Termination of Casual Employment

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.

Thus:

“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)

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).)

Just like all other employees, a casual employee may be terminated for just cause and authorized cause. A special case for termination of this employment is when the reason for hiring ceases to continue and such activity ceases to exist.

However, it is still better to indicate the duration of the cessation of such activity, and to have a good practice of limiting the activity to at most five (5) months only.

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)