Rada vs NLRC

January 9, 1992

Facts: In 1977, Rada was contracted by Philnor Consultants and Planners, Inc as a
driver. He was assigned to a specific project in Manila. The contract he signed was
for 2.3 years. His task was to drive employees to the project from 7am to 4pm. He
was allowed to bring home the company vehicle in order to provide a timely
transportation service to the other project workers. The project he was assigned to
was not completed as scheduled hence, since he has a satisfactory record, he was
re-contracted for an additional 10months. After 10months the project was not yet
completed. Several contracts thereafter were made until the project was finished in
1985. At the completion of the project, Rada was terminated as his employment
was co-terminous with the project. He later sued Philnor for non-payment of
separation pay and overtime pay. He said he is entitled to be paid OT pay because
he uses extra time to get to the project site from his home and from the project
site to his home every day in total, he spends an average of 3 hours OT every day.

ISSUE:
Whether or not Rada is entitled to separation pay and OT pay.
HELD:
Yes.
Separation Pay
The SC ruled that Rada was a project employee whose work was coterminous with
the project for which he was hired. Project employees, as distinguished from
regular or non-project employees, are mentioned in Section 281 of the Labor Code
as those 'where the employment has been fixed for a specific project or undertaking
the completion or termination of which has been determined at the time of the
engagement of the employee.' Project employees are not entitled to termination
pay if they are terminated as a result of the completion of the project or any phase
thereof in which they are employed, regardless of the number of projects in which
they have been employed by a particular construction company. Moreover, the
company is not required to obtain clearance from the Secretary of Labor in
connection with such termination.'

Yes
OT Pay
Rada is entitled to OT pay. The fact that he picks up employees of Philnor at certain
specified points along EDSA in going to the project site and drops them off at the
same points on his way back from the field office going home to Marikina, Metro
Manila is not merely incidental to Rada's job as a driver. On the contrary, said
transportation arrangement had been adopted, not so much for the convenience of
the employees, but primarily for the benefit of Philnor. As embodied in Philnor’s
memorandum, they allowed their drivers to bring home their transport vehicles in
order for them to provide a timely transport service and to avoid delay not really so
that the drivers could enjoy the benefits of the company vehicles nor for them to
save on fair.