Practice question
A genuine contractor’s regular employee has served several client assignments. One service agreement expires, and the contractor insists that the employee must either accept immediate automatic dismissal without benefits or become the principal’s employee by operation of expiry. No illicit-contracting finding or independent ground for either conclusion exists. Which is the best analysis?
- The contractor has correctly identified the only two legal outcomes
- Expiry alone neither terminates the regular employment nor automatically establishes direct employment by the principal; the applicable employment and re-employment rules must be assessed
- Expiry automatically cancels all rights under the Labor Code
- The employee must be treated as a new probationer after every assignment
- The principal’s choice of terminology conclusively resolves employment status
Legal references
- https://www.dole.gov.ph/php_assets/uploads/2017/07/DO-174-17-Rules-Implementing-Articles-106-to-109-of-the-Labor-Code-As-Amended1.pdf — DO 174-17, sections 10–13, employee rights, required contracts, and effect of termination.
- https://www.scribd.com/document/768934000/Department-Order-No-174-Series-of-2017 — mirrored issued DO 174-17 text, section 13.
- https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/11/90581 — EO 51, s. 2018, section 2, security of tenure and due process.
- https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/10/71535 — DO 147-15, Rule I-A, application of just and authorized causes under Articles 297–299.
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