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Big AA Manufacturer vs.

[G.R. No. 160854 March 3, 2006]


The respondent employees alleged that as regular employees, they worked for petitioner Big AA
from 8:00 a.m. to 5:00 p.m. in its premises and using its tools and equipment. They received P250 per
day. They alleged that they were dismissed without just cause and due process.

However, Big AA denied that respondents were its regular employees. Instead, it claimed that
Antonio was one of its independent contractors who used the services of the other respondents.
According to Big AA, its independent contractors were paid by results and were responsible for the
salaries of their own workers. As such, there was no employer-employee relationship between
petitioner and respondents. Big AA explained that it allowed respondents to use its facilities only to
meet job orders. It also denied that respondents were laid-off, since they were merely project


Whether or not respondents are regular employees


Respondents are regular employees. They were employed for more than one year and their work as
carpenters was necessary or desirable in petitioner’s usual trade or business of manufacturing office
furniture. Under Article 280 of the Labor Code, the applicable test to determine whether an
employment should be considered regular or non-regular is the reasonable connection between the
particular activity performed by the employee in relation to the usual business or trade of the

Respondents cannot be considered project employees. Petitioner had neither shown that
respondents were hired for a specific project the duration of which was determined at the time of
their hiring nor identified the specific project or phase thereof for which respondents were hired.

Antonio was not an independent contractor for he does not carry a distinct and independent
business, and he does not possess substantial capital or investment in tools, equipment, machinery or
work premises. He works within petitioner’s premises using the latter’s tools and materials and
other facilities for the "proper implementation" of job orders. He is also under petitioner’s control
and supervision. Moreover, the Implementing Guidelines regulating attendance, overtime, deadlines,
penalties; providing petitioner’s right to fire employees or "contractors"; requiring the carpentry
division to join petitioner’s exercise program; and providing rules on machine maintenance, all
reflect control and supervision over respondents.

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