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AT A GLANCE:
There is project employment when the employment has been fixed for a specific project or undertaking, the completion or termination of which has been determined at the time of engagement of the employee. (Article 295, Labor Code)
The Philippine Labor Code provides that there is project employment when the employment has been fixed for a specific project or undertaking, the completion or termination of which has been determined at the time of engagement of the employee. (Article 295, Labor Code)
Jurisprudence provides that:
A project has reference to a particular job or undertaking that may or may not be within the regular or usual business of employer. In either case, the project must be distinct, identifiable from the main business of the employer and its duration must be determined or determinate. (Philippine Airlines, Inc. v. National Labor Relations Commission)
Because the services of project employees are only needed when there are projects to be undertaking, they are not regular employees. However, jurisprudence says:
Where the employment of project employees is extended long after the supposed project has been finished, the employees are removed from the scope of project employees and are considered as regular employees. (Tomas Lao Construction v. National Labor Relations Commission, G.R. No. 116781, September 5, 1997)
What are the indicators that an employee is a project employee?
As held by the Supreme Court in the case of Samson v. National Labor Relations Commission (G.R. No. 113166, February 1, 1996), an employee is considered a project employee when one or more of the following circumstances or indicators are present:
- The duration of the specific or identified undertaking for which the worker is engaged is reasonably determinable;
- Such duration, as well as the specific work or service to be performed is defined in an employment agreement and is made clear to the employee at the time of hiring;
- The work or service performed by the employee is in connection with the particular project or undertaking for which he is engaged;
- The employee, while not employed and awaiting engagement, is free to offer his services to any other employer;
- The termination of his employment in the particular project or undertaking is reported to the DOLE Regional Office having jurisdiction over the workplace within thirty (30) days following the date of his separation from work, using the prescribed form on employees’ termination, dismissal or suspension;
- An undertaking in the employment contract by the employer to pay completion bonus to the project employee as practiced by most construction companies.
In what instances may a project employee become a regular employee?
In the case of Maraguinot v. National Labor Relations Commission (G.R. No. 120969, January 22, 1998), the Supreme Court ruled that a project employee may become a regular employee when:
- There is continuous rehiring of project employees even after the cesstion of a project for the same tasks or nature of tasks; and
- The tasks performed by the alleged project employee are vital, necessary and indispensable to the usual business or trade of the employer.
What is the principal test to determine whether employees are project employees?
The test is whether or not the project employees are assigned to carry out a specific project or undertaking, the duration or scope of which are specified at the time the employees are engaged for that project. (ALU-TUCP v. National Labor Relations Commission, G.R. No. 109902, August 2, 1994)
Related Article/s:
Knowing the Difference Between Probationary Employment and Project Employment
Does the continuous rehiring of a project employee make him a regular employee?
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