l\epuhlic of tbe Jlbilippines

$>Upreme QCourt
:§manila

FIRST DIVISION

MARK ABADILLA, NELSON G.R. No. 258658

AGUIRRE, HAYDEN ANDACA
JR., STELLA MARIE MINETTE Present:
ANO, NOE ARCA, JOSE ARRO,
MELENDE BACASON AUSA, GESMUNDO,
RENE BANARES, FERNANDO Chairperson,*
BELEDIANO, MELISSA HERNANDO,
BONGCARON, LYDIA , Acting Chairperson,**
CAGALANAN, VICTORINO ZALAMEDA,
CASPE JR., RICKY CONDADA ROSARIO, and
SR., DANE DAVILA, RECHEL 1 MARQUEZ,JJ
DE LOS SANTOS, ROEL DELA
FLOR, BETTY DEMONTANO,
JAY GALE DEONIDO, ALBERT
DESCUTIDO, EDWARD
DUMALA-OG, CIRIACO ENO,
MAE M. ERAS, BELLA JOY
GAMELO, TERESITA GELIM,
DEMSON GREMIO, HERNAN!
GUANZON JR., ARACELI
JENTILIZO, SHARON LEE,
ELSA LISONDRA, ALVIN
LOPEZ, MERCY MELGAR,
REYMOND NARVASA, HARRY
NECESARIO, MARIO PACETE • .,,,.,,
JR., JOSEPH PALMA, JOEL
PANOLINO, DELILAH PAVIA,
JOEMARIE PEREZ, ROLANDO
PONTE, MILDRED POSTA,
GEORGE PRINCE SA JR.,
ROSELYN PROVEDENCIA,

• On official leave.
•• Per Special Order No. 3098 dated June 13, 2024.
1 Rollo, p. 9. Referred to as "Ritchel'' in the Petition for Review on Certiorari and the records.

'1 T· 1 •1··
,·· f_:1!; ''.' (f;..,
! :;;·f:.;,

•D~cisiori 2 G.R. No. 258658

f

• ii- -'· ,:. ·_: :

ERICKSON RIVERA, STEPHEN

SAZON, ARNOLD TALADUA,
ARNEL TALAVER, JOSE TANA
JR., JANETH TEROSA, EDNA
TORIO, ANALIZA TUBIL,
FLOYD BRYAN UNDAG,
MARLYN VALERO, DONNY
VARGAS, RICKY VALENCIANO,
JOEY VILLETA,
Petitioners,
,,.LI:

- versus -

PHILIPPINE AMUSEMENT &

GAMING CORPORATION,2
Respondent.

Promulgated:

U1 1 .J.1

x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

HERNANDO, J.:

This Petition for Review on Certiorari3 (Petition) challenges the Decision4

and the Resolution5 of the Court of Appeals (CA) in CA-G.R. CEB SP No.
12537.

2
Under Presidential Decree No. 1869 (1983), as amended by Republic Act No. 9487 (2007), the entity should
be referred to as "Philippine Amusement and Gaming Corporation".
3
Rollo, pp. 9-62.
4
Id. at 43-51. The December 18, 2019 Decision in CA-G.R. CEB SP. No. 12537 was penned by Associate
Justice Gabriel T. Ingles, and concurred in by Associate Justices Marilyn B. Lagura-Yap and Alfredo D.
Ampuan of the Special Eighteenth Division, Court of Appeals, Cebu City.
5 Id. at 65-67. The September 30, 2021 Resolution in CA-G.R. CEB SP. No. 12537 was penned by Associate
Justice Gabriel T. Ingles, and concurred in by Associate Justices Marilyn B. Lagura-Yap and Dorothy P.
Montejo-Gonzaga of the Special Former Special Eighteenth Division, Court of Appeals, Cebu City.
 ,,.,,,.,

Decision 3 G.R. No. 258658

The Parties

Mark Abadilla, Nelson Aguirre, Hayden Andaca Jr., Stella Marie Minette
Afio, Noe Arca, Jose Arro, Melende Bacason Ausa, Rene Bafiares, Fernando
Belediano, Melissa Bongcaron, Lydia Cagalanan, Victorino Caspe Jr., Ricky
Condada Sr., Dane Davila, Rechel 6 De Los Santos, Roel Dela Flor, Betty
Demontafio, Jay Gale Deonido, Albert Descutido, Edward Dumala-Og, Ciriaco
Eno, Mae M. Eras, Bella Joy Gamelo, Teresita Gelim, Demson Gremio,
Hemani Guanzon Jr., Araceli Jentilizo, Sharon Lee, Elsa Lisondra Alvin Lopez,
Mercy Melgar, Reymond Narvasa, Harry Necesario, Mario Pacete Jr., Joseph
Palma, Joel Panolino, Delilah Pavia, Joemarie Perez, Rolando Ponte, Mildred
Posta, George Princesa Jr., Roselyn Provedencia, Erickson Rivera, Stephen
Sazon, Arnold Taladua, Amel Talaver, Jose Tana Jr., Janeth Terosa, Edna
' •'f:11p"'' ':

Torio, Analiza Tubil, Floyd Bryan Undag, Marlyn Valero, Donny Vargas,
Ricky Valenciano, Joey Villeta (collectively Abadilla, et al.), aver that they
were employees of the Philippine Amusement and Gaming Corporation
(PAGCOR). 7

Abadilla et al. worked as either cook, assistant cook, waiter, purchaser,

pantry aide, food processor, food attendant, steward, assistant food checker,
dishwasher, kitchen supervisor, or busboy, among others, for PAGCOR's hotel
and restaurantbusiness. 8 Their employment was evidenced by various contracts
of employment designed to end after a fixed term but were occasionally
renewed. 9 Based on the records, the total period over which Abadilla et al.
worked for P AGCOR ranged from one year to 17 years. 10

On the other hand, PAGCOR is a government-owned or -controlled

corporation (GOCC) with an original charter.ll PAGCOR is governed by
Presidential Decree No. 1869, 12 as amended by Republic Act No. 9487, 13 or the
PAGCOR Charter (PAGCOR Charter). ,,

Andres Lizares was the general manager of PAGCOR in Bacolod City, 14

and was referred to in such capacity in the records.

6 Id. at 9. Referred to as "Ritchel" in the Petition for Review on Certiorari and the records.
7
Id at 12, 45.
8
Id. at 25, 95-96.
9
Id. at 12, 45.
10
Id. at 12-15, 45.
11
Id. at 11, 50.
12 Consolidating and Amending Presidential Decree Nos. 1067-A, 1067-B, 1067-C, 1399 and 163/2, Relative
to the Franchise and Powers of the Philippine Amusement and Gaming Corporation (PAGCOR) (1983).
13 An Act Further Amending Presidential Decree No. 1869, Otherwise Known as PAGCOR Charter (2007).
14
Rollo, p. 85.
Decision 4 G.R. No. 258658

Factual Antecedents

Records show that Abadilla et al. were engaged on a "no work, no pay"
basis, and performed works which were necessary and desirable in the business
of PAGCOR. 15 However, despite performing work for P AGCOR, Abadilla et
al. averred that they were unduly deprived of the benefits extended to the regular
employees of P AGCOR, including overtime pay, service incentive leave, and
vacation leave. 16

Prior to the filing of the initial complaint, PAGCOR announced its decision
to close down its hotel business located at Goldenfield Complex, Bacolod City,
and transfer to another location at L'Fisher Hotel, 14th Lacson St., Bacolod
City. 17 PAGCOR also announced its decision not to renew Abadilla et al.'s
individual contracts. 18

This prompted s01ne 19 of the workers to file an illegal dismissal complaint

before the Civil Service Commissimt- Regional Office (CSCRO-VI). 20

On March 7, 2014, the CSCRO-VI promulgated its Decision21 dismissing

the complaint for lack of jurisdiction. 22 The dispositive portion of the CSCRO-
VI Decision23 reads:

WHEREFORE, the complaint of Mae M. Eras, et al. against Andres

Lizares, General Manager, Philippine Amusement and Gaming Corporation,
Bacolod City, is dismissed for lack of jurisdiction.24

The CSCRO-VI scrutinized the individual contracts of Eras et al. and

found that such contracts were "satiated with provisions prohibited by the
[applicable Civil Service Commission (CSC)] guidelines, [and] did not convert
them into government employees over which [CSCRO-VI] can exercise its
jurisdiction. " 25 Simply stated, the CSCRO-VI concluded that Eras et al. were
job order workers who were not government employees and were not covered
by civil service laws and rules.
,,,

15
Id at 12, 45.
16
Id. at 15, 45.
17
Id. at 15, 45.
18
Id. at 15, 45.
19
Id at 45. The footnote cited in the CA Decision dated December 18, 2019 noted that the following
petitioners filed a complaint before the Civil Service Commission - Regional Office: (1) Stella Marie Afio,
(2) Erickson Rivera, (3) Joemarie Perez, and (4) Ricky Valenciana.
20
Id at 15, 45.
21
Id. at 77-85. The March 7, 2014 Decision of the Civil Service Commission Regional Office No. 6 in
CSCRO6 Case No. ND-14-003 was penned by Director V Atty. Rodolfo B. Encajonado.
22
Id. at 45.
23
Id. at 77-85.
24
Id. at 85.
25
Id. at 84.
Decision 5 G.R. No. 258658

Undaunted, Abadilla et al. 26 filed .a ,pgmpla,int before the Regional Trial

Court ofBacolod City on June 4, 2014. 27 On November 12, 2014, the trial court
dismissed the complaint for lack of jurisdiction and remanded the case to the
CSC. 28

Thus, Abadilla et al. refiled the case with the CSCRO-VI,29 but it was
elevated motu proprio as a petition for review/appeal to the CSC in Quezon
City. 30 On June 3, 2015, the CSC issued an order31 requiring Abadilla et al. to
pay the appeal fee, which the latter complied with. 32

During the pendency of the case, PAGCOR issued a Memorandum33 dated

December 15, 2016 with the subject "End of Contract" effectively terminating
Abadilla et al.' s services.

In an Order34 dated February 9, 2017, the CSC required Abadilla et al. to

comply with the requisites of a valid complaint under Section 11 of the Revised
Rules on Administrative Cases in the Civil Service. Abadilla et al. complied
with the CSC's mandate on May 5, 2017,.aud re-filed their complaint.

On August 15, 2018, the CSC promulgated its assailed Order35 and found
that Abadilla et al. did not comply with the requisites of a valid complaint. The
dispositive portion of the CSC Order36 reads:

WHEREFORE, the Complaint of Dane J. Davilla and twenty-three (23)

other employees of the [PAGCOR] is hereby DISMISSED without prejudice to
its refiling upon compliance with the afore-cited requirements.

SO ORDERED, Quezon City[.] 37 (Emphasis in the original)

26 Id. at 45. The footnote cited in the CA Decision dated December 18, 2019 noted that Stella Marie Afio did
not join the complaint filed before the Regional Trial Court.
27 Id.atl7,45. "'''
28
Id. at 17, 45.
29 Id. at 46. The footnote cited in the CA Decision dated December 18, 2019 stated that the second complaint
was not made part of the records.
30 Id. at 46. The footnote cited in the CA Decision dated December 18, 2019 stated that the order elevating the
case was not made part of the records.
31 CA rollo, pp. 78-79. The June 3, 2015 Order of the Civil Service Commission in the case docketed as NDC-
2015-05111 was penned by Assistant Commissioner Atty. Ariel G. Ronquillo.
32
Rollo, p. 46.
33
Id. at 121-135.
34 Id. at 99-100. The February 9, 2017 Order of the Civil Service Commission in the case docketed as NDC-
2015-05111 was penned by Assistant Commissioner Atty. Ariel G. Ronquillo.
35 Id. at 136-138. The August 15, 2018 Order of the Civil Service Commission in the case docketed as NDC-
2015-05111 was penned by Assistant Commissioner Atty. Ariel G. Ronquillo.
36
Id. at 136-138.
37
Id. at 138.
Decision 6 G.R. No. 258658

Undaunted, Abadilla et al. filed their motion for reconsideration, 38 which

was denied by the CSC in its Order39 dated January 23, 2019. The decretal
portion reads:

WHEREFORE, the Moticnt for Reconsideration of Dane J. Davilla,

Assistant Cook, and twenty-three (23) others, employees of the [PAGCOR] is
hereby DENIED. Accordingly, CSC Order No. 180224 dated August 15, 2018
STANDS. 40 (Emphasis in the original)

Dissatisfied, Abadilla et al. filed their Petition for Review41 under Rule 43
of the Rules of Court before the CA. 42

Ruling of the Court ofAppeals

On December 18, 2019, the appellate court denied the petition for review
for lack of merit. The dispositive portion of the CA Decision43 reads:

WHEREFORE, the petition is denied for lack of merit.

SO ORDERED.44 (Emphasis in the original)

Regarding the procedural issue. on the timeliness of the action before the
CSC, the appellate court found that the CSC treated the action as an original
action instead of an appeal. 45

More importantly, the appellate court ruled that the civil service laws and
rules do not apply to Abadilla et al. 46

Abadilla et al. sought reconsideration, 47 but to no avail for their motion for
reconsideration was denied due to lack of merit. The CA found that the motion
for reconsideration merely reiterated, repeated, and rehashed arguments from
its appeal, which were thoroughly discussed in its assailed Decision dated
December 18, 2019. 48

Thus, the dispositive portion of the CA Resolution49 dated September 30,

2021 states:
38
Id. at 139-147.
39
Id. at 148-150. The January 23, 2019 Order of,t~ Civil Service Commission in the case docketed as NDC-
2015-05111 was penned by Assistant Commissioner Atty. Ariel G. Ronquillo.
40
Id. at 150.
41 Id. at 151-171.
42
Id. at 44.
43
Id. at 51.
44 Id.
45 Id. at 47--48.
46
Id. at 48-50.
47
Id. at 53-62.
48
Id. at 66.
49
Id. at 67.
Decision 7 G.R. No. 258658

IN LIGHT OF THE FOREGOING, we DENY the instant motion for

reconsideration for lack of merit.

SO ORDERED. 50 (Emphasis in the original)

Dissatisfied, Abadilla et al. filed the instant Petition ascribing two errors
on the part of the appellate court: (1) they are not confidential employees; 51 and
(2) they are regular employees of PAGCOR entitled to security oftenure. 52

Issue

The main issue in the Petition is the employment status of Abadilla et al.
'f' 1 '11· • r

Our Ruling

We affirm.

The Court finds that Abadilla et al. are contract of service and job order
workers. Consequently, the CA did not gravely abuse its discretion in ruling
that Abadilla et al. are not regular employees under the civil service, and are
thus not under the jurisdiction of the CSC.

PAGCOR has the power to

hire its own employees, as well
as contract of service or job
order workers

An employer-employee relationship in the public sector is primarily

determined by special laws, civil service laws, rules and regulations. 53

It is undisputed that PAGCOR is a GOCC created under the PAGCOR

Charter. Under its charter, PAGCOR was created for two main purposes: (1) to
centralize and integrate the right and authority to operate and conduct games of
chance into one corporate entity to be controlled, administered, and supervised
by the Government; 54 and (2) to establish and operate clubs and casinos, for
amusement and recreation, including sports gaming pools (basketball, football,
lotteries, etc.) and such other forms of amusement and recreation including
games of chance, which may be allowed by law within the territorial jurisdiction
of the Philippines, 55 among others.

50 Id.
51 Id. at 20-24.
52
Id at 24-31.
53
National Transmission Corporation. v. Commission on Audit, 800 Phil. 618, 629 (2016) [Per J. Mendoza,
En Banc].
54
See Presidential Decree No. 1869 (1983), sec. 1 (a).
55
See Presidential Decree No. 1869 (1983), sec. 1 (b). • r ,
Decision 8 G.R. No. 258658

One of P AGCOR' s corporate powers is the employment of such officers

and personnel as may be necessary or proper to carry on its business. 56

The PAGCOR Charter explicitly states that PAGCOR is exempted from

Civil Service Law and is governed by its own personnel management policies. 57
Accordingly, P AGCOR Charter, Sec. 16 states:
SECTION 16. Exemption. - All position in the Corporation, whether
technical, administrative, professional, or managerial are exempt from the
provisions of the Civil Service Law, rules and regulations, and shall be governed
only by the personnel management,11olicies set by the Board of Directors. All
employees of the casinos and related services shall be classified as "Confidential"
appointee.

We discussed the proper and more logical interpretation of PAGCOR

Charter, Sec. 16, in Civil Service Commission and Philippine Amusement and
Gaming Corporation v. Salas 58 (Salas). Thus, We ruled:
On this point, [W]e approve the more logical interpretation advanced by the
CSC to the effect that "PD 1869 [, Section 16] insofar as it exempts PAGCOR
positions from the provisions of Civil Service Law and Rules has been
amended, modified or deemed repealed by the 1987 Constitution and
Executive Order No. 292 (Administrative Code of 1987)."

However, the same cannot be said with respect to the last portion of
Section 16 which provides that "all employees of the casino and related
services shall be classified as 'confidential appointees."' While such executive
declaration emanated merely from the provisions of the Civil Service Act of
1959, [Rule XX of the implementing rules, Sec. 2 thereof], the power to declare
a position as policy-determining, p,ri:p:1arily confidential or highly technical as
defmed therein has subsequently been codified and incorporated in [Executive
Order No. 292, Book V, Section 12(9)] or the Administrative Code of 1987. This
later enactment only serves to bolster the validity of the categorization made
under ... Presidential Decree No. 1869[, Section 16]. Be that as it may, such [a]
classification is not absolute and all-encompassing. 59 (Emphasis supplied,
citations omitted)

Expounding on Salas, We ruled in Philippine Amusement and Gaming

Corporation v. Rilloraza60 (Rilloraza), among others, that PAGCOR Charter,
Sec. 16, insofar as it declares all positions within P AGCOR as primarily
confidential, is not absolutely binding on the courts. Thus:

Justice Regalado's incisive discourse yields three (3) important points:

first, the classification of a particular position as primarily confidential,
policy-determining or highly technical amounts to no more than an

56 See Presidential Decree No. 1869 (1983), sec. 3 (e).

57
See Presidential Decree No. 1869 (1983), sec. 16..
58
340 Phil. 526 (1997) [Per J. Regalado,En Banc]:
59
Id at 534.
60
412 Phil. 114 (2001) [Per J. De Leon, Jr., Second Division].
Decision 9 G.R. No. 258658

executive or legislative declaration that is not conclusive upon the courts, the
true test being the nature of the position. Second, whether primarily
confidential, policy-determining or highly technical, the exemption provided in
the Charter pertains to exemption from competitive examination to determine
merit and fitness to enter the civil service. Such employees are still protected by
the mantle of security of tenure. Last, and more to the point, P.D. 1869, [Sec.
16,] insofar as it declares all positions within PAGCOR as primarily
confidential, is not absolutely binding on,the courts. 61 (Emphasis supplied)

Applying the foregoing, the PAGCOR Charter, Sec. 16 thereof, applies to

government employees hired by PAGCOR.

In particular, the first sentence of Sec. 16, insofar as it exempts P AGCOR

positions from the provisions of Civil Service Law and Rules, has been
amended, modified, or deemed repealed by the 1987 Constitution and Executive
Order No. 29262 or the Administrative Code of 1987.

On the other hand, the second sentence of Sec. 16 referring to "confidential

employees" should not be liberally applied to all other PAGCOR employees.
Instead, confidential employees of PAGCOR are determined by the nature of
the position, and such a classification is not absolutely binding on the courts.

However, not all personnel hired by PAGCOR are considered

government employees governed by applicable civil service laws and rules
as discussed above. 63 Other personnel hired by PAGCOR are considered
contract of service or job order workers who are not government
employees and are not under the jurisdiction of the CSC.

As will be discussed separately, there are applicable government issuances

for contract of service or job order workers.

Abadilla, et al. • are not

confidential employees of
PAGCOR

In a catena of cases involving PAGCOR, We ruled that the internal security

staff member in Salas, 64 casino operations manager in Rilloraza,65 and slot
machine roving token attendants, 66 are not confidential employees. In the cited
jurisprudence, We took into account the nature of the functions, organizational

61
Id. at 128.
62 Instituting the "Administrative Code of 1987" (1987).
63
Rollo, p. 81.
64 340 Phil. 526, 539 (1997) [Per J. Regalado, En Banc].
65 412 Phil. 114, 132 (2001) [Per J. De Leon, Jr., Second Division].
66 Philippine Amusement and Gaming Corporation v. Angara, 511 Phil. 486, 488 (2005) [Per J. Austria-
Martinez, Second Division].
Decision 10 G.R. No. 258658

ranking, and compensation level, of the employees concerned, then concluded

that the positions were not of confidential employees.

Here, Abadilla et al. argue that they are not confidential employees of
PAGCOR, contrary to the finding of the appellate court. 67 To support their
argument, Abadilla et al. quoted •the summary of the appellate court in its
September 30, 2021 Resolution,68 to wit:

Still and all and if only to make a point, we have thoroughly discussed the
following in our decision: (1) that, the labor code recognizes that the terms
and conditions of employment of all government employees, including those
of GOCC's, shall be governed by the civil service law, rules and regulations;
(2) that CSC-COA-DBM Joint Circular No. 01-07, June 15, 2017, clarified
that workers under contract of service or job order are not covered by Civil
Service laws, rules and regulations; (3) that, in cases of GOCC's created by
special law, the terms and conditions of employment of its employees are
particularly governed by its charter; (4) that, the respondent is a
government[-]owned and [-]controlled corporation and its charter,
[Presidential Decree] 1869, provides that all positions in the [corporation,
whether technical, administrative, professional or managerial are exempt
from the provisions of the Civil Service law, rules and regulations and] shall
be governed only by the personnel management policies set by the Board of
Directors. All employees of the casinos and related services shall be classified
as "confidential" appointee; (5) that, law and jurisprudence are clear on the
matter, petitioners are not covered by;,the civil service laws and are not entitled
to the benefits of those covered; (6) that, consequently the Civil Service
Commission does not have jurisdiction over them; (7) that, their tenure as
workers of the respondent is limited by the term set in their contract; (8) that, the
decision of the CSCRO-VI did not amount to· [res judicata] since it did not have
jurisdiction over the subject matter and over the petitioners as contract of service
and job order workers; (9) that, as a result, the issue of whether or not the GSC
erred in dismissing the complaint pursuant to section 11 of the RRACCS need
not be resolved. 69 (Emphasis supplied)

Abadilla et al. gravely misinterpreted the first four pronouncements

of the appellate court. Nowhere did the CA rule that they are confidential
employees.

As Abadilla et al. themselves pointed out, the positions of cook, assistant

cook, waiter, purchaser, pantry aide, food processor, food attendant, steward,
assistant food checker, dishwasher, kitchen supervisor, or busboy, among
others, belong to the lowest rank and cannot be considered confidential. 70

67
Rollo, pp. 20-24.
68
Id. at 20-21.
69
Id. at 66-67.
70
Id. at 21.
Decision 11 G.R. No. 258658

Applying jurisprudence, the nature of Abadilla et al.' s functions, their

organizational ranking, and compensati'5ii level, cannot be considered as
confidential. Thus, Abadilla et al. are not confidential employees of PAGCOR.

Abadilla et al. are not regular

employees, but contract of
service and job order workers
ofPAGCOR

Abadilla et al. are neither confidential employees nor regular employees

of PAGCOR. Instead, they are contract of service and job order workers.

The provisions of CSC Memorandum Circular No. 40, series of 199871

(CSC Memorandum Circular No. 40-98), CSC Resolution No. 02079072
dated June 5, 2002 (CSC Resolution No. 020790), and CSC, COA, and
Department of Budget and Management (DBM) Joint Circular No. 1,
series of 201773 dated June 15, 2007 (CSC-COA-DBM Joint Circular No.
1) apply to contract of service and job qrger wprkers.

Workers under contracts of services and job orders are not considered to
have rendered service for the government, 74 covers lump sum work or services
where no employee-employer relationship exist, 75 exists for a period of short
duration not exceeding six months on a daily basis, 76 are not covered by Civil
Service Law, Rules, and Regulations, but by the Commission on Audit (COA)
rules, 77 and do not enjoy the benefits enjoyed by government employees. 78

Thus, CSC Memorandum Circular No. 40-98, Rule XI, Secs. 1 and 2 read:

SECTION 1. Contracts of Services/Job Orders, as distinguished from those

covered under Sec. 2 (e) and (f), RULE III of these Rules, need not be submitted
to the Commission. Services rendered thereunder are not considered
government services.

SECTION 2. Contracts of Services/Job Orders refer to employment

described as follows:
1r1 111 -

a. The contract covers lump sum work or services such as janitorial,

security, or consultancy services where no employer-employee
relationship exist;

71 CSC Memorandum Circular No. 40 (1989)

72 CSC Resolution No. 020790 (2002).
73
CSC, COA, DBM Joint Circular No. 1 (2017).
74 See Civil Service Commission Memorandum Circular No. 40 (1998), rule XI, sec. I.
75 See Civil Service Commission Memorandum Circular No. 40 (1998), rule XI, sec. 2 (a).
76 See Civil Service Commission Memorandum Circular No. 40 (1998), rule XI, sec. 2 (b).
77 See Civil Service Commission Memorandum Circular No. 40 (1998), rule XI sec. 2 (c).
78
See Civil Service Commission Memorandum Circular No. 40 (1998), rule XI, sec. 2 (d).
Decision 12 G.R. No. 258658

b. The job order covers piece work or intermittent job of short

duration not exceeding six months on a daily basis;
c. The contracts of services and job orders are not covered by Civil
Service Law, Rules and Regulations, but covered by COA rules;
d. The employees involved in the contracts or job orders do not enjoy
the benefits enjoyed by government employees, such as PERA,
COLA and RATA. (Emphasis supplied)

Furthermore, as expressly stated by the CSC, there are specific provisions

that must not be incorporated in contract of services or job orders. Thus, Sec. 3
of CSC Resolution No. 020790 reads:
11,,.J,

SECTION 3. The contract of services, MOA or job order shall not contain
the following provisions:

a. The employee performs work or a regular function that is

necessary and essential to the agency concerned or work also
performed by the regular personnel of the hiring agency;
b. The employee is required to report to the office and render service
during the agency's prescribed office hours from 8:00 am to 5:00 pm
or for forty (40) hours per week;
c. The employee is entitled to benefits enjoyed by government
employees such as ACA, PERA and RATA and other benefits given
by the agency such as mid-year bonus, productivity incentive,
Christmas bonus and cash gifts.
d. The employee's conduct and performance shall be under the direct
control and supervision of the government agency concerned.
e. The employee's performance shall be evaluated by the government
agency. (Emphasis supplied)

The employment status is therefore clear. In jurisprudence, We ruled that

. lll,.J,., ,

"[a] plain reading of the foregoing provisions of CSC Resolution No. 020790
shows that workers hired under job orders are not government employees. They
do not enjoy the same benefits as government employees and their services
rendered are not considered government service." 79

In 201 7, the CSC, COA, and DBM noted the proliferation of individual
job order and contract of service workers in the govermnent, and issued a joint
circular to address the issues on lack of social protection for the workers and
inequality in benefits, as well as the obscure accountability of job order and
contract of services workers due to lack of employee-employer relationship
with the hiring agency. so

79
People v. Palma Gil-Rolfo, G.R. No., 249564, & 249568-76, March 21, 2022 [Per J. Hernando, Second
Division] at 21. This pinpoint citation refers to the copy of the Decision uploaded to the Supreme Court
website.
80
See CSC, COA, DBM Joint Circular No. 1 (2017) par. 1.
Decision 13 G.R. No. 258658

In CSC-COA-DBM Joint Circular No. 1, it was expressly stated that

contract of services or job order workers are not covered by Civil Service laws
and rules. Accordingly, Section 7.4 of the CSC-COA-DBM Joint Circular No.
1 states:
7.4 The services of the contract of service and job order workers are
not covered by Civil Service law and rules thus, not creditable as
government service. They do not enjoy the benefits enjoyed by government
employees, such as leave, PERA, RAl? A and thirteenth month pay.
(Emphasis supplied)

In jurisprudence, We emphasized that CSC-COA-DBM Joint Circular No.

1 clarified the earlier guidelines set forth by the CSC. 81 We likewise reiterated
that there is no employer-employee relationship between the government and
job order workers, and that the latter's services are not considered government
service. 82 For these reasons, job order employees are not covered by Civil
Service law, rules, and regulations. 83

Applying the foregoing to the case at bar, We find that Abadilla et al.
are contract of service and job order workers in the government who are
not government employees, and are not covered by Civil Service law, rules,
and regulations.

In fact, the Contract of Employment84 issued by PAGCOR to Abadilla et

al. is indeed a contract of service or job order that complied with CSC
Memorandum Circular No. 40-98 and CS<i:>Resolution No. 020790.

We quote with approval the findings of the CSC in its Decision85 dated
March 7, 2014:

In the instant case, a circumspect examination of the Contract of

Employment attached to the complaint indicates that the nature of the
complainants' work in PAGCOR is [a] contract of services. Despite the fact
that the employment contract is riddled with allusion to the applicability of
Civil Service laws, rules and regulations, the spirit and intent of the contract
as gleaned from its provisions, is in the nature of contract of services.
Manifestations obtaining in the Employment Contract are under contract of
services are noted, as follows:

81 People v. Palma Gil-Rolfo, G.R. No. 249564 & 249568-76, March 21, 2022 [Per J. Hernando, Second
Division] at 22. This pinpoint citation refers to the copy of the Decision uploaded to the Supreme Court
website.
82 Id.
83 Id.
84
Rollo, p. 74.
85
Id. at 77-8S.
Decision 14 G.R. No. 258658

1. The employment contract provides in Paragraph 1 that employees who

rendered work in excess of eight (8) hours a day are "entitled to an
hourly overtime pay" .... On the contrary, government employees who
render overtime work are not paid monetary compensation equivalent
to the number of hours rendered overtime .... ;

2. Aside from the Night Shift Auditor, the services rendered by the
complainants under the employment contract are considered
"janitorial" services ... The positions of the complainants indicated in
the Summary of Services vary from cook, waiter, dishwasher, and
pantry aide;

3. Complainants are paid a basic daily rate appropriate to their respective

positions. Aside from the additional benefit of thirty-five [PHP 35.00]
worth of meal per duty, complainants are not paid COLA, PERA, and
RATA. . . . Moreover, the allegations in the complaint that
complainants are not receiving benefits accorded to government
employees such as leave benefits, 13 th month pay and the like is
sufficient to form a conclµ$iQn .that they are not considered government
employees cloaked by Civil Service laws and rules.

4. The complainants were not issued appointments in accordance with the

appropriate Civil Service - rules; hence, they are not considered
"contractual employees." .... and;

5. The [CSC] Negros Occidental Field Office is bereft of employment

records or appointments of the complainants. This fact strengthens the
conclusion that complainants in the instant case worked with P AGCOR
under contract of services ....

The fact that the employment contracts of the complainants with

PAGCOR contain provisions and items such as "eight (8) working hours a
day," "strict observance of civil service laws, rules and regulations," (sic)
and "contractual employment," does not automatically make the
complainants government employees ....

Thus, complainants' 'employn'lent contract with PAGCOR, satiated

with provisions prohibited by [CSC Memorandum Circular No. 40-98 and
CSC Resolution No. 020790], did not convert them into government
employees over which this office can exercise its jurisdiction.

The confluence of the above-mentioned circumstances creates a

reasonable conclusion that complainants rendered work at PAGCOR under
contract of services. As such, complainants are not considered government
employees; hence, outside the mantle of Civil Service laws, rules and
regulations. Consequently, this Office is stripped of jurisdiction in matters
involving job orders and workers covered by contracts of services. 86
(Emphases supplied)

86
Id at 82-84.
..
Decision 15 G.R. No. 258658

It is clear from the records that the nature of Abadilla et al's. functions,
their organizational ranking, compensation level, and employment contracts, do
not classify them as either confidential employees nor regular employees of
PAGCOR.

Consequently, the CA did not gravely abuse its discretion in ruling that
Abadilla et al. are job order workers, and are thus not under the jurisdiction of
the CSC.

In summary, We rule that PAGCOR has the power to hire its own
employees, as well as contract of service of job order workers. While it is
recognized that the petitioners are contract of service or job order workers, We
find that they are neither confidential employees nor regular employees of
PAGCOR.

A final note.

What has become abundantly clear is what Abadilla et al. are not.

They are not confidential employees as determined by law and

jurisprudence through the nature of their functions, their organizational ranking,
and their compensation level.

They are also not regular employees nor government employees because
of various government issuances limiting tlieir contracts.

At the core of it all, Abadilla et al. are workers and personnel whose
humanity must also be recognized.

This Court seeks to uphold the constitutional protection afforded to labor. 87

We sternly remind PAGCOR and all similar agencies that while their authority
to contract services is recognized under applicable civil service rules, 88 such
hiring authority should not be used to mistreat or otherwise mismanage contract
of service or job order workers.

ACCORDINGLY, the Petition for Review on Certiorari is DENIED.

The Court of Appeals' December 18, 2019 Decision and the September 30,
2021 Resolution in CA-G.R. CEB SP No. 12537 are AFFIRMED.

87 See CONST., art. XIII, sec. 3, par. 1; art. II, sec. 18.
88 National Transmission Corporation. v. Commission on Audit, 800 Phil. 618,627 (2016) [Per J. Mendoza,
En Banc].
Decision 16 G.R. No. 258658

SO ORDERED.

~ o
Associate Justice
Acting Chairperson

WE CONCUR:

(on official leave)

ALEXANDER G. GESMUNDO
Chairperson
Chief Justice

ll1,.J.,

~~
JO~SP.M~QUEZ
~/4~:iate Justice

,.u,
Decision 17 G.R. No. 258658

ATTEST4JION
I attest that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court's Division.

Acting Chairperson

CERTIFICATION ,,.,

Pursuant to Article VIII, Section 13 of the Constitution, and the Division

Acting Chairperson's Attestation, I certify that the conclusions in the above
Decision had been reached in consultation before the cases were assigned to the
writer of the opinion of the Court's Division.

/
~MARVI M.V.F. LEONEN
Acting Chief Justice

'T'' II