Project Employment Contract

Project employment contract is a necessary document to establish the correct relationship between the company and the individual. There are specific rules unique to this employment relationship that should be observed.

Since project employment creates a limited form of security of tenure compared to regular employment it is, in this sense, inferior to the latter. However, the difference is not designed to defeat the rights of labor. It is due to the nature of business involved.

For instance, a condominium project involves several phases to construct until its completion. Constructing the foundation has a life of its own independent of all other other phases. Thus, employees may be engaged on this phase separately from those who would be hired for metal work on the first floor, second floor, etc.

Hence, those who were engaged for the skills needed in the foundation work cannot be sustained when that phase is completed and the structure begins to go up. It would be unfair on the part of the company to keep the foundation Mason on payroll even during the time that the workers needed should only be finishing carpenters.

However, employers should carefully craft the project employment contract since the burden of proof to prove project arrangement lies with the employer. In case of doubt it shall be resolved in favor of labor. Thus, a more favorable arrangement which is regular employment may be adjudged to what supposed to be project employee simply because of technical errors in the crafting of the employment contract.

The post below is based on the book Human Resource Forms, Notices & Contracts Volume 1 by Atty. Elvin B. Villanueva.

Project employee has been defined to be one whose employment has been fixed for a specific project or under-taking, the completion or termination of which has been determined at the time of the engagement of the employee.

The service of project employees are co-terminus with the project and may be terminated upon the end or completion of that project or project phase for which they were hired.

Length of service is not the controlling determinant of the employment tenure of a project employee, but whether the employment has been fixed for a specific project or undertaking, its completion has been determined at the time of the engagement of the employee.

Important things to remember in a project employment contract:

1. It is for a specific project or undertaking; and

2. The completion or termination of the project has been determined at the time of their engagement.

In fact, portion of Article 295 [formerly 280] of the Labor Code (Get a copy of the re-numbered version of the Labor Code 2018 by Atty. Villanueva) provides that 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 employment distinguishes itself from regular employment when an employee is assigned to carry out a specific project or undertaking, the duration and scope of which were specified at the time the employees were en-gaged for that project. (See Grandspan Development Corporation vs. Bernardo, G.R. No. 141464, September 21, 2005; See also Equipment Technical Services vs. CA, G.R. No. 157680, October 8, 2008.)

Form No. 7-A

PROJECT EMPLOYMENT CONTRACT

KNOW ALL MEN BY THESE PRESENTS:

            This PROJECT EMPLOYMENT CONTRACT is entered into 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 COMPANY,

-and-

1. ________________________, of legal age, and a resident of _____________________________________________, hereinafter called the PROJECT EMPLOYEE,

WITNESSETH, THAT:

WHEREAS, the COMPANY has commenced a project for the construction of condominium building;

WHEREAS, the COMPANY desires to engage employees for each phase of the building project;

WHEREAS, the PROJECT EMPLOYEE offered his services to the COMPANY to finish a particular phase of the project;

WHEREAS, the agreement shall be on purely project employment relationship where the COMPANY;

THEREFORE, the parties hereby covenant that:

COMMENCEMENT OF PROJECT EMPLOYMENT

1. The PROJECT EMPLOYEE is engaged for a particular project the scope and duration of which is known to him at the time of engagement;
2. The PROJECT EMPLOYEE shall perform his duties until the completion of the project or phase thereof;
3. This contract shall commence on ________________ and shall remain effective until the completion of the project or phase thereof;
4. The PROJECT EMPLOYEE is not a regular employee and shall not be entitled to all the benefits given only to regular employees;
5. The PROJECT EMPLOYEE is free to offer his services to other companies or seek employment after the completion of the project;
6. The PROJECT EMPLOYEE shall be paid the following cost for his services ___________________ PESOS (PhP______.00) per month;

THE PROJECT AND ITS DURATION

7. The PROJECT EMPLOYEE shall act as Mason for the project known as Tower 1, Sub-Terrain Work Phase;
8. The expected or estimated completion date of the project is on ______________ after which this agreement shall automatically terminate;
9. As PROJECT EMPLOYEE, he shall perform the responsibilities a list of which is hereto attached as Annex “A”;
10. If the project extends beyond the expected completion date, the duration of this contract shall be governed by the completion of said project and the contract shall be deemed extended until the completion of the said project;
11. The fact of the duration of the project has been made known to the PROJECT EMPLOYEE at the time of his engagement;

COMPLETION BONUS

12. Once the project has ben completed, a completion bonus of _____________________ PESOS (PHP__________.00) shall be given to the PROJECT EMPLOYEE;

VOLUNTARY SIGNING OF AGREEMENT

13. The parties have agreed on this contract knowingly and voluntarily without moral dominance by one over the other;
14. The PROJECT EMPLOYEE was aware that he had the option of not signing the agreement or requesting for amendment if he finds any provision disagreeable as to him;

IN WITNESS WHEREOF, the parties have hereby affixed their respective signature this ____ day of _______, 2018, in the City of ____________.

For the COMPANY:

_____________________                                               ________________________

(Position Title)                                                          PROJECT EMPLOYEE

ID: ______________________                           ID: ________________________

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 Project 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 __________, 2018.

Doc. No.: _________;

Page No.: _________;

Book No.: _________;

Series of 2018