Agabon vs.

NLRC
November 17, 2004 | YNARES-SANTIAGO, J. | Due Process ISSUE:

PETITIONERS: JENNY M. AGABON and VIRGILIO C. AGABON W/N the petitioners were illegally dismissed. – NO, there’s no illegal dismissal
RESPONDENTS: NATIONAL LABOR RELATIONS COMMISSION because the petitioners abandoned their work.
(NLRC), RIVIERA HOME IMPROVEMENTS, INC. and VICENTE
ANGELES RULING: Supreme Court found that the petitioners abandoned their work, but
SUMMARY: Private respondent Riviera Home Improvements, Inc. is engaged ordered the respondent to pay damages to the petitioners for non-compliance with
in the business of selling and installing ornamental and construction materials. It statutory due process.
employed petitioners Virgilio Agabon and Jenny Agabon as gypsum board and
cornice installers on January 2, 1992 until February 23, 1999 when they were RATIO:
dismissed for abandonment of work. Thus, Petitioners then filed a complaint for 1. To dismiss an employee, the law requires not only the existence of a just and
illegal dismissal and payment of money claims. Petitioners also claim that valid cause but also enjoins the employer to give the employee the opportunity
respondent did not comply with the twin requirements of notice and hearing. to be heard and to defend himself. Article 282 of the Labor Code enumerates the
Respondent, on the other hand, maintained that petitioners were not dismissed just causes for termination by the employer:
but had abandoned their work. The Labor Arbiter declared the dismissals illegal (a) serious misconduct or willful disobedience by the employee of the
and ordered Respondent to pay the monetary claims. NLRC reversed the Labor lawful orders of his employer or the latter's representative in connection with the
Arbiter because it found that the petitioners had abandoned their work, and were employee's work;
not entitled to backwages and separation pay. CA ruled that the dismissal of the (b) gross and habitual neglect by the employee of his duties;
petitioners was not illegal because they had abandoned their employment but (c) fraud or willful breach by the employee of the trust reposed in him by
ordered the payment of money claims. SC affirmed the CA’s decision, and his employer or his duly authorized representative;
ordered the respondents to pay damages to the petitioners for non-compliance (d) commission of a crime or offense by the employee against the person of
with statutory due process. his employer or any immediate member of his family or his duly authorized
DOCTRINE: Constitutional due process protects the individual from the representative; and
government and assures him of his rights in criminal, civil or administrative (e) other causes analogous to the foregoing.
proceedings; while statutory due process found in the Labor Code and
Implementing Rules protects employees from being unjustly terminated without 2. Abandonment is the deliberate and unjustified refusal of an employee to
just cause after notice and hearing. resume his employment. It is a form of neglect of duty, hence, a just cause
for termination of employment by the employer.
FACTS:
1. Respondent Riviera Home Improvements, Inc. is engaged in the business of For a valid finding of abandonment, these two factors should be present:
selling and installing ornamental and construction materials. It employed
petitioners Virgilio Agabon and Jenny Agabon as gypsum board and cornice (1) the failure to report for work or absence without valid or justifiable
installers in January 1992 until February 1999 when they were dismissed for reason; and
abandonment of work.
2. Petitioners filed a complaint for illegal dismissal and payment of money claims. (2) a clear intention to sever employer-employee relationship
The Labor Arbiter declared the dismissals illegal and ordered Respondent to pay
the monetary claims. (with the second as the more determinative factor which is manifested
3. On appeal, the NLRC reversed the Labor Arbiter because it found that the by overt acts from which it may be deduced that the employee has no
petitioners had abandoned their work, and were not entitled to backwages and more intention to work)
separation pay. The other money claims awarded by the Labor Arbiter were also
denied for lack of evidence. In February 1999, petitioners were frequently absent having subcontracted for
4. Upon denial of their motion for reconsideration, Petitioners filed a petition for an installation work for another company. Subcontracting for another company
certiorari with the Court of Appeals. CA ruled that the dismissal of the petitioners clearly showed the intention to sever the employer-employee relationship with
was not illegal because they had abandoned their employment but ordered the private respondent. This was not the first time they did this. In January 1996,
payment of money claims. they did not report for work because they were working for another company.
 Private respondent at that time warned petitioners that they would be dismissed
if this happened again. Petitioners disregarded the warning and exhibited a clear In the second and third situations where the dismissals are illegal, Article 279
intention to sever their employer-employee relationship. The record of an mandates that the employee is entitled to reinstatement without loss of seniority
employee is a relevant consideration in determining the penalty that should be rights and other privileges and full backwages, inclusive of allowances, and
meted out to him. other benefits or their monetary equivalent computed from the time the
compensation was not paid up to the time of actual reinstatement.
In Sandoval Shipyard v. Clave, SC held that an employee who deliberately In the fourth situation, the dismissal should be upheld. While the procedural
absented from work without leave or permission from his employer, for the infirmity cannot be cured, it should not invalidate the dismissal. However, the
purpose of looking for a job elsewhere, is considered to have abandoned his job. employer should be held liable for non-compliance with the procedural
requirements of due process.
SC should apply that rule with more reason here where petitioners were absent
because they were already working in another company. The present case squarely falls under the fourth situation. The dismissal should
be upheld because it was established that the petitioners abandoned their jobs to
3. After establishing that the terminations were for a just and valid cause, we now work for another company. Private respondent, however, did not follow the
determine if the procedures for dismissal were observed. notice requirements and instead argued that sending notices to the last
The procedure for terminating an employee is found in Book VI, Rule I, Section known addresses would have been useless because they did not reside there
2(d) of the Omnibus Rules Implementing the Labor Code: anymore. Unfortunately for the respondent, this is not a valid excuse because
Standards of due process: requirements of notice. – In all cases of the law mandates the twin notice requirements to the employee's last known
termination of employment, the following standards of due process shall be address. Thus, it should be held liable for non-compliance with the procedural
substantially observed: requirements of due process.
I. For termination of employment based on just causes as defined in Article
282 of the Code: 5. Wenphil or Belated Due Process Rule: Where the employer had a valid reason
(a) A written notice served on the employee specifying the ground or to dismiss an employee but did not follow the due process requirement, the
grounds for termination, and giving to said employee reasonable dismissal may be upheld but the employer will be penalized to pay an indemnity
opportunity within which to explain his side; to the employee.
(b) A hearing or conference during which the employee concerned, with the
assistance of counsel if the employee so desires, is given opportunity to In the Serrano case, SC held that the violation by the employer of the notice
respond to the charge, present his evidence or rebut the evidence presented requirement in termination for just or authorized causes was not a denial of due
against him; and process that will nullify the termination.
(c) A written notice of termination served on the employee indicating that
upon due consideration of all the circumstances, grounds have been 6. The Due Process Clause in Article III, Section 1 of the Constitution embodies a
established to justify his termination. system of rights based on moral principles so deeply imbedded in the traditions
4. From the foregoing rules four possible situations may be derived: and feelings of our people as to be deemed fundamental to a civilized society as
conceived by our entire history. Due process is that which comports with the
(1) the dismissal is for a just cause under Article 282 of the Labor Code, for an deepest notions of what is fair and right and just. It is a constitutional restraint
authorized cause under Article 283, or for health reasons under Article 284, on the legislative as well as on the executive and judicial powers of the
and due process was observed; government provided by the Bill of Rights.
(2) the dismissal is without just or authorized cause but due process was
observed; Due process under the Labor Code, like Constitutional due process, has two
(3) the dismissal is without just or authorized cause and there was no due aspects:
process; and
(4) the dismissal is for just or authorized cause but due process was not substantive, i.e., the valid and authorized causes of employment
observed. termination under the Labor Code; and

In the first situation, the dismissal is undoubtedly valid and the employer will procedural, i.e., the manner of dismissal.
not suffer any liability.
 Procedural due process requirements for dismissal are found in the
Implementing Rules of PD 442, as amended, otherwise known as the Labor
Code of the Philippines.

Breaches of these due process requirements violate the Labor Code.

7. Constitutional due process protects the individual from the government and
assures him of his rights in criminal, civil or administrative proceedings;
while statutory due process found in the Labor Code and Implementing
Rules protects employees from being unjustly terminated without just cause
after notice and hearing.

8. SC believes that in cases involving dismissals for cause, but without observance
of the twin requirements of notice and hearing, the better rule is to abandon the
Serrano doctrine and to follow Wenphil by holding that the dismissal was for
just cause but imposing sanctions on the employer. Such sanctions, however,
must be stiffer than that imposed in Wenphil. By doing so, SC would be able to
achieve a fair result by dispensing justice not just to employees, but to
employers as well.

9. Where the dismissal is for a just cause, as in the instant case, the lack of
statutory due process should not nullify the dismissal, or render it illegal, or
ineffectual. However, the employer should indemnify the employee for the
violation of his statutory rights, as ruled in Reta vs. National Labor Relations
Commission.