13th month pay, service incentive leave pay, night shift
differential, moral and exemplary damages, and attorney’s fees. In their
complaints, petitioners alleged that their dismissal from service was unjust as
the same was effected without substantive and procedural due process.
In their defense, respondents averred that petitioners
were not regular employees but merely project-based employees, and as such, the
termination of the Alltel Project served as a valid ground for their dismissal.
In support of their position, respondents noted that it was expressly indicated
in petitioners’ respective employment contracts that their positions are “project-based”
and thus, “co-terminus to the project.” Respondents further maintained that
they complied with the requirements of procedural due process in dismissing
petitioners by furnishing each of them their notices of termination at least thirty
(30) days prior to their respective dates of dismissal.
Labor arbiter decided in favor of
Sykes, it stated that petitioners are project-based employees.
NLRC decided that they are
regular employees but were validly terminated due to redundancy.
The CA reinstated the decision of
the Labor Arbiter.
The issue before the Court is whether or not the petitioners were
regular employees or merely project-based employees, and thus, was validly
dismissed from service?
Supreme Court’s Decision.
Decision of the Supreme Court: The petitioners herein are project
employees. The Supreme Court cited Article 294 of the Labor Code, as amended, distinguishing project-based employee from a regular employee;
x x x x (Emphasis and underscoring supplied)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.
Verily, for an employee to be considered project-based, the employer must show compliance with two (2) requisites, namely that: (a) the employee was assigned to carry out a specific project or undertaking; and (b) the duration and scope of which were specified at the time they were engaged for such project.
In the instant case, n this case, records reveal that Sykes Asia adequately informed petitioners of their employment status at the time of their engagement, as evidenced by the latter’s employment contracts which similarly provide that they were hired in connection with the Alltel Project, and that their positions were “project-based and as such is co-terminus to the project.” In this light, the CA correctly ruled that petitioners were indeed project-based employees, considering that: (a) they were hired to carry out a specific undertaking, i.e., the Alltel Project; and (b) the duration and scope of such project were made known to them at the time of their engagement, i.e., “co-terminus with the project.”
The word “determinable time” concerning the duration of the undertaking simply means “capable of being determined or fixed” The Court said that Sykes Asia substantially complied with this requisite when it expressly indicated in petitioners’ contracts that their positions were “co-terminus with the project”. This sufficiently apprised petitioners that their security of tenure with Sykes Asia would only last as long as the Alltel project was subsisting.
The Supreme Court therefore decided in favor of Sykes Asia.
Have you experienced a similar situation at work? Were you dismissed because you were a project employee? Be sure to look at your employment contract that you signed with your employer and check if you were hired as a regular employee or a project-employee first before going after your employer. Take note that the case started in 2009 and ended in 2015 - six years of court battle that will definitely test every employee-petitioner’s patience.
Read the full text here:
MA. CHARITO C. GADIA, ERNESTO M. PENAS, GEMMABELLE B. REMO, LORENA S. QUESEA, MARIE JOY FRANCISCO, BEVERLY A. CABINGAS, IVEE U. BALINGIT, ROMA ANGELICA 0. BORJA, MARIE JOAN RAMOS, KIM GUEVARRA, LYNN S. DE LOS SANTOS, CAREN C. ENCANTO, EIDEN BALDOVINO, JACQUELINE B. CASTRENCE,MA.ESTRELLA V. LAPUZ, JOSELITO L. LORD, RAYMOND G. SANTOS, ABIGAIL M. VILORIA, ROMMEL C. ACOSTA, FRANCIS JAN S. BAYLON, ERIC 0. PADIERNOS, MA. LENELL P. AARON, CRISNELL P. AARON, and LAWRENCE CHRISTOPHER F. PAPA, Petitioners,
vs. SYKES ASIA, INC./ CHUCK SYKES/ MIKE HINDS/ MICHAEL HENDERSON, Respondents.
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