Atlanta Industries vs Sebolino

January 26, 2011

Brion

Facts: Complainants Aprilito R. Sebolino, et.al., filed several complaints for illegal dismissal,
regularization, underpayment, nonpayment of wages and other money claims, as well as claims for moral
and exemplary damages and attorneys fees against the petitioners Atlanta Industries, Inc. (Atlanta) and
its President and Chief Operating Officer Robert Chan. Atlanta is a domestic corporation engaged in the
manufacture of steel pipes.
The complainants alleged that they had attained regular status as they were allowed to work with Atlanta
for more than six (6) months from the start of a purported apprenticeship agreement between them and
the company. They claimed that they were illegally dismissed when the second apprenticeship agreement
expired and that they were actually already employees of Atlanta before they we put in the apprenticeship
program.
In defense, Atlanta and Chan argued that the workers were not entitled to regularization and to their
money claims because they were engaged as apprentices under a government-approved apprenticeship
program. The company offered to hire them as regular employees in the event vacancies for regular
positions occur in the section of the plant where they had trained. They also claimed that their names did
not appear in the list of employees (Master List) prior to their engagement as apprentices.
Subsequently a compromise agreement was entered into by the respondent with Atlanta, but the
remaining respondents had refused to sign.
Issues: Whether or not the termination of the employees after the expiration of the apprenticeship
agreement was valid cause for dismissal
Held: No.
Ratio: Based on company operations at the time material to the case, Costales, Almoite, Sebolino and
Sagun were already rendering service to the company as employees before they were made to undergo
apprenticeship. The company itself recognized the respondents status through relevant operational
records.
The Master List (of employees) that the petitioners heavily rely upon as proof of their position that the
respondents were not Atlantas employees, at the time they were engaged as apprentices, is unreliable
and does not inspire belief.
The fact that Costales, Almoite, Sebolino and Sagun were already rendering service to the company
when they were made to undergo apprenticeship (as established by the evidence) renders the
apprenticeship agreements irrelevant as far as the four are concerned. The respondents occupied
Summary: Complainants were engaged as apprentices in Atlanta Corp. and now suing the corporation
for illegal dismissal, among others, for its refusal to grant them regular status 6 months after
commencing their apprenticeship.
Doctrine: With the expiration of the apprenticeship agreement and the retention of the employees,
Atlanta had, to all intents and purposes, recognized the completion of their training and their acquisition
of a regular employee status.

positions such as machine operator, scaleman and extruder operator - tasks that are usually necessary
and desirable in Atlantas usual business or trade as manufacturer of plastic building materials. These
tasks and their nature characterized the four as regular employees under Article 280 of the Labor Code.
Thus, when they were dismissed without just or authorized cause, without notice, and without the
opportunity to be heard, their dismissal was illegal under the law.
Even if we recognize the companys need to train its employees through apprenticeship, we can only
consider the first apprenticeship agreement for the purpose. With the expiration of the first agreement and
the retention of the employees, Atlanta had, to all intents and purposes, recognized the completion of
their training and their acquisition of a regular employee status. To foist upon them the second
apprenticeship agreement for a second skill which was not even mentioned in the agreement itself, is a
violation of the Labor Codes implementing rules and is an act manifestly unfair to the employees, to say
the least.