PHILIPPINE FRUIT & VEGETABLE INDUSTRIES, INC. AND ITS PRESIDENT AND GENERAL MANAGER, MR. PEDRO CASTILLO, PETITIONERS, VS. NATIONAL LABOR RELATIONS COMMISSION, AND PHILIPPINE FRU…

Philippine Fruit and Vegetable Industries versus National Labor Relations Commission

The Case

This is a special civil action for certiorari brought by Philippine Fruit and Vegetable Industries, a government-owned and controlled corporation engaged in the manufacture and processing of fruit and vegetable purees for export, together with its President and General Manager, Pedro Castillo. They ask the Supreme Court to annul the rulings of the National Labor Relations Commission, which affirmed the Labor Arbiter's finding that the members of the Philippine Fruit and Vegetable Workers Union were illegally dismissed and were therefore entitled to backwages, thirteenth month pay, and separation pay. The case matters because it is a compact review of three recurring labor law questions: when an employee is regular by the nature of his work under the first paragraph of Article 280 of the Labor Code, whether a seasonal business makes its workers seasonal, and the elementary but often forgotten rule that each complainant must prove his own claim.

Procedural History

The union filed a complaint for unfair labor practice and illegal dismissal with damages before the labor arbitration branch. Labor Arbiter Ricardo Olairez rendered a decision holding the company liable for illegal dismissal. On appeal, the third division of the National Labor Relations Commission set aside that decision and remanded the case to the arbitration branch for further proceedings. After receiving the evidence of both parties, Labor Arbiter Quintin Mendoza rendered a decision finding the company liable for illegal dismissal and ordering it to pay one hundred ninety complainants their backwages and thirteenth month pay, plus separation pay, and attorney's fees. On appeal, the National Labor Relations Commission affirmed with the modification that attorney's fees shall be based only on the amounts corresponding to thirteenth month pay. The company's motion for reconsideration was denied. The company then came to the Supreme Court by petition for certiorari.

Facts

Many of the complaining union members began working for San Carlos Fruits Corporation, which later incorporated into Philippine Fruit and Vegetable Industries in January or February 1983. They served as seeders, operators, sorters, slicers, janitors, drivers, truck helpers, mechanics, and office personnel. They were dismissed on different dates in 1985, 1986, 1987, and 1988, and they claimed the dismissals were due to their involvement in union activities and were without just cause.

The company's defense was that it operates seasonally. Its operation begins in February with the processing of tomatoes into tomato paste and ceases by the end of that month when the supply is consumed. It resumes at the end of April or early May with the processing of mangoes into purees and ceases in June. On this theory, the complainants were seasonal workers whose employment simply ceased during the off-season due to the absence of work, and who therefore cannot invoke tenurial benefits. The company also claimed that many complainants failed or refused to undergo the required medical examination.

On the evidence, the Labor Arbiter found that the company in fact operates for the whole year, processing mangoes and calamansi from January to July, tomatoes from January to April, mangoes again up to August, and guyabano, papaya, and pineapple until November or the end of the year. He rejected the company's attendance report as self-serving. The National Labor Relations Commission agreed, noting that the company did not confine itself to tomatoes and mangoes and that office administration, cleaning, and upkeep of machines kept a large food processing corporation running throughout the year.

Issues

• Whether or not the complaining members of the union are regular employees of the company, rather than seasonal workers whose employment ceased during the off-season due to the non-availability of work.
• Whether or not the National Labor Relations Commission committed manifest error in ordering the company to pay backwages, thirteenth month pay, and separation pay to all one hundred ninety-four union members, when only a portion of them presented evidence to substantiate their claims.

Applicable Provisions

Article 280 of the Labor Code, on regular and casual employment, provides:

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 employers, except where the employment has been fixed for a specific project.

This is the provision under which the Court classifies the complainants as regular employees by the nature of their work.

The same Article continues:

An employment shall be deemed to be casual if it is not covered by the preceding paragraph; 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 activity in which he is employed and his employment shall continue while such actually exists.

The Court cites this second paragraph only to explain, following its earlier ruling in Mercado versus National Labor Relations Commission, that the one-year proviso applies to casual employees and need not be reached once regularity is established under the first paragraph.

Ruling

On the first issue, the Court held that the complainants are regular employees. Findings of fact of the National Labor Relations Commission affirming those of the Labor Arbiter are entitled to great weight and will not be disturbed if supported by substantial evidence, and the Court found no circumstance warranting reversal. Under Article 280, employment is regular where the employee has been engaged to perform activities usually necessary or desirable in the usual business or trade of the employer, or where he has rendered at least one year of service, continuous or broken, with respect to the activity in which he is employed. The work of the complainants as seeders, operators, sorters, slicers, janitors, drivers, truck helpers, mechanics, and office personnel is without doubt necessary in the usual business of a food processing company. Their employment was not fixed for a specific project, and it was not seasonal in nature. While some phases of processing depend on the supply of fruits for a particular season, the equally important aspects of manufacturing and marketing are not seasonal, and large-scale food processing companies continue to operate throughout the year even if the availability of fruits and vegetables is seasonal. Having resolved regularity under the first paragraph, the Court did not dwell on the one-year service requirement.

On the second issue, the Court ruled in the affirmative and found manifest error. Only eighty of the one hundred ninety-four union members presented evidence, such as affidavits, testimonies, pay slips, passbooks, and identification cards; the other one hundred fourteen presented no evidence at all. It is a basic rule in evidence that each party must prove his affirmative allegation. The evidence is personal to each complainant: whatever testimony or other proof of employment one of them submitted proves only the status of his own employment and not that of any other complainant. The Labor Arbiter therefore erred in appreciating the evidence of the complaining members in favor of the other one hundred fourteen.

Doctrine

First, under the first paragraph of Article 280 of the Labor Code, an employee is regular where he is engaged to perform activities usually necessary or desirable in the usual business or trade of the employer, regardless of any written or oral agreement to the contrary, except where employment is fixed for a specific project. Second, a business does not become seasonal in all its aspects merely because part of its operations depends on the supply of raw materials; where the company continues to operate and do business throughout the year, its workers are not seasonal employees and enjoy security of tenure. Third, the one-year service proviso in the second paragraph of Article 280 applies only to casual employees, not to employees already regular under the first paragraph. Fourth, in labor cases involving multiple complainants, each must prove his own claim by substantial evidence; evidence of employment submitted by one complainant cannot be used to establish the employment of another.

Disposition

The Court affirmed the decision of the National Labor Relations Commission as to the eighty union members who proved their claims, reversed it as to the other one hundred fourteen who adduced no evidence, and ordered accordingly.

Remember This

The line to memorize is that the work of the complainants being necessary and desirable in the usual business of the employer, they are regular employees under the first paragraph of Article 280, and the one-year proviso applies only to casuals. Examiners use this case to test the regular-versus-seasonal distinction and the rule that each complainant in a labor case must prove his own claim.