Labor Relations Case Digests

(A Compilation)


and


Comparison of Dismiss Now, Pay Later Doctrines
(Wenphil, Serrano, Agabon & Jaka Doctrines)




Submitted to:

ATTY. RIZA LYN OCAMPO
Labor Relations Professor
School of Law
University of San Jose-Recoletos




Submitted by:

RON STEPHANE P. MAYLON
Labor Relations Course (Sunday, 12:00NN-3:00PM)




March 23, 2014


Page 2




Table of Contents
GENERAL TEXTILE, INC. and EDGAR TOLENTINO vs. NLRC ........................................................................... 3
FEDERICO M. LEDESMA, JR. vs. NLRC .......................................................................................................... 5
JONERI ESCOBIN vs. NLRC ............................................................................................................................. 8
BRENT SCHOOL INC. VS ZAMORA ............................................................................................................... 10
WENPHIL CORPORATION vs NLRC .............................................................................................................. 12
SERRANO VS NLRC ...................................................................................................................................... 14
AGABON VS. NLRC ...................................................................................................................................... 17
JAKA VS. NLRC ............................................................................................................................................. 19
Comparison of Dismiss Now, Pay Later Doctrines .................................................................................... 21




Page 3



GENERAL TEXTILE, INC. and EDGAR TOLENTINO vs. NLRC


FACTS:
Private respondent Rodolfo Lopez was employed by petitioner Gentex Inc. as machine operator. Lopez fell
ill, he was later diagnosed as suffering from moderately advanced pulmonary tuberculosis.
He went on sick leave upon the advice of the company physician and was later granted by the Social
Security System sickness benefits for 60 days, he went to Gentex with the intention of returning to work.
He was instead told by the company physician to extend his leave for another 6 months.
He was confined at the Quezon Institute.
This fact was known to Gentex, as its personnel manager, petitioner Edgar Tolentino, accomplished Lopez'
Medicare form. Tolentino, sent Lopez a Notice of Termination informing him of the termination of his
employment "immediately upon receipt of this notice" on the ground that he had been absent without
official leave. Lopez filed a complaint against Gentex and- Tolentino for illegal dismissal and for non-
payment of the thirteenth-month pay and service incentive leave for the year.
In their defense, petitioners contended that Lopez abandoned work beginning September 17,1988.
Labor Arbiter ordered the reinstatenent of Lopez with full backwages from the time his salary was witheld
until his actual reinstatement, subject to his fitness for work.
On appeal, NLRC ruled that as there was no abandonment, Lopez' dismissal on such ground was illegal.
However, NLRC ruled that Lopez' reinstatement could not be forced upon Gentex, since there was
showing that his pulmonary tuberculosis was already arrested.


ISSUE/S:
Whether or not an employee has abandoned his work


HELD:
Section 8, Rule I, Book VI of the Rules to Implement the Labor Code, reads as follows:

Disease as a ground for dismissal. Where the employee suffers from a
disease and his continued employment is prohibited by law or prejudicial to his
health or to the health of his co-employees, the employer shall not terminate his
employment unless there is a certification by a competent public health
authority that the disease is of such nature or at such a stage that it cannot be
cured within a period of 6 months even with proper medical treatment . If the
disease or ailment can be cured within the period, the employer shall not
terminate the employee but shall ask the employee to take a leave. The
employer shall reinstate such employee to his former position immediately upon
the restoration of his normal health.

The preceding provision explicitly requires a certification by a competent public health authority that the
disease is of such nature or at such a stage that it cannot be cured within a period of six months even with
proper medical treatment.
There is no showing that such a certification was presented in the course of the proceedings before the
Labor Arbiter and NLRC.

Page 4


Lopez is entitled to full backwages, inclusive of allowances, and to his other benefits or their monetary
equivalent computed from the time his compensation was withheld from him up to the time of his actual
reinstatement.
We are also aware of the contingency that the illness of private respondent be certified by a competent
public health authority as being of such nature or at such a stage that renders him physically unfit to
return to work.
In such a case, separation pay at the rate provided for in Article 284 must be paid private respondent, in
addition to the backwages for his illegal dismissal.

Page 5


FEDERICO M. LEDESMA, JR. vs. NLRC


FACTS:
Petitioner was employed as a service driver by the private respondent on probationary basis, he
was required to report at private respondents training site in Dasmarias, Cavite, under the
direct supervision of its site administrator, Pablo Manolo de Leon.
Petitioner filed a complaint against de Leon for allegedly abusing his authority as site, immoral
conduct allegedly carried out within the private respondents premises.
A copy of the complaint was duly received by private respondents Chief Accountant, Nita
Azarcon.
De Leon filed a written report against the petitioner addressed to private respondents Vice-
President for Administration, Ty citing his suspected drug use.
Private respondents Human Resource Manager, Cueva served a copy of a Notice to petitioner
requiring him to explain within why no disciplinary action should be imposed on him instead he
filed a complaint for illegal dismissal against private respondent before the Labor Arbiter.
In his Position Paper, petitioner averred that in view of the complaint he filed against de Leon,
the latter retaliated by falsely accusing petitioner as a drug user. Ty, however, instead of
verifying the veracity of report, readily believed his allegations and together with Cueva, verbally
dismissed him from service.
Petitioner immediately went to St. Dominic Medical Center for a drug test and he was found
negative for any drug substance.
With his drug result on hand, he went back to private respondents main office to talk to Ty and
Cueva and to show to them his drug test result, since his drug test proved that he was not guilty
of the drug use charge against him, he decided to continue to work.
He reported for work but he was no longer allowed to enter the training site for he was
allegedly banned there from according to the guard on duty.
Private respondent countered that petitioner was never dismissed from employment but merely
served a Notice to Explain why no disciplinary action should be filed against him in view of the
report that he was suspected of using illegal drugs. Instead of filing an answer, petitioner
prematurely lodged a complaint for illegal dismissal against private respondent before the Labor
Arbiter.
Labor Arbiter rendered a Decision in favor of the petitioner declaring illegal his separation from
employment.
The Labor Arbiter, however, did not order petitioners reinstatement for the same was no longer
practical, and only directed private respondent to pay petitioner backwages. Both parties
questioned the Labor Arbiters Decision before the NLRC.
Petitioner assailed the portion of the Labor Arbiters Decision denying his prayer for
reinstatement, private respondent controverted the Labor Arbiters finding that petitioner was
illegally dismissed from employment, and insisted that petitioner was never dismissed from his
job but failed to report to work.
NLRC granted the appeal raised by both parties and reversed the Labor Arbiters Decision.
The NLRC declared that petitioner failed to establish the fact of dismissal for his claim that he
was banned from entering the training site was rendered impossible by the fact that he was able
to subsequently claim his salary and 13th month pay.

Page 6


Petitioners claim for reinstatement was, however, granted by the NLRC.
The Motion for Reconsideration filed by petitioner was likewise denied by the NLRC in its
Resolution.
The Court of Appeals dismissed petitioners Petition for Certiorari and affirmed the NLRC
decision giving more credence to private respondents stance that petitioner was not dismissed
from employment, as it is more in accord with the evidence on record and the attendant
circumstances of the instant case.
Petitioners Motion for Reconsideration was denied by CA.


ISSUE/S:
Whether or not CA subverted due process of law when it did not consider the evidence on
record showing that there was no just cause for dismissal as petitioner is not a drug user and
there is no evidence to support this ground for dismissal.


HELD:
It is best to stress that the issues raised by petitioner in this instant petition are factual in nature
which is not within the office of a Petition for Review.
The reason for this rule is that, this Court is not a trier of facts and does not routinely undertake
the re-examination of the evidence presented by the contending parties for the factual findings
of the labor officials who have acquired expertise in their own fields are accorded not only
respect but even finality, and are binding upon this Court.
However, when the findings of the Labor Arbiter contradict those of the NLRC, departure from
the general rule is warranted, and this Court must of necessity make an scrutiny and examine
the records all over again including the evidence presented by the opposing parties to
determine which findings should be preferred as more conformable with evidentiary facts.
The Labor Arbiter found that the petitioner was illegally dismissed from employment warranting
the payment of his backwages.
The NLRC and the Court of Appeals found otherwise.
In reversing the Labor Arbiters Decision, the NLRC underscored the settled evidentiary rule that
before the burden of proof shifts to the employer to prove the validity of the employees
dismissal, the employee must first sufficiently establish that he was indeed dismissed from
employment. The petitioner, in the present case, failed to establish the fact of his dismissal.
The NLRC did not give credence to petitioners allegation that he was banned by the private
respondent from entering the workplace, opining that had it been true that petitioner was no
longer allowed to enter the training site when he reported for work.
Well-entrenched is the principle that in order to establish a case before judicial and quasi-
administrative bodies, it is necessary that allegations must be supported by substantial
evidence.
In the present case, there is hardly any evidence on record so as to meet the quantum of
evidence required, i.e., substantial evidence. Petitioners claim of illegal dismissal is supported
by no other than his own bare, uncorroborated and, thus, self-serving allegations, which are also
incoherent, inconsistent and contradictory.
It is true that the Constitution affords full protection to labor, and that in light of this
Constitutional mandate, we must be vigilant in striking down any attempt of the management

Page 7


to exploit or oppress the working class. However, it does not mean that we are bound to uphold
the working class in every labor dispute brought before this Court for our resolution.
The law in protecting the rights of the employees, authorizes neither oppression nor self-
destruction of the employer. It should be made clear that when the law tilts the scales of justice
in favor of labor, it is in recognition of the inherent economic inequality between labor and
management. The intent is to balance the scales of justice; to put the two parties on relatively
equal positions.


Page 8


JONERI ESCOBIN vs. NLRC

FACTS:
PEFTOK Integrated Services, Inc., is a duly licensed watchman and protective agency while
respondent UP-NDC Basilan Plantations, Inc. is a corporation duly organized in accordance with
law, and the owner/possessor of lands principally planted to rubber, coconut, citrus, coffee, and
other fruit trees in Lamitan, Province of Basilan.
That complainants are bona fide members of the Basilan Security Force Association hired by PISI
to work as guards in UP-NDC Basilan Plantations premises, for the purpose of guarding and
protecting plantation property and installations from theft, pilferage, robbery, trespass and
other unlawful acts by strangers or third persons, and plantation employees .
Petitioners filed at the Regional Arbitration Branch No. 09 in Zamboanga City a Complaint
against private respondents for illegal termination by way of constructive dismissal.
After conciliation proceedings failed to settle the matter, the parties were ordered to submit
their respective position papers.
Labor Arbiter rendered a Decision in favor of petitioners, declaring the dismissal to be illegal for
being without just cause. On appeal, Respondent Commission reversed the labor arbiter and
denied Motion for reconsideration.

ISSUE/S:
Whether or not the NLRC acted with grave abuse of discretion in ruling that petitioners
committed willful disobedience of lawful orders of their employer.
Whether or not the NLRC acted with grave abuse of discretion in ruling that petitioners
abandoned their work.
Whether or not the NLRC acted with grave abuse of discretion in reversing the finding of the
labor arbiter that petitioners were illegally dismissed by way of constructive dismissal.
Whether or not the NLRC acted with grave abuse of discretion in denying recovery of
backwages, separation pay, damages, and attorneys fees in favor of petitioners.


HELD:
I
o Respondent Commission committed grave abuse of discretion in holding that
petitioners were dismissed for a just cause.
o The reasonableness and lawfulness of a rule, order or instruction depend on the
circumstances availing in each case.
o Reasonableness pertains to the kind or character of directives and commands and to the
manner in which they are made.
o In this case, the order to report to the Manila office fails to meet this standard.
o First, it was grossly inconvenient for petitioners, who were residents and heads of
families residing in Basilan, to commute to Manila.
o Second, petitioners were not provided with funds to defray their transportation and
living expenses.
o Third, private respondent argues that it sent transportation money to petitioners.
However, the recipients of such funds are not parties in this case.

Page 9


o Fourth, no reason was given by private respondent company explaining why it had failed
to inform petitioners of their specific security assignments prior to their departure from
Basilan.
o This fact demonstrates that petitioners dismissal was not commensurate to their
insubordination which, we reiterate, was neither willful nor intentional they very well
knew that petitioners were not receiving any salary while they were on floating status
and, thus, also knew that they would hardly be able to comply with the directive to
report to Manila.
o In any event, dismissal was too harsh a penalty for an infraction which appears, under
the circumstances, to be excusable.
II
o This contention is untenable.
o Abandonment, as a just and valid cause for dismissal, requires a deliberate, unjustified
refusal of an employee to resume his work, coupled with a clear absence of any
intention of returning to his work.
o No evidence was presented to establish that petitioners relinquished their jobs.
o Denying they abandoned their work, petitioners contend that it was private respondent
agency which deserted them by failing to communicate with them for over two months,
from February 1, 1991 to April 8, 1991
III
o No constructive dismissal.
o Constructive discharge is an involuntary resignation resorted to when continued
employment is rendered impossible, unreasonable or unlikely; when there is a
demotion in rank and/or a diminution in pay; or when a clear discrimination,
insensibility or disdain by an employer becomes unbearable to the employee.
o In this particular case, petitioners were not constructively dismissed; they were actually
dismissed without just and valid cause.
IV
o The normal consequences of illegal dismissal are reinstatement and payment of
backwages.
o These remedies give life to the workers constitutional right to security of tenure.
o Separation pay is generally not awarded except in instances where reinstatement is no
longer feasible or appropriate, as in this case.
o As a substitute for immediate and continued reemployment, separation pay is meant to
provide the employee during the period that he is looking for another employment.
o In this particular case, private respondent alleges that there is no assignment in Basilan
or Zamboanga available to petitioners.
o Transfer to another post outside said areas would have only given rise to the same
problems as those entailed by the original directive.
o Reinstatement presupposes that the previous position from which the employee had
been removed still exists, or there is an unfilled position of a similar nature, more or
less, as the one previously occupied by the employee.
o If no such position is available, reinstatement becomes a legal impossibility.

Page
10


BRENT SCHOOL INC. VS ZAMORA

FACTS:
Doroteo R. Alegre was engaged as athletic director by Brent School.
The contract fixed a specific term for its existence, five (5) years, subsequent subsidiary
agreements reiterated the same terms and conditions, including the expiry date, as those
contained in the original contract.
Three months before the expiration of the stipulated period, Alegre was given a copy of the
report filed by Brent School with the Department of Labor advising of the termination of his
services effective on July 16, 1976.
The stated ground for the termination was "completion of contract, expiration of the definite
period of employment."
And a month or so later, on May 26, 1976, Alegre accepted the amount of P3,177.71, and signed
a receipt therefor containing the phrase, "in full payment of services for the period May 16, to
July 17, 1976 as full payment of contract."
However, at the investigation conducted by a Labor Conciliator of said report of termination of
his services, Alegre protested the announced termination of his employment.
He argued that although his contract did stipulate that the same would terminate on July 17,
1976, since his services were necessary and desirable in the usual business of his employer, and
his employment had lasted for five years, he had acquired the status of a regular employee and
could not be removed except for valid cause.
The Regional Director considered Brent School's report as an application for clearance to
terminate employment (not a report of termination), and accepting the recommendation of the
Labor Conciliator, refused to give such clearance and instead required the reinstatement of
Alegre, as a "permanent employee," to his former position without loss of seniority rights and
with full back wages.
Brent School filed a motion for reconsideration.
The Regional Director denied the motion and forwarded the case to the Secretary of Labor for
review.
The latter sustained the Regional Director.
Brent appealed to the Office of the President.
Again it was rebuffed. That Office dismissed its appeal for lack of merit and affirmed the Labor
Secretary's decision, ruling that Alegre was a permanent employee who could not be dismissed
except for just cause, and expiration of the employment contract was not one of the just causes
provided in the Labor Code for termination of services.
The School is now before this Court in a last attempt at vindication.


ISSUE/S:
Whether or not Alegres contract of employment is subject to a term or he is deemed
permanent and can be removed only upon just cause

HELD:
The employment contract between Brent School and Alegre was executed at a time when the
Labor Code of the Philippines (P.D. 442) had not yet been promulgated.
Page
11


Indeed, the Code did not come into effect some 3 years after the perfection of the employment
contract, and rights and obligations thereunder had arisen and been mutually observed and
enforced.
At that time before the advent of the Labor Code, there was no doubt whatever about the
validity of term employment. It was impliedly but nonetheless clearly recognized by the
Termination Pay Law, R.A. 1052, as amended by R.A. 1787.
Basically, this statute provided that
In cases of employment, without a definite period, in a commercial, industrial, or agricultural
establishment or enterprise, the employer or the employee may terminate at any time the
employment with just cause; or without just cause in the case of an employee by serving written
notice on the employer at least one month in advance, or in the case of an employer, by serving
such notice to the employee at least one month in advance or one-half month for every year of
service of the employee, whichever is longer, a fraction of at least six months being considered
as one whole year.
The employer, upon whom no such notice was served in case of termination of employment
without just cause, may hold the employee liable for damages.
The employee, upon whom no such notice was served in case of termination of employment
without just cause, shall be entitled to compensation from the date of termination of his
employment in an amount equivalent to his salaries or wages corresponding to the required
period of notice.
It is plain then that when the employment contract was signed between Brent School and Alegre
it was perfectly legitimate for them to include in it a stipulation fixing the duration thereof
Stipulations for a term were explicitly recognized as valid by this Court.
It should have no application to instances where a fixed period of employment was agreed upon
knowingly and voluntarily by the parties, without any force, duress or improper pressure being
brought to bear upon the employee and absent any other circumstances vitiating his consent, or
where it satisfactorily appears that the employer and employee dealt with each other on more
or less equal terms with no moral dominance whatever being exercised by the former over the
latter.
Unless thus limited in its purview, the law would be made to apply to purposes other than those
explicitly stated by its framers; it thus becomes pointless and arbitrary, unjust in its effects and
apt to lead to absurd and unintended consequence.
Respondent Alegre's contract of employment with Brent School having lawfully terminated with
and by reason of the expiration of the agreed term of period thereof, he is declared not entitled
to reinstatement and the other relief awarded and confirmed on appeal.

Page
12


WENPHIL CORPORATION vs NLRC

FACTS:
Private respondent was hired by petitioner as a crew member at its Cubao Branch.
He thereafter became the assistant head of the Backroom department of the same branch.
On May 20, 1985 private respondent had an altercation with a co-employee, Job Barrameda, as
a result of which he and Barrameda were suspended on the following morning and in the
afternoon of the same day a memorandum was issued by the Operations Manager advising
private respondent of his dismissal from the service in accordance with their Personnel Manual.
The notice of dismissal was served on private respondent.
Thus private respondent filed a complaint against petitioner for unfair labor practice, illegal
suspension and illegal dismissal.
After submitting their respective position papers to the Labor Arbiter and as the hearing could
not be conducted due to repeated absence of counsel for respondent, the case was submitted
for resolution.
The decision was rendered by the Labor Arbiter by dismissing the complaint for lack of merit.
Private respondent appealed to NLRC wherein in due course a decision was rendered setting
aside the appealed decision and ordering the reinstatement of private respondent to his former
position without loss of seniority and other related benefits and 1 year backwages without
qualification and deduction.
Hence the herein petition for certiorari with preliminary injunction and/or restraining order.
The court issued a restraining order as prayed for in the petition enjoining the enforcement of
the decision of public respondent

ISSUE/S:
Whether or not NLRC committed a grave abuse of discretion in rendering its decision contrary to
the evidence on record.

HELD:
The conclusion of the public respondent NLRC on appeal that private respondent was not
afforded due process before he was dismissed is binding on this Court.
Indeed, it is well taken and supported by the records.
However, it cannot justify a ruling that private respondent should be reinstated with back wages
as the public respondent NLRC so decreed.
Although belatedly, private respondent was afforded due process before the labor arbiter
wherein the just cause of his dismissal had been established.
With such finding, it would be arbitrary and unfair to order his reinstatement with back wages.
The Court holds that the policy of ordering the reinstatement to the service of an employee
without loss of seniority and the payment of his wages during the period of his separation until
his actual reinstatement but not exceeding 3 years without qualification or deduction, when it
appears he was not afforded due process, although his dismissal was found to be for just and
authorized cause in an appropriate proceeding in the Ministry of Labor and Employment, should
be re-examined.
It will be highly prejudicial to the interests of the employer to impose on him the services of an
employee who has been shown to be guilty of the charges that warranted his dismissal from
employment.
Page
13


Indeed, it will demoralize the rank and file if the undeserving, if not undesirable, remains in the
service.
Thus in the present case, where the private respondent, who appears to be of violent temper,
caused trouble during office hours and even defied his superiors as they tried to pacify him,
should not be rewarded with re-employment and back wages.
It may encourage him to do even worse and will render a mockery of the rules of discipline that
employees are required to observe.
Under the circumstances the dismissal of the private respondent for just cause should be
maintained.
He has no right to return to his former employer.
However, the petitioner must nevertheless be held to account for failure to extend to private
respondent his right to an investigation before causing his dismissal.
The rule is explicit as above discussed.
The dismissal of an employee must be for just or authorized cause and after due process.
Petitioner committed an infraction of the second requirement.
Thus, it must be imposed a sanction for its failure to give a formal notice and conduct an
investigation as required by law before dismissing petitioner from employment.
The questioned decision of the public respondent NLRC for the reinstatement with back wages
of private respondent is REVERSED AND SET ASIDE, and the decision of the labor arbiter dated
dismissing the complaint is revived and affirmed, but with the modification that petitioner is
ordered to indemnify private respondent in the amount of P1,000.00.
The restraining order issued by this Court is hereby made permanent and the bond posted by
petitioner is cancelled.

Page
14


SERRANO VS NLRC

FACTS:
Petitioner was hired by private respondent Isetann Department Store as a security checker to
apprehend shoplifters and prevent pilferage of merchandise.
Initially hired on contractual basis, petitioner eventually became a regular employee on 1985. In
1988, he became head of the Security Checkers Section of private respondent.
Sometime in 1991, as a cost-cutting measure, private respondent decided to phase out its entire
security section and engage the services of an independent security agency.
The loss of his employment prompted petitioner to file a complaint for illegal dismissal, illegal
layoff, unfair labor practice, underpayment of wages, and nonpayment of salary and overtime
pay.
The Labor Arbiter rendered a decision finding petitioner to have been illegally dismissed.
He ruled that private respondent failed to establish that it had retrenched its security section to
prevent or minimize losses to its business; that private respondent failed to accord due process
to petitioner; that private respondent failed to use reasonable standards in selecting employees
whose employment would be terminated; that private respondent had not shown that
petitioner and other employees in the security section were so inefficient so as to justify their
replacement by a security agency, or that "cost-saving devices such as secret video cameras and
secret code tags on the merchandise" could not have been employed; instead, the day after
petitioners dismissal, private respondent employed a safety and security supervisor with duties
and functions similar to those of petitioner.
Private respondent appealed to the NLRC which, in its resolution reversed the decision of the
Labor Arbiter and ordered petitioner to be given separation pay equivalent to one month pay
for every year of service, unpaid salary, and proportionate 13th month pay. Petitioner filed a
motion for reconsideration, but his motion was denied
Hence this petition.


ISSUE/S:
Whether or not the petitioner is laid off for a cause

HELD:
Art. 283 provides:
Closure of establishment and reduction of personnel. - The employer
may also terminate the employment of any employee due to the
installation of labor-saving devices, redundancy, retrenchment to
prevent losses or the closing or cessation of operations of the
establishment or undertaking unless the closing is for the purpose of
circumventing the provisions of this Title, by serving a written notice on
the workers and the Department of Labor and Employment at least one
(1) month before the intended date thereof. In case of termination due
to the installation of labor-saving devices or redundancy, the worker
affected thereby shall be entitled to a separation pay equivalent to at
least one (1) month pay or to at least one (1) month pay for every year
of service, whichever is higher. In case of retrenchment to prevent losses
and in cases of closure or cessation of operations of establishment or
Page
15


undertaking not due to serious business losses or financial reverses, the
separation pay shall be equivalent to at least one (1) month pay or at
least month pay for every year of service, whichever is higher. A
fraction of at least 6 months shall be considered as one (1) whole year.

In the case at bar, we have only the bare assertion of petitioner that, in abolishing the security
section, private respondents real purpose was to avoid payment to the security checkers of the
wage increases provided in the collective bargaining agreement approved in 1990.
Such an assertion is not a sufficient basis for concluding that the termination of petitioners
employment was not a bona fide decision of management to obtain reasonable return from its
investment, which is a right guaranteed to employers under the Constitution.
The law also provides that to terminate the employment of an employee for any of the
authorized causes the employer must serve "a written notice on the workers and the
Department of Labor and Employment at least 1 month before the intended date thereof."
In the case at bar, petitioner was given a notice of termination on the same day, his services
were terminated.
He was thus denied his right to be given written notice before the termination of his
employment, and the question is the appropriate sanction for the violation of petitioners right.
The rule reversed a long standing policy theretofore followed that even though the dismissal is
based on a just cause or the termination of employment is for an authorized cause, the dismissal
or termination is illegal if effected without notice to the employee.
The court doesnt agree that disregard of this requirement by an employer renders the dismissal
or termination of employment null and void. Such a stance is actually a reversion to the
discredited pre-Wenphil rule of ordering an employee to be reinstated and paid backwages
when it is shown that he has not been given notice and hearing although his dismissal or layoff is
later found to be for a just or authorized cause. Such rule was abandoned in Wenphil because it
is really unjust to require an employer to keep in his service one who is guilty,
The Wenphil Doctrine Re-examined.
The termination of his employment should not be considered void but he should simply be paid
separation pay as provided in Art. 283 in addition to backwages.
In cases of dismissal under Art. 282, the purpose for the requirement of notice and hearing is
not to comply with Due Process Clause of the Constitution.
The time for notice and hearing is at the trial stage.
Then that is the time we speak of notice and hearing as the essence of procedural due process.
Thus, compliance by the employer with the notice requirement before he dismisses an
employee does not foreclose the right of the latter to question the legality of his dismissal.
If an employee is laid off for any of the causes in Arts. 283-284, i.e., installation of a labor-saving
device, but the employer did not give him and the DOLE a 30-day written notice of termination
in advance, then the termination of his employment should be considered ineffectual and he
should be paid backwages.
The consequence of the failure either of the employer or the employee to live up to this precept
is to make him liable in damages, not to render his act (dismissal or resignation, as the case may
be) void.
The measure of damages is the amount of wages the employee should have received were it not
for the termination of his employment without prior notice.
If warranted, nominal and moral damages may also be awarded.

Page
16


Given the nature of the violation, therefore, the appropriate sanction for the failure to give
notice is the payment of backwages for the period when the employee is considered not to have
been effectively dismissed or his employment terminated.
The resolution of the National Labor Relations Commission is MODIFIED by ordering private
respondent Isetann Department Store, Inc. to pay petitioner separation pay equivalent to 1
month pay for every year of service, his unpaid salary, and his proportionate 13th month pay
and, in addition, full backwages from the time his employment was terminated on October 11,
1991 up to the time the decision herein becomes final. For this purpose, this case is REMANDED
to the Labor Arbiter for computation of the separation pay, backwages, and other monetary
awards to petitioner.

Page
17


AGABON VS. NLRC


FACTS:
Virgilio and Jenny Agabon worked for respondent Riviera Home Improvements, Inc. as gypsum
and cornice installers from January 1992 until Feb 1999.
Their employment was terminated when they were dismissed for allegedly abandoning their
work.
Petitioners Agabon then filed a case of illegal dismissal.
The Labor Arbiter ruled in favor of the spouses and ordered Riviera to pay them their money
claims. The NLRC reversed the Labor Arbiters decision, finding that the Agabons were indeed
guilty of abandonment.
The CA modified the Labor Arbiter by ruling that there was abandonment but ordering Riviera to
pay the Agabons money claims.
The arguments of both parties are as follows:
o The Agabons claim, among others that Riviera violated the requirements of notice and
hearing when the latter did not send written letters of termination to their addresses.
o Riviera admitted to not sending the Agabons letters of termination to their last known
addresses because the same would be futile, as the Agabons do not reside there
anymore.
o However, it also claims that the Agabons abandoned their work.
o More than once, they subcontracted installation works for other companies.
o They already were warned of termination if the same act was repeated, still, they
disregarded the warning.

ISSUE/S:
Whether or not the Agabons were illegally dismissed
Whether Riviera violated the requirements of notice and hearing
Whether or not the violation of the procedural requirements of notice and hearing for
termination of employees is a violation of the Constitutional due process


HELD:
I
o No. There was just cause for their dismissal, i.e., abandonment. Art. 282 specifies the
grounds for just dismissal
o Here, the Agabons were frequently absent from work for having performed installation
work for another company, despite prior warning given by Riviera.
o This clearly establishes an intention to sever the employer-employee relationship
between them, and which constitutes abandonment.
II
o Yes. While the employer has the right to expect good performance,diligence, good
conduct and loyalty from its employees, it also has theduty to provide just
compensation to his employees and to observe the procedural requirements of notice
and hearing in the termination of his employees.
o A written notice to the employee specifying the grounds for termination and giving the
employee reasonable opportunity to be heard
Page
18


o
o A hearing where the employee is given the opportunity torespond to the charges
against him and present evidence or rebutthe evidence presented against him.
o A written notice of termination indicating that grounds have beenestablished to justify
his termination upon due consideration of all circumstances.
o In this case, Riviera failed to notify the Agabons of their termination to their last known
addresses.
o Hence, they violated the procedural requirement laid down by the law in the
termination of employees

III
o No. Constitutional due process is that provided under the Constitution, which involves
the protection of the individual against governmental oppression and the assurance of
his rights In civil, criminal andadministrative proceedings; statutory due process is that
found in the Labor Code and its Implementing Rules and protects the individual from
being unjustly terminated without just or authorized cause after notice and hearing.
o The two are similar in that they both have two aspects:
Substantive due process and procedural due process. However, they differ in
that under the Labor Code, the first one refers to the valid and authorized
causes of employment termination, while the second one refers to the manner
of dismissal. A denial of statutory due process is not the same as a denial of
Constitutional due process for reasons enunciated in Serrano v. NLRC.
o The dismissal is valid, but Riviera should pay nominal damages to the Agabons in
vindication of the latter for violating their right to notice and hearing. The penalty is in
the nature of a penalty or indemnification, the amount dependent on the facts of each
case, including the nature of gravity of offense of the employer
o In this case, the Serrano doctrine was re-examined.
o In the Serrano case, the dismissal was upheld, but it was held to be ineffectual. Hence,
Serrano was still entitled to the payment of his backwages from the time of dismissal
until the promulgation of the court of the existence of an authorized cause.
o Further, he was entitled to his separation pay as mandated under Art. 283. The ruling is
unfair to employers and has the danger of thefollowing consequences:
o The encouragement of filing frivolous suits even by notoriousemployees who were justly
dismissed but were deprived of statutory due process; they are rewarded by invoking
due process
o It would create absurd situations where there is just or authorized cause but a
procedural infirmity invalidates the termination, ie an employee who became a criminal
and threatened his co-workers lives, who fled and could not be found
o It could discourage investments that would generate employment in the economy
o The payment of backwages is unjustified as only illegaltermination gives the employee
the right to be paid full backwages.
o When the dismissal is valid or upheld, the employee has no right tobackwages

Page
19


JAKA VS. NLRC

FACTS:
Respondents Darwin Pacot, Robert Parohinog, David Bisnar, Marlon Domingo, Rhoel Lescano
and Jonathan Cagabcab were earlier hired by petitioner JAKA Foods Processing Corporation until
the latter terminated their employment because the corporation was in dire financial straits.
It is not disputed, however, that the termination was effected without JAKA complying with the
requirement under Article 283 of the Labor Code regarding the service of a written notice upon
the employees and the Department of Labor and Employment at least 1 month before the
intended date of termination.
In time, respondents separately filed with the regional Arbitration Branch of the NLRC
complaints for illegal dismissal, underpayment of wages and nonpayment of service incentive
leave and 13th month pay against JAKA and its HRD Manager, Rosana Castelo.
After due proceedings, the Labor Arbiter rendered a decision declaring the termination illegal
and ordering JAKA and its HRD Manager to reinstate respondents with full backwages, and
separation pay if reinstatement is not possible.
Therefrom, JAKA went on appeal to the NLRC, which, in a decision affirmed in toto that of the
Labor Arbiter. JAKA filed a motion for reconsideration.
Acting thereon, the NLRC came out with another decision this time modifying its earlier decision
it REVERSED and SET ASIDE and another one entered ordering respondent JAKA Foods
Processing Corporation to pay petitioners separation pay equivalent to one (1) month salary, the
proportionate 13th month pay and, in addition, full backwages from the time their employment
was terminated on August 29, 1997 up to the time the Decision herein becomes final.


ISSUE/S:

Whether or not the court of appeals correctly awarded full back wages and awarded separation
pays to the respondents.


HELD:

The very recent case of Agabon vs. NLRC, the court had the opportunity to resolve a similar
question.
Therein, it was found that the employees committed a grave offense, i.e., abandonment, which
is a form of a neglect of duty which, in turn, is one of the just causes enumerated under Article
282 of the Labor Code. In said case, the validity of the dismissal despite non-compliance with
the notice requirement of the Labor Code was upheld.
The clear-cut distinction between a dismissal for just cause under Article 282 and a dismissal for
authorized cause under Article 283 is further reinforced by the fact that in the first, payment of
separation pay, as a rule, is not required, while in the second, the law requires payment of
separation pay.
For these reasons, there ought to be a difference in treatment when the ground for dismissal is
one of the just causes under Article 282, and when based on one of the authorized causes under
Article 283.
Page
20


On another breath, a dismissal for an authorized cause under Article 283 does not necessarily
imply delinquency or culpability on the part of the employee.
Instead, the dismissal process is initiated by the employers exercise of his management
prerogative, i.e. when the employer opts to install labor saving devices, when he decides to
cease business operations or when, as in this case, he undertakes to implement a retrenchment
program.
It is, therefore, established that there was ground for respondents dismissal, i.e., retrenchment,
which is one of the authorized causes enumerated under Article 283 of the Labor Code.
Likewise, it is established that JAKA failed to comply with the notice requirement under the
same Article.
Considering the factual circumstances in the instant case and the above ratiocination, it was
therefore, deem it proper to fix the indemnity at P50,000.00.
The Court of Appeals to have been in error when it ordered JAKA to pay respondents separation
pay equivalent to 1-month salary for every year of service.
The rule, therefore, is that in all cases of business closure or cessation of operation or
undertaking of the employer, the affected employee is entitled to separation pay.
This is consistent with the state policy of treating labor as a primary social economic force,
affording full protection to its rights as well as its welfare.
The exception is when the closure of business or cessation of operations is due to serious
business losses or financial reverses; duly proved, in which case, the right of affected employees
to separation pay is lost for obvious reasons.
Resolution of the Court of Appeals are hereby SET ASIDE and a new one entered upholding the
legality of the dismissal but ordering petitioner to pay each of the respondents the amount of
P50,000.00, representing nominal damages for non-compliance with statutory due process.

Page
21


Comparison of Dismiss Now, Pay Later Doctrines



Doctrines Distinction
Wenphil Doctrine
When the services of the employee was terminated due to a just or authorized cause but failed to
give a formal notice and conduct an investigation as required by law before dismissing from
employment, employees right to due process has been violated, the dismissal is legal but the
employee is entitled to damages by way of indemnification for the violation of the right.
Serrano Doctrine
This doctrine abandoned the WENPHIL DOCTRINE and ruled that if the employee is dismissed under
just or authorized cause but the employer did not give him and the DOLE a 30-day written notice of
termination in advance, then the termination of his employment violated the employees right to
due process, his dismissal becomes ineffectual. Therefore, the employee is entitled to backwages
from the time he was dismissed until the determination of the justness of the cause of the
dismissal.
Agabon Doctrine


Abandoned the Serrano doctrine and REINSTATED THE WENPHIL DOCTRINE. The dismissal is valid,
but employer should pay nominal damages to the Agabons in vindication of the latter for violating
their right to notice and hearing. The penalty is in the nature of a penalty or indemnification, the
amount dependent on the facts of each case, including the nature of gravity of offense of the
employer.

The payment of backwages is unjustified as only illegal termination gives the employee the right to
be paid full backwages.
Jaka Doctrine
This doctrine the dismissal under Art 282 and 283 was distinguished; a dismissal for an authorized
cause under Article 283 does not necessarily imply delinquency or culpability on the part of the
employee. Instead, the dismissal process is initiated by the employers exercise of his management
prerogative. The rule, business closure or cessation of operation or undertaking of the employer,
the affected employee is entitled to separation pay. This is consistent with the state policy of
treating labor as a primary social economic force, affording full protection to its rights as well as its
welfare. The exception is when the closure of business or cessation of operations is due to serious
business losses or financial reverses; duly proved, in which case, the right of affected employees to
separation pay is lost for obvious reasons.