Casual Employment and the Importance of Having a Good Contract

An employment shall be deemed to be casual if the employee has not been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer, regular, project, or seasonal employee.

It is one of the exceptions to the rule on regular employment under Article 295 which states that 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 employer, except 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 or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season.

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 activity exists.

Casual employment is loosely referred to in business talk as “contractual.” This is not an accurate reference but the obvious intention of people calling it as such is to refer to temporary employment or “contractual.”

However, if the intention of hiring a casual is to obviate the regularization of employee, then it cannot be permitted by the Court. As held by the Supreme Court (SC), the Court cannot countenance this practice as to do so would effectively permit companies to avoid hiring permanent or regular employees by simply hiring them on a temporary or casual basis, thereby violating the employees’ security of tenure relative to their jobs. (University of Santo Tomas [UST] vs. Samahang Manggagawa ng UST, April 24, 2017, G.R. No. 184262)

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In a 1990 case, the complainants were cogon grass cutter who claim to be regular employees. The employer is engaged in the manufacturing of cultured milk. Thus, the SC held that the activity is not related to the business of the employer. The employment is not regular.

The cutting of the cogon grasses in the premises of its factory is hardly necessary or desirable in the usual business of the private respondents. Indeed, it is alien thereto. (Capule vs. NLRC, G.R. No. 90653, November 12, 1990)

It is vital at this point that the contract for casual employment should comply with the requisites to be a valid casual contract. Otherwise, the presumption is that the employee is regular. (See Omni Hauling Services, Inc. v. Bon, 742 Phil 335, 344-345 (2014), and Basan v. Coca-Cola Bottlers Philippines, 753 Phil 74, 90-91 (2015).)

Below is an incomplete sample template for Casual Employment for Daily Paid Employee, just to provide an idea of salient provisions to include (View the description and contents of the full version of the Casual Employment Contract here):

KNOW ALL MEN BY THESE PRESENTS:

         This CONTRACT FOR CASUAL EMPLOYMENT (Agreement for brevity), is entered into this ____ day of___________ by and between:

         XYZ Corporation, a corporation duly organized and existing under and by virtue of the laws of the Republic of the Philippines with principal place of business at 123 Bldg., Ayala Ave., Makati City, Philippines, represented herein by its President, MR. ____________________, hereinafter known as “EMPLOYER”;

 -and-

____________________________________, of legal age, married/single, a with residential address at __________________________, and hereinafter referred to as “CASUAL EMPLOYEE”;

WITNESSETH THAT:

WHEREAS, the EMPLOYER is in need employee of temporary employee who will perform duties not usually necessary and desirable in the usual business or trade of the EMPLOYER;

WHEREAS, the CASUAL EMPLOYEE seeks employment, applied for and expressed willingness to join the EMPLOYER as its temporary or casual worker;

WHEREAS, the agreement shall be for a period of only five (5) months or until after the unrelated job for which the CASUAL EMPLOYEE was hired has ceased;

THEREFORE, the parties hereby covenant:

COMMENCEMENT OF CASUAL EMPLOYMENT

1. The CASUAL EMPLOYEE shall have duties and responsibilities set forth hereunder;
2. The CASUAL EMPLOYEE shall report for work on xxx;
3. The hiring date of the CASUAL EMPLOYEE, which is the commencement of this agreement shall be on __________;

4. The CASUAL EMPLOYEE is not a regular employee and shall not be entitled to xxx;

5. The temporary employment of CASUAL EMPLOYEE shall expire on _________________;

JUST AND AUTHORIZED CAUSES FOR DISMISSAL OR TERMINATION

6. In addition to the date of expiration of employment, the CASUAL EMPLOYEE may be dismissed from service for xxx;

7. Further, the employment may be terminated in the event of xxx;

8. The employment may likewise be terminated for authorized cause under xxx;

9. Employment may likewise be validly terminated if xxx;

10. The employment may likewise be suspended due to causes arising from xxx;

PLACE OF POSTING

11. The initial place of posting of the CASUAL EMPLOYEE shall be xxx;

12. The place of work may change when xxx;

DUTIES AND RESPONSIBILITIES

13. The CASUAL EMPLOYEE shall perform duties and responsibilities hereto attached as Annex “B,” and such other responsibilities that xxx;

14. In addition, the CASUAL EMPLOYEE shall observe the xxx;

COMPENSATION AND BENEFITS

15. The CASUAL EMPLOYEE shall receive a salary of ________________________ PESOS (PhP______.00) per day which will be paid every xxx;

16. For the payroll period of 15th of the month, attendance cut-off shall be xxx;

17. The salary of the CASUAL EMPLOYEE shall be deducted xxx;

18. The CASUAL EMPLOYEE undertakes to xxx;

OFFICE DECORUM

19. The CASUAL EMPLOYEE shall report for work in proper business attire. The following are prohibited office attire:

xxx

CONFIDENTIALITY

20. The CASUAL EMPLOYEE recognizes and acknowledges that xxx;

21. Thus, the CASUAL EMPLOYEE agrees that, except as directed by the EMPLOYER in writing, she will not at any time, whether during or after employment, disclose to any person or use any xxx;

22. The term “confidential information” shall include xxx;

23. The CASUAL EMPLOYEE undertakes not to make copies or duplicates of xxx;

24. Failure of the CASUAL EMPLOYEE to submit, turnover, or return the company property falling under confidential information xxx;

25. In case of violation, the CASUAL EMPLOYEE agrees to compensate the EMPLOYER the amount equivalent to xxx;

26. The CASUAL EMPLOYEE authorizes the EMPLOYER to xxx;

NON-COMPETE CLAUSE

27. The CASUAL EMPLOYEE agrees and covenants within a period of xxx.

28. The CASUAL EMPLOYEE shall not, during the same period directly or indirectly solicit to xxx;

29. If the CASUAL EMPLOYEE would in the future be directed by any governmental agency or judicial forum or court xxx;

30. In the event of any breach of the non-compete clause, the CASUAL EMPLOYEE shall compensate the EMPLOYER the amount of xxx;

31. Payment of liquidated damages shall in no way affect the other rights which xxx;

RESIGNATION

32. If the CASUAL EMPLOYEE would resign from service, he shall give at least xxx;

33. This written contract and its annexes constitute the entire agreement between the xxx.

CONSENT UNDER DATA PRIVACY LAW

34. By providing personal information and sensitive personal information, the employee acknowledges and recognizes the exclusive right of the company to utilize the xxx. 

IN WITNESS WHEREOF, the parties have hereby affixed their respective signature this ____ day of _______, 20___, in the City of ____________.

For the EMPLOYER:

_______________________                   ________________________

President                                                 CASUAL EMPLOYEE 

Signed in the presence of:

__________________________                      _________________________

ACKNOWLEDGMENT

 Republic of the Philippines     )

City of _______________      ) S.S.

         BEFORE ME, a notary public for and in the City of ______________, the parties appeared and presented their respective identification cards as competent proof of identity and are known to me and to me known to be the same persons who executed the foregoing Contract for Casual Employment consisting of three (3) pages, including this page where the Acknowledgment is written and affirmed to me that the same is their own, free, voluntary act and deed.

         WITNESS MY HAND AND SEAL, this _____ day of __________, 20___.

Doc. No.: _________;

Page No.: _________;

Book No.: _________;

Series of 20__

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