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MY San Biscuit Case

Bernardino Labayog and 42 others filed complaints of illegal dismissal against M.Y. San Biscuits, Inc. and Mew Wah Lim after their fixed-term contracts expired and their services were terminated. The labor arbiter ruled in favor of the petitioners, but the NLRC and CA affirmed the validity of the fixed-term contracts. The Supreme Court also ruled that the fixed-term contracts were valid as the duties were necessary for the employer's business and the contracts were knowingly agreed upon without force or improper pressure. Since the contracts specified the duration of employment and expired on their own terms, there was no illegal dismissal when the petitioners' services were terminated.

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107 views2 pages

MY San Biscuit Case

Bernardino Labayog and 42 others filed complaints of illegal dismissal against M.Y. San Biscuits, Inc. and Mew Wah Lim after their fixed-term contracts expired and their services were terminated. The labor arbiter ruled in favor of the petitioners, but the NLRC and CA affirmed the validity of the fixed-term contracts. The Supreme Court also ruled that the fixed-term contracts were valid as the duties were necessary for the employer's business and the contracts were knowingly agreed upon without force or improper pressure. Since the contracts specified the duration of employment and expired on their own terms, there was no illegal dismissal when the petitioners' services were terminated.

Uploaded by

Janela Lana
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd
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BERNARDINO LABAYOG, CRESENCIO GRANZORE, JEANETTE GONZALES, NOEME DADIZ, GEMMA

PANGANIBAN, DALISAY BUENVIAJE, VICTORIANA RUEDAS, MA. VICTORIA CABALONG, AMALIA SALVARRI,
ROWENA FERNANDEZ, DELIA LOZARES, LUNINGNING ANGELES, ROSEMARIE SALES, VIVIAN VERZOSA,
MARILYN JOSE, ROSANNA ROLDAN, HERMINIO CARANTO, ANITA SALVADOR, JORGE SALAMAT, ROBERTO
ODIAMAR, EFREN LACAMPUINGAN, NOEL TAGALOG, MARCOS DE LA CRUZ, ELIAS BELO, DARIUS EROLES,
HELEN BARAYUGA,1 CRISTOPHER HILARIO, JOEL ESGUERRA, BERNABE DUCUT, JOSEPH TANAUY, EDWIN
CEA, NOEL VILLASCA, ERNESTO ALFONSO, FERNANDO CEBU and REYNALDO SESBRENO, petitioners,

vs.

M.Y. SAN BISCUITS, INC. and MEW WAH LIM, respondents

G.R. No. 148102, 11 July 2006.

Corona, J.:

On various dates in 1992, petitioners entered into contracts of employment with respondent company as
mixers, packers and machine operators for a fixed term. On the expiration of their contracts, their
services were terminated. Forthwith, they each executed a quitclaim.

Petitioners filed complaints for illegal dismissal, among others. The labor arbiter ruled their dismissal to
be illegal on the ground that they had become regular employees who performed duties necessary and
desirable in respondent company's business and ordered for their reinstatement.

The NLRC reversed the ruling, which the CA eventually affirmed.

ISSUE: W/N the fixed term contract of petitioners were valid.

RULING: YES.
Where the duties of the employee consist of activities which are necessary or desirable in the usual
business of the employer, the parties are not prohibited from agreeing on the duration of employment.
Article 280 of the Labor Code does not proscribe or prohibit an employment contract with a fixed period
provided it is not intended to circumvent the security of tenure.

Two criteria validate a contract of employment with a fixed period: (1) the fixed period of employment
was knowingly and voluntarily agreed upon by the parties without any force, duress or improper
pressure being brought to bear on the employee and without any circumstances vitiating consent or, (2)
it satisfactorily appears that the employer and employee dealt with each other on more or less equal
terms with no moral dominance whatever being exercised by the former on the latter. Against these
criteria, petitioners' contracts of employment with a fixed period were valid.

In this case, there was no allegation of vitiated consent. Respondents did not exercise moral dominance
over petitioners. The contracts were mutually advantageous to the parties.

While their employment as mixers, packers and machine operators was necessary and desirable in the
usual business of respondents, they were employed temporarily only, during periods when there was
heightened demand for production. Consequently, there could have been no illegal dismissal when their
services were terminated on expiration of their contracts. There was even no need for notice of
termination because they knew exactly when their contracts would end. Contracts of employment for a
fixed period terminate on their own at the end of such period

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