Philips Semiconductors Phils. Inc. vs. Eloisa Fadriquela

PHILIPS SEMICONDUCTORS (PHILS.), INC. vs.
ELOISA FADRIQUELA
G.R. No. 141717 April 14, 2004
CALLEJO, SR., J.:
FACTS: Philips Semiconductors, petitioner, is a domestic corporation engaged in the

production and assembly of semiconductors such as power devices, RF modules,
CATV modules, RF and metal transistors and glass diods. It caters to domestic and
foreign corporations that manufacture computers, telecommunications equipment and
cars. Aside from contractual employees, the petitioner employed 1,029 regular workers.
The employees were subjected to periodic performance appraisal based on output,
quality, attendance and work attitude. One was required to obtain a performance rating
of at least 3.0 for the period covered by the performance appraisal to maintain good
standing as an employee. Eloisa Fadriquela, respondent, during her 5 consecutive
contracts, got the following ratings: 3.15, 3.8, 3.4, and 2.8. The reason for her failed
mark on the last contract was her absences. She was then asked to explain such
absences but she failed to do the same. Subsequently, respondent’s supervisor
recommended that her employment be terminated due to habitual absenteeism. Thus,
her contract of employment was no longer renewed.
Respondent then filed a complaint for illegal dismissal. On the other hand, petitioner
contends that respondent was not dismissed; her contract was merely expired. The
Labor Arbiter and the NLRC based their decision on the CBA between the petitioner
and the labor union which provides that a contractual employee would only be
considered a regular employee if he has completed 17 months of service and a
performance rating of at least 3.0. The respondent filed a motion for reconsideration but
the NLRC denied the same. On appeal, the CA reversed the decision of the NLRC.
Hence, this petition.
ISSUE: Whether or not Eloisa Fadriquela is a contractual employee of the company.
RULING: No, the original contract of employment had been extended or renewed four
times, to the same position, with the same chores. Such a continuing need for the
services of the respondent is sufficient evidence of the necessity and indispensability of
her services to the petitioner’s business. By operation of law, then, the respondent had
attained the regular status of her employment with the petitioner, and is thus entitled to
security of tenure as provided for in Article 279 of the Labor Code.
The two kinds of regular employees under the law are (1) those engaged to perform
activities which are 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 activities in which they are
employed. The primary standard to determine a regular employment is the reasonable
connection between the particular activity performed by the employee in relation to the
business or trade of the employer. The test is whether the former is usually necessary
or desirable in the usual business or trade of the employer. If the employee has been
performing the job for at least one year, even if the performance is not continuous or
merely intermittent, the law deems the repeated and continuing need for its
performance as sufficient evidence of the necessity, if not indispensability of that activity
to the business of the employer. Hence, the employment is also considered regular, but
only with respect to such activity and while such activity exists. The law does not
provide the qualification that the employee must first be issued a regular appointment or
must be declared as such before he can acquire a regular employee status.
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. To
uphold the contractual arrangement would, in effect, permit the former to avoid hiring
permanent or regular employees by simply hiring them on a temporary or casual basis,
thereby violating the employee’s security of tenure in their jobs.

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PHILIPS SEMICONDUCTORS (PHILS.), INC. vs.

FACTS: Philips Semiconductors, petitioner, is a domestic corporation engaged in the

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