SC rules PAGCOR contract workers not employees

The Supreme Court (SC) emphasized in a ruling that contract of services or job order workers hired by the Philippine Amusement and Gaming Corporation (PAGCOR) are not considered government employees under the Civil Service Commission's (CSC) jurisdiction.

This was stated in a decision penned by Associate Justice Ramon Paul L. Hernando dated 19 June 2024, the Supreme Court’s First Division ruled that a group of workers who worked for PAGCOR in its hotel and restaurant business are contract of services and job order workers in the government who are not government employees covered by Civil Service law, rules, and regulations.

Under Presidential Decree No. 1869, as amended by Republic Act 9487, or the PAGCOR Charter, PAGCOR is a government-owned or -controlled corporation.

The GOCC hired Mark Abadilla, et al. in various positions such as cook, waiter, purchaser, pantry aide, food attendant, steward, dishwasher, kitchen supervisor and busboy, among others.

They signed a contract with PAGCOR for a fixed term, but they were occasionally renewed, and they worked for PAGCOR for a total period ranging from one to 17 years.

Their contracts included a provision, “strict observance of civil service laws, rules and regulations.”

When PAGCOR closed its hotel business in Goldenfield Complex and transferred to L’Fisher Hotel, both in Bacolod City, it did not renew the individual contracts of Abadilla et al.

The JO’s filed an illegal dismissal complaint before the CSC Regional Office (CSCRO-VI), arguing they are regular employees entitled to security of tenure.

However, it was dismissed by CSCRO-VI for lack of jurisdiction, finding that they were job order workers and not government employees based on their contracts.

Abadilla et al. re-filed the case with CSCRO-VI, which elevated it as an appeal to the CSC.

While the case was pending with the CSC, PAGCOR issued a memorandum that effectively terminated their services.

The CSC later issued an order dismissing the complaint which was affirmed by the Court of Appeals (CA), which held that Abadilla et al. are not regular employees in the civil service and thus are not under CSC’s jurisdiction.

The SC in affirming the CA, ruled there is no employer-employee relationship between the government and job order workers whose services are not considered government service and they are not covered by Civil Service law, rules and regulations.