Project Employee: Meaning
Quick answer
A project employee is an employee hired for a specific project or undertaking whose end was already set when the employee was hired. Article 295 [280] of the Labor Code treats project employment as an exception to regular employment. The employer must be able to show that the worker was told the duration and scope of the project at the start; without that proof, the Supreme Court presumes the worker is regular.
Also called: Project-based employee, Project worker
What does Article 295 say?
[Article 295 [280]](/law/labor-code/article-295) makes employment regular when the employee does work that is usually necessary or desirable in the employer's business. It then names the exceptions:
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.
For project employment, two parts of this text matter:
- the project must be specific; and
- its completion or termination must be determined at the time of engagement, meaning when the employee was hired, not later.
How do courts tell a project employee from a regular one?
In Engineering & Construction Corporation of Asia v. Palle (2020), the Supreme Court said the principal test is whether the employees were assigned to carry out a specific project or undertaking, "the duration and scope of which were specified at the time the employees were engaged for that project."
The Court also said:
- without proof that the workers were told the duration and scope at hiring, "it is presumed that respondents are regular employees";
- the employer's failure to report to DOLE the end of the workers' employment each time a project was completed was "an indication that the workers were not project employees but regular ones"; and
- length of service "may not necessarily be applicable in a construction industry", so what matters is how each hiring was made.
Why does the label matter?
A regular employee can be dismissed only for a just or authorized cause. A true project employee's job can end when the project ends, because that end was set at the start. If a worker labeled "project employee" turns out to be regular, ending the job "because the project is over" is a dismissal that needs a valid cause. Without one, the worker is entitled to reinstatement and full backwages under [Article 294 [279]](/law/labor-code/article-294).
Is a project employee the same as an agency worker?
No. A project employee is hired directly by the employer. An agency worker is hired by a contractor that supplies workers to a principal, under the rules on contracting. See labor-only contracting.
Example
Made-up illustration: Mila is hired as a mason for a two-storey building. Her contract names the building and says her work ends when the masonry phase is done, and this is explained to her when she is hired. She is a project employee, and her job can end with that phase. Dino, a construction helper, is rehired by the same company for project after project for years, but no one ever tells him at hiring what the project is or when it will end. As in Engineering & Construction Corporation of Asia, without that proof he may be presumed regular.
For more, see project employees: rights and when they become regular and when does an employee become regular?
Which provisions use this term?
Frequently asked questions
What is a project employee in simple words?
An employee hired for a specific project or undertaking whose completion or termination was already determined when the employee was hired. When the project ends, the employment can end with it.
Where does the Labor Code mention project employees?
In Article 295 [280], which makes employment regular when the work is usually necessary or desirable in the employer's business, except where the employment was fixed for a specific project whose end was set at the time of hiring.
What is the test for a project employee?
In Engineering & Construction Corporation of Asia v. Palle (2020), the Supreme Court said the principal test is whether the employees were assigned to a specific project or undertaking whose duration and scope were specified at the time they were engaged.
What happens if the employer cannot prove the project terms?
In Engineering & Construction Corporation of Asia (2020), there was no proof that the workers were told the duration and scope of the project when hired, so the Court presumed they were regular employees.
Is a project employee the same as a seasonal or casual employee?
No. Article 295 [280] treats project employment, seasonal employment and casual employment separately. A casual employee who has rendered at least one year of service becomes regular with respect to the activity in which he or she is employed.
General information, not legal advice. For your case, ask a lawyer, the Public Attorney's Office (PAO) or the agency.
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