Republic of the Philippines

SUPREME COURT

Manila

THIRD DIVISION

G$.$R$.$ No$.176627$ August $24,2007$

GLORY PHILIPPINES, INC., Petitioner,

vs$.$

BUENAVENTURA B$.$ VERGARA and ROSELYN T$.$ TUMASIS, Respondents.

D E C I S I O N

YNARES$-$SANTIAGO, J$.$:

This petition$1$ for review on certiorari assails the September $18,2006$ Decision$2$ of the Court of Appeals in CA$-$G$.$R$.$ SP No$.73377$ which set aside the December $20,2001$ Decision and July $22,2002$ Order of the National Labor Relations Commission in NLRC NCR CA No$.022914-00$ and declared that respondents Buenaventura B$.$ Vergara and Roselyn T$.$ Tumasis were illegally dismissed; and the February $6,2007$ Resolution$3$ denying the motion for reconsideration.

Petitioner Glory Philippines, Inc. manufactures money$-$counting machines. In June $1998,$ it created a Parts Inspection Section $($PIS$)$ tasked to inspect the machine parts for exportation to its exclusive buyer, Glory Limited Japan $($Glory Japan$).$

Petitioner hired respondents on July $6,1998,$ allegedly as members of the PIS. However, the employment contracts$4$ which they signed only on August $18,1998,$ indicated them as Production Operators in the Production Section with a daily wage of Php$188\mathrm{.}00.$ The contracts covered the period from July $31$ to August $30,1998.$

Thereafter, respondents$$ employment contracts were extended on a monthly basis. For the periods from August $31$ to October $20,1998,$ and October $21$ to November $30,1998,$ respondents signed their respective employment contracts designating them as members of the PIS. From December $1,1998$ to April $27,1999,$ respondents performed the same duties and responsibilities despite the absence of employment contracts. On April $27,1999,$ however, they were each made to sign employment contracts$5$ covering the period from February $28$ to April $30,1999.$

On April $26,1999,6$ petitioner$$s President, Mr$.$ Takeo Oshima, informed the Assistant Manager that the contractual employees in the PIS would no longer be needed by the company as Glory Japan had cancelled its orders.

Nevertheless, despite the alleged lack of need for respondents$$ services, petitioner claimed that it reluctantly agreed to extend respondents$$ employment due to their insistent pleas. Thus, for the period from May $1$ to May $15,1999,$ respondents signed employment contracts with a higher wage of Php$200\mathrm{.}00$ a day.

Respondents claimed that they continued to work until May $25,1999$ when, at the close of working hours, petitioner$$s security guard advised them that their employment had been terminated and that they would no longer be allowed to enter the premises. Consequently, on May $27,1999,$ they filed separate complaints for illegal dismissal with the Department of Labor and Employment, Region IV$.$ The cases were subsequently referred to the National Labor Relations Commission $($NLRC$)$ for resolution.

On October $29,1999,$ the Labor Arbiter rendered a decision$7$ finding that respondents were regular employees because they performed activities desirable to the usual business or trade of petitioner for almost eleven $(11)$ months; and that they were illegally dismissed for lack of just cause and non$-$observance of due process. Thus:

Hence, in accordance with Art. $280,$ we believe as we ought to believe that complainants $[$herein respondents$]$ were regular employees since their engagement was not fixed for a specific project or undertaking for a particular season. As regular employees, complainants had all the rights to security of tenure.

x x x x

After a careful perusal of the record of this case, we could not find any glimpse of just cause and the observance of due process before and during the termination of complainants$$ services. In this case, only general allegations were asserted by respondent such as "declining order from Glory Japan coupled with poor work performance of complainants" to justify the dismissal of the latter. This afterthought averment, in the absence of any substantial evidence to prove respondent$$s defense, should be considered as empty allegation and must miserably fail.

Thus, we declare as we ought to declare that the dismissal of complainants Vergara and Tumasis were $($sic$)$ illegal in the absence of any just cause as enunciated in Art. $282$ and the non$-$observance of due process in the termination of complainants$$ services$\mathrm{.}8$

On appeal, the NLRC affirmed the findings of the Labor Arbiter. However, upon motion for reconsideration, the NLRC reversed and set aside its earlier decision$9$ and dismissed the complaint for lack of merit. The NLRC ruled that respondents were project employees and that their employment was terminated upon expiration of their employment contracts. Respondents$$ motion for reconsideration was denied hence, they filed a petition for certiorari before the Court of Appeals. On September $18,2006,$ the appellate court granted the petition, as follows:

WHEREFORE, the PETITION FOR CERTIORARI IS GRANTED.

The DECISION dated December $20,2001$