G.R. No. 205953. June 6, 2018.*

 
DIONELLA A. GOPIO, doing business under the name and
style, JOB ASIA MANAGEMENT SERVICES,
petitioner, vs. SALVADOR B. BAUTISTA, respondents.

Labor Law; Termination of Employment; Illegal Dismissal;

Burden of Proof; In termination disputes or illegal dismissal cases,
it has been established by Philippine law and jurisprudence that
the employer has the burden of proving that the dismissal is for
just and valid causes; and failure to do so would necessarily mean
that the dismissal was not justified and is, therefore, illegal.—
Regulatory provisions may be read all throughout R.A. No. 8042
that carry out the policy of the State to protect and promote the
rights of Filipino migrant workers. Employment agreements are
verily more than contractual in nature in the Philippines. The
Philippine Constitution and laws guarantee special protection to
workers here and abroad. Thus, even if a Filipino is employed
abroad, he or she is entitled to security of tenure, among other
constitutional rights. In termination disputes or illegal dismissal
cases, it has been established by Philippine law and jurisprudence
that the employer has the burden of proving that the dismissal is
for just and valid causes; and failure to do so would necessarily
mean that the dismissal was not justified and is, therefore, illegal.
Taking into account the character of the charges and the penalty
meted to an employee, the employer is bound to adduce clear,
accurate, consistent, and convincing evidence to prove that the
dismissal is valid and legal. This is consistent with the principle
of security of tenure as guaranteed by the Constitution and
reinforced by Article 292(b) of the Labor Code of the Philippines.
Same; Same; Two-Notice Rule; To meet the requirements of
due process, the employer must furnish the worker sought to be
dismissed with two (2) written notices before termination of
employment can be legally effected, i.e.: (1) a notice which apprises
the employee of the particular acts or omissions for which his
dismissal is sought; and (2) the subsequent notice after due
hearing which informs the employee of the employer’s decision to
dismiss him.—The due process require-
_______________

*  FIRST DIVISION.

 
 
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Gopio vs. Bautista

ment is not a mere formality that may be dispensed with at

will. Its disregard is a matter of serious concern since it
constitutes a safeguard of the highest order in response to man’s
innate sense of justice. To meet the requirements of due process,
the employer must furnish the worker sought to be dismissed
with two written notices before termination of employment can be
legally effected,  i.e.: (1) a notice which apprises the employee of
the particular acts or omissions for which his dismissal is sought;
and (2) the subsequent notice after due hearing which informs the
employee of the employer’s decision to dismiss him.
Same; Same; Notice and Hearing; The Labor Code requires
both notice and hearing; notice alone will not suffice.—Bautista
was notified on July 6, 2009 that his services will be terminated
effective on the close of business hours on July 10, 2009, allegedly
because his performance was “unsatisfactory and did not meet the
standards of the Company.” He was also paid one-month salary in
lieu of one month’s notice of the termination of his
employment.  Surely, this cannot be considered compliance with
the two-notice requirement mandated by the Labor Code in
effecting a valid dismissal. The Labor Code requires both notice
and hearing; notice alone will not suffice. The requirement of
notice is intended to inform the employee concerned of the
employer’s intent to dismiss him and the reason for the proposed
dismissal. On the other hand, the requirement of hearing affords
the employee an opportunity to answer his employer’s charges
against him and accordingly defend himself therefrom before
dismissal is effected. In this case, Bautista was not given a chance
to defend himself. Five days after the notice was served, he was
repatriated. Clearly, he was denied his right to due process.
Same; Overseas Filipino Workers; Security of Tenure;
Overseas workers, regardless of their classification, are entitled to
security of tenure, at least for the period agreed upon in their
contracts.—Overseas workers, regardless of their classification,
are entitled to security of tenure, at least for the period agreed
upon in their contracts. This means that they cannot be dismissed
before the end of their contract terms without due process.  The
law recognizes the right of an employer to dismiss employees in
warranted cases, but it frowns upon the arbitrary and whimsical
exercise of that right when employees are not accorded due
process. If they were illegally dismissed, the workers’ right to
security of tenure is violated. The law

 
 

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Gopio vs. Bautista

and jurisprudence guarantee to every employee security of

tenure. This textual and the ensuing jurisprudential commitment
to the cause and welfare of the working class proceed from the
social justice principles of the Constitution that the Court
zealously implements out of its concern for those with less in life.
Thus, the Court will not hesitate to strike down as invalid any
employer act that attempts to undermine workers’ tenurial
security.
  Same; Contract of Employment; Time and again, the
Supreme Court (SC) has held that a contract of employment is
imbued with public interest. The parties are not at liberty to
insulate themselves and their relationships from the impact of
labor laws and regulations by simply contracting with each other.
—Indeed, while our Civil Code recognizes that parties may
stipulate in their contracts such terms and conditions as they may
deem convenient, these terms and conditions must not be
contrary to law, morals, good customs, public order or policy. The
employment contract between Shorncliffe and Bautista is
governed by Philippine labor laws. Hence, the stipulations,
clauses, and terms and conditions of the contract must not
contravene our labor law provisions. Time and again, we have
held that a contract of employment is imbued with public interest.
The parties are not at liberty to insulate themselves and their
relationships from the impact of labor laws and regulations by
simply contracting with each other. Also, while a contract is the
law between the parties, the provisions of positive law that
regulate such contracts are deemed included and shall limit and
govern the relations between the parties. In sum, there being no
showing of any clear, valid, and legal cause for the termination of
Bautista’s employment and that he was not afforded due process,
the law considers the matter a case of illegal dismissal for which
Bautista is entitled to indemnity. We uphold the Labor Arbiter’s
award of indemnity equivalent to Bautista’s salaries for the
unexpired term of his employment contract, and damages.
Same; Termination of Employment; Illegal Dismissal; Civil
Indemnity; The proper indemnity in illegal dismissal cases should
be the amount equivalent to the unexpired term of the employment
contract.—Section 10 of R.A. No. 8042 provides that in case of
termination of overseas employment without just, valid or
authorized cause as defined by law or contract, the workers shall
be entitled to the full reimbursement of his placement fee with
interest of 12% per annum,

 
 
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Gopio vs. Bautista

plus his salaries for the unexpired portion of his employment

contract or for three months for every year of the unexpired term,
whichever is less. We declared the clause “or for three months for
every year of the unexpired term, whichever is less”
unconstitutional in the 2009 case of Serrano v. Gallant Maritime
Services, Inc., 582 SCRA 254 (2009), and again in the 2014 case
of Sameer Overseas Placement Agency, Inc. v. Cabiles, 732 SCRA
22 (2014), after the provision found its way again in R.A. No.
10022 which took effect in 2010. We held that the clause violated
substantive due process and the equal protection clause of the
Constitution in that it generated classifications among workers
that do not rest on any real or substantial distinctions that would
justify different treatments in terms of the computation of money
claims resulting from illegal termination. Thus, we held that the
proper indemnity in illegal dismissal cases should be the amount
equivalent to the unexpired term of the employment contract. In
this case, it is Bautista’s monthly salary of
P115,850.00  multiplied by 22 months, the remaining term of his
employment contract or a total amount of P2,548,700.00.
Civil Law; Wage Recovery; Attorney’s Fees; It is settled that
when an action is instituted for the recovery of wages, or when
employees are forced to litigate and consequently incur expenses to
protect their rights and interests, the grant of attorney’s fees is
legally justifiable.—We also uphold the Labor Arbiter’s award of
moral and exemplary damages to Bautista on the ground that his
dismissal was without just and authorized cause, in complete
disregard of his right to due process of law, and done in bad faith,
in addition to being anti-Filipino and capricious.  Likewise, we
find the award of attorney’s fees proper. It is settled that when an
action is instituted for the recovery of wages, or when employees
are forced to litigate and consequently incur expenses to protect
their rights and interests, the grant of attorney’s fees is legally
justifiable. Petitioner’s argument that she should not be held
jointly and severally liable with Shorncliffe for the payment of
monetary awards to Bautista as she had no control over the
manner of implementation of the employment contract, she had
no hand whatsoever in Bautista’s dismissal, and that her agency
was extinguished as soon as the employee was deployed to and
have worked in Shorncliffe’s construction project in Papua New
Guinea, has no merit. In the first place, such joint and solidary
liability is required prior to the issuance of a license to petitioner
to operate a recruitment agency.

 
 
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Labor Law; Overseas Filipino Workers; The overseas workers

are assured that someone — at the very least, the foreign
employer’s local agent — may be made to answer for violations
that the foreign employer may have committed.—R.A. No. 8042 is
a police power measure intended to regulate the recruitment and
deployment of OFWs. It aims to curb, if not eliminate, the
injustices and abuses suffered by numerous OFWs seeking to
work abroad. In Sameer, we explained that the provision on joint
and several liability in R.A. No. 8042 is in line with the state’s
policy of affording protection to labor and alleviating workers’
plight. It assures overseas workers that their rights will not be
frustrated by difficulties in filing money claims against foreign
employers. Hence, in the case of overseas employment, either the
local agency or the foreign employer may be sued for all claims
arising from the foreign employer’s labor law violations. This way,
the overseas workers are assured that someone — at the very
least, the foreign employer’s local agent — may be made to
answer for violations that the foreign employer may have
committed. By providing that the liability of the foreign employer
may be “enforced to the full extent” against the local agent, the
overseas worker is assured of immediate and sufficient payment
of what is due them. The local agency that is held to answer for
the overseas worker’s money claims, however, is not left without
remedy. The law does not preclude it from going after the foreign
employer for reimbursement of whatever payment it has made to
the employee to answer for the money claims against the foreign
employer.

PETITION for review on certiorari of the decision and

resolution of the Court of Appeals.
The facts are stated in the opinion of the Court.
   A.J.Y. Arreza & Associates for petitioner.
   Randolph L. Fajardo for respondent.

 
JARDELEZA, J.:
 
This is a petition for review on  certiorari1  seeking the
reversal of the August 31, 2012 Decision2  of the Court of
Ap-

_______________

1  Rollo, pp. 23-42.

 
 
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Gopio vs. Bautista

peals (CA) in C.A.-G.R. S.P. No. 116450 which annulled the

Decision3  and Resolution4  issued by the National Labor
Relations Commission (NLRC) and reinstated the
Decision5 rendered by the Labor Arbiter, and the February
22, 2013 CA’s Resolution6  denying petitioner’s motion for
reconsideration of the assailed Decision.
On September 26, 2008, respondent Salvador A. Bautista
(Bautista) was hired as a Project Manager for Shorncliffe (PNG)
Limited (Shorncliffe) in Papua New Guinea through Job Asia
Management Services (Job Asia), a single proprietorship owned
by petitioner Dionella A. Gopio (Gopio), which is engaged in the
business of recruitment, processing, and deployment of land-
based manpower for overseas work. Bautista’s contract stated
that his employment shall be valid and effective for 31 months
with a net monthly salary of P40,000.00. On October 4, 2008, he
arrived at his workplace in Papua New Guinea.7
On July 6, 2009, or just nine months after his
deployment in Papua New Guinea, Bautista was served a
notice of termination effective July 10, 2009 on the alleged
grounds of unsatisfactory performance and failure to meet
the standards of the company. He was paid his salary for
the period July 1 to 10, 2009, annual leave credits, and one-
month pay net of taxes. Thereafter, he was repatriated on
July 11, 2009.8
On July 27, 2009, Bautista lodged a complaint with the
arbitration branch of the NLRC against Job Asia, Gopio,
and Shorncliffe for illegal dismissal and monetary claims.
He 

_______________

2  Id., at pp. 8-21. Penned by Associate Justice Romeo F. Barza, with

Associate Justices Noel G. Tijam (now a Member of this Court) and
Ramon A. Cruz, concurring.
3  Id., at pp. 70-77.
4  Id., at pp. 78-79.
5  Id., at pp. 59-69.
6  Id., at pp. 57-58.
7  Id.
8  Id.

 
 
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Gopio vs. Bautista

claimed that he was terminated without just cause since

there had been no job evaluation conducted prior to
Shorncliffe’s decision to dismiss him from employment. As
a result, he is entitled to the payment of his salaries for the
unexpired portion of his contract, or for 22 months. He
alleged that while his contract contained an understated
monthly income of P40,000.00, he was actually being paid
the amount of P115,850.00 a month. Other than salaries,
Bautista also claimed unrealized employment benefits,
nine days sick leave pay, four weeks recreation leave pay,
moral and exemplary damages, as well as attorney’s fees.9
Job Asia, Gopio, and Shorncliffe, for their part, argued
that Bautista’s employment was terminated because he
failed to meet Shorncliffe’s standards. To buttress their
claim, they submitted in evidence the work performance
evaluation report on Bautista which listed the following
observations:
1. He is not capable of performing the duties of a Project
Manager.
 2. He was unable to control or direct his workforce,
equipment and materials.
3. He is incompetent in the handling of his daily tasks.
4. [He] failed to provide any monthly reports both verbal
and written on the progress of his projects as a
company requirement.
5. He has never submitted any monthly progress claims
as a company requirement.
6. He demonstrated that he was technically incompetent
and hides himself when there is a problem.
7. He was not capable of running project site meetings
with the management and his staff.

_______________

9  Id., at pp. 44-45.

 
 
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Gopio vs. Bautista

8. He is a lazy person, incompetent in his decision-

making and has poor communication skills.
9. He was unable to pass his knowledge to young PNG
Engineers, in fact they were teaching him instead.10
 
On January 7, 2010, the Labor Arbiter rendered his
Decision finding Bautista to have been illegally dismissed
as the dismissal was not proven to be for a just cause and
Shorncliffe failed to observe due process. The Labor Arbiter
held that the work performance evaluation allegedly
showing Bautista’s inefficiency and shortcomings in the
performance of his job was made only on August 22, 2009,
or more than one month after Bautista’s dismissal. Thus,
the findings therein are mere conclusions of fact, at best
self-serving and merits no consideration.11  Moreover,
Shorncliffe failed to observe due process by not giving
Bautista the twin notices required by law. The latter was
not notified of the intention to dismiss him or the acts or
omissions complained of. Neither was he notified of the
decision to dismiss him and given an opportunity to answer
and rebut the charges against him in between notices.12
The Labor Arbiter also rejected the argument that
Bautista’s employment was terminated on the basis of
Article 4.3 of the employment contract by giving him one-
month salary in lieu of one month’s written notice.13  The
said provision states:
 
4.3. The Employer or Employee may terminate this
contract on other grounds. The Employer should give
one month’s writ-

_______________

10  Id., at pp. 45-46.

11  Id., at p. 64.
12  Id., at p. 63, citing MGG Services, Inc. v. NLRC, G.R. No. 114313,
July 29, 1996, 259 SCRA 664.
13  Id., at pp. 64-66.

 
 
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ten notice of his intention to terminate or in lieu

thereof pay the Employee a sum equivalent to one
month’s salary. The Employee may likewise
terminate this Contract by giving three months’
notice to the Employer.14

The Labor Arbiter held that the stipulation providing for

payment of one-month salary in lieu of serving one month’s
notice of the employer’s intention to terminate Bautista’s
employment is contrary to our laws which uphold the
sanctity of workers’ security of tenure. It also considered
the employment contract as a contract of adhesion which
cannot militate against the rights of Bautista.15  He thus
ordered Job Asia, Gopio, and Shorncliffe to jointly and
severally pay Bautista his salaries for the unexpired
portion of his contract of employment in the amount of
P2,548,700.00,16  moral and exemplary damages in the
amount of P300,000.00, and attorney’s fees at
P254,870.00.17
Undaunted, Job Asia, Gopio, and Shorncliffe filed an
appeal with the NLRC. On May 17, 2010, the NLRC issued
its Decision setting aside the Decision of the Labor Arbiter
and dismissing the complaint for illegal dismissal and
monetary claims for lack of merit. Nevertheless, it ordered
that Bautista be indemnified nominal damages in the
amount of P40,000.00.18
The NLRC held that the parties were bound by the
terms and conditions of the employment contract that bore
the stamp of approval of the Philippine Overseas
Employment Administration (POEA). Consequently, it
found that Bautista’s contract was pre-terminated in
accordance with Article 4.3

_______________

14  Id., at p. 101.
15  Id., at pp. 64-68.
16  P115,850.00 x 22 months, id., at p. 68.
17  Id., at p. 69.
18  Id., at pp. 76-77.

 
 
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Gopio vs. Bautista

thereof. Contrary to the Labor Arbiter’s finding, the NLRC

upheld the reports of Shorncliffe’s officers pertaining to his
unsatisfactory performance and incompetence, and thus
declared Bautista’s employment to have been terminated
for a just cause. It, however, held that Bautista was not
afforded due process, for which he should be awarded
indemnity pegged at the rate of his basic salary for one
month as stated in his employment contract, or P40,000.00.
The NLRC found no bad faith or malice on the part of Job
Asia, Gopio, or Shorncliffe that would have been the basis
for an award of moral and exemplary damages and
attorney’s fees.19
Bautista filed a motion for reconsideration of the
NLRC’s Decision, but it was denied through a Resolution
dated July 30, 2010. Hence, he filed a petition
for certiorari with the CA.
On August 31, 2012, the CA rendered its Decision
annulling and setting aside the NLRC’s Decision and
reinstating that of the Labor Arbiter. It held that Article
4.3 of the employment contract violates the provisions of
the Labor Code on security of tenure since it gives the
employer the option to do away with the notice
requirement as long as he grants one-month salary to the
employee in lieu thereof. The provision deprives the
employee of due process and violates his right to be
apprised of the grounds for his termination without giving
him an opportunity to defend himself and refute the
charges against him. Moreover, the term “other grounds” is
all-encompassing and makes the employee susceptible to
arbitrary dismissal.20
The CA also held that Job Asia, Gopio, and Shorncliffe
failed to substantiate their claim that Bautista was
discharged for just cause. Their claim that the latter was
dismissed for performing below standards was not backed
by any proof. Further, Bautista was notified of his
termination only four days prior to the intended date of
dismissal without evi-

_______________

19  Id., at pp. 74-76.

20  Id., at p. 16.

 
 
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dence of an assessment of his performance and the results

thereof. Neither was he served a notice of any wrongdoing
prior to the service of the notice of his termination. The CA
noted that the declarations of Anthony B. Ponnampalam
and Paul Thompson, officers of Shorncliffe, were executed
on October 31, 2009 and October 1, 2009, respectively, or
more than two months after the termination of Bautista’s
employment on July 10, 2009. Further, the evaluation
report made by Robert Aup, another Shorncliffe official,
was made only on August 22, 2009, and hence obviously an
afterthought. Thus, there being no sufficient cause to
terminate Bautista’s employment, his dismissal is illegal.
The CA thus upheld the Labor Arbiter’s Decision and
additionally awarded Bautista full reimbursement of his
placement fee with interest of 12% per annum.21
Thus, this petition where the Court is called upon to
ultimately resolve two issues that have been beleaguering
the parties for more than eight years, to wit: whether or
not Bautista was illegally dismissed from employment, and
whether or not he is entitled to his monetary claims.
 We uphold with modification the Decision of the CA.
 
 
I.
 
In 1995, Republic Act (R.A.) No. 8042, otherwise known
as an “An Act to Institute the Policies of Overseas
Employment and Establish a Higher Standard of
Protection and Promotion of the Welfare of Migrant
Workers, Their Families and Overseas Filipinos in
Distress, and for Other Purposes” was passed. More
popularly known as the Migrant Workers and Overseas
Filipinos Act of 1995, this law echoes the provision in the
1987 Constitution22  on protection of labor. Thus, Section
2(b) thereof under “Declaration of Policies,” states:

_______________

21  Id., at pp. 17-19.

22  CONSTITUTION, Art. XIII, Sec. 3 states:

 
 
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Gopio vs. Bautista

(b) The State shall afford full protection to labor, local and
overseas, organized and unorganized, and promote full
employment and equality of employment opportunities for
all. Towards this end, the State shall provide adequate and
timely social, economic and legal services to Filipino
migrant workers.

 
Moreover, Section 2(c) thereof provides:

(c) x  x  x The existence of the overseas employment

program rests solely on the assurance that the dignity and
fundamental human rights and freedoms of the Filipino
citizens shall not, at any time, be compromised or violated.
x x x

 
Accordingly, regulatory provisions may be read all
throughout R.A. No. 8042 that carry out the policy of the
State to protect and promote the rights of Filipino migrant
workers. Employment agreements are verily more than
contractual in nature in the Philippines. The Philippine
Constitution and laws guarantee special protection to
workers here and abroad.23  Thus, even if a Filipino is
employed abroad, he or she is entitled to security of tenure,
among other constitutional rights.24

_______________

The State shall afford full protection to labor, local and overseas,
organized and unorganized, and promote full employment and equality of
employment opportunities for all.
It shall guarantee the rights of all workers to self-organization,
collective bargaining and negotiations, and peaceful concerted activities,
including the right to strike in accordance with law. They shall be entitled
to security of tenure, humane conditions of work, and a living wage. x x x
23   Sameer Overseas Placement Agency, Inc. v. Cabiles, G.R. No.
170139, August 5, 2014, 732 SCRA 22, 42-44.
24   Dagasdas v. Grand Placement and General Services Corporation,
G.R. No. 205727, January 18, 2017, 814 SCRA 529, 541.

 
 
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Gopio vs. Bautista

In termination disputes or illegal dismissal cases, it has

been established by Philippine law and jurisprudence that
the employer has the burden of proving that the dismissal
is for just and valid causes; and failure to do so would
necessarily mean that the dismissal was not justified and
is, therefore, illegal.25 Taking into account the character of
the charges and the penalty meted to an employee, the
employer is bound to adduce clear, accurate, consistent,
and convincing evidence to prove that the dismissal is valid
and legal.26 This is consistent with the principle of security
of tenure as guaranteed by the Constitution and reinforced
by Article 292(b)27  of the Labor Code of the
Philippines,28 which provides:

Art. 292. Miscellaneous Provisions.—x x x

(b) Subject to the constitutional right of workers to
security of tenure and their right to be protected against
dismissal except for a just and authorized cause and
without prejudice to the requirement of notice under Article
 [298] of this Code, the employer shall furnish the worker
whose employment is sought to be terminated a written
notice containing a statement of the causes for termination
and shall afford the latter ample opportunity to be heard
and to defend himself with the assistance of his
representative if he so desires in accordance with company
rules and regulations promulgated pursuant to guidelines
set by the Department of Labor and Employ-

_______________

25  See Ting v. Court of Appeals, G.R. No. 146174, July 12, 2006, 494
SCRA 610, 620-621.
26  Bank of the Philippine Islands v. Uy, G.R. No. 156994, August 31,
2005, 468 SCRA 633, 646.
27   As renumbered in DOLE Department Advisory No. 1, Series of
2015. Formerly Article 277.
28   EDI-Staffbuilders International, Inc. v. National Labor Relations
Commission, G.R. No. 145587, October 26, 2007, 537 SCRA 409, 431-432.

 
 
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Gopio vs. Bautista

ment. Any decision taken by the employer shall be without

prejudice to the right of the worker to contest the validity or
legality of his dismissal by filing a complaint with the regional
branch of the National Labor Relations Commission. The burden
of proving that the termination was for a valid or authorized cause
shall rest on the employer. x x x29

Here, petitioner argues that there was justifiable cause

for the termination of Bautista’s employment since the
latter has fallen short of Shorncliffe’s employment and
work standards. She cited the report of Shorncliffe’s Chief
Executive Officer and Project Team Leader, Robert Aup,
which detailed Bautista’s shortcomings, as well as the
report of Paul Thompson, Supervising Engineer of the
Project to which Bautista was assigned, which mentioned
the latter’s incompetence.30  Maintaining that the rights
and obligations among the Overseas Filipino Worker
(OFW), the local recruiter or agent, and the foreign
employer or principal is governed by the employment
contract which is the law among them, petitioner also
claims that Bautista’s employment was validly terminated
even without notice as he was given the equivalent of one-
month salary in lieu thereof.31
The Court is not convinced.
As observed by the CA, the evaluation report of Robert
Aup was made only on August 22, 2009, and the
declaration of Paul Thompson was executed only on
October 1, 2009, which dates are beyond the date of
termination of Bautista’s employment on July 10, 2009.
The CA correctly concluded that these were made as an
afterthought in order to lend credence to the claim that the
termination of Bautista’s employment 

_______________

29  As amended by R.A. No. 6715, Sec. 33.

30  Rollo, pp. 33-34.
31  Id., at pp. 29-30, 36.

 
 
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Gopio vs. Bautista

was for a valid reason.32  In  Skippers United Pacific, Inc. v.

Maguad,33  we held that the Master’s Statement Report
presented by therein petitioners to corroborate their claim that
the dismissal of therein respondents was for just cause,  i.e.,
incompetence, was issued 78 days34  after therein respondents
were repatriated to Manila and two months after the latter
instituted a complaint for illegal dismissal before the NLRC. Such
report can no longer be a fair and accurate assessment of therein
respondents’ competence as the same was presented only after the
complaint was filed. Its execution was a mere afterthought in
order to justify the dismissal of therein respondents which had
long been effected before the report was made; hence, such report
is a self-serving one.35
The Court thus finds that Bautista’s incompetence as
the alleged just cause for his dismissal was not proven by
substantial evidence.
 
II.
 
In addition, Bautista was not accorded due process.
Consequently, the Court is not convinced that he was
legally dismissed. 
The due process requirement is not a mere formality
that may be dispensed with at will. Its disregard is a
matter of serious concern since it constitutes a safeguard of
the highest order in response to man’s innate sense of
justice. To meet the requirements of due process, the
employer must furnish the worker sought to be dismissed
with two written notices before termination of employment
can be legally effected, i.e.: (1) a notice which apprises the
employee of the particular acts or omissions for which his
dismissal is sought; and (2) the sub-

_______________

32  Id., at pp. 17-18.

33  G.R. No. 166363, August 15, 2006, 498 SCRA 639.
34  This is the correct number of days based on the pertinent dates as
indicated in the case. Id., at p. 648.
35  Id., at p. 662.

 
 
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478 SUPREME COURT REPORTS ANNOTATED

Gopio vs. Bautista

sequent notice after due hearing which informs the employee of

the employer’s decision to dismiss him.36
Here, Bautista was dismissed under Article 4.3 of the
employment contract which allegedly permits his employer,
Shorncliffe, to terminate the contract on unspecified “other
grounds” by giving one month’s written notice of its
intention to terminate, or in lieu thereof, to pay the
employee a sum equivalent to one month’s salary.
Bautista was notified on July 6, 2009 that his services
will be terminated effective on the close of business hours
on July 10, 2009, allegedly because his performance was
“unsatisfactory and did not meet the standards of the
Company.”37  He was also paid one-month salary in lieu of
one month’s notice of the termination of his
employment.38  Surely, this cannot be considered
compliance with the two-notice requirement mandated by
the Labor Code in effecting a valid dismissal. The Labor
Code requires both notice and hearing; notice alone will not
suffice. The requirement of notice is intended to inform the
employee concerned of the employer’s intent to dismiss him
and the reason for the proposed dismissal. On the other
hand, the requirement of hearing affords the employee an
opportunity to answer his employer’s charges against him
and accordingly defend himself therefrom before dismissal
is effected.39 In this case, Bautista was not given a chance
to defend himself. Five days after the notice was served, he
was repatriated. Clearly, he was denied his right to due
process.
The CA aptly observed that Article 4.3 deprives the
employee of his right to due process of law as it gives the
employer the option to do away with the notice
requirement provided that it grants one-month salary to
the employee in

_______________

36  Id., at p. 663.
37  Rollo, p. 96.
38  Id., at pp. 65-66.
39  Skippers United Pacific, Inc. v. Maguad, supra note 33 at pp. 664-
665.

 
 
479

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Gopio vs. Bautista

lieu thereof. It denies the employee of the right to be

apprised of the grounds for the termination of his
employment without giving him an opportunity to defend
himself and refute the charges against him. Moreover, the
term “other grounds” is all-encompassing. It makes the
employee susceptible to arbitrary dismissal. The employee
may be terminated not only for just or authorized causes
but also for anything under the sun that may suit his
employer. Thus, the employee is left unprotected and at the
mercy of his employer, subjected to the latter’s whims.40
We cannot sustain the validity of Article 4.3 of the
employment contract as it contravenes the constitutionally-
protected right of every worker to security of tenure.41
Bautista’s employment was for a fixed period of 31
months.42  Article 4.3 took back this period from him by
rendering it in effect a facultative one at the option of
Shorncliffe, which may shorten that term at any time and
for any cause satisfactory to itself, to a one-month period or
even less, by simply paying Bautista a month’s salary. The
net effect of Article 4.3 is to render Bautista’s employment
basically employment at the pleasure of Shorncliffe. The
Court considers that the provision is intended to prevent
any security of tenure from accruing in favor of Bautista
even during the limited period of 31 months.43
To emphasize, overseas workers, regardless of their
classification, are entitled to security of tenure, at least for
the period agreed upon in their contracts. This means that
they cannot be dismissed before the end of their contract
terms without due process.44  The law recognizes the right
of an em-

_______________

40  Rollo, p. 16.
41  Supra note 22.
42  Rollo, p. 98.
43   See  Pakistan International Airlines Corporation v. Ople, G.R. No.
61594, September 28, 1990, 190 SCRA 90.
44  Supra note 23 at p. 60.

 
 
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480 SUPREME COURT REPORTS ANNOTATED

Gopio vs. Bautista

ployer to dismiss employees in warranted cases, but it

frowns upon the arbitrary and whimsical exercise of that
right when employees are not accorded due process.45  If
they were illegally dismissed, the workers’ right to security
of tenure is violated.46
The law and jurisprudence guarantee to every employee
security of tenure. This textual and the ensuing
jurisprudential commitment to the cause and welfare of the
working class proceed from the social justice principles of
the Constitution that the Court zealously implements out
of its concern for those with less in life. Thus, the Court
will not hesitate to strike down as invalid any employer act
that attempts to undermine workers’ tenurial security.47
Indeed, while our Civil Code recognizes that parties may
stipulate in their contracts such terms and conditions as
they may deem convenient, these terms and conditions
must not be contrary to law, morals, good customs, public
order or policy.48  The employment contract between
Shorncliffe and Bautista is governed by Philippine labor
laws. Hence, the stipulations, clauses, and terms and
conditions of the contract must not contravene our labor
law provisions.
Time and again, we have held that a contract of employment is
imbued with public interest. The parties are not at liberty to
insulate themselves and their relationships from the impact of
labor laws and regulations by simply contracting with each other.
Also, while a contract is the law between the parties, the
provisions of positive law that regulate such

_______________

45  Tan, Jr. v. National Labor Relations Commission, G.R. No. 85919,

March 23, 1990, 183 SCRA 651, 657.
46  Supra note 23.
47   Imasen Philippine Manufacturing Corporation v. Alcon, G.R. No.
194884, October 22, 2014, 739 SCRA 186, 194-195.
48  CIVIL CODE, Art. 1306.

 
 
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Gopio vs. Bautista

contracts are deemed included and shall limit and govern

the relations between the parties.49
In sum, there being no showing of any clear, valid, and
legal cause for the termination of Bautista’s employment
and that he was not afforded due process, the law considers
the matter a case of illegal dismissal for which Bautista is
entitled to indemnity. We uphold the Labor Arbiter’s award
of indemnity equivalent to Bautista’s salaries for the
unexpired term of his employment contract, and damages.
 
III.
 
Section 10 of R.A. No. 8042 provides that in case of
termination of overseas employment without just, valid or
authorized cause as defined by law or contract, the workers
shall be entitled to the full reimbursement of his placement
fee with interest of 12%  per annum, plus his salaries for
the unexpired portion of his employment contract or for
three months for every year of the unexpired term,
whichever is less.
 We declared the clause “or for three months for every
year of the unexpired term, whichever is less”
unconstitutional in the 2009 case of  Serrano v. Gallant
Maritime Services, Inc.,50  and again in the 2014 case
of  Sameer Overseas Placement Agency, Inc. v.
Cabiles,51  after the provision found its way again in R.A.
No. 1002252  which took effect in 2010. We held that the
clause violated substantive due process and the equal
protection clause of the Constitution in that it generated
classifications

_______________

49  Philippine National Bank v. Cabansag, G.R. No. 157010, June 21,

2005, 460 SCRA 514, 533-534.
50  G.R. No. 167614, March 24, 2009, 582 SCRA 254.
51  Supra note 23.
52  AN ACT AMENDING REPUBLIC ACT NO. 8042, OTHERWISE KNOWN AS THE

MIGRANT WORKERS AND OVERSEAS FILIPINOS ACT OF 1995, AS AMENDED,

FURTHER IMPROVING THE STANDARD OF PROTECTION AND PROMOTION OF THE

WELFARE OF MIGRANT WORKERS, THEIR FAMILIES AND OVERSEAS FILIPINOS IN

DISTRESS AND FOR OTHER PURPOSES.

 
 
482

482 SUPREME COURT REPORTS ANNOTATED

Gopio vs. Bautista

among workers that do not rest on any real or substantial

distinctions that would justify different treatments in terms of the
computation of money claims resulting from illegal
termination.53 Thus, we held that the proper indemnity in illegal
dismissal cases should be the amount equivalent to the unexpired
term of the employment contract. In this case, it is Bautista’s
monthly salary of P115,850.0054  multiplied by 22 months, the
remaining term of his employment contract or a total amount of
P2,548,700.00.
We also uphold the Labor Arbiter’s award of moral and
exemplary damages to Bautista on the ground that his dismissal
was without just and authorized cause, in complete disregard of
his right to due process of law, and done in bad faith, in addition
to being anti-Filipino and capricious.55  Likewise, we find the
award of attorney’s fees proper. It is settled that when an action is
instituted for the recovery of wages, or when employees are forced
to litigate and consequently incur expenses to protect their rights
and interests, the grant of attorney’s fees is legally justifiable.56
Petitioner’s argument that she should not be held jointly
and severally liable with Shorncliffe for the payment of
monetary awards to Bautista as she had no control over the
manner of implementation of the employment contract, she
had no hand whatsoever in Bautista’s dismissal, and that
her agency was extinguished as soon as the employee was
deployed to and have worked in Shorncliffe’s construction
project in Papua New Guinea,57 has no merit.
In the first place, such joint and solidary liability is required
prior to the issuance of a license to petitioner to operate a
recruitment agency. Thus, Section 1(f)(3), Rule II, Part

_______________

53  Supra note 23 at p. 60.
54  Rollo, p. 97.
55  Id., at p. 68.
56  Supra note 49 at p. 536.
57  Rollo, pp. 38-39, 122.

 
 
483

VOL. 864, JUNE 6, 2018 483

Gopio vs. Bautista

II of the 2002 POEA Rules and Regulations Governing the

Recruitment and Employment of Land-Based Overseas
Workers provides:
 
RULE II
ISSUANCE OF LICENSE

Sec. 1. Requirements for Licensing.—Every applicant for

license to operate a private employment agency shall
submit a written application together with the following
requirements:
 
x x x x
f. A verified undertaking stating that the applicant:
x x x x
3) Shall assume joint and solidary
liability with the employer for all claims
and liabilities which may arise in
 connection with the implementation of the
contract, including but not limited to payment
of wages, death and disability compensation
and repatriations[.] (Emphasis supplied)

 
Furthermore, Section 10 of R.A. No. 8042 provides:

Sec. 10. Money Claims.—x x x

The liability of the principal/employer and the
recruitment/place-ment agency for any and all claims
under this section shall be joint and several.  This
provision shall be incorporated in the contract for overseas
employment and shall be a condition precedent for its
approval. The performance bond to be filed by the re-

 
 
484

484 SUPREME COURT REPORTS ANNOTATED

Gopio vs. Bautista

cruitment/placement agency, as provided by law, shall be

answerable for all money claims or damages that may be
awarded to the workers. If the recruitment/placement
agency is a juridical being, the corporate officers and
directors and partners as the case may be, shall themselves
be jointly and solidarily liable with the corporation or
partnership for the aforesaid claims and damages.
(Emphasis supplied)

 
Consistent with the law and the POEA Rules,
petitioner’s joint and several liability is incorporated in
Bautista’s employment contract with Shorncliffe, which
states:

Article 1. This Employment Contract is executed and

entered into by and between:
A. EMPLOYER:
SHORNCLIFFE (PNG) LIMITED 
(Name of Establishment) 
x x x x
Represented in the Philippines:
JOB ASIA MANAGEMENT SERVICES
By: Mr. JAIME M. ARREO
(Managing Consultant)
 and persons authorized by Agent Company who will
be jointly and severally responsible to [sic]
compliance herewith:
and
B. EMPLOYEE: SALVADOR BUSTILLO BAUTISTA.58
(Emphasis supplied)
x x x x

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58  Id., at p. 98.

 
 
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Gopio vs. Bautista

Petitioner thus cannot evade liability by claiming that

she did not have any control over the foreign employer and
had nothing to do with Bautista’s dismissal, because her
liability is defined by law and contract.
We have held that the burden devolves not only upon
the foreign-based employer but also on the employment or
recruitment agency to adduce evidence to convincingly
show that the worker’s employment was validly and legally
terminated. This is because the latter is not only an agent
of the former, but is also solidarily liable with the foreign
principal for any claims or liabilities arising from the
dismissal of the worker.59
R.A. No. 8042 is a police power measure intended to
regulate the recruitment and deployment of OFWs. It aims
to curb, if not eliminate, the injustices and abuses suffered
by numerous OFWs seeking to work abroad.60  In  Sameer,
we explained that the provision on joint and several
liability in R.A. No. 8042 is in line with the state’s policy of
affording protection to labor and alleviating workers’
plight. It assures overseas workers that their rights will
not be frustrated by difficulties in filing money claims
against foreign employers. Hence, in the case of overseas
employment, either the local agency or the foreign
employer may be sued for all claims arising from the
foreign employer’s labor law violations. This way, the
overseas workers are assured that someone — at the very
least, the foreign employer’s local agent — may be made to
answer for violations that the foreign employer may have
committed. By providing that the liability of the foreign
employer may be “enforced to the full extent” against the
local agent, the overseas worker is assured of immediate
and sufficient payment of what is due them. The local
agency that is held to answer for the overseas worker’s
money claims, however, is not left without remedy. The law
does not preclude it

_______________

59  Supra note 28 at p. 434.
60   Sto. Tomas v. Salac, G.R. No. 152642, November 13, 2012, 685
SCRA 245, 262.

 
 

486

486 SUPREME COURT REPORTS ANNOTATED

Gopio vs. Bautista

from going after the foreign employer for reimbursement of

whatever payment it has made to the employee to answer
for the money claims against the foreign employer.61
WHEREFORE, the petition is  DENIED. Petitioner is
ordered to pay respondent:
1. Reimbursement of respondent’s placement fee with
interest at the rate of 12% per annum;
2. Two Million Five Hundred Forty-Eight Thousand
Seven Hundred Pesos (P2,548,700.00) representing
Bautista’s salaries for the unexpired portion of his
contract;
3. Moral damages in the amount of One Hundred Fifty
Thousand Pesos (P150,000.00);
4. Exemplary damages in the amount of One Hundred
Fifty Thousand Pesos (P150,000.00); and
5. Attorney’s fees at the rate of 10% of the monetary
award exclusive of damages and reimbursement of
placement fee in the amount of Two Hundred Fifty-
Four Thousand Eight Hundred Seventy Pesos
(P254,870.00).
All monetary awards and damages (except
reimbursement of placement fee) shall earn 6% interest
from finality of this judgment until fully paid.
SO ORDERED.
 Leonardo-De Castro,**  Del Castillo,
***
Caguioa  and Ges-mundo,**** JJ., concur.

_______________

61  Supra note 23 at pp. 69-70.

**  Designated Acting Chairperson of the First Division per Special
Order No. 2559 dated May 11, 2018.
*** Designated additional member per Raffle dated June 4, 2018.
*** Designated Acting Member of the First Division per Special Order
No. 2560 dated May 11, 2018.

 
 

487

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Gopio vs. Bautista

Petition denied.

Notes.—The employer is required to give the charged

employee at least two written notices before termination;
Aside from the notice requirement, the employee must also
be given “an opportunity to be heard.” (Sameer Overseas
Placement Agency, Inc. vs. Cabiles, 732 SCRA 22 [2014])
Section 10 of Republic Act (RA) No. 8042, as amended,
expressly provides for joint and solidary liability of
corporate directors and officers with the
recruitment/placement agency for all money claims or
damages that may be awarded to Overseas Filipino
Workers (OFWs). (Gargallo vs. Dohle Seafront Crewing
[Manila], Inc., 801 SCRA 135 [2016])

 
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