G.R. No.

158693             November 17, 2004

JENNY M. AGABON and VIRGILIO C. AGABON, petitioners, 

ANTECEDENT FACTS:

 Virgilio and Jenny Agabon were cornice installers of Riviera Home Improvements, a company engaged in the
business of selling ornamental construction materials.
 They were employed from January 2, 1992 until February 23, 1999, when they were dismissed for abandonment
of work.
 The Agabons filed a complaint for illegal dismissal before the LA, who ruled in their favor. The NLRC reversed on
appeal. The CA sustained the NLRC’s decision.
 The Agabons further appealed to the SC, disputing the finding of abandonment, and claiming that the company
did not comply with the twin requirements of notice and hearing.
 SC upheld the finding of abandonment, because the act of the Agabons in seeking employment elsewhere clearly
showed a deliberate intent to severe the employer - employee relationship. They had abandoned their
employment and were already working for another employer.
 After establishing that the terminations were for a just and valid cause, we now determine if the procedures for
dismissal were observed.
 The procedure for terminating an employee is found in Book VI, Rule I, Section 2(d) of the Omnibus Rules
Implementing the Labor Code:
Standards of due process: requirements of notice. – In all cases of termination of employment, the following
standards of due process shall be substantially observed:
For termination of employment based on just causes as defined in Article 282 of the Code:
1. A written notice served on the employee specifying the ground or grounds for termination, and giving to
said employee reasonable opportunity within which to explain his side;
1. A hearing or conference during which the employee concerned, with the assistance of counsel if the employee
so desires, is given opportunity to respond to the charge, present his evidence or rebut the evidence
presented against him; and
(c) A written notice of termination served on the employee indicating that upon due consideration of all the
circumstances, grounds have been established to justify his termination.
In case of termination, the foregoing notices shall be served on the employee’s last known address.

 The dismissal should be upheld because it was established that the petitioners abandoned their jobs to
work for another company.
 Private respondent, however, did not follow the notice requirements and instead argued that sending
notices to the last known addresses would have been useless because they did not reside there anymore.
Unfortunately for the private respondent, this is not a valid excuse because the law mandates the twin notice
requirements to the employee’s last known address. Thus, it should be held liable for non-compliance with
the procedural requirements of due process.

SEPARATE OPINION TINGA, J:

Constitutional Considerations 
Of Due Process and the Notice-Hearing
Requirement in Labor Termination Cases

 Justice Puno proposes that the failure to render due notice and hearing prior to dismissal for just cause
constitutes a violation of the constitutional right to due process. This view, as acknowledged by Justice Puno
himself, runs contrary to the Court's pronouncement in Serrano v. NLRC that the absence of due notice
and hearing prior to dismissal, if for just cause, violates statutory due process.

 Clearly, the Court, prior to the enactment of the Labor Code, was ill-receptive to the notion that termination for just
cause without notice or hearing violated the constitutional right to due process. Nonetheless, the Court recognized
an award of damages as the appropriate remedy. The Termination Pay Law was among the repealed laws with
the enactment of the Labor Code in 1974. Significantly, the Labor Code, in its inception, did not require notice or
hearing before an employer could terminate an employee for just cause.

 The Court in the landmark case of People v. Marti39 clarified the proper dimensions of the Bill of Rights.

o That the Bill of Rights embodied in the Constitution is not meant to be invoked against acts of private
individuals finds support in the deliberations of the Constitutional Commission.

 I do not doubt that requiring notice and hearing prior to termination for just cause is an admirable sentiment borne
out of basic equity and fairness. Still, it is not a constitutional requirement that can impose itself on the relations of
 private persons and entities. Simply put, the Bill of Rights affords protection against possible State oppression
against its citizens, but not against an unjust or repressive conduct by a private party towards another.

Constitutional Protection of Labor

 The provisions of the 1987 Constitution affirm the primacy of labor and advocate a multi-faceted state policy that
affords, among others, full protection to labor.

 It is quite apparent that the constitutional protection of labor was entrenched more than eight decades ago, yet
such did not prevent this Court in the past from affirming dismissals for just cause without valid notice. Nor was
there any pretense made that this constitutional maxim afforded a laborer a positive right against dismissal for just
cause on the ground of lack of valid prior notice. As demonstrated earlier, it was only after the enactment of the
Labor Code that the doctrine relied upon by the dissenting opinions became en vogue. This point highlights my
position that the violation of the notice requirement has statutory moorings, not constitutional.

 At present, the Labor Code is the primary mechanism to carry out the Constitution's directives. This is clear from
Article 3 under Chapter 1 thereof which essentially restates the policy on the protection of labor as worded in the
1973 Constitution, which was in force at the time of enactment of the Labor Code. It crystallizes the fundamental
law's policies on labor, defines the parameters of the rights granted to labor such as the right to security of tenure,
and prescribes the standards for the enforcement of such rights in concrete terms. While not infallible, the
measures provided therein tend to ensure the achievement of the constitutional aims.

The Effect of Statutory Violation Of Notice and Hearing

 There is no doubt that the dismissal of an employee even for just cause, without prior notice or hearing, violates
the Labor Code. However, does such violation necessarily void the dismissal?

B. Dismissal for Just Cause

 There is no express provision in the Labor Code that voids a dismissal for just cause on the ground that there was
no notice or hearing. Under Section 279, the employer is precluded from dismissing an employee except for a just
cause as provided in Section 282, or an authorized cause under Sections 283 and 284. Based on reading Section
279 alone, the existence of just cause by itself is sufficient to validate the termination.

 Just cause is defined by Article 282, which unlike Article 283, does not condition the termination on the service of
written notices. Still, the dissenting opinions propound that even if there is just cause, a termination may be
invalidated due to the absence of notice or hearing. This view is anchored mainly on constitutional moorings, the
basis of which I had argued against earlier. For determination now is whether there is statutory basis under the
Labor Code to void a dismissal for just cause due to the absence of notice or hearing.

 Indubitably, the failure to substantially comply with the standards of due process, including the notice and hearing
requirement, may give rise to an actionable claim against the employer. Under Article 288, penalties may arise
from violations of any provision of the Labor Code

 However, the remedy of reinstatement despite termination for just cause is simply not authorized by the Labor
Code. Neither the Labor Code nor its implementing rules states that a termination for just cause is voided
because the requirement of notice and hearing was not observed. 

 These just causes for termination are not negated by the absence of notice or hearing.

 In fact, the practical purpose of requiring notice and hearing is to afford the employee the opportunity to dispute
the contention that there was just cause in the dismissal. Yet it must be understood – if a dismissed employee is
deprived of the right to notice and hearing, and thus denied the opportunity to present countervailing
evidence that disputes the finding of just cause, reinstatement will be valid not because the notice and
hearing requirement was not observed, but because there was no just cause in the dismissal.

Award for Damages Must Have Statutory Basis

 I disagree with Serrano insofar as it held that employees terminated for just cause are to be paid backwages from
the time employment was terminated "until it is determined that the termination is for just cause because the
failure to hear him before he is dismissed renders the termination of his employment without legal effect."64 Article
279 of the Labor Code clearly authorizes the payment of backwages only if an employee is unjustly dismissed. A
dismissal for just cause is obviously antithetical to an unjust dismissal. An award for backwages is not clearly
warranted by the law.

Article 288 of the Labor Code as a Source of Liability

 Another putative source of liability for failure to render the notice requirement is Article 288 of the Labor Code
  It is apparent from the provision that the penalty arises due to contraventions of the provisions of the Labor Code.
It is also clear that the provision comes into play regardless of who the violator may be.

 However, it is apparent that Article 288 is a penal provision; hence, the prescription for penalties such as fine and
imprisonment. The criminal case has to be instituted before the proper courts, and the Labor Code violation
subject thereof duly proven in an adversarial proceeding. Hence, Article 288 cannot apply in this case and
serve as basis to impose a penalty on Riviera Homes.

The Proper Basis: Employer's Liability under the Civil Code

 The proper legal basis for holding the employer liable for monetary damages to the employee dismissed
for just cause is the Civil Code. The award of damages should be measured against the loss or injury
suffered by the employee by reason of the employer's violation or, in case of nominal damages, the right
vindicated by the award. This is the proper paradigm authorized by our law, and designed to obtain the
fairest possible relief.

 The damages referred under Section 217(4) of the Labor Code are those available under the Civil Code. It is but
proper that the Civil Code serve as the basis for the indemnity, it being the law that regulates the private relations
of the members of civil society, determining their respective rights and obligations with reference to persons,
things, and civil acts.76 No matter how impressed with the public interest the relationship between a private
employer and employee is, it still is ultimately a relationship between private individuals. 

 Given the long controversy that has dogged this present issue regarding dismissals for just cause, it is wise to lay
down standards that would guide the proper award of damages under the Civil Code in cases wherein the
employer failed to comply with statutory due process in dismissals for just cause.

 I believe that it can be maintained as a general rule, that failure to comply with the statutory requirement
of notice automatically gives rise to nominal damages, at the very least, even if the dismissal was
sustained for just cause.